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TMI Blog2013 (11) TMI 1237X X X X Extracts X X X X X X X X Extracts X X X X ..... tained in section 194I of the Act are applicable for plant & machinery or for land and building or land appurtenant to a building or , plant, equipment, furniture or fittings but as we have already observed in the earlier part of this order that cranes are not the plant & machinery as per the ratio laid down by the Hon'ble Gujarat High Court in the case of Gujco Carriers Vs. CIT (2002 (2) TMI 48 - GUJARAT High Court). Therefore, the provisions of section 194J of the Act were not applicable. - Decided in favor of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... f National Thermal Power Co. Ltd. vs. CIT [1998] 262 ITR 383 (SC). The learned CIT, D.R. did not object for the admission of the above additional ground. Therefore, the additional ground is admitted, although the assessee has already taken the same ground vide ground No. 1. 5. Ground No. 5 of this appeal is general in nature while the additional ground and ground No. 1 are correlated, in our opinion, no specific finding is required for these grounds as the same will be dealt while deciding ground nos. 2, 3 and 4. 6. Vide ground No. 2 and 3 of the appeal, the grievance of the assessee relates to the application of provisions of section 194J instead of 194C of the I.T. Act, 1961 (hereinafter referred to as the "Act") in respect of payments made to the contractors. 7. The Facts related to this issue, in brief, are that a survey u/s 133A of the Act was carried out on 4th and 5th March, 2009 at the business premises of the assessee. The A.O. observed that in the course of survey, it was found that during the financial year 2007-08 following payments were made by the assessee for obtaining technical services:- S.No. Name and Address of the contractor/ deductees Amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were covered in the exclusionary part of explanation (2) to section 9(a)(vii) of the Act on the ground that none of the deductees carried out any construction or assembling or mining or like projects for the assessee and no specific evidence to justify the claim made was furnished. The assessee for the above said contention placed reliance on the following case laws: 1. ITAT, Ahmedabad decision in the case of Gujarat State Electricity Corporation Ltd. Vs. ITO 82 TTJ 456 2. Sky Cell Communication Ltd. Vs. DCIT 251 ITR 53 (Mad) However, the Assessing Officer was of the view that the aforesaid decisions, relied by the assessee, were distinguishable on facts. The Assessing Officer held that the assessee ought to have deducted tax at source u/s 194J and not u/s 194C of the Act. He accordingly considered the assessee in default for a sum of ₹ 1,01,07,835/- for short deduction of tax u/s 201(1) of the Act and ₹ 25,84,605/- on account of interest thereon u/s 201(1A) of the Act. 8. Being aggrieved, the assessee carried the matter to learned CIT(A) and submitted that the assessee company is registered under the Companies Act, 1956 having its Registered office at Duliajan, Dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and unloaded on the trailers and trucks and assembled in the well site with the help of cranes (The contract was awarded to Choudhary Transport). Boring holes in the ground also required a lot more equipment and materials. The main amongst them were Casings (Steel Pipes), Drill Pipes (used for boring holes with external rotational force), Bits (conical earth-cutting device), Chemicals, and Cement etc. All these materials were transported by trailers and trucks (The contract was awarded to RR Enterprise) to the well site. Here also cranes (The contract was awarded to Choudhary Transport) were used for loading and unloading purposes. As soon as all materials were transported to the well site and the Rig was assembled, actual boring started. As the Bit attached to the Drill Pipes started cutting the earth with rotational force, the Bit and Drill Pipes slowly moved downwards. At this moment, Casings were lowered in the holes as the depth increased. Lowering of casings in the hole was done with the help of cranes (The contract was awarded to Choudhary Transport) and Rig Masts. Casings were lowered to prevent the earth from caving in. (b) Cementing Services: Cementing was done with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Preparation of logs on the basis of the data gathered during logging operation. 8. Interpretation of the log and report there on as to the existence or otherwise of Oil & Gas in the well. If presence of Oil & Gas was indicated then at what depth. 9. Perforation of well: Once, on the basis of the data gathered from logging operations, it was established the presence of Oil & Gas in the well, perforation was done. Perforation was making series of holes in the Casing to make ways for Oil & Gas to come out. (e) Man Management for Rig: Since, the company did not have the required manpower to operate and maintain the Rig, a Man Management Contract had been entered. The essential services under the contract included (This Contract was awarded to Mercantile Associates) - 1. Assembling of the Rig for drilling operation and dismantling of the Rig after completion of drilling. 