TaxTMI 
TaxTMI 
2022 (7) TMI 176
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....DS @ 10% u/s 194-I of the Income Tax Act, 1961 (in short "the Act"). Hence, the assessee committed a default u/s 201(1) of the Act and was, therefore, liable for payment of tax and interest, since there was a short deduction of TDS. 2. I have heard the arguments of both the sides and carefully perused the material available on record of the Tribunal, inter alia, two paper books of assessee, consisting of 138 and 19 pages respectively. The learned counsel submitted that AO has erred on facts and law in completing the assessment u/s 201(1)/201(1A) of the Act and making addition on account of short deduction of tax amounting to Rs 11,16,161/-. The learned counsel also submitted that AO has grossly erred in holding that the common maintenance ....
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....d under Rule 31ACB of the income-tax Rules, 1962, inserted w.e.f. 12.9.2012, which was inserted after the end of financial year, has held that the assessee had not fulfilled the prescribed requirement to file the prescribed format from the payee. But this conclusion was drawn by the learned CIT(A) without show causing or confronting the assessee about this requirement. Therefore, the assessee obtained relevant certificates from certain payees and submitted before this Bench in the form of paper book which may kindly be accepted as additional evidence in order to grant justice to the assessee. 3. Replying to the above, the learned Sr. DR drew our attention towards para 6 of the assessment order and submitted that CAM expenses is duly covere....
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....able for deduction of tax at source @10%, i.e., u/s 194-1 and not @2%, i.e., U/S.194C of the Act, as claimed by the assessee. Succinctly stated, the assessee company which is engaged, inter alia, in the business of running of fast food restaurants in North and East India under the brand name "Me. Donalds", had taken shop/spaces/units in commercial areas/malls on lease from various parties by way of lease agreements. Apart from the rent, the assessee-company had also paid CAM charges, i.e., charges which are fundamentally for availing common area maintenance services, which may either be provided by the landlord or any other agency. In so far the CAM charges that were paid by the assessee to the same party to whom rent was being paid pursuan....
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.... such income or, as the case may be, the aggregate of the amounts of such income credited or paid or likely to be credited or paid during the financial year by the aforesaid person to the account of or to, the payee, does not exceed one hundred and eighty thousand rupees: ......... . .......... . Explanation.-For the purposes of this section,- (i) "rent" means any payment, by whatever name called, under any lease, sublease, tenancy or any other agreement or arrangement for the use of (either separately or together) any, - (a) land; or (b) building (including factory building); or (c) land appurtenant to a building (including factory building); or (d) machinery; or (e) plant; or (f) equipment; or (g) furniture; or (h) f....
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.... 13. In the backdrop of our aforesaid deliberations, we concur with the claim of the Id. AR that as the payments towards CAM charges are in the nature of contractual payments that are made for availing certain services/facilities, and not for use of any premises/equipment, therefore, the same would be subjected to deduction of tax at source u/s.194C of the Act. Our aforesaid view is supported by the order of the ITAT, Delhi in the case of Kapoor Watch Company P. Ltd. vs. ACIT in ITA No.889/Del/2020. In the aforesaid case, the genesis of the controversy as in the case of the assessee before us were certain proceedings conducted by the Department in the case of Ambience Group (supra) to verify the compliance of the provisions of Chapter XVII-....