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TMI Blog2021 (9) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... Group, and in Clause-5 of the written agreement between the parties, a condition has been stipulated that provision of services would involve providing vehicles owned by the assessee or associates of assessee or agents, for transportation of the employees of Thomson Corporation, and further, on facts, it was found that the assessee is owning a fleet of vehicles, which is not sufficient to meet the agreement entered into between the assessee and such individual owners. The Court held that there is no necessity for a written agreement between the parties. The facts before us are entirely different, as both the CIT(A) as well as the Tribunal have held on facts that the assessee hired vehicles from the drivers and there was nothing on recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the provision of section 40(a)(ia) will not be applicable to the assessee case by holding that there is no contractual liability between the assessee and lorry owners/drivers? 3.Whether on the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that there is no contractual liability between the assessee and the lorry owners without considering that there is an implied contract? 3.We have elaborately heard Mrs.S.Premalatha, learned Junior Standing Counsel for the appellant/Revenue and Mr.A.S.Sriram, learned counsel for the respondent/assessee. 4.The assessee is the Proprietor of a conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce. The Assessing Officer was not convinced with the reply given by the assessee and accordingly, completed the assessment by order dated 24.12.2011, disallowing the payments with regard to lorry hire charges. 5.Aggrieved by the same, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals), Madurai ( CIT(A) for brevity). The said appeal was partly allowed, i.e., to state that there was no written contract between the assessee and the lorry owners/drivers and the question of deducting Tax at Source would not arise. However, after making the said observation, the assessee was called upon to furnish the details of the amount exceeding ₹ 50,000/- during the Assessment Year under consideration and on 13 such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s an agreement between the assessee and the Cement Company for transportation of Salt and Gypsum from Tuticorin. The correctness of the said stand was examined by the CIT(A) and it was found that there was no material on record to draw any such inference against the respondent/assessee. The correctness of the said finding was tested by the Tribunal and the Tribunal rejected the appeal filed by the Revenue. 8.Insofar as the order of the CIT(A) restricting the disallowance to ₹ 11,24,684/- is concerned, the Tribunal, in our view, rightly interfered with the said order, because, no issue would be as to whether at all there is subcontract agreement between the assessee and lorry drivers and in the absence of any such contract, the qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y other companies under written contract on various dates and only to perform the obligation under the said contracts, he had hired vehicles from the sub-contractors under the written contract and the liability to deduct TDS arises under Section 194C(2) of the Act. Furthermore, while testing the correctness of the stand taken by the assessee, the Court considered the factual position that the assessee is providing vehicles to one of its customers, M/s.Mahindra Group, and in Clause-5 of the written agreement between the parties, a condition has been stipulated that provision of services would involve providing vehicles owned by the assessee or associates of assessee or agents, for transportation of the employees of Thomson Corporation, and f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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