TaxTMI 
TaxTMI 
TaxTMI 
2016 (11) TMI 1309
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.... (ii) Machinery Hire Charges paid : Cr.Rana Jitendra Const. (P) Ltd. No.388) : Rs.63,50,000/- Cr.Berhampur (Orissa) Closing balances transferred Rs. 3,51,025/- Cr.Varanasi Work Site Closing balances transferred: Rs. 1,00,525/- (iii) Truck & Trailor Hire Charges : Cr.Rana Jitendra Const. (P)Ltd. Being Machinery transportation Bill amount payable (No.123) Rs. 1,08,500/- Cr.Rana Jitendra Const. (P)Ltd. Being Machinery transportation Bill amount payable (No.235) Rs. 70,700/- Cr.Rana Jitendra Const. (P)Ltd. Being Machinery transportation Bill amount payable (No.287) Rs. 27,000/- Cr.Sadbhav Engg. Ltd. (halwad) Truck Hire Charges (No.370) Rs. 71,100/- Cr.Shringar (Kishangarh) Closing balances transferred (No.406) Rs. 46,500/- Cr.Varanasi Work Site Closing balances transferred (No.436) Rs. 1,03,233/- Rs. 72,59,483/- The assessee admittedly did not deduct tax at source at the time of making the aforesaid payment towards hire charges. According to the AO the payments in question are in the nature of payments made to a contractor for carrying out work within the meaning....
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....t has clearly been pointed out that the payment was made for hiring of machinery, cranes, etc. by the appellant and such payments could not be covered u/s.194C as the same was for hire charges of the Machineries, cranes, etc. Furthermore, as has been held by the Madras High Court in the case of CIT-I, Trichirapalli -vs- D.Rathinam, the provisions of Sec.194I providing for TDS even in respect of Machinery/Equipments were introduced with effect from 01-06- 2007 and were therefore not applicable for A.Yr. 2005-06. In the case of appellant, the assessment year is also 2005-06. Therefore, the payments cannot be considered as covered under provisions of Sec.194I. It is accordingly held that the AO was provisions of TDS not justified in considering these payments to be covered by provisions of TDS and disallowance of the same made u/s 40(a)(ia) is deleted. 6. Aggrieved by the order of CIT(A) the revenue has preferred the present appeal before the Tribunal. 7. The ld. DR submitted that since the assessee was engaged in the business of earth moving contract, it has to be verified as to whether the payment for hiring of equipments, machinery were made as part of the composite contract for....
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.... 194J; (iv) "work" shall have the same meaning as in Explanation III to section 194C; " 11. The Memorandum explaining the provisions in the Finance Bill explained the rationale of the insertion of the new provision in following words :- "With a view to augment compliance of TDS provisions, it is proposed to extend the provisions of section 40(a)(i) to payments of interest, commission or brokerage, fees for professional services or fees for technical services to residents, and payments to a resident contractor or sub-contractor for carrying out any work (including supply of labour for carrying out any work), on which tax has not been deducted or after deduction, has not been paid before the expiry of the time prescribed under subsection (1) of section 200 and in accordance with the other provisions of Chapter XVII-B. It is also proposed to provide that where in respect of payment of any sum, tax has been deducted under Chapter XVII-B or paid in any subsequent year, the sum of payment shall be allowed in computing the income of the previous year in which such tax has been paid. The proposed amendment will take effect from 1st day of April, 2005 and will, accordingly, apply ....
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....r credit is being given to an individual or a Hindu undivided family; (ii) two per cent. where the payment is being made or credit is being given to a person other than an individual or a Hindu undivided family, of such sum as income-tax on income comprised therein. Explanation III to Sec.194C provides that for the purposes of this section, the expression "work" shall also include- (a) advertising (b) broadcasting and telecasting including production of programmes for such broadcasting or telecasting; (c) carriage of goods and passengers by any mode of transport other than by railways; (d) catering 15. Sec.194I of the Act as it existed on 1.4.2005 provided that any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident] any income by way of rent, shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of- (a) two per cent. for the use of any machinery or plant or equipment; and (b) ten per cent. for the use of any land or building (in....