2. Transportation of Rig materials 3. Operation of the Rig at the time of boring a hole. 4. Maintenance of the Rig. 5. Supply of required number of crews for Operation and Maintenance of the Rig. 6. Catering Services. (f) Man Management for Cementing: Since the company did not have the required ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of work on the field of exploration block of the assessee company and in accordance with the work executed as per their bills with the details of the work done by the respective contractors and the company paid after deduction of TDS u/s 194C of the IT Act. It was submitted that all the contracts were in connection with prospecting for, or extraction or exploration or production of mineral oils and were clearly covered by the exclusionary part, viz. consideration for any construction, assembly, mining or like project, excluded in the definition of "fees for technical services" given in Explanation 2 to clause (vii) of sub-section (1) of section 9 which indicates that the payments made to contractors for execution of mining contracts, by no stretch of imagination could be regarded as payment by way of fee for technical services as contemplated in section 194J of the Act. The reliance was placed on the following case laws: (i) Gujarat State Electricity Corporation Ltd, Vs. ITO, Ahmedabad 82 TTJ 456 (Ahd). (ii) Skycell Communication Ltd. & Anr. Vs. DCIT 251 ITR 53 (Mad.) (iii) CIT V/s Estel Communications (P) Ltd. 217 CTR 102 (Del.) [13] (iv) Pacific Internet (India) P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resumption was clearly contrary to the plain language of section 194C of the Act. The reliance was placed on the Circular No. 666 dated 8th October 1993 issued by the CBDT and the judgment of Hon'ble Supreme Court in the case of Associated Cement Company Vs. Commissioner of Income Tax 201 ITR 435 (SC). It was further contended that the Instruction No.1862 issued on 22/10/1990 by the CBDT explained the scope of mining or like project in respect of 'mining' or prospecting for, or extraction or production of mineral oil, which includes rendering of services like imparting of training and carrying out drilling operations for exploration or exploitation of oil and natural gas and the assessee was carrying on only such activities in the year under consideration. As such any payment connected with such drilling operation could not be treated as fee for technical services for the purpose of explanation 2 to the section 9(1)(vii) of the I.T. Act. The reliance was placed the following case laws: (i) ONGC (as representative assessee of Alberta Research Council, Canada) vs. Joint CIT Spl. Range, Dehradun 133 TTJ 0663 (DELHI) (ii) Geofizyka Torun Sp. Z. O. O., In Re 320 ITR 0268 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provision of services. The services were spelt out in detail in section II of the contract. The contractor was to provide experienced personnel for the services. The price schedule also mentioned payment of service charges. (2) Contract with Mercantile Associates dated 10.08.2005 was for man management services for operation and maintenance (page 65 of P.B.). Even in the definition clause of the contract the work had been defined to mean each and every activity required for the successful performance of the services described under this contract. The appellant was paying the deductee consideration for the provision of services. The services were spelt out in detail in para 7 of the contract. The contractor was to provide experienced personnel for the services (para 4.6). The price schedule also mentioned payment of mobilization charges. (3) Contract with Purvanchal Banijaya Vikas dated 31.05.2005 was for providing services for bulk handling plant and related services (page 108 of P.B.). Even in the definition clause of the contract the work had been defined to mean each and every activity required for the successful performance of the services described under this contract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee engaged contractor from time to time for different oilfield services, such as Seismic Survey, Hiring of Drilling Rigs, Wire-line Logging Services, Mud Logging Services, Hiring of Cranes, Transportation by Trucks/Trailers, Man Management Services, Cementing Services etc. towards achievement of its stated objectives of extraction of oil and gas. The learned counsel for the assessee also explained the various activities involved in mining of oil and gas, since we have already reproduced those in the former part of this order, as the same were submitted to the learned CIT(A) also, therefore, for the cost of repetition these are not reproduced herein. However, the learned CIT(A) had not given the details relating to step-4 i.e. production, which was explained by the learned counsel for the assessee in the following words: Step-4 Production: Once Oil or Gas is struck and perforation is done at the required depth, Oil or Gas comes out of the well (MINE) spontaneously. However, to maintain steady production or increase the production some activities are undertaken. The major activities undertaken in this regard include - (A) Installation of Oil Collecting Stations (OCS) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. It was also stated that neither in the case of the assessee nor in the case of other Oil Companies, different view had ever been taken