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TMI Blog2012 (10) TMI 887X X X X Extracts X X X X X X X X Extracts X X X X ..... contractors. Accordingly, summons u/s. 131 of the IT Act was issued to the assessee/deductor requiring to furnish the details of TCS pertaining to parking lots. The AO after considering the reply of the assessee and the details noted that the provisions of section 206C(1C) are applicable for the purpose of deduction of TCS in respect of parking lots because the person who is granting parking lots is responsible for collecting tax at source and in this case, the Financial Controller of Agra Development Authority (ADA) has defaulted by not collecting tax at source. The AO noted the details of defaulted amounts of TCS with interest at page 6 & 7 of the order dated 21.01.2009 passed for all the assessment years and raised total demand of Rs. 4,62,841/- against the assessee. The break up is noted therein that for F.Y. 2006-07 demand of Rs. 1,02,141/- (80640 TCS + 21502 interest) was raised and demand of Rs.2,88,337/- (251185 TCS + 37157 Interest) was raised for F.Y. 2007-08 and demand of Rs.72,362/- (67890 TCS + 4472 Interest) was raised for F.Y. 2008-09. The assessee challenged the combined order raising the above demands by the AO before the ld. CIT(A). The ld. CIT(A) considering the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the purpose of business shall, at the time of debiting of the amount payable by the licensee or lessee to the account of the licensee or lessee or at the time of receipt of such amount from the licensee or lessee in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, collect from the licensee or lessee of any such licence, contract or lease of the nature specified in column (2) of the Table below, a sum equal to the percentage, specified in the corresponding entry in column (3) of the said Table, of such amount as income-tax: TABLE Sl. No. Nature of contract or licence or lease, etc. Percentage (1) (2) (3) (i) Parking lot Two per cent (ii) Toll plaza Two per cent (iii) Mining and quarrying Two per cent. Explanation 1.- For the purposes of this sub-section, "mining and quarrying" shall not include mining and quarrying of mineral oil. Explanation 2.- For the purposes of Explanation 1, "mineral oil" includes petroleum and natural gas.] (6) Any person responsible for collecting the tax who fails to collect the tax in accordance with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT(A) that the assessee was responsible for making TCS from the persons with whom a contract has been entered into for parking lots as was admitted in the written submissions dated 25.03.2010. The ld. counsel for the assessee, however, submitted that though auction was held of parking lots, but no contract was executed in terms of auction and the contractors did not sign any contract and continued to charge parking charges. Therefore, the provisions of section 206C(1C) would not apply to the case and further for applicability of these provisions, the contract should also be registered. He has further submitted that specimen copy of the auction has been filed in the paper book. Therefore, in absence of any contract executed between the assessee and the contractor, the demand should not have been raised against the assessee. We do not agree with the submissions of the ld. counsel for the assessee. It is admitted fact that the assessee auctioned parking lots to the contractors and consideration has been received as is mentioned in the impugned order for use of the parking lots. According to section 2(h) of the Indian Contract Act "an agreement enforceable by law is a contract". Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the paper book to show that once no proper notice has been issued, the proceedings are liable to be cancelled. We do not agree with the submissions of the ld. counsel for the assessee because during the course of survey conducted in the case of assessee, specific instances were found to show that the assessee has allotted parking lots to different contractors and the assessee has not collected tax at source. The details were called for from the assessee, but the assessee instead of giving complete details filed an evasive reply and adopted delaying tactics. Thereafter, the AO issued letters to the assessee (PB-1 & 2) as referred to by the ld. counsel for the assessee in which the AO called for the specific details as per provisions of section 206C of the IT Act. It would mean that the AO initiated proceedings against the assessee u/s. 206C of the Act for taking action against the assessee. May be on the top of notices, the survey proceedings have been mentioned but the contents of the notice (PB-1 &2) clearly specified that the AO intended to proceed against the assessee u/s. 206C of the Act and for the same purpose the explanation of the assessee was called for. The purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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