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TMI Blog2010 (2) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... e's appeal is dismissed. Payment made to labourers in cash - violation of section 40A(3) - CIT(A) deleted the addition - HELD THAT:- We find that the facts has already been discussed in the above ground, the labour payment is not exceeding the prescribed limit for deduction of tax, i.e., above Rs. 20,000. Accordingly, we are of the view that this issue is covered by the decision of the above ground. Accordingly, this issue of the Revenue's appeal is dismissed. - Order The order of the Bench was delivered by Mahavir Singh (Judicial Member).-These four appeals-one by the assessee and three by the Revenue are arising out of the order of the Commissioner of Income-tax (Appeals)-IV, Baroda, in Appeal No. CAB/IV-A205, 88- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourse of survey the statement of the director of the company, Shri Devendra Ravjibhai Patel was recorded, whereby the details of labour charges paid for loading and unloading, sorting and cleaning and transportation charges were required to explain. During the survey, Shri Devendra R. Patel stated that the assessee-company is compiling the data of TDS and also the details of transporter to whom the payments were made and the nature of payment made to all the concerns. He also explained that there are two types of expenses booked under sorting and clearing/loading expenses and unloading and loading expenses in the manufacturing activity. He stated that one is for loading and unloading goods in manufacturing activity and other for loading and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctfully submit that they are coming from nearby villages and are not permanent employees of the company, hence we are enable to provide address/PAN. (3) With regard to address of staff/ workers, who have received all such payments, address of staff as under : (1) Natubhai K Prajapati, At and Post Sudan, Tal. Anand. (2) Rajeshbhai B Raj, At and Post Sudan, Tal. Anand. (3) Jagdishbhai K Raj, At and Post Adas, Tal. Anand. (4) Pravinbhai B Raj, At and Post Adas, Tal. Anand. (4) There are no separate records of attendance but there are records in support of all such payment. (5 and 6). With regard to payment of transportation charges under head "toor dal expenses". We are submitting copy of ledger account of "toor dal expenses acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ragraphs it is ascertained that the payments made to `mukadum' for labour charges is nothing but payment made to contractor within the meaning of section 194C of the Income-tax Act and TDS was not deducted in accordance with the provisions of section 194C of the Act. Hence, the assessee is an assessee-in-default within the meaning of section 201(1) read with section 194C of the Act accordingly he is liable to pay tax under section 201(1) and consequential interest under section 201(1A) of the Act. (To ascertain the monetary limit prescribed in section 194C, i.e., a single payment does not exceed Rs. 20,000 or payments were made during the year per person exceeding Rs. 50,000, the details provided by the assessee were shorted out per perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed by the appellant under this head is not genuine. In view of the fact that the receipt by one person for further redistribution is merely an administrative convenience and no existence of a contact has been established between the recipient and the appellant-company, the provisions of section 194C would not apply and therefore, the Assessing Officer is directed to delete the demand raised under section 201(1) and 201(1A) of the Income-tax Act for the assessment years 2005-06, 2006-07 and 200708." Before us the learned senior Departmental representative, Shri Sanjay Rai, first of all, relied on the statement of Shri Devendra R. Patel recorded during the course of survey under section 133A of the Act and he read out the statement as rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng expenses, for sorting and cleaning/ loading expenses were filed. He stated that complete names and addresses of the labourers engaged, were submitted before the Assessing Officer as well as before the Commissioner of Income-tax (Appeals) and stated that mukadum were mainly employees of the assessee and the payments to the labourers are made through mukadum, who are employees of the assessee to represent the labourers. They are not the contactors of the assessee. They are directly the representative of the labourers. Accordingly, payment made is below the prescribed limit in each of the labourers and the complete details were filed in view of the letter dated May 8, 2007 before the Assessing Officer. We have heard the rival contentions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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