TaxTMI 
TaxTMI 
2018 (3) TMI 300
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....ate for Nil deduction of tax at source. While processing the application, the Assessing Officer (AO) noticed that it had made certain payments to M/s. UPL Environmental Engineers Ltd. (UEEL) on which tax had been deducted at the rates applicable u/s. 194C and not u/s. 194J. An inspection was carried out on 19/3/2013 to verify the nature of services rendered by the deductee. He called further details in that regard. While going through the details, he observed that payment made to UEEL was in the nature of technical services. A notice, dated 11/06/ 2013, was issued to the assessee for collection of the shortfall in deduction and for treating the payment as payment for technical services. In response to the said notice, the assessee submitted....
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....erred an appeal before the First Appellate Authority(FAA)and made detailed submissions. It also relied upon certain case laws. After considering the available material, he held that the basic issue to be decided was as to whether the contract between the assessee and UEEL was a work contract or a service contract. He referred to the case of Bharti Cellular Ltd. (319ITR139)and held that word 'techni -cal services' had to be read in narrower sense, that the words technical services in section 9 (1)(vii) r. w. Explanation 2 would appear between the words managerial and consultancy services, that the AO had reproduced certain portions of the agreement to hold that the nature of contract was technical-service-contract, that the assessee had argu....
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.... to show that the sums paid by it to UEEL had been offered to tax, that it had failed to enclose the P&L account to verify as to whether the said income was included as profit in the return of income. Accordingly, he directed the AO to call for the books of the deductee company, i. e. UEEL and to verify as to whether the sums paid by the assessee were offered as income. He further observed that if the claim of the assessee was found to be correct the principles laid down by the judgments of Hon'ble Supreme Court in the case of Hindustan Cocacola Beverages (supra), would be applicable and accordingly no tax would be charged u/s. 201(1)of the Act. He also held that interest chargeable u/s. 201(1A) would be applicable till the date of paym....
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....olid waste management in 2007, that municipal corporation had deducted tax at source u/s. 194C of the Act for the payments made to the assessee, that it had completed the execution of part of the project, that it had sub-contracted the operational and maintenance part of the main contract to UEEL, that the work was performed by UEEL under contractual obligation as per the requirements of the assessee and CMC. According to us, the agreement with UEEL was continuation of the original agreement entered into between CMC and the assessee. The issue to be decided is as to whether the work carried out by the assessee would fall in the category of technical services as envisaged by the provisions of section 9 of the Act. Technical services means....
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.... the duty of the contractor to provide all types of labour, supervisors, engineers, inspectors, measuring and testing equipment, testing and commissioning for the execution of the project in accordance with the specifica - tions of the assessee. He held that the level of human intervention was high and sophisticated and accordingly held the assessee in default under section 201(1A) for having failed to deduct the tax at source and invoked the provisions of sections 200 and 201 read with rule 30 of the Income-tax Rules, 1962. The FAA held that the scope of the work given to the sub-contractors involved construction work, welding, erection, alignment, transportation of equipment and materials with the help of machines which did not fall withi....
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....94J of the Act. The Hon'ble High Court has also held that Section 194J of the Act was not a residuary clause, that in other words, it was not that if a contract did not fall within the ambit of section 194C, it must be deemed to fall within the ambit of section 194J, that Sections 194C and 194J were independent provisions. In the case of Gujarat Flurochemicals Ltd. (supra)the Tribunal has held that the collection, transportation and disposal of waste could be said to be covered under the provisions of section 194C of the Act. In the matter of Ruby Maacons Ltd. (supra) the issue involved was regarding the applicability of TDS provisions for payment made by the assessee to Vapi Waste and Effluent Management Company Ltd. (VWEMCL) for the tr....