2018 (4) TMI 988

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....ome Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2012-13. 2. The only issue raised by the assessee in various grounds of appeal is against upholding the order of AO-TDS for treating the contractual payment to M/S Lobo Staffing Solutions Pvt. Ltd. by way of reimbursements and administration work as fee for professional services and further holding that the TDS was liable to be deductible under section 194J of the Act instead of section 194C of the Act. 3. The facts in brief are that during the year the assessee has made payments amounting to Rs. 22,08,80,806/- to M/s. Lobo Staffing Solutions Pvt. Ltd. on which TDS was deducted under section 194C of the Act by treating the same as contractual payment....

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....r passed by AO under section 201(1A) of the Act. The Ld. CIT(A) upheld the order of the AO on the issue by coming to the conclusion that the payments made by the assessee to Lobo Staffing Solutions Pvt. Ltd. was liable for deduction of TDS under section 194J and not under 194C of the Act. 5. The Ld. A.R. vehemently submitted before us that the assessee made contractual payments for the services to a company Lobo Staffing Solutions Pvt. Ltd for the purpose of carrying out day to day duty and data entry work etc. The employees deputed by the said company were paid salary by the company itself and also incurred expenses on behalf of the assessee which were reimbursed by the assessee. The said company was paid administrative fee over and abo....

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....ve fee paid to the said company. In defense of his argument, the Ld. A.R. cited various decisions wherein it has been held that no TDS is liable to be deducted on the reimbursement of expenses. The decisions relied upon by the Ld. A.R. are listed as under: 1. DCIT vs. Dhaanya Seeds Pvt. Ltd. (64 SOT 15) 2. ACIT vs. Madhyanchal Vidyut (57 taxmann.com 261) 3. Bhagyanagar Gas Ltd. vs. ACIT (29 taxmann.com 220) 6. Finally, the Ld. A.R. submitted that the assessee has duly complied with all the provisions relating to tax deduction at source and therefore, interest levied under section 201(1A) of the Act was wrongly imposed by the AO and affirmed by Ld. CIT(A) which should be deleted. 7. We have heard the rival su....