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TMI Blog2023 (9) TMI 909X X X X Extracts X X X X X X X X Extracts X X X X ..... For the Revenue : Smt. Monisha Choudhary (Addl.CIT) ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM These five appeals are filed by the assessee aggrieved from the order of the National Faceless Appeal Centre (NFAC), Delhi [ Here in after referred as NFAC/ld.CIT(A) ] for the assessment years 2015-16 to 2019-20 dated 09.03.2023 which in turn arises from the order of the ITO, TDS, Alwar passed under Section 201(1)/201(1A) 206C of the Income tax Act, 1961 (in short 'the Act') dated 28.06.2019. 2. Since the issues involved in the assessee s appeal for different years are almost identical and are almost common, except the difference in figure of demand raised and disputed. Therefore, these appeals were heard together with the agreement of both the parties and are being disposed off by this consolidated order. 3. At the outset of the hearing the ld. AR submitted that the matter pertaining to Bharatpur Dugdha Utpadak Sahkari Sangh Limited in ITA no. 321/JPR/2023 may be taken as a lead case for discussions as the issues involved in the lead case are common and inextricably interlinked or in fact interwoven and the facts and circumstances of other cases are identi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e I.T. Act saying, but does not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer 3. That, the appellant craves leave to add, alter, amend and/or substitute one or more grounds of appeal as and when necessary. 6. The fact as culled out from the records is that in this case, a TDS survey u/s 133A(2A) of Income-tax Act 1961 was conducted on 28.01.2019 at the business premises of the assessee. During the course of survey it was found that the assessee/deductor M/s Bharatpur Dugdh Utpadak Sahakari Sangh Ltd. Bharatpur, TAN JPRB02179C has made the contract through government to supply the packing material since F.Y. 2014-15 onwards and payment made for purchase of packing material, but TDS not deducted under the head contractor payment as per u/s 194C of the I.T. Act, 1961 and TDS required to be deducted @ 1%/2% as applicable as per u/s 194C amounts to Rs. 63,700/-. Therefore, assessee was asked to furnish the details of TDS/TCS deducted by them on packing material of an amount of Rs. 31.85 lacs. On perusal of the details filed it is noted by the ld. AO tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lid enforceable contracts and paid them sum of money in terms of such contracts/agreements for the services availed, consequently, held as liable to comply with the provisions of section 194C. I find that the appellant is unable to submit any cogent, justified reason in support of his claim raised in grounds . At the same time the appellant has miserably failed to comply with the provision of section 194 C of the Income Tax Act and therefore the ground taken by the appellant is misconceived, incorrect and not corroborated with supporting evidence as per law. Considering the entire conspectus of the case and in the light of foregoing findings vis- -vis discussion, substantial force is found in the order of the AO, passed order u/s 201(1)/201(1A). In the light of above discussion I find that the AO is justified in imposing tax interest u/s 201(1)/201(1A) of the Income Tax Act after providing ample opportunity to appellant. Accordingly, the levy of tax with interest stand confirmed. In view of above I find no logic in appellant's submission of contractual purchase of packing material won't be qualified as a contract. The assesseefirm since engaged this resident contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s201(1) In Rupees Demand u/s 201(1A) In Rupees Total Demand In Rupees 2015-16 31.85 Lacs 63,700/- 36,309/- 1,00,009/- 2016-17 24.61 Lacs 49,220/- 22,149/- 71,369/- 2017-18 24.71 Lacs 49,420/- 16,308/- 65,728/- 2018-19 51.16 Lacs 1,02,320/- 21,487/- 1,23,807/- 2019-20 31.01Lacs 62,020/- 5,582/- 67,602/- Total 3,26,680/- 1,01,835/- 4,28,515/- Further except the difference in figures of payment made for purchase of packing material, tax charged u/s 201(1) and interest charged u/s 201(1A), the other facts and circumstances and issue involved in all the five appeals are identical and common and similar grounds have been raised by the assessee in al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ability of TDS on the assessee by mentioning that the assessee deductor was liable to deduct TDS @2% on the payment made for purchase of packing material. The AO further observed in all the orders u/s 201(1)/201(1A) 206C (6)/206C (7) of the IT Act for FY 2014-15 to 2018-19 relevant to AY 2015-16 to 2019-20 that on perusal of the ledger of purchase of packing material in all the five years it reveals that the assessee deductor has made payments to selling dealers on which TDS is to be deducted @2% as per section 194C, whereas TDS has not being deducted and hence he is in default for short/non deduction of TDS. Against all the five orders the assessee filed appeal before ld CIT(A) who by passing a common order confirmed the levy of tax and interest for all the five years by wrongly describing purchase of packing material from different parties like Shakun Plastic Pvt. Ltd., M/s Satyan Industries totaling to Rs. 163.34 Lacs as receipts of services. Now against all these orders passed by the ld CIT (Appeal), the assessee is in appeal before the honorable tribunal . SUBMISSIONS IN SUPPORT OF EACH GROUND OF APPEAL GROUNDS OF APPEAL NO. 1 2 Both these grounds of appeal ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmodation or for the purpose of planning, development or improvement of cities , towns and village, or for both; or (g) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any law corresponding to that Act in force in any part of India; or (h) any trust ; or (i) any university established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a university under section 3 of the University Grants Commission Act, 1956 (3 of 1956); or (j) any Government of a foreign State or a Foreign enterprise or any association or body established outside India; or (k) any firm; or (l) any person, being an individual or a Hindu undivided family or an association of persons or body of individuals, if such person,- (A) does not fall under any of the preceding sub-clauses; and (B) is liable to audit of accounts under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which sum is credited or paid to the account of the contractor; (ii) goods carriage shall have the meaning assigned to it in the Explanation to sub-section (7) of section 44 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the requirement or specification of a customer by using material purchased from a person other than such customer. In support of this submission the humble appellant craves leave to refer to and rely upon the judgement of hon ble Karnataka High Court reported in(2014) 369 ITR 72 (Karn) in the case of CIT v/s Spice Tele communications Pvt. Ltd wherein the hon ble court by observing that as the assessee did not supply any material to the manufacturers or suppliers for the supply of SIM or scratch cards as per their requirement or specification, such transactions could not be treated as works contracts within the meaning of section 194C (1) of the IT Act. 3. It is further submitted that in response to a show cause notice issued on 03/06/2019 by the AO, the assessee vide his letter of reply dated 27/06/2019 ( A copy of it is appearing in each of the order u/s 201(1) /201(1A) and 206C (6) /206 C(7) dated 28/06/2019 for all the years) interalia explained to the AO that it (assessee) has purchased packing material from the sellers i.e. manufacturers for packing of its products for sale . The assessee also mentioned in the reply that it purchased packing material as per requirement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ived of the fact. Apropos to this argument the ld. AR of the assessee has submitted following details : Considering these aspects of the matter, when the invoice specifically suggests the purchase of goods duly paid for VAT there is no liability to discharge the TDS for any contract and thus, invocation of levy u/s. 194C is misconceived. 9. The ld DR is heard who has relied on the findings of the lower authorities. 10. We have heard the rival contentions and perused the material placed on record. The bench noted that the ld. CIT(A) has confirmed the addition considering the fact that the assessee is having a regular supply contract and therefore, confirmed the levy of TDS. The bench noted from the complete chart for which the assessee held as assessee in default amount on 31,84,532/- are all though regular supply contract but the same is not for any services liable to TDS u/s. 194C of the Act. The provision of section 194C of the Act is applicable to work and not for purchase made which are liable for VAT. Based on the evidences so produced and argument advanced before us we are of the considered view that all are purchases of material with some specifications suppo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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