TaxTMI 
TaxTMI 
2025 (3) TMI 2152
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....nts made to these Van Samitis are not contract payments under the provisions of section 194C of the I.T. Act, 1961. These VFPMCs do not fall into category of State Government or Local Authority as per Section 10(20) or section 10(46) of the Income Tax Act or under any other sub-section of section 10 nor they are registered as trust as per provisions of section 11 and 12 of the Income Tax Act, 1961. Since these EDCs/VFPMCs are not registered as Co-operative Society, the provisions of Section 80P of the Income Tax Act, are also not applicable on them. Hence by virtue of their creation they are not falling in any category whose income is subject to be exempted for payment of Income taxes or they are likely to receive 100% deduction on the same in view of the CBDT circular no 502 dated 27.01.1988. 4. Briefly the facts of the case are that the Revenue has filed an appeal against the order of the CIT(A) dated 16/01/2024, wherein the CIT(A) deleted the tax demand of Rs. 3,45,72,332/- under Section 201(1)/201(1A) of the Income Tax Act, 1961, for the Financial Year 2012-13. The Revenue contends that the CIT(A) erred in holding that payments made to Van Suraksha and Prabandh Samitis (VFPM....
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.... disputed that the institution of these EDCS/VFPMC groups or the nature of the work executed by them for the forest department. The only issue at hand is whether payments made for preservation of forest/reforestation by employing self help groups as per implementation of panchayti raj/NREP/RLEGP can be constituted as contract payment within the meaning of section 194C of the Act or not. The ld. AR of the assessee heavily relied upon the CBDT circular no. 502 (F.No. 385/49/86-ITC dated 27.01.1988). As per this circular, programmes under NREF/RLEGP are executed with the participation of the people and the Panchayati Raj institutions under the active supervision of the State Governments in conformity with the guidelines framed by the Central Government. There is no contract between the village committee/voluntary agencies and the State Governments, which is sine qua non for attracting the provisions of section 194C. Moreover, these schemes specifically ban the employment of contractors/middlemen for the execution of the work undertaken under these schemes. The Van Samitis are instituted as per Rajasthan State Government Notification S.No. F/7(39)/VAN/90 dated 17.08.1999 for various co....
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....able on EDC payable by developer to HUDA. 11. When we examine aforesaid contention raised by the ld.DR for the Revenue in the light of the facts and circumstances of the case in which EDC have been paid to HUDA for Financial Years 2013-14, 2014-15, 2015-16 & 2016-17 (upto December 2016) as mentioned by the ld. CIT (A) in para 2.1 of his order, it goes to prove that prior to 23.12.2017, the date of CBDT circular, there was no clarity whatsoever as to the deduction of tax on EDC. When there was no clarity with the assessee prior to 23.12.2017, if TDS was to be deducted by the assessee on payment of EDC, it provided a "reasonable cause" u/s 273B of the Act that TDS was not required to be deducted. 12. Ld. AR for the assessee contended that DTCP had issued a clarification dated 29.06.2018 to the effect that no TDS was/is required to be deducted in respect of payment of EDC and relied upon the order passed by the coordinate Bench of the Tribunal in case of RPS Infrastructure Ltd. vs. ACTI in ITA Nos.5805, 5806, 5349/Del/2019 order dated 23.07.2019 wherein it is held that, "on the basis of letter supra issued by DTCP that the letter covers both past and future transacti....
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....re convinced that there is no substantial question of law, the facts and law having properly and correctly been assessed and approached by the Commissioner of Income Tax (Appeals) as well as by the Income Tax Appellate Tribunal. Thus, we see no merits in the appeal and it is accordingly dismissed." 15. Furthermore, coordinate Bench of the Tribunal in case of DCIT (TDS), ACIT (TDS) and JCIT (TDS), Dehradun vs. The Joint Secretary Organizing Committee for Winter Games also decided the identical issue by relying upon the decision rendered by Hon'ble Supreme Court in case of CIT vs. Bank of Nova Scotia (supra) and deleted the penalty u/s 271C by returning following findings :- "31. We have carefully considered the rival contentions and perused the orders of the lower authorities. On looking to the facts of the case as discussed by us in appeal of the assessee and revenue in 201(1) and 201(1A) proceedings above, we find that the belief of the assessee is bonafide and failure to deduct tax at source u/s 194C of the Act is for a reasonable cause. The ld Assessing Officer could not show any contemptuous conduct on part of the assessee for non-deduction of tax at source. T....
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...., Ajmer (ITA No. 358-360/JP/2023). As there is no contrary decision of any superior court therefore the said decision still holds good and is definitely binding on the CIT(A) and the AO. 9.2 Further more we may also mention the decision of the Hon'ble Telangana High Court in case of Mylan Laboratories Ltd. [2022] 137 taxmann.com 178 (Telangana wherein the Hon'ble Telangana High Court has held that the decision of the Tribunal is binding on the AO / CIT(A). 34. We are afraid such a view taken by the Assessing Officer can be justified. Rather, it is highly objectionable for an Assessing Officer to say that decision of the Income Tax Appellate Tribunal is not acceptable; and that since it has been appealed against, the issue of allowability of depreciation on goodwill has not attained finality. Unless there is a stay, order/decision of the jurisdictional Income Tax Appellate Tribunal is binding on all income tax authorities within its jurisdiction. 35. In Union of India v. Kamlakshi Finance Corporation Ltd. 1992 taxmann.com 16, Supreme Court held and reiterated that the principles of judicial discipline require that the orders of the higher appellate authorities s....