2026 (2) TMI 316

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.... in DIN & Order No: ITBA/APL/S/250/2024-25/1073386062(1) arising out of the order dated 22.06.2018 u/s 201 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') passed by the ACIT Circle 77(1), Delhi for AY: 2017-18. The revenue has raised following grounds; 2. On hearing both the sides the relevant factual background is that the Respondent assessee is engaged in the business of establishment, maintenance and management of clinical reference laboratories in India and employs various doctors on its rolls ('Salaried doctors') for the provision of such clinical services. Further, to provide a wider variety of medical consultancy services, the Respondent separately engages specialized doctors as full-time consultants (FT....

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.... with the Consultants. However, the Ld. AO passed impugned order dated 22.06.2018 under Section 201(1)/201(14) of the IT Act, treating the Respondent to be an 'assessee in default for deducting TDS on payments made to Consultants under Section 194J of the IT Act instead of Section 192 of the IT Act, thereby raising a demand of Rs. 1,00,83,568/-. Separately, penalty proceedings were also initiated against the Respondent on account of such alleged short deduction of TDS. 3. Aggrieved by the above-said order, the Respondent filed an appeal before the Commissioner of Income-tax, Appeals, Circle-33(1), Delhi and during the course of the CIT(A) proceedings, the affidavits of two Consultants, namely, Dr. Neeraj Prakash and Dr. Hemant Yadav,....

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....nts made to retained doctors liable for TDS u/s 192. 2. Whether on the facts and in the circumstances of the case, the Ld. CIT(A) failed to appreciate that as per the nature of work of Retained doctors/Full time consultants, TDS should have been made u/s 192 at the prescribed slab rates for the respective financial year. 3. Whether on the facts and in the circumstances of the case, the Ld. CIT(A) failed to appreciate that as there was complete control of employer (deductor) over the consultants (deductees) and there was employeremployee relation between them. 4. That, the appellant craves to add, amend, modify and delete any of the grounds of appeal before or at the time of hearing." 3. Ld. DR has though relied....

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....deliver as per the terms and conditions of the contract. Thus, it is only for the purpose of discipline and adherence to the timings that the consultant doctors are required to report for certain number of hours at the hospitals. The same explanation goes for the leave rules as well......." 4. We are of the considered view that the ld. AO had fallen in error to distinguish between contract "for service" and "not of service", which ld. CIT(A) has duly considered. Ld. CIT(A) has rightly relied the consultancy agreements, which made it evident that the Consultants act in their independent professional capacity while providing the concerned medical consultancy and advisory services since the parties operate on a 'principal to principal&#....