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TMI Blog2015 (12) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes of section 194-I of the Act. In our view it would be in appropriate to consider the payment of berth charges as rent simplicitor, and rather the same is being paid for a host of other services when the vessels are anchored at the Port area. Therefore, assessee has rightly deducted the tax at source on berth hire charges paid to Mumbai Port Trust in terms of section 194C of the Act as contractual charges - Decided in favour of assessee. - ITA No.7017/MUM/2013, ITA No.7018/MUM/2013 - - - Dated:- 31-8-2015 - SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER For The Assessee : Shri Harsh Shah For The Revenue : Shri Akhilendra Yadav ORDER PER G.S.PANNU, A.M: The captioned are two ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 2009-10 2010-11 Berth Hire Charges paid by appellant to Mumbai Port Trust 3,83,90,778/- 4,87,94,451/- 9,85,86,223/- TDS Deducted by assessee applying rate prescribed u/s 194C 3,95,425/- 13,21,571 19,77,576/- Amount of TDS as per AO applying rate prescribed u/s 194I 7,90,850/- 25,12,914 27,81,281/- Shortfall in deduction of taxes and assessee u/s 201(1) 3,95,426/- 11,91,243 8,03,704/- Interest u/s 201(1A) of the act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, therefore, the said order of the CIT(A) for assessment year 2009-10 be approved. 6. On the contrary, Ld. Departmental Representative has reiterated the order of the CIT(A) for assessment years 2008-09 and 2010-11, where the berth hire charges have been construed to be in the nature of rent so as imply deduction of tax at source under section 194-I of the Act. 7. We have carefully considered the rival submissions. Notably, the Hon ble Supreme Court in a recent decision in the case of Japan Airlines Co. Ltd. Vs. CIT, (2015) 60 taxmann.co 71(SC) has disproved the judgement of the Hon ble Delhi High Court in the case of United Airlines (supra) and has instead approved the contrary view rendered by the Hon ble Madras High Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... substance behind such charges. When matter is looked into from this angle, keeping in view the full and larger picture in mind, it becomes very clear that the charges are not for use of land per se and, therefore, it cannot be treated as 'rent within the meaning of Section 194-1 of the Act. 22. We, therefore, are of the considered opinion that the view taken by the Madras High Court is correct and we are unable to subscribe to the view taken by Delhi High Court in United Airlines case. The judgment in United Airlines case as well as the impugned judgment of the Delhi High Court are accordingly over-ruled. 7.1 In our considered opinion, the parity of reasoning laid down by the Hon ble Supreme Court in the case of Japan Airli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc. Proportionate Salvage Underwater repairs expenses Proportionate Dredging Marine survey expenses Expenses on Pollution control Operational Maintenance Electric wharf cranes up to 6 tone at ID 13 ton electric wharf crane Supervision general expenses Water supply to shipping docks The above cost elements display a very clear picture of the real services provided by Mumbai Port Trust. Thus, as displayed above it is not a case of rent services, but a composite contract entered into for various port services for which charges including berth hire charges to be paid. The above cost element annexure is enclosed alongwith the below referred letter dated 19th April 2010 from Mu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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