by the tax authorities and even the Assessing Officers assessing for various years as well as the statutory auditors and tax auditors have found due compliance of the provisions of tax deductions at source. It was contended that the Assessing Officer created a huge arbitrary, illegal, unjustified and unsustainable demand but collected coercively in order to meet its revenue collection target. It was further contended that the DCIT (TDS) invoked the provisions of section 194J of the Act by treating payments made to the contractors as Fees for Technical Services as against tax deductible and deducted at source u/s 194C of the Act on the payments made for execution of works contracts in connection with prospecting for, or extraction or exploration or production of mineral oils (Contract for Mining Activities) against circular/clarification of C.B.D.T. and binding precedents submitted before him. It was pointed out that the Assessing Officer failed to follow the decision of the Hon'ble Supreme Court in the case of Associated Cement Co. Ltd. Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... execution of the said work, however, ignored this vital fact that such employees were employees of the contractors and without the contractors, the assessee could not have been able to execute different step in the mining work. The learned counsel for the assessee also referred to circular No. 202 dated 05/07/1976 and submitted that the said circular reveals that as per section 44AB of the Act, presumptive income in case of non-resident engaged in the business of providing services or facilities in connection with or supplying plant and machinery on hire, used, or to be used, in the prospecting for or extraction or production of mineral oils, shall be determined equal to 10% of the amount paid or payable to the assessee for such services and that the expression "mineral oil" includes petroleum and natural gas and these expressions have been defined in section 9(1)(vii) of the Act read with Explanations thereof, for which Departmental Circular No. 202 dated 5th July, 1976 stands issued. It was emphasized that a plain reading of Explanation 2 to section 9(1)(vii) defining fees for technical services clearly shows that consideration received for any construction, assembly, m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (AAR) (iii) DCIT vs. ONGC as agent of Foramer France [2009] 70 ITD 468 (Delhi) (iv) ACIT, Circle-1, Dehradun vs. Paradigm Geophysical Pty. Ltd. [2010] 122 ITD 155 (vi) Seabird Exploration FZ LLC. In Re [2010] 320 ITR 26 (AAR) It was argued that the scope of section 194C of the Act is very wide and it applies to all types of contracts for carrying out any work including transport contracts, services contracts, labour contracts, material contracts and works contracts, except what has been specifically excluded but the Assessing Officer as well as the learned CIT(A) wrongly assumed as if section 194C applies only to simple work contract. The said presumption was clearly contrary to the plain language of section 194C and judgment of the Hon'ble Apex Court in the case of Associated Cement Company V/s Commissioner of Income Tax (1993) 201 ITR 435 (SC). It was also stated that the CBDT has issued various circulars from time to time to explain the wide meaning and scope of section 194C of the Act. It was submitted that the assessee had rightly deducted tax at source as per provisions contained in section 194C of the Act from payments made to all the concerned contractors since beg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rendering services for Oil India Ltd. such as hiring wire line logging, perforation and data processing services having adequate experience in logging, data processing and perforation services to provide the service for the fields in Rajasthan in open and cased hole logging, perforation, data processing and related services. Apart from this, company has also carried out services of Natural Gamma Ray services, Gamma ray Spectroscopy Services, Side wall core sampling services with gamma ray positioning, Stonley wave travel time with standard spacing of transmitter & receiver, Borehole Seismic services for vertical seismic profiling, Tool for high resolution bore hole images using micro electric arrays, Formation pressure measurement, Cement Bond evaluation services etc. etc. 2. M/s Mercantile Associates, Dibrugarh (Assam):- Company has provided Man-Management Services for an initial period of two years to Company for drilling of approximately fifteen (15) On-Shore oil/gas wells by deploying one number newly acquired (Company owned) 1000 HP Mobile Diesel Electrical Drilling Rig having two Power Packs for the SCR Module to power the mud pumps solid control equipment and other ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oration Blocks in Rajasthan prior to seismic survey, drilling of twenty exploratory wells and production testing of these wells. Environment Impact Assessment study includes collection of Primary and secondary baseline data through field investigations, environmental monitoring and from secondary sources viz; maps, Reports and scientific literature etc. The collected data then be analyzed for identification of impacts and arrive at cost effective mitigation measures. The overall activities includes potable water monitoring in the vicinity, Air pollution quality monitoring, Flora and Fauna in the area, if any, Socio-economic study, Source of air pollution. Source of water pollution. 