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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 ..... gories of leave, gratuity, HRA, etc. benefits which the independent doctors were not entitled to. Apart from the above, we are of the opinion that the real intention of the parties in the present case is appointment of consultants and not to create employer-employee relationship and accordingly TDS is liable to be deducted u/s 194J of the Act. Another aspect in this matter is that the fact that the TDS is liable to be deducted u/s. 194J of the Act on payment to the independent professional doctors, the AO has ignored the excess of TDS amount deducted u/s. 194J of the Act in certain cases, in comparison with 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 - Decided in favour of assessee. - ITA No. 4043/Mum/2015 - - - Dated:- 23-8-2017 - SRI MAHAVIR SINGH, JM AND SRI RAJESH KUMAR, AM For The Assessee : Shri Madhur Agarwal, AR For The Revenue : Shri Purushottam Kumar, DR ORDER PER MAHAVIR SINGH, JM: This appeal by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of employee, noticed that the terms of appointment of these full time consultant doctors of the hospitals are to be treated as employees. The appointment letter issued by the assessee carry sufficient directions suggesting the manner in which the consultant doctor should carry out the work assigned to him. The letter make it clear that the assessee is exercising sufficient control over the consultants as a result of which employer employee relationship is very much manifest. According to AO, there exists employee and employer relationship between full time consultant doctors and the assessee. The AO also discussing the default on account of short deduction under section 201(1) of the Act and consequently interest under section 201(1A) of the act as under: - Name of doctor Amount paid TDS deductible under section 192B TDS deducted under section 194J Default under section 101(1) Interest under section 201(1A) Anand Bhabor 1145000 201365 114500 86865 26,928 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty. 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 employer/employee relationship which exists between the assessee and the Consultants/ doctors. 6. We find that the assessee had been following this practice consistently from the past and the same has been accepted by the department in the earlier years. There is no change in the said services/engagement of such doctors during the yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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 fund, retiremental benefit, etc., then, merely because they are required to spend certain fixed time at the hospital, treating fixed number of patients at the hospital, attend them as out patients and Indoor patients does not mean that a employer-employee relationship can be culled out or inferred. We do not see how Mr Gupta can faul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 and hospitals. The management, therefore, insists that such facilities, which are very costly and expensive are utilized to the optimum and the investment of time, money and infrastructure is not wasted. Hence, fixed timings and required number of hours and such stipulations are incorporated in contracts so that they are of bi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 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 cases that matters of this nature must be decided. This approach of the Tribunal did not require it to render elaborate or lengthy findings and when it agreed with the Commissioner. We do not find even in the case of Dr Sumit Basu the Commissioner or the Tribunal committed any error. Merely because of his stature he was ens ..... X X X X Extracts X X X X X X X X Extracts X X X X
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