TaxTMI 
TaxTMI 
2013 (6) TMI 934
X X X X Extracts X X X X
X X X X Extracts X X X X
....not deducted tax at source u/s 194C of the Act, consequently the assessee is in default u/s 201(1)/201(1A) of the Act. As per the learned counsel for the assessee, the CIT(A) has deleted the liability created u/s 201 but has upheld the liability of interest u/s 201(1A) against which the assessee is in further appeal before the Tribunal 3. Rival contentions have been heard and record perused. During the assessment years under appeal the ITO TDS found that the assessee made payment to the various Government Agencies without deducting Tax at Source u/s 194C. Thus he treated the Organization as assessee in default and accordingly created the demand u/s 201(1) and interest u/s 201(1A) against the assessee the details of same is as under:- ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....made by the A.O. on account of short payment of tax at Rs. 1,45,621/- is not substainable and, therefore, it is hereby Deleted. 4.6 As far as charging of interest u/s 201 (1A) on short payment is concerned, interest has to be charged on the short payment of the tax till the date deductee has made the payment. Similar view is held by the Hon'ble Supreme Court in the case of Hindustan Coco Cola Beverages Pvt. Ltd., Vs. CIT (2007) 293 ITR 226 (SC) as under:- "The Circular No. 275/201/95-IT(B) , dated 29- 01-1997 issued by the Central Board of Direct Taxes would put an end to the controversy. The circular declares that no demand visualized under section 201(1) should be enforced after the tax deductor has satisfied the officer-i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nt on behalf of the appellant. (iii) Thus the M.P.Housing Board and M.P.Laghu Udhyog Nigam Ltd are not a contractor but only. Nodal Agencies consequent thereto appellant is not liable to deduct Tax U/S 194C of the Income Tax Act on the payment made to these Nodal Agencies consequent thereto the Ld. A.a. and Ld.CIT (A) erred in' treating the assessee as assessee in default. (iv) In the case of U.P. State Industrial Development Corporation Ltd. Vs. ITO (2004) 89 TTJ (Lucknow) 669. It was held that :- " We have carefully considered the facts and circumstances relating to this matter, the entire material including the case laws to which our attention was invited and the rival submissions. After going through the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e said to be 'performing any work' by KSL". In view of above facts it is clear that the assessee has not made any payment directly to the contractors it has make the payment to the Nodal Agencies namely M.P.Housing Board and M.P.Laghu Udhyog Nigam Ltd., and who in tum make the payment to the contractor on behalf of the assessee by deducting the Tax at Source under section 194C of the I.T. Act., which is duly deposited these Nodal Agencies in the Credit of Central Government on behalf of appellant. Thus it is prayed the liability of interest u/s 201(lA) upheld by the Ld. CIT (A) be deleted. 6. On the other hand, the learned Sr. DR relied on the orders of the authorities below and contended that the assessee has not deduct....
X X X X Extracts X X X X
X X X X Extracts X X X X
....essee, therefore, the assessee is no more liable for the amount of TDS. However, the CIT(A) has upheld the demand created u/s 201(1A) of the Act in respect of interest, if any, on delayed payment of taxes. 9. From record we find that the assessee has transferred funds received from the Government to M.P. Housing Board and M.P. Laghu Udyog Nigam Limited, who in turn got the building constructed through contractors. Mere transfer of fund by the assessee to M.P. Housing Board and M.P. Laghu Udyog Nigam Limited will not attract the liability u/s 194C since neither M.P. Housing Board nor M.P. Laghu Udyog Nigam Limited is a contractor or sub-contractor. As per the learned counsel, M.P. Housing Board and M.P. Laghu Udyog Nigam Limited have got ....