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TMI Blog2014 (1) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee itself has not utilized the buses being plants but they were used by the transport contractor for fulfilling the obligations set out in the contract agreement - the provisions of Sec. 194 I could not be applied and the assessee has rightly deducted tax at source under the provisions of sec. 194C of the Act – Decided against Revenue. - ITA Nos.4878 & 4879/DEL/ 2012 - - - Dated:- 24-5-2013 - Shri U. B. S. Bedi And Shri T. S. Kapoor,JJ. For the Petitioner : Shri Sanjeev Kavatra, CA, For the Respondent : Mrs. Y. Kakkar, Sr. DR. ORDER Per Bench:- These are two appeals filed by the Revenue against the order of the Commissioner of Income Tax (Appeals), NOIDA dated 14.06.2012 for the assessment years 2008-09 2009-10. Similar grounds of appeals has been taken in both the appeals and main grievance of the Department is that assessee was required to deduct TDS under the provisions of section 194 (I) and CIT(A) has wrongly allowed relief to the assessee. For the sake of convenience the grounds of appeal as appearing in assessment year 2008-09 are reproduced below:- "1.1 The CIT (A) has erred on facts and in law in canceling the order dated 14.06.2012 passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4(i) and as per provisions of section 194(c). 3. Aggrieved with the order, the assessee filed appeal before CIT (A) and reiterated its submissions before the CIT (A). Complete provisions of section 194(i) were explained and on the basis of provisions it was argued that assessee was required to deduct the tax u/s 194 (c) which it had deducted correctly and deposited within time. The assessee also relied upon certain case laws, which were in favour of assesee. After going through the submissions made by assessee. The Ld. CIT (A) decided the matter in favour of assessee by holding as under: "1. From a careful perusal of copies of Transport Contracts entered into by the assessee with the different transporters/ contractors and placed on record by the appellant it is found that the contract has been awarded to various transporters for transportation of students to/ from school. The contract is on a per trip basis for specified route. The rates per trip are frozen for a period of one year. The vehicle i.e. the school bus remains in possession of the transporter and the staff required to operate the vehicle is also engaged by the transporter. All costs incurred for running and mainten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TDS) Noida 46 SOT 77 (Delhi) (URO) b) Ahmedabad Urban Development Authority vs. Assistant CIT 46 SOT 75 (Ahmedabad) (URO c) ACIT (TDS) vs Accenture Services Pvt. Ltd. 44 SOT 290 (Mumbai) d) ITO vs Indian Oil Corporation 15 Taxmann. com 210. Delhi ITAT Identical issue has been decided by the Delhi ITAT in ITA No.3254 3255/ Del/2010 in the case of Lotus Valley Education Society Vs. ACIT (TDS) Noida in favour of the assessee by holding that provisions of sec 1941 could not be applied in the case of transportation contracts for transportation of school children. In the case of Ahmedabad Urban Development India vs. ACIT TDS Circle Ahmedabad (ITA No. 1637/AHD/2010) similar issue concerning rate of TDS to be deducted on hiring of cars was decided. The contention of the revenue was that provisions of sec 1941 are applicable whereas the assessee argued that it was the contract for hiring of vehicles and therefore TDS was to be deducted u/s 194C @ 2%. The dispute was decided by the ITAT in favour of the assessee. In the case of ACIT vs. Accenture Service Pvt. Ltd. (ITA No. 5920,5921 5922/ Mumbai/2009) the dispute involved pertained to applicability or otherwise of the provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not under 1941. In the light of the above and relying on the decisions of case laws cited by the appellant and discussed above, I reject the AO's action in invoking provisions of sec 194-1 and hold that in the appellant's case, in respect of the payments made to the transport operators/ constructors, the provisions of section 194C are applicable. Accordingly, the grounds taken by the appellant on this score succeed." 4. Aggrieved, the Revenue is in appeal before us. At the outset, the Ld. DR submitted that case of the Revenue is against them and it is covered by various decision of ITAT which were dealt by CIT (A) in his order. Hoever, he relied upon the order of AO. The Ld. AR supported the order of CIT(A). 5. We have heard the rival parties and have gone through the material placed on record. We observe that issue is squarely covered against the Revenue in various cases decided by Hon'ble ITAT. The facts and circumstance of the present cases are similar to the facts and circumstances of the case law in the case of Lotus Valley Education Society Vs. ACIT (TDS), which was decided by Delhi Bench in ITA No.3254 3255 /Del/2010. It contents at page 37 of the said order vide p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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