12.1 The learned CIT, D.R. also gave a write-up on the analysis of nature of services, which reads as under: "From the above details it is clear without any doubt that all the impugned contracts were not ordinary contracts. It is so because all the activities required to be performed as per these contracts involved technical knowledge and expertise. The operations of the company in Rajasthan are not ordinary operations. Being one of the very few players the field of highly technical job of oi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the operation and all maintenance work required for the bulk Handling Plants, Compressors (specifications of the compressor: Atlas Copco make air compressors; Model - VI 250, capacity 250 to 300 CFM, W.P. 40 psi, run by parking P6-354 diesel engine), storage silos and their accessories. Exploroil Tech has rendered services of mud engineering through qualified and trained mud engineers having minimum qualification and experiences they carried out the work of mud engineering at well site as per international standards. Viewed in this context one can easily understand that the works like man-management services, mud engineering services, services of various operational crews, services of electrical engineers, rig electricians, radio operators, instrumentation technicians, mechanical engineers etc. etc. for which the aforesaid contracts were made by the company, cannot be termed as non-technical or simple work contracts by any stretch of imagination. It is so because all these services required a very high degree of technical knowledge, expertise and skill from the side of the contractors. The contention of assessee company that its case is covered in the exclusionary part of E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 194C of the Act. In the present case, we have to analyze as to whether the provisions contained in section 194C of the Act were applicable or not. The provisions contained in section 194C of the Act read as under: "194C. (1) Any person responsible for paying any sum to any resident (hereafter in this section referred to as the contractor) for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and a specified person shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to-- (i) one per cent where the payment is being made or credit is being given to an individual or a Hindu undivided family; (ii) two per cent where the payment is being made or credit is being given to a person other than an individual or a Hindu undivided family, of such sum as income-tax on income comprised therein. (2) Where any sum referred to in sub-section (1) is credited to any account, whether called "Suspense account" or by any other name, in the book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both; or (g) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any law corresponding to that Act in force in any part of India; or (h) any trust; or (i) any university established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a university under section 3 of the University Grants Commission Act, 1956 (3 of 1956); or (j) any Government of a foreign State or a foreign enterprise or any association or body established outside India; or (k) any firm; or (l) any person, being an individual or a Hindu undivided family or an association of persons or a body of individuals, if such person,-- (A) does not fall under any of the preceding sub-clauses; and (B) is liable to audit of accounts under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such sum is credited or paid to the account of the contractor; (ii) "goods carriage" shall have the meaning assigned to it i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation in the tax law. Indeed in the sub-section, the 'work' referred to therein expressly includes supply of labour to carry out a work. It is a clear indication of legislature that the 'works' in subsection is not intended to be confined to or restricted to 'works contract'. 'Work' envisaged in the sub- section, therefore, has a wide import and covers 'any work' which one or the other of the organizations specified in the sub-section can get carried out through a contract under a contract and further it includes obtaining by any of such organizations supply of labour under a contract with a contractor for carrying out its work.. Therefore a person who credits to the account of or pans to a contractor any sum payable by any of the organizations specified in s. 194C(1) for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and the specific specified organization is liable to deduct two per cent of such sum as income-tax as required under that sub-section." 13.2 From the ratio laid down in the aforesaid decision, it is clear that the work envisaged in section 194C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Attorney General has opined that such operations are mining operations and the expressions 'mining project' or 'like project' occurring in Explanation 2 to section 9(1) (vii) of the Income tax Act would cover rendering of services like imparting of training and carrying out drilling operations for exploration or exploitation of oil and natural gas. 3. In view of the above opinion, the consideration for such services will not be treated as fees for technical services for the purpose of Explanation 2 to section 9(1)(vii) of the Income-tax Act, 1961. Payments for such services to a foreign company, therefore, will be income chargeable to tax under the provisions of section 44BB of the Income-tax Act, 1961 and not under the special provision for the taxation of fees for technical services contained in section 115A read with section 44D of the Income-tax Act, 1961." 