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TMI Blog2015 (7) TMI 360X X X X Extracts X X X X X X X X Extracts X X X X ..... n question can be termed as a rent. Accordingly, we see no reason to interfere in the order of ld. CIT(A) in deleting the addition on account short deduction as also the interest charged u/s 201(1)/201(1A). - Decided against revenue. - ITA Nos. 5267 & 5268/Del/2013, ITA Nos. 4933 & 4934/Del/2013 - - - Dated:- 29-4-2015 - S. V. Mehrotra, AM And H. S. Sidhu, JM,JJ. For the Appellant : Shri Mohinder Rajpal (Manager Taxation) For the Respondent : Shri B R R Kumar Sr. DR ORDER Per S V Mehrotra, AM. These are cross appeals, preferred by the revenue as well as by the assessee, against separate orders passed by the ld. CIT(A), Noida relating to A.Y. 2008-09 2009-10. ITA no. 5267 /Del/2013 (Revenue's appeal): ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hired buses from various transporters and while making payment of hire charges to such concerns, assessee had deducted tax u/s 194C of the I.T. Act @ 2%. The AO was of the opinion that in view of the amended provision of section 194I of the I.T. Act w.e.f. 1-4-2008 to 31-03-2009 tax was to be deducted @ 10%. It was found in course of proceedings that assessee had made payments for vehicle hiring charges for the FY 2007-08 and 2008-09. The assessee in its reply, inter alia, submitted that for the transportation of the employees of the company, the company had entered into contracts with various contractors for transportation of employees to/from various locations to factories situated in various locations in Noida. The AO, after considering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e he will be considered as tenant. In the instant case, exclusive possession of the buses vehicle hired were given to the assessee and hence section 194-I is applicable on the entire payments. Besides, it is also pertinent to mention here that the assessee, being the hirer was not only in exclusive possession of the vehicle, but could also use them in the manner it wanted and no other person could use them during the tenancy period. 4. He, accordingly, determined the short deduction u/s 201 along with interest u/s 201(1A) as under: Amount of vehicle hiring charges TDS u/s 194C @ 2.2666% TDS u/s 194-I 10.3% Short Deduction u/s 194-I Defaults in months w.e.f. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attracted for the following reasons: (a) The agreements/ contracts entered by the assessee with the transport service providers were primarily in the nature of transport contract/ service contract for pick and drop facility of employees to/ from work place (office/ factory) to their homes and not for hiring of the vehicles. (b) Section 191-I refers to plant machinery used by the assessee in its business by hiring them but not hiring a transport service. (c) Explanation III to section 194C of the Act defines work to include carriage of goods and passengers by any mode of transport other than by railways . The activity of transport contractors was a simple activity of carriage of its employee by way of mode of transport other th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised: 1. The CIT(A) has erred in law and on facts in deleting the addition of ₹ 5,16,997/- on account of short deduction and ₹ 1,55,099/- on account of interest thereon and in directing that provisions contained in section 194C is applicable on the payment made by assessee for hiring of buses, ignoring the fact of the case that the deductor company is liable to deduct the tax u/s 194 I at the rate of 10% for hiring of buses in view of amendment made u/s 194 I w.e.f. 01-06-2007. 2. The CIT(A) has erred in law and on facts in deleting the addition of ₹ 5,16,997/- on account of short deduction and ₹ 1,55,099/- on account of interest thereon without appreciating the fact that the hired vehicles were covered under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at we are deducting tax at source (TDS) as per the Act on the basis of the earnings available in a particular month. The total earnings vary due to various payments being made in between during the financial year, such as - Regular increment in the month of July for the employees who have joined in the months of April to June. Special increment being given to the employees time to time. Leave encashment Full and final settlement New joining. 11. The AO computed the interest leviable u/s 201(1)/201(1A) by considering the average rate of TDS at ₹ 3,56,988/- for AY 2007-08 and average rate of monthly TDS was taken at ₹ 3,95,154/- for FY 2008-09. He accordingly computed the interest leviable u/s 201(1)/201(1A) at ..... X X X X Extracts X X X X X X X X Extracts X X X X
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