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TMI Blog2023 (5) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... r deduction at source @ 2% i.e., u/s 194C - Decided in favour of assessee. - ITA No. 1312/Del/2022 - - - Dated:- 27-4-2023 - SHRI C. M. GARG , JUDICIAL MEMBER AND SHRI M BALAGANESH , ACCOUNTANT MEMBER For the Assessee : Sh. Deepak Singh , Adv For the Revenue : Sh. Vipul Kashyap , Sr. DR ORDER PER C. M. GARG , J. M. : This appeal has been preferred by the assessee against the order of the CIT(A)-30, New Delhi, dated 27.04.2022 for AY 2014-15. 2. The sole issue in this appeal for consideration and adjudication is the ld CIT(A) erred in confirming the demand of TDS plus interest amounting to Rs. 2,20,319/- (Rs. 1,10,992/- short TDS plus interest Rs. 1,09,327/-). 3. The ld. Counsel for the assessee submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urposes and as per agreement the assessee will pay CAM charges with rent which is addiotnal rent charges on the top of base rent and is mainly composed of maintenance fees for work performed on the common area of the property. As per the agreement the premises will be used as corporate office therefore, the provision of section 194I should be attracted and TDS shall be deducted @10% as against the deduction of TDS at 2% by the assessee u/s 194C of the Act as the provisions of section 194-I of the Act are not applicable to payment of CAM charges as per orders of the ITAT, Delhi, in the cases Kapoor Watch Company Pvt. Ltd. vs. ACIT (supra) and Connaught Plaza Restaurants P. Ltd. vs. DCIT (supra). 5. Replying to the above, the ld. Sr. DR ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owner as well as CAM service providers. It has not been controverted by the ld. Sr. DR that the assessee has paid rent to different property owners and CAM charges to separate service providers. 7. Now, we turn to the findings given by the ITAT, Delhi B Bench in the case of Connaught Plaza Restaurants P. Ltd. (supra), wherein the Bench has also considered the earlier judgement of ITAT B Bench in the case of Kapoor Watch Company Pvt. Ltd. (supra) and held as under:- 11. We shall now advert to the claim of the assessee that both the lower authorities had erred in law and the facts of the case in concluding that the CAM charges paid by the assessee to Ambience Group (supra) were liable for deduction of tax at source @10%, i.e., u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any income by way of rent, shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of (a) two per cent for the use of any machinery or plant or equipment; and (b) ten per cent for the use of any land or building (including factory building) or land appurtenant to a building (including factory building) or furniture or fittings: Provided that no deduction shall be made under this section where the amount of such income or, as the case may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndlord or any other agency, therefore, the same cannot be brought within the scope and gamut of the definition of terminology rent . On the other hand, we are of the considered view, that as the CAM charges are in the nature of a contractual payment made to a person for carrying out the work in lieu of a contract, therefore, the same would clearly fall within the meaning of work as defined in Section 194C of the Act. In our considered view, as the CAM charges are not paid for use of land/building but are paid for carrying out the work for maintenance of the common area/facilities that are available along with the lease premises, therefore, the same could not be characterized and/or brought within the meaning of rent as defined in Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same as were therein involved in the aforesaid case, therefore, in the backdrop of our aforesaid deliberations, and respectfully following the aforesaid order of the Tribunal, we herein conclude, that as claimed by the assessee, and rightly so, the CAM charges paid by it were liable for deduction of tax at source @2%, i.e., u/s.194C of the Act. We, thus, in terms of our aforesaid observations set-aside the order of the CIT(A) who had approved the order passed by the AO treating the assessee company as an assessee-in default u/s.201(1) of the Act. The Grounds of appeal no.4 to 4.5 are allowed in terms of our aforesaid observations. 8. In view of the above, we have no hesitation to hold that the CAM charges paid by the assessee did ..... X X X X Extracts X X X X X X X X Extracts X X X X
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