13.4 In the above said instruction, at para 2, it is made clear that prospecting for, or extraction or production of, mineral oil can be termed as 'mining' operations and the expressions 'mining project' or 'like project' occurring in Explanation 2 to section 9(1)(vii) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... following types, namely: (i) Any consideration received for any construction, assembly, mining or like project undertaken by the recipient. Such consideration has been excluded from the definition on the ground that such activities virtually amount to carrying on business in India for which considerable expenditure will have to be incurred by a non-resident and accordingly it will not be fair to tax such consideration in the hands of a foreign company on gross basis or to restrict the expenditure incurred for earning the same to 20 per cent of the gross amount as provided in new s. 44D of the IT Act. Consideration for any construction, assembly, mining or like project will, therefore, be chargeable to tax on net basis, i.e., after allowing deduction in respect of costs and expenditure incurred for earning the same and charged to tax at the rates applicable to the ordinary income of the non- resident as specified in the relevant Finance Act." (Emphasis supplied by us) 13.8 From the above circular, it is clear that any mining or like project undertaken by the recipient, the expression 'fees for technical services' is not applicable. On the basis of above, it can be sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the year under consideration are similar to the facts involved in the earlier years wherein the Department had accepted the tax deducted at source u/s 194C of the Act, so keeping in view the principle of consistency also, the Assessing Officer was not justified in deviating from the earlier stand. It is although well settled that "res judicata" is not applicable in the income tax proceedings since each and every assessment year is separate and independent year however, the principle of consistency is to be maintained when the facts are identical. We, therefore, considering the totality of the facts of the present case as discussed herein above, are of the view that the learned CIT(A) was not justified in confirming the action of the Assessing Officer. In that view of the matter, the impugned demand u/s 201(1) and 201(1A) raised by the Assessing Officer and confirmed by the learned CIT(A) is deleted. 14. Vide ground No. 4 the grievance of the assessee relates to the application of provisions of section 194I of the Act instead of section 194C with respect to payments made to contractors for hiring of crane. 15. The facts related to this issue, in brief, are that the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned CIT(A) and submitted that there was no discussion about the payments made to M/s R.R. Enterprises in the order passed u/s 201/201(A) on the amount paid to the said party which had only been included in Annexure-A of the said order while computing the alleged short deduction and interest thereon. As regards to the payment made to M/s Choudhary Transport, it was stated that the same was covered u/s 194C only since those contracts clearly revealed that the work of lifting, loading, transportation, unloading of heavy goods was entrusted to the said contractors and the work of operation, maintenance etc. of the cranes was also the responsibility of the said contractors. It was further stated that the operator and crew were also provided by the said contractors, therefore, the contract clearly came within the definition of work of carriage of goods by any mode of transport other than by railways, which was specifically covered within the definition of expression 'work' given in section 194C of the Act. It was pointed out that the provisions contained in Explanation (ii) below section 194C(7) provided that "goods carriages" shall have the same meaning assigned to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iterated the submissions made before the authorities below. It was further submitted that the copies of contracts executed with the parties for hiring of diesel hydraulic trucks mounted mobile cranes with operators and crew, revealed that the work of lifting, loading, transportation and unloading of heavy goods was entrusted to the said contractors and the work of operation, maintenance etc. of the cranes was also the responsibility of the said contractors. It was stated that the operator and crew were also provided by the said contractors, therefore, such contracts clearly come within the definition of work of carriage of goods by any mode of transport other than by railways, which was specifically covered within the definition of expression 'work' given in section 194C of the Act. It was stated that the provision