TaxTMI 
TaxTMI 
2016 (11) TMI 652
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....davit of the CA of the assessee is also filed explaining the cause of delay as it has escaped his attention due to heavy pressure of outstanding audits of cooperative banks. Subsequently he realised the receipt of the impugned order and then took the steps to prepare the appeals and filed the same without further delay. 03. Ld. AR of the assessee has submitted that the delay in filing the appeal was due to an inadvertent and bonafide mistake on the part of the CA because of his business and heavy pressure of work of outstanding audits of banks. Thus the Ld. AR has submitted that the delay of 33 days is neither intentional nor deliberate but due to unavoidable reasons which were beyond the control of the assessee. Accordingly the same may....
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....ed Commissioner of Income-Tax (Appeals) ought to have seen that the appellant is not obliged to deduct tax on the said payment and hence the provisions of Sec. 40(a)(ia) are not attracted to the facts of the case. 07. At the time of hearing the Ld. AR of the assessee has stated that assessee does not press grounds 1.1 to 2.2 and the same may be dismissed as not pressed. Ld. DR has raised no objection if these grounds of appeal are dismissed as not pressed. Accordingly grounds 1.1 to 2.2 are dismissed being not pressed. 08. Grounds 3.1 and 3.2 are regarding disallowance made by the AO u/s.40(a)(ia) of the Income-tax Act, 1961 ('the Act' in short), for nondeduction of tax at source. The assessee is carrying on the business as direct mar....
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....,23,430/- by invoking the provisions of Section 40(a)(ia) of the Act. 10. On appeal, the assessee has reiterated its contention that the contract was only for labour charges and there is no contract between the assessee and Shri. Venkatesh regarding supply of material. However the material was purchased through Shri. Venkatesh. The assessee also pointed out that the material was purchased by the assessee directly in his name, through the contractor and the invoices were issued by the vendor of the material in the name of the assessee. Therefore, this payment was only reimbursement of the cost of the material. The CIT (A) was not impressed with the contention of the assessee and confirmed the disallowance. 11. Before us, the Ld. AR of ....
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....h Court in the case of CIT v. HP (India) Sales P. Ltd [382 ITR 496] and submitted that the similar view taken by the Tribunal has been upheld by the Hon'ble jurisdictional High Court. 12. On the other hand the Ld. DR has relied upon the orders of the authorities below and submitted that there is a concurrent finding by the AO as well as the CIT (A) that the payment in question was made as a composite payment under the work contract and therefore the provisions of Section 194C of the Act are attracted on this payment. Since the assessee has failed to deduct the tax at source the provisions of Section 40(a)(ia) are attracted. 13. We have considered the rival submissions and considered the relevant material on record. As it is clear from....
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.... the construction of the apartments and therefore the material procurement was outside the agreement in question. The CIT (A) though admitted this fact that the contract is only in respect of labour charges but has held in para.7.1, as under : 7.1 I have considered the Issue. I note that there is a contract agreement with respect to the labour charges, but no separate contract for the material purchases. The AO has proceeded on the assumption that since Sri Venkatesh's name appears as a creditor in the balance sheet, and the ledger account reflects payments to pay - for supply of materials as per invoice, the contention of the appellant that it had purchased the materials directly in Its name is not correct. The appellant in his writ....
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.... clearly distinguishable from the facts involved in the current appeal. 15. It is also found that the invoices for purchase of material in question was in the name of the assessee and therefore the contractor Shri. Venkatesh has a limited role of inspecting the quality of material in procurement of the material. It is not the case of the Revenue that the contractor has charged anything for the purpose of procurement of the material used in the construction. The payment made by the assessee is only the cost of the material purchased and therefore there was no element of any income or profit of the contractor in respect of the procurement of material in question. It was found that the contract agreement in question is only in respect of la....