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TMI Blog2017 (9) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... : - "1. On the facts and in the circumstances of the case and in law, the learned Commissioner of income-tax (Appeals) grossly erred treating the appellant to be an assessee in default' u/s. 201(1) and confirming the addition of Rs. 10,50041/- u/s. 201(1) along with interest u/s 201('IA) of the Income Tax Act, 1961(ITA), by holding that TDS on payment to Full Time Consultants (FTCs) was to be withheld u/s 192 of the ITA as against deduction u/s 194J of the ITA by the appellant." 3. Briefly stated facts are that the assessee is a charitable trust running hospital and research centre in Mumbai. The assessee is taking services from three type of doctors (1) Resident Doctors who are as employees of the assessee Trust on salary basis (2) full time consultant doctors (3) Honorary consultant doctors. There is no disputed on deduction of TDS under section 192 and 194J of the Act in respect of payment made to Resident doctors and Honorary consultant doctors. The issue in dispute is that the payment to full time consultant and wherein the assessee is deducted TDS under section 194J of the Act as against the view of the Revenue that the TDS is to be deducted under section 192 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ltant doctors. Aggrieved assessee in second appeal before Tribunal. 5. Before us the learned Counsel for the assessee, argued that the assessee appointed certain doctors who draw their fees based upon the patients treated by them (physiotherapist etc.) and on other times based upon time spent on the duty which is normally an 8 hourly duty. As per the understanding of these independent professional doctors with the assessee hospital, it is agreed upon by them that they would receive their professional fees when the patients pay the same or on monthly basis. These independent doctors are not prohibited from practicing on their own. They are neither entitled to any retirement benefits, nor to any provident fund, gratuity, leave encashment etc. which are available to the employees of the assessee hospital. They are not on the payroll of the assessee hospital and also no other perquisites/benefits/ provisions as applicable to employees of the hospital are applicable to them. The assessee hospital in no ways is controlling the professional activity of these doctors and therefore due to the above stated facts, the payments are rejected to withholding u/s 194J of the Act, as there is no e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the TDS liability determined u/s 192 of the Act, thereby raising a demand u/s 201(1). Further, these doctors have filed their return of income and declared the receipts from the assessee hospital and have paid taxes thereon. Accordingly, interest u/s. 201(1A) is not chargeable. The learned Counsel for the assessee also relied on the decision of Hon'ble Bombay High Court in the case of CIT (TDS) vs Grant Medical Foundation (2015) 375 ITR 49 (Bom), wherein exactly identical facts held as under: - "37. In relation to other category of doctors there was a dispute. The Assessing Officer and the Commissioner concluded that though these categories of doctors had a fixed remuneration and variable pay but their terms and conditions of employment or service would be crucial and material. In relation to two doctors, namely, Dr Zirpe and Dr Phadke, the contracts were taken as sample and scrutinized minutely. Upon such a scrutiny the Tribunal noted that it cannot be said that these doctors were employees. If the first part of the Commissioner's order indicates as to how these persons or doctors were not treated by the assessee as regular employees for want of benefits like provident fun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they were found to be sharing a overwhelming number of attributes of employees. In relation to that the contract seems to have been bifurcated or split up or read in bits and pieces by the Commissioner. The Leave Rules were held to be applicable in case of Dr Phadke and there were fixed timing and fixed remuneration. Now, it is inconceivable that merely because for a certain period of time or required number of hours the doctors have to be at Ruby Hall Clinic means they will not be entitled to visit any other hospital or attend patients at it necessarily. The anxiety appears is not to inconvenience the patients visiting and seeking treatment at the Ruby Hall Clinic. If specialized team of Doctors, Experts and Experienced in the field are part of the Assessee's Clinic, then, their availability at the clinic has to be ensured. Now, the trend is to provide all facilities under one roof so that patients are not compelled to go to several clinics or Hospitals. Hence, a diagnostic center with laboratories and clinics, consultation rooms, rooms with beds for indoor treatment, critical care, treatment for kidney, lever, heart, brain, stomach ailments are facilities available at clinics ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be admitted to the assessee hospital. That would not denote a binding relationship or a master servant arrangement. A attractive or better term to attract talented young professionals and too in a competitive world would not mean tying down the person or restricting his potential to one set up only. The arrangement must be looked in its entirety and on the touch stone of settled principles. The Tribunal was right in reversing the findings of the Assessing Officer and the Commissioner. There was a clear perversity and contradiction in the findings, particularly pointed out by us hereinabove. 39. In relation to other doctors where the remuneration was variable and there was a written contract or no written contract the Commissioner and the Tribunal did not commit any error at all. Both have referred extensively to the materials on record. We are not in agreement with Mr Gupta that the Tribunal's order is in any way incomplete or sketchy or cryptic. The settled principles and rendered in co-ordinate Bench decisions have been referred only to emphasize the tests which have been evolved from time to time. It is only in the light of such tests and their applicability to individual ..... X X X X Extracts X X X X X X X X Extracts X X X X
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