9911796707
TMI Blog2018 (4) TMI 988X X X X Extracts X X X X X X X X Extracts X X X X ..... AO to make the deletion by holding that the payments to Lobo Staffing Solutions Pvt. Ltd. were a contractual payments and not professional fee and therefore TDS is not required to be made under section 194J. Merit in the contention of the A.R. that even if the payment to the said company by way of administrative fee of 45,42,411/-was liable for TDS u/s 194J of the Act, the assessee has deducted TDS of 44,17,617/- which constitute 97% of the administrative fee. Hence, there is no short deduction of TDS from administrative fee. Thus as regards non deduction of TDS on the reimbursement of expenses, we are inclined to set aside the order of Ld. CIT(A) and hold that there is no short deduction of TDS and hence there is no default under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee filed the copy of agreement dated 21.12.2011 under which the reimbursements and payments of administrative fee were made to the said company. The assessee submitted before the AO that staff deputed by the said company did not render any professional or technical services and whatever was paid to the said company was towards the contractual payments for which even certificate under section 197(1) of the Act for A.Y. 2011-12 and 2013-14 was issued mentioning the said payments as contractual payments. However, the AO did not find any merit in the submissions of the assessee and treated the payments to the Lobo Staffing Solutions Pvt. Ltd. as technical fee on which TDS was liable to be deducted under section 194J of the Act and rais ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 45,42,411/- as administrative fees and deducted tax at the rate of 2% under section 194C of the Act which worked out to ₹ 44,17,617/-. The Ld. A.R. submitted that the AO disallowed the payments made to the said company under section 40(a)(ia) of the Act for not deducting the tax at source under section 194J. However, the Dispute Resolution Panel reversed the order of AO holding that the assessee had rightly deducted the tax at source under section 194C of the Act and thus deleted the disallowance. The order of DRP has also attained finality. The Ld. A.R. also submitted that its TDS was deducted from payments made to Lobo Staffing Solutions Pvt. Ltd. comprised of three elements viz. (i) reimbursement of salary, (ii) reimbursement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was making reimbursements of salary of the deputed staff and also out of expenses incurred by the said company + administrative fee was also paid over and above the reimbursement as stated above. During the year the assessee made payment of ₹ 22,03,74,842/- as per details below: Reimbursement of salary - Rs.19,81,30,302/- Reimbursement out of pocket expenses - Rs.1,77,02,129/- Administrative fees - Rs.45,42,411/- TDS deducted @ 2% - Rs.44,17,617/- Pertinent to state that the assessee was also issued certificate under section 197(1) for A.Y. 2011-12 and 2013-14 wherein the assessee was directed to deduct the TDS at source under section 194C of the Act by the ITO-TDS. However, the AO-TDS reached a conclusion that the TDS was ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
