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TMI Blog2016 (11) TMI 879X X X X Extracts X X X X X X X X Extracts X X X X ..... for service are that the contractor is free to choose the means of performing the contract and no relationship of subordination exists between the contractor or the provider of services and the client in respect of such performance. In the instant case before us the ld. DR has not brought anything contrary to the findings of ld. CIT(A). In our considered view the wages in the instant case are covered under section 192 of the Act. Therefore the provisions of section 194C are not applicable. In the instant case the payment has been made to the employees of the assessee. In view of above we do not find any reason to interfere in the order of ld. CIT(A). - ITA No. 559/Kol /2013 - - - Dated:- 21-10-2016 - Shri Waseem Ahmed, Accountant Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case is an individual and engaged in business of contracting. Assessee for the year under consideration has filed its return of income disclosing income at ₹ 8,18,250/- comprising of profit under the head business and profession . Subsequently the case was selected for income escaping assessment u/s 147 of the Act and accordingly notice u/s. 148 of the Act was issued upon assessee. The assessment was framed u/s. 147/144 of the Act at a total income of ₹ 98,82,470/- by making certain disallowances. During the course of assessment proceedings, AO observed that assessee has paid labour charges amounting to ₹ 89,64,219/- without deducting TDS. Therefore, said expense was disallowed under the head profession of Sec. 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attract provisions of sec. 40(a)(ia) r.w.s 194C(2) of the Act. therefore, the labaour charges claimed were nothing but wages paid to the employees as the cost of labour and in such circumstances, there is no scope to invoke provisions of sec. 40(a)(ia) of the Act. That being so, the disallowance made by the AO u/s 40(a)(ia) of the Act is deleted and the AO is directed to allow the claim of the assessee in respect of expenditure of rs.89,64,419/- incurred on payment of wages to labourers. Ground No.1 of this appeal is thus allowed. Being aggrieved by this order of Ld. CIT(A) Revenue is in appeal before us. 4. Before us Ld. DR submitted that labourers are not employees of assessee and in none of the case, no employment letters have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ern the formation of the contract of employment. A contract of employment is a contract by which a person, the employee, undertakes for a limited or indeterminate period of time to do work for remuneration according to the instructions and under the direction or control of another person, i.e the employer. Within the framework of a contract of employment, a person carries out the service of work, receives remuneration and the work is carried out according to the direction and control of the employer. The terms of the contract may be either in writing or given orally, but both are equally binding and enforceable. When a person is hired to be an employee, the person enters into a contract of service, which is an employer/employee relationship ..... X X X X Extracts X X X X X X X X Extracts X X X X
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