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TMI Blog2022 (1) TMI 840X X X X Extracts X X X X X X X X Extracts X X X X ..... e the order of the Tribunal as well as the authorities and to restore the matter to the file of the Assessing Officer to reconsider the matter afresh in the light of the observations made herein above. AO shall record a finding after examining the contract if any, entered by the assessee with the truck owners/ operators and an appropriate decision shall be taken in accordance with law. In the facts and circumstances of the case, it is made clear that the registration number of trucks/truck owner would not be relevant for the purpose of deciding the applicability of Section 194 C of the Act but it is the personnel/truck operator from whom the trucks are hired. With the aforesaid observations and directions, appeal stands allowed as indicted above sans answering the substantial questions of law, directing the Assessing Officer to re-examine the matter, keeping open all the rights and contentions of the parties. - INCOME TAX APPEAL NO.70 OF 2017 - - - Dated:- 15-11-2021 - HON BLE MRS. JUSTICE S. SUJATHA AND HON BLE MR. JUSTICE V. SRISHANANDA APPELLANT [BY SRI. CHYTHANYA K.K., ADVOCATE (PHYSICAL HEARING)] RESPONDENT [BY SRI. K.V.ARAVIND, ADVOCATE (PHYSICAL HEARING)] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome Tax in ITA No.468/Bang/2010 relating to the Assessment Year 2006-2007 submitted that in identical circumstances, the Tribunal has remitted the matter to the Assessing Officer for reconsideration with a direction to look into the issue comprehensively and to arrive at the conclusion as to whether the assessee s case falls within the ambit of Section 194C of the Act or not. Despite citing the said order before the Tribunal, ignoring the same, the Tribunal proceeded to dismiss the appeal. 5. Learned counsel would submit that truck operators are not the truck owners. The proceedings concluded by the Tribunal is wholly unjustifiable and is not in consonance with the CBDT Circular No.715 dated 08.08.1995. It was argued that the Assessing Officer has grossly erred in disallowing the deduction under Section 40 (a)(ia) of the Act mainly considering the aggregate numbers of the trucks used by the assessee for transportation of the mines materials, irrespective of the different truck operators holding the authorisation to drive such trucks. It is not the case of the revenue that the aggregate payment made to particular truck holder exceeded prescribed limit under Section 194C of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned counsel placing reliance on the judgment of the Hon ble Apex Court in the case of Shree Choudhary Transport Company v/s Income Tax Officer reported in [2020] 118 taxmann.com 47(SC) submitted that the agreement though was oral between the appellant and the truck operator, the said oral contract also could be considered for determining the nature of the transaction and in this regard the Hon ble Apex Court has categorically held that hiring services of the truck operators/ owners for the purpose of transportation could have only been under a contract between the assessee and truck operators/ owners. Whether such a contract was reduced into writing or not carries hardly any relevance. Hence, truck operators/ owners answered to the description of sub-contractor for carrying out the whole or part of the work undertaken by the contractor under Section 194C of the Act. In the light of this decision, the order passed by the Tribunal cannot be faulted with. Thus, it was submitted that the substantial questions of law deserve to be answered in favour of the revenue and against the assessee. 8. We have heard the learned counsel for the parties and perused the material on record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 40(a)(ia) of the Act, any sum payable to a resident on which tax is deductible at source under Chapter XVII-B has not been deducted or, after deduction, has not been paid on or before the due date specified in sub section (1) of Section 139, is not deductible in computing the income tax chargeable under the head Profits and Gains of business or the profession, the claim made by the assessee was denied by the authorities as well as the Tribunal in the case on hand. The intention of the legislature could be gathered from the language employed i.e., to reduce the hardship to the tax payers. 13. It is not in dispute that in Circular No.175 dated 8.8.1995 for question No.9, i.e., in the case of payment to transporters, can each GR be said to be a separate contract, even though payments for several GRs are made under one bill? , the clarification given is that normally, each GR can be said to be a separate contract, if the goods are transported at one time. But if the goods are transported continuously in pursuance of a contract for a specific period or quantity, each GR will not be a separate contract and GRs relating to that period or quantity will be aggregated for the purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ible documentary proof was advanced even at the stage of hearing before this Bench to belie the stand of the authorities below. 7.2. It may be pointed out that some of the companies owning lorries/trucks would have engaged their vehicles with drivers to the assessee for transporting the goods. There were also quite possibilities that most of the lorry owners who themselves at the wheels could have been engaged by the assessee to carry the goods. There were also instances that some of the lorry companies having fleet of vehicles with adequate drivers on shifts would have lent their same vehicles with different drivers on different days for carrying the goods which could have ITA No.468/Bang10/ contributed in making a number of trips during the period and in some cases, the lorry companies could have leased out their vehicles on monthly basis to the persons who intended to drive such vehicles themselves to thrive their fortunes. This could have contributed the possibilities and instances of making repeated trips by a same truck or van during the course of the year. These aspects as to the existence of contract between the assessee and owner of the vehicle/driver of the vehicle/d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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