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TMI Blog2018 (6) TMI 882X X X X Extracts X X X X X X X X Extracts X X X X ..... anies u/s. 40(a)(ia) without deducting TDS - Assessing Officer mentioned that the purchase was on basis of a hire purchase agreement and assessee is liable to deduct tax at source on interest payment - Held that:- We find that the CIT(A) has considered the entire issue in light of hon'ble apex court’s decision in “ICDS” case [2013 (1) TMI 344 - SUPREME COURT] as well as the relevant hire purchase agreement as per CBDT’s Circular 647/1993 dated 22.03.1993 deals with application of section 194 on Hire Purchase agreements. Hire Purchase is a system by which a buyer pays for a thing in regular installments while enjoying the use of it. During the repayment period, ownership (title) of the item does not pass to the buyer. Upon the full payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Maharastra AIR 2003 Bombay 498 P 501, Gujco Carriers vs. C.I.T. 256 ITR 50 (Guj) and decision of ITAT, C Bench Kolkata in ITA No.1336 (Kol)/2008 in the case of AIT, Circle-3, Asansol vs. M/s Asoka Transport, Kolkata dt. 02.03.2009 by which depreciation at higher rates can be granted, if the assets are let on hire. Here Profit and Loss Account reflects hire income. 7. The eligibility for granting depreciation at higher rates to payloaders is settled in the above decisions. In regard to concrete mixers, the argument of appellant (the details of concrete mixers is explained in detail in second and third paragraph in page 4 of assessment order) is that the same wheel mounted and is used exclusively for transporting concrete in su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue in assessee s favour. There is no distinction on facts or law being pointed out in Revenue s pleadings. We therefore adopt Revenue s instant this substantive ground. 4. This leaves us with Revenue s latter substantive ground regarding disallowance of interest paid of ₹ 13,33,568/- u/s. 40(a)(ia) at assessee s behest to two payees M/s SREI Equipment Finance (P) Ltd Ashok Leyland Finance Ltd. without deducting TDS. We find that the CIT(A) has considered the entire issue in light of hon'ble apex court s decision in ICDS case as well as the relevant hire purchase agreement as per CBDT s Circular 647/1993 dated 22.03.1993 in the following detailed discussion:- 9. Ground 3 is against addition under section 40(a)(ia). Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d passes only when the person has paid the last installment of the goods which he or she has hired. 3. Under hire purchase system the buyer can return the goods to the seller if he or she does not want to continue with the agreement. 4. In case of hire purchase the person who has taken the good on hire cannot transfer the goods to a third party as he or she doe s not have the ownership of the goods. In I.C.D.S. Ltd. vs. CIT Anr. (20133) 350 ITR 527 (SC) it is held that depreciation in case of lease is available to lessor. In the instant case assessee has claimed depreciation on the basis of ownership. Therefore claiming depreciation and benefit of circular 647 does not go simultaneously. Hence the Hire Purchase agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X
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