9911796707
TMI Blog2008 (5) TMI 142X X X X Extracts X X X X X X X X Extracts X X X X ..... 127/Del/2004 and has sought to raise the following substantial questions of law:- "Whether on the facts and in the circumstances of the case, the Ld. ITAT was right in law in upholding the order of the CIT(A), deleting the demand created by the Assessing Officer under Section 201(1) and 201(1A) of the Income-tax Act, 1961, as the assessee failed to deduct tax at source as per the provisions of Section 194C of the Act?" 2. The assessee is a limited company engaged in the business of manufacture and export of rice. During the course of export activity, rice was transported from Samana Bahu to Kandla Port. Whenever there was need for transportation of goods from business premises to Kandla Port, the assessee used to engage trucks through tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kandla Port were of the value less than Rs.20,000/- each and that the assessee should have deducted tax at source on the amount paid to M/s East West Cargo Movers. The Assessing Officer also found that similar payment has been made by the assessee to another clearing and forwarding agent, namely, Leeladhar Pasoo Forwarders (P) Ltd. and to some of the transporters but no tax has been deducted at source under Section 194C of the Act. He, therefore, treated the assessee in default for short deduction of tax at Rs.2,18,230/-under Section 201 of the Act and also levied interest under Section 201 (1A) of the Act. 3. Aggrieved against this order, the assessee filed an appeal before the Commissioner of Income-tax (Appeals) [(for short the 'CIT(A)' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be made, if the sum paid or credited do not exceed rupees twenty thousand. In the instant case payment of transportation charges paid to truck owners/forwarding agents were considered by the Assessing Officer as liable for deduction of tax at source. This decision of Assessing Officer was based on question and answers No.6, 9 and 30 of CBDT Circular No.715 issued with reference to applicability of provisions of TDS under Section 194-C and 194-J. In the instant case, we found that each payment of transportation charges was not exceeding Rs.20,000/-. The Assessing Officer had held the assessee liable for deduction of tax under Section 194-C of the Act, only on the assumption that assessee was having agreement with the parties through whom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct for carriage of goods. Thus, the payment made to these C & F agents has to be seen in the light of question No.6 itself. Tax was required to be deducted from the payments made to these C & F agents for carriage of goods if there is a contract for carriage of goods. Similarly, even as per question No.9 of Circular No.715 of CBDT., and its reply, it is clear that normally each GR should be treated as separate contract, but if the goods are transported continuously in pursuance of a contract for specific period or quality, all GRs relating to that party or quantity should be aggregated for the purpose of the TDS. It is very evident from the answer to both these questions that what is most important is a contract for a specific period or qua ..... X X X X Extracts X X X X X X X X Extracts X X X X
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