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TMI Blog2019 (5) TMI 768X X X X Extracts X X X X X X X X Extracts X X X X ..... the following grounds of appeal:- "1 That the CIT(A) was not justified in sustaining the disallowance of Rs. 950600/- made by the AO u/s 40(a)(ia) of the income Tax Act, 1961. 2. That CIT(A) while sustaining the disallowance failed to appreciate that the provisions of section 194C were not applicable to the assessee hence disallowance made by the AO u/s 40(a) (ia) could not have been sustained. 3. That adhoc disallowance of Rs. 100000/- made by the AO out of the expenses has wrongly been sustained by the CIT(A) despite various judgments of various higher authorities including jurisdictional Pb & Haryana High Court. 4. That the orders of the CIT(A) and AO are against the law and facts of the case" 2. Briefly stated, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a)(ia) of the IT Act. 4. Aggrieved, the assessee carried the matter in appeal before the CIT(A). The assessee in the course of the appellate proceedings tried to impress upon the CIT(A) that as the payments to the aforementioned parties were not in the nature of a contractual payments, hence there was no requirement on its part to deduct tax at source under Sec. 194C in respect of the said payments. Apart therefrom, it was also submitted by the assessee that as the respective payees were income tax assesses and were regularly filing their returns of income, hence for the said reason also no disallowance of the aforesaid expenditure could be made under Sec. 40(a)(ia) of the IT Act. However, the CIT(A) held a conviction that as the cranes w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions of Sec. 194C of the IT Act. In sum and substance, it was the contention of the Ld. A.R that the lower authorities had erred in disallowing under Sec. 40(a)(ia) the payments made by the assessee towards hiring charges of cranes on the ground that it had failed to deduct tax at source under Sec. 194C in respect of the aforesaid amounts. 6. Per contra, the Ld. Departmental Representative (for short 'D.R') relied on the orders of the lower authorities. It was submitted by the Ld. D.R that as the assessee had failed to deduct tax at source under Sec. 194C of the IT Act on the payments made towards hiring charges of cranes, hence the A.O had rightly disallowed the said amount under Sec. 40(a)(ia) of the IT Act. 7. We have heard the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds or passengers by any mode or transport other than by railways; (d) catering (e) manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer, but does not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer." We are persuaded to subscribe to the contention advanced by the Ld. A.R that a simpliciter payment towards hiring charges of cranes cannot be brought within the sweep of the definition of the term "work" as envisaged in Sec. 194C of the IT Act. We thus are of the considered view that the lower authorities had erred in con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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