TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 1151
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.... 2. The learned JCIT(A) has erred in concluding that the doctors had not employer-employee relationship with deductor and the subject to deduction u/s 194J of the Income Tax Act, 1961 instead of 192 of the Act in spite of the facts that the doctors were paid monthly remuneration, professional tax was deducted, duty time is generally from 8.30 am to 5.30 pm. 3. The JCIT(A) ought to have appreciated the fact that: (i) As per the terms and conditions of the instant case which indicate employer-employee relationship and facts of the instant case discussed at Para 5 to 12 of the AO's were not considered by the Hon'ble Tribunals/Courts. (ii) Also the decision relied on by the JCIT(A) are not that of Hon'ble jurisdictional ITAT/High Court. (iii) There is no denying facts that the aforesaid case laws relied on by the deductor, various Hon'ble courts have decided the issue of remuneration paid to the doctors as professional fee deductible u/s 194J which is in favour of few hospital, but under different facts and circumstances. (iv) The 50 doctors are working exclusively for deductor hospital, the doctors are working as per the tim....
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....ties below. 8. We have given our thoughtful consideration to the rival submissions and have perused the orders passed by the authorities below and the judicial precedents stated therein. We find that the Ld. CIT(A) has decided the issue in favor of the Assessee by holding as under:- "5.1 On Grounds of Appeal Nos. 1 to 5: The core issue for determination is whether the payments made by the appellant hospital to the doctors engaged by it are in the nature of 'salary' taxable under Section 15 of the Act, requiring TDS under Section 192, or 'professional fees' taxable under Section 28, requiring TDS under Section 194J. The determination hinges on whether an employer-employee relationship exists between the appellant and the doctors. 5.2 It is a well-established principle in income tax law that the nature of payment is determined by the substance of the relationship between the payer and the payee, rather than merely the nomenclature used. The distinction between a 'contract of service' and a 'contract for service' is crucial in this regard. A 'contract of service' typically implies a master-servant relationship where....
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.... the appellant is allowed." 9. On perusal of the above, it is clear that the Ld. CIT(A) has on examining the arrangement between the Assessee and the doctors, came to a conclusion that in the facts of the present case, the arrangement between the Assessee and the Doctors could not be recorded as 'contract for service'. It was observed by the Ld. CIT(A) that the doctors were not prohibited from being associated with other hospitals and were not entitled to benefits, such as provident fund and terminal benefits provided to employees. Therefore, the arrangement between the Assessee and the doctors aligned more closely with a 'contract for service'. We note that in Paragraph No. 5.4 of the order impugned that the Ld. CIT(A) has categorically recorded that after considering the totality of facts, the nature of engagement, terms and conditions governing the relationship between the Assessee and the doctors was that independent professional and not of employees. During the course of hearing, Revenue has failed to bring any material to controvert the above findings returned by the Ld. CIT(A). During the course of hearing the Learned Departmental Representative had placed reliance on Par....
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.... benefit, etc., then, merely because they are required to spend certain fixed time at the hospital, treating fixed number of patients at the hospital, attend them as out patients and Indoor patients does not mean that a employer employee relationship can be culled out or inferred. We do not see how Mr Gupta can fault such conclusions by relying upon decisions which have been rendered in cases of doctors having a fixed pay and tenure. In that case, before us, there is no dispute. Even the assessee accepts the position that they are the employees of the assessee trust. 38. However, in cases of other doctors the contract would have to be read as a whole. It would have to be read in the backdrop of the relationship and which was of engagement for certain purpose and time. The skill of the doctors and their expertise were the foundation on which an invitation was extended to them to become part of the assessee which is a public charitable trust and rendering medical service. If well known doctors and in specified fields are invited to join such hospitals for a fee or honorarium and there are certain terms drawn so as to understand the relationship, then, in every case such term....
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....tals. The management, therefore, insists that such facilities, which are very costly and expensive are utilized to the optimum and the investment of time, money and infrastructure is not wasted. Hence, fixed timings and required number of hours and such stipulations are incorporated in contracts so that they are of binding nature. The Doctor or Expert Medical Practitioner is then obliged to denote his time and energy to the clinic whole heartedly. If handsome remuneration, fee is prescribed in return of ready-made facilities even for professionals, then, such insistence is not necessarily to treat highly qualified professionals as servants. It is a relationship of mutual trust and confidence for the larger interest of the patient being served efficiently. From this contract or any clause therein no such conclusion could have been arrived at. We do not see how there was any express bar from working at any other hospital and if the contracts would have been properly and carefully scrutinized. Merely because their income from the hospital is substantial does not mean that ten out of the fourteen criteria evolved by the Commissioner have been satisfied. The Assessing Officer and the Co....
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....es that matters of this nature must be decided. This approach of the Tribunal did not require it to render elaborate or lengthy findings and when it agreed with the Commissioner. We do not find even in the case of Dr Sumit Basu the Commissioner or the Tribunal committed any error. Merely because of his stature he was ensured and guaranteed a fixed monthly payment. That would not make him an employee of the hospital. This cannot be seen as a stand alone term. There are other terms and conditions based on which the entire relationship of a consultant or professional and visiting the assessee's hospital had been determined. Once again, no general rule can be laid down. Now a days, Private Medical Care has become imperative. Public Hospitals cannot cater to the increasing population. Hence, Private Hospitals are established and continue to be formed and set up day by day. The quality of care, service, attention, on account of the financial capacity, therein has forced people of ordinary means also to visit them. Since specialists are in demand because of the life style diseases that consultants and doctors prefer these hospitals. Sometimes they hop from one medical centre or clinic....