TaxTMI 
TaxTMI 
2017 (5) TMI 1519
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....ssioner of Income-Tax (Appeals)-XIV, Ahmedabad has erred in law and on facts in deleting the addition of Rs. 1,1 9,63,570/- made u/s.40(a)(ia) of the Act in respect of payments made by Assessee to the distributors which is squarely covered under the definition of 'work' as per the newly inserted explanation (iv)(e) to Section 194C of the Act by Finance Act, 2008 w.e.f. 01/06/2008. 2. The Ld. Commissioner of Income-Tax (Appeals)-XIV, Ahmedabad has erred in law and on facts in deleting the disallowance of Rs. 2,794/- made on account of late payment of employees contribution to Provident Fund u/s.36(1)(va) of the Act." 3. In this case, return of income declaring income of Rs. 29,99,740/- was filed on 27/09/2010. Subsequentl....
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.... section 194C of the act, therefore, the provisions of section 40(a)(ia) were attracted. Consequently, the assessing officer added Rs. 1,11963,57/- to the total income of the assessee. 4. Aggrieved against the decision of the assessing officer, the assessee preferred appeal before the ld. CIT(A). The ld. CIT(A) has deleted the addition made by the assessing officer by observing as under:- "5.2 In ground No. 2, the appellant raised objection of disallowance made by A.O. u/s 40(a)(ia) of the Act and addition of Rs. 1,19,63,570/- on account of infringement / incompliance of section 194C of the Act. The appellant's submission and A.O.'s contentions had already been elaborated in earlier para of my this order. (A) Br....
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....jarat High Court judgement in the case of All Gujarat Federation of tax Commutates & others v. CBDT where after consideration of Hon'ble Supreme Court judgement in the case of ACC Ltd. Board circular No. 681 was quashed, held that definition of work as included in expl. Ill inserted by the Finance Act. 1994 w.e.f. 01/07/95 does not included "Exhibition of film in theatre" as work. (v) Hon'ble Bombay High Court in the case of commissioner of Income tax TD Vs. M/s. Shingar Cinemas Pvt. Ltd;, Income tax appeal No. 991 of 2008 dealt in details all the issues related to exhibition of film and provisions of IDS and held in favour of assessee. (vi) The relationship between assessee and distributor is on principal....
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....mer by using material purchased from such customer. The A.O. compared the transactions between assessee and distributor as supply of a product as per requirement / specification to assessee and no material involved and no manufacturing activity involved. The A O. emphasized the inclusive definition at cl. (iv) of explanation to : section 194C of the Act for 'work' and contended that supply of print of the film falls within the definition of 'work'. The A.O. questioned the relationship between distributor and assessee as that of principal to principal since distributor acquired on his own decision the rights for a film and supply the same to assessee which is not a purchase & sale activity. (iii) Hon'ble Bombay H....
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.... reverse it or set aside. The ratio of Hon'ble ITAT Mumbai 'K' bench in the case of M/s Shrinagar Cinemas (P) Ltd. also discussed in earlier para of this order and as evident is squarely applicable in the case of appellant- I am not inclined with A.O. that since both these orders were made before the amendment to section 194C of the Act, the ratio is not applicable. All the issue and fact were deliberated in both these order and such amendment will not affect in any way to the ratio so pronounced. The amendment to include the work of supplying the product as per specified norm and parameter is in relation to job work under taken by an assessee, under a close supervision with predetermined parameter i.e. a works contract. In the ....
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....he Act. The addition so made is therefore unjustified and not sustainable. The A.O. is directed to allow such accounting of revenue sharing and delete the addition of Rs. 1,19,63,570/- so made. The appellant gets relief accordingly. This ground is therefore allowed" 5. We have heard the rival contentions. We have also considered that the Co-ordinate Bench of the ITAT Ahmedabad in ITA No. 2978, 2979 and 2980/Ahd/2004 for assessment year 2002-03 to 2004-05 had decided that provisions of section 194C of the act was not applicable to the case of the assessee. We find even the definition of work as amended by the Finance Act, 2009 w.e.f. 01/10/2009 in explanation to section 194C of the act not applicable to the case of the assessee because th....