contained in Explanation (ii) below section 194C(7) provides that "goods carriages" shall have the same meaning assigned to it in Explanation to sub-section (7) of section 44AE of the Act. It was stated that the truck with Cranes were "heavy goods vehicle" and not "machinery". The reliance was placed the following case laws: (i) M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds or passengers as envisaged in Explanation-III to section 194C of the Act. It was pointed out that these cranes required specific parameters of the lifting capacity and operating radius of the cranes etc. making it obvious that the impugned contracts were for hiring cranes only. The reliance was placed the decision of Hon'ble Madras High Court in the case of CIT vs. Shri Ram Transport Finance Co. Ltd. [2002] 254 ITR 558. 19. It was also pointed out that the ITO, TDS ward 51(6), New Delhi had issued a certificate u/s 197/194I of the Act to M/s Choudhary Transport on 30/06/2008. As per this certificate for the Financial Year 2008-09, the tax at source was to be deducted @ 0.30% plus surcharge and cess as applicable in respect the payments being made to this concern. It was further stated that the said certificate was effective between 24/06/2008 to 31/03/2009 and the Assessing Officer clearly mentioned that the payments to M/s Choudhary Transport were in the nature of rent and were accordingly covered u/s 194I of the Act which was sufficient to prove without any doubt that the payment made for hiring of cranes were covered u/s 194I of the Act. Neither the payees nor the compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e part of the load on the boom and thereby, prevent the entire crane from overturning while carrying the load. A mobile crane mounted on a truck constitutes a single unit known as "truck crane" which is adapted for use on roads for special services. The trucks on which the crane is mounted is constructed and adapted specially to carry the crane. "Goods carriage" as defined in section 2(14) of the Motor Vehicles Act, 1988, means any motor vehicle constructed or adapted for use solely for the carriage of goods, or any motor vehicle not so constructed or adapted when used for the carriage of goods. Unloading in the context of truck crane where the crane remains mounted and attached to the truck when carried and even at the destination where it is put to use is not a relevant factor at all. Though not required to be loaded or unloaded like other goods transported in carriage of freight, the crane remains fixed, mounted on the truck which has been adapted for use solely for its carriage and such truck crane is used for the special service of lifting and moving heavy objects. This is why such a mobile crane is registered as a heavy motor vehicle which is a heavy goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee made a payment of ₹ 27,02,003/- to the aforesaid society towards providing security services on contracts basis. The Assessing Officer noticed that in the course of survey it was found that for part of the year the assessee company had not deducted tax at source on this payment. On enquiry the assessee replied to the Assessing Officer that ITO, ward 1(1) Udaipur had issued a "No Deduction Certificate" to the payee society on 10/06/2003 and accordingly when the payee submitted this certificate, in later part of the financial year, tax was not deducted on the payments made to it. The Assessing Officer observed that copy of the said certificate issued on 10/06/2003 did not mention the period for which it was applicable. When it was pointed out to the assessee, it was stated that since there was no period mentioned in the said certificate, it was presumed that it was effective for the Financial Year under consideration. The Assessing Officer enquired from ITO, Ward 1(1), Udaipur who informed that for Financial Year 2005-06 and 2006-07 also "No Deduction Certificate" were again issued to the aforesaid society. However, he could not confirm that for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were later in time prescribed the validity period and the earlier certificate, i.e. issued on 10/06/2003 is superseded by the later certificates issued for Financial Year 2005-2006 and 2006-2007. The learned CIT(A) pointed out that no other certificate could be furnished by the assessee for the year under consideration, he, therefore, confirmed the action of the Assessing Officer. 26. Now the assessee is in appeal. The learned counsel for the assessee reiterated the submissions made before the authorities below and further submitted that the assessee furnished the certificate dated 08/05/2008 for non deduction of tax issued by the Assessing Officer which was valid up to 31/3/2009 and related to the society whose income was exempt u/s 80P of the Act, therefore, the action of the Assessing Officer in considering the assessee as "assessee in default" for the payment of the impugned amount was not justified and that the learned CIT(A) without considering the facts of the case in right perspective confirmed the action of the Assessing Officer. Reliance was placed on the following case laws: - CIT Vs. Rishikesh Apts. Co-Operative Housing Society Ltd. (2002) 253 ITR 310 (Guj.) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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