Court Rules EDC Payments to HSVP Subject to Tax Deduction; HSVP Not Exempt as "Government" u/s 196.

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....TDS u/s 194C - liability to deduct tax - External Development Charges (EDC) - payments made to the Haryana Shahari Vikas Pradhikaran [HSVP] (Earlier known as HUDA) - The High Court held that, Section 196 frees sums payable to the Government, RBI or a corporation established by or under a Central Act from the obligation of tax being collected at source. Undisputedly, HSVP would neither fall within the ambit of clause (1) or clause (3) of Section 196. The mere fact that HSVP has been constituted under a statutory enactment does not make it the “Government”. - The court found that EDC payments fall within the ambit of Section 194C, imposing a duty on the payer to deduct tax from payments made to a contractor, without discretion to assess the chargeability of the payment to tax.....