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TMI Blog2011 (12) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... t. TPA vs. DCIT (Karnataka High Court) cannot be applied, while deciding the case in favour of the assessee. ii) The work of conducting the evaluation of copy books of the examinees was rightly held by the Assessing Officer of the nature of technical services and therefore, in the facts and under the circumstances, the Assessing Officer rightly held that the assessee was under obligation to deduct tax at source u/s 194J of the Income-tax Act, 1961 on entire payment made by the university." 2. Facts, in brief, as per relevant orders are that a survey was conducted in the premises of aforesaid university on 10th July, 2009,wherein it was found that the assessee did not deduct tax at source from the payments of Rs.1,95,39,827/- in the FY 2006-07 and Rs. 2,91,05,000/- in the FY 2007-08 made to the Principals of the various colleges under their jurisdiction as detailed in the respective orders dated 18.9.2009.In response to a show cause notice dated 26th July, 2009, the aforesaid university did not file any reply even after taking a number of adjournments until 8th September, 2009. On 8th September, 2009, a letter was received through DAK wherein detail of payments to di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , clerical staff and class IV staff for which remuneration is fixed as per norms from time to time. iii) The university has advanced the amount of Rs.1,95,39,827/- for the FY 2006-07 and for the FY 2007-08 to the coordinators to conduct the exams. iv) Therefore, the coordinators are not a contractor but are bound to fulfill their duty being principals of colleges. Each coordinator is in-charge to conduct the exam at his centre with the help of professors, clerical staff and class IV employees. v) All the team staff get remuneration as per/the duty which is paid by the coordinator towards traveling expenses, food and beverages etc. which is exempted u/s 10(14) of the Income-tax Act. However, principal of center is understood as DDO to deduct tax if remuneration paid by the coordinator exceeds the limits as provided in Income-tax Act after making all the deductions as per law. 6.3.4. Conclusion: I have considered the observation of the Assessing Officer as well as the submissions of the AR. The Assessing Officer's observation and contentions are based on presumptions. The Assessing Officer has not considered the legal position of the case. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of Rs.1,95,39,827/- made to the coordinators (TPAs) was only in fact a reimbursement of the expenses for making payments of remuneration and expenses of the evaluation staff of the coordinator colleges for conducting of exams. v) Question of deducting TDS on the advance payments/replenishment by the university to the coordinator colleges (TPAs) does not arise in the light of recent CBDT Circular No.8 dated 24 November 2009 and the judgment cited in the case of Medi Assist TPA vs. DCIT (Karnataka High Court). In the light of facts and the position of law as discussed above, the order passed by the Assessing Officer u/s 201(1) read with section 194J of the Income-tax Act, 1961 dated 18.9.2009 raising a demand of Rs.31,21,520/-, is found to be erroneous. The same cannot be sustained. Appellant's grounds are allowed." 3.1 Similar findings were recorded by the ld. CIT(A) in the AY 2008-09 4. The Revenue is now in appeal before us against the aforesaid findings of the ld. CIT(A). At the outset, the ld. DR while carrying us through the impugned order contended that the evaluation work assigned by the assessee to different coordinators, being technical i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance companies. The ld. CIT(A) while referring to submissions on behalf of the assessee concluded that the order passed by the Assessing Officer u/s 201 read section 194J of the Act erroneous. Inter alia, the learned CIT(A) observed that remuneration fixed as per letter dated 25th June, 2009 issued by the University was paid to the evaluation staff by the coordinator colleges out of advance/replenishment received by the coordinator colleges from the Meerut University. However, the respondent before us is CCS University and not Meerut University. The ld. CIT(A) further observed that the amount paid as advance/replenishment to the coordinator colleges cannot be considered at all as remuneration to the coordinator colleges and the guidelines issued by the University could not be considered as a contract between the University and coordinator colleges. As is apparent from a mere glance at the impugned order, the ld. CIT(A) did not record any findings on the applicability or otherwise of provisions of sec. 194J of the Act, which the AO specifically invoked in the instant case nor as to whether or not the nature of aforesaid payments fall within the meaning of fees for technical services ..... X X X X Extracts X X X X X X X X Extracts X X X X
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