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2023 (4) TMI 1209 - AT - Income TaxTDS u/s 194C - payments made to driver-partners under the Uber App and payments made to the restaurant and courier partners under the Uber EATS App - Meaning of person responsible for paying u/s 204 - primary services provided through this mobile App is the transportation services wherein the passenger looking for a ride on the App and the driver/vehicle owner willing to offer accepts the offer - HELD THAT - As in assessee s own case in M/s Uber India Systems Private Ltd 2021 (3) TMI 326 - ITAT MUMBAI held that the assessee cannot be treated as a person responsible for paying for the purpose of section 194C r/w section 204 of the Act in respect of payment made to driver partners on behalf of the Uber BV for the transportation services. Accordingly, the coordinate bench held that the assessee cannot be treated as an assessee in default under section 201(1)/201 (1A) We find that the coordinate bench of the Tribunal in assessee s own case in Uber India Systems Private Ltd 2023 (1) TMI 1243 - ITAT MUMBAI rendered similar findings in respect of payment made to driver partners on behalf of the Uber BV for the transportation services. In the year under consideration, the assessee provided taxi services as well as food delivery services in India through its mobile application. However, it is an accepted position that Uber EATS is a food delivery App on a similar pattern as Uber App and is a Restaurant Aggregator platform akin to Uber App being a ride-sharing platform. We find that the AO-TDS also rendered similar findings in respect of payments made under the food delivery services. DR could not show us any reason to deviate from the aforesaid decisions rendered in assessee s own case and no change in law was alleged in the relevant assessment year. The issue arising in the present appeal is recurring in nature and has been decided by the coordinate bench of the Tribunal in the preceding assessment years. Decided against revenue.
Issues Involved:
1. Determination of whether Uber India System Pvt. Ltd. (UISPL) is the "Person responsible for paying" under section 204 of the Income Tax Act. 2. Applicability of section 194C of the Income Tax Act on payments made to driver-partners, restaurant partners, and courier partners. 3. Retrospective application of the amendment to section 204(v) of the Income Tax Act. 4. Implications of non-payment of equalization levy under section 165A of the Finance Act 2016 by Uber B.V./Uber Portier B.V. Summary of Judgment: 1. Determination of UISPL as "Person responsible for paying" under section 204 of the Income Tax Act: The Revenue contended that UISPL, which makes payments to driver-partners, restaurant partners, and courier partners, should be considered the "Person responsible for paying" as per section 204 of the Act. However, the Tribunal found that UISPL is merely a payment and collection service provider acting on behalf of Uber B.V., and not the principal payer. The Tribunal upheld the decision that UISPL does not satisfy the conditions under section 194C and section 204 to be considered as the person responsible for paying. 2. Applicability of section 194C of the Income Tax Act: The Tribunal noted that UISPL does not fulfill the three conditions necessary under section 194C: it is not the person responsible for paying, the payments are not for carrying out any work for UISPL, and there is no contract between UISPL and the driver-partners. The Tribunal reiterated that UISPL acts as a remitter of money collected on behalf of Uber B.V. and is not liable to deduct TDS under section 194C. 3. Retrospective application of the amendment to section 204(v) of the Income Tax Act: The Tribunal observed that the amendment to section 204(v), which includes agents of non-residents as persons responsible for paying, is effective from 1.4.2020 and cannot be applied retrospectively. The Tribunal emphasized that the amendment was not introduced with the expression "for the removal of doubts," and thus, it cannot be deemed clarificatory or retrospective. 4. Implications of non-payment of equalization levy under section 165A of the Finance Act 2016: The Revenue argued that the non-payment of equalization levy implied that UISPL was involved in the business operations of Uber B.V./Uber Portier B.V. However, the Tribunal did not find this argument sufficient to classify UISPL as the person responsible for paying under section 204. Conclusion: The Tribunal dismissed the Revenue's appeal, affirming that UISPL cannot be treated as an "assessee in default" under section 201(1)/201(1A) of the Act. The Tribunal upheld the decision of the learned CIT(A) and found no reason to deviate from the previous rulings in similar cases involving UISPL. The appeal by the Revenue was dismissed, and the judgment was pronounced in open court on 26/04/2023.
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