2019 (12) TMI 1226

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....sessee from the company "North Bengal Eye Centre Pvt. Ltd." was not in the nature of professional fees assessable under the head 'income from profession', but was in the nature of salary income assessable under the head 'income from salary'. The AO stated that no deduction is admissible except professional tax under the head 'salary income'. Further, he rejected the claim of the assessee for deduction u/s 54EC of the Act. 3. Aggrieved, the assessee carried the matter in appeal before the first appellate authority who granted part relief. 4. Further aggrieved, the assessee is before us on the following grounds: "1. For that on the facts and in the circumstances of the case, the ld. CIT(A) erred in confirming the action of the AO in treating the income from Profession of Rs. 33,73,898/- as income from Salary. 2. For that on the facts and in the circumstances of the case, the ld. CIT(A) was not justified in confirming the action of the AO in disallowing the expenses of Rs. 6,80,960/- claimed against the professional income. 3. That the appellant craves leave to add, alter or delete all or any of the grounds of appeal." 5. Ld. Counsel for the assesse....

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....aimed were personal in nature like telephone expenses, car renting expenses, travelling and conveyance etc. He also took this Bench through the clauses of the agreement and argued that in effect, in terms of the agreement was what is paid is salary and that the assessee and the hospital had an 'employer-employee' relationship. He distinguished the case laws relied upon by the ld. Counsel for the assessee. 8. Rival contentions heard. On a careful consideration of the facts and circumstances of the case, perusal of the papers on record and case laws cited, we hold as follows. 9. The AO has in his assessment order assessed the income in question under the head 'income from profession', though in the body of the order, he was of the opinion that the income in question was assessable under the head 'income from salary'. He simply disallowed the claim of exemption made by the assessee and assessed the gross receipts as professional income. 10. A perusal of the agreement demonstrates that the assessee was rendering professional services. It does not lead us to a conclusion that there is an 'employeremployee' relationship between the assessee and the company. 11. In the preambl....

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....duty hereunder for reason of vacation, illness, continuing professional education or any other reason. The Ophthalmologist shall exercise due care in availing vacations, leave of absence etc., and shall give due regard to the state or condition of the patients and the medical emergencies / exigencies as well as legal liabilities arising from non-attending the patients. The leave and vacations shall be as per the policy of the Company. 16.1 The Company shall purchase professional liability insurance cover from a renowned insurance company insuring the Company against claims for medical negligence made by any person against the Ophthalmologist. 17.1 Notwithstanding the medical insurance covers contemplated in this agreement, the' Ophthalmologist shall indemnify and hold the Company harmless from and against all the damages or losses which the Company or any patient may suffer owing to any act of medical negligence on the part of the Ophthalmologist. The Ophthalmologist assures the Company that the legal actions which may be filed against the Ophthalmologist and the Company owing to Ophthalmologist's medical negligence shall be defended by the Ophthalmologist at ....

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....fixed term under a contract, the fact that the assessee had no liability to pay provident fund or pension or such other post retiral benefits. It was also noted that the doctors were free to carry on their private practice in their own clinics outside the said hospital beyond the hospital time. [Para 8] • In the present case, it has been recorded that the doctors were entitled to admit, investigate and provide treatment to the patients and that the doctors would be responsible for their clinical care. The doctors were responsible for supervising the subordinate staff whereas the facilities of the hospital staff, paramedical and nursing staff would be provided by the hospital along with the necessary equipment to render services to the patients. 15 per cent of the fee collected by the doctors would be deducted by the hospital as its share and the balance 85 per cent would be paid to the doctors after deduction of tax at source. In case of fees not being paid by patients, the same would be the liability of the concerned doctors. It was on this basis the Tribunal had come to the conclusion that the relationship between the hospital and the doctors cannot be treated as one....