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TMI Blog2021 (2) TMI 758X X X X Extracts X X X X X X X X Extracts X X X X ..... d that appellant controls the technical education being provided in around 195 Engineering Colleges, 291 Polytechnic Colleges, 12 Junior Technical Schools and 76 fine Arts College. It has further been held that the government of Karnataka directed the assessee to appoint a particular agency like M/s Rites Ltd. Or M/s Karnataka Housing Board for every new building. The agency is remunerated by providing a specific percentage usually around 7% to 10% of the project cost for each building in the form of service charges. It has further been held in paragraph 8.10, the Commissioner of Income Tax (Appeals) has gone into details of memorandum of understanding entered into with M/s Rites Ltd. or M/s Karnataka Housing Board and has held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, the work entrusted by them is not merely consultancy but overall responsibility of construction of the building right from design to completion of work which attracted provision 194c and 194J of the Act and as such the assessee was liable to deduct tax on payment made to said parties? . 2. Facts leading to filing of this appeal briefly stated are that the assessee is Technical Education Department of Government of Karnataka which is incharge of academic and administrative functions of controlling technical education in the State of Karnataka. As part of its activities, the construction of engineering and polytechnic college buildings was required. The assessee, therefore, entered into construction agreements with Karnataka Housing B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred by the revenue. In the aforesaid factual background, the revenue has filed this appeal. 4. Learned counsel for the revenue submitted that the Commissioner of Income Tax (Appeals) as well as the Tribunal ought to have appreciated that the relationship between the assessee and RITES and Karnataka Housing Board was principal and agent and therefore, the provisions of Section 194C of the Act were attracted to the fact situation of the case and the assessee was therefore an assessee in default and accordingly, the Assessing Officer has rightly raised the demand. However, the aforesaid aspect of the matter has neither been appreciated by the Commissioner of Income Tax (Appeals) nor by the Tribunal. 5. On the other hand, learned coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e charges. It has further been held in paragraph 8.10, the Commissioner of Income Tax (Appeals) has gone into details of memorandum of understanding entered into with M/s Rites Ltd. or M/s Karnataka Housing Board and has held that the provisions of Section 194C are not applicable to the facts of the case. The aforesaid finding of fact has been affirmed by the tribunal. In the peculiar facts of this case, we are not inclined to interfere with the concurrent findings of fact, in the absence of any perversity being demonstrated before us. Therefore, the substantial question of law is answered against the revenue and in favour of the assessee. In the result, we do not find any merit in this appeal, the same fails and is hereby dismissed. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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