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TMI Blog2014 (1) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... nt car/travel agents, as it appears, are independent contracts for car rental services, being entered into by it in accordance with the needs of its business - the assessee is hiring the cars therefrom on his own account for a cost - As far as the vendors are concerned, they are only providing cars for a hire to the assessee, which could include the services of the driver as well. It cannot be said to be a case of sub-contract – Following Mythri Transport Corporation v. Asst. CIT [2009 (1) TMI 337 - ITAT VISAKHAPATNAM] - prior to its substitution by Finance (No.2) Act, 2009 w.e.f. 01/10/2009, the hiring of vehicles by a contractor for his own use in executing the contracts undertaken by him, is not a case of sub-contract/s, so as to attract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re incurred. The hiring cost, where paid at a minimum of Rs.50,000/- to a single party during the year, worked to Rs.134.61 lakhs. As no tax at source stood deducted by the assessee in respect of these payments, the Assessing Officer (A.O.), invoking the provision of section 40(a)(ia), disallowed the same, assessing the income at Rs.155.96 lakhs, as against the returned income of Rs.21.34 lacs (vide return of income filed on 29.10.2007). The same having been confirmed in appeal, the assessee is in second appeal before us. 4.1 Before us, at the very outset, it was submitted by the ld. AR, the assessee's counsel, that the amendment to section 194C(1), extending the ambit of the provision to qualifying individuals, HUFs, etc., i.e., whose tot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicability of section 194C(1), stands made out by the assessee before the Revenue authorities, with it being the accepted position that the said section was applicable, and the assessee pleading its case before them on the basis that the hiring of taxis by him did not amount to a contractual payment, and which stood not accepted inasmuch as the assessee had engaged the services for the transportation of passengers, and which was clearly in pursuance to a contract, albeit oral, falling within the ambit of section 194C, as transportation of passengers by any mode (other than by railways) constitutes 'work' within the meaning of the said section. 5. We have heard the parties, and perused the material on record. 5.1 Even as expressed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntracts for car rental services, being entered into by it in accordance with the needs of its business. As and when it falls short of cars, the same are arranged from the market, and which would though definitely be from known and regular sources. A case of sub-contract, on the other hand, would be where it off loads a part (defined) of the contract work, i.e., transportation of passenger/s by car, to the other vendor/s, while in the instant case the assessee is hiring the cars therefrom on his own account for a cost. As far as the vendors are concerned, they are only providing cars for a hire to the assessee, which could include the services of the driver as well. As such, it cannot be said to be a case of sub-contract, even as explained b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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