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TMI Blog2024 (2) TMI 1341X X X X Extracts X X X X X X X X Extracts X X X X ..... er respondent (assessee) ought to have deducted tax under Section 194I or Section 194C of the Income Tax Act, 1961 (the Act) from the storage charges paid by assessee. According to the Assessing Officer the payment of storage charges is covered under Section 194I of the Act and hence, tax had to be deducted at source at the rate of 20%, whereas assessee says it would be under Section 194C of the Act and hence, deducted tax at source only at 2%. 3. Assessee had entered into an agreement with various parties for facilities and services for handling import of RBD palmolein oil or vegetable oils edible grade. Assessee used to pay storage charges. Therefore, assessee had hired tanks of various parties and paid them storage charges. The Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tended by assessee that CIT(A) had erred in confirming the applicability of Section 194I of the Act for deductions of tax at source on storage charges and hence, could not have confirmed the demand of Rs. 1,05,04,786/-. The ITAT, by the impugned order dated 28th November 2002, allowed the appeal of assessee and set aside the assessment order. It is this order that is impugned in these appeals. The appeals were admitted on 14th October 2004 and the following substantial questions of law were framed : INCOME TAX APPEAL NO. 307 OF 2003 (a) Whether on the facts and in the circumstances of the case and in law, the Tribunal erred in allowing the appeal of the assessee and holding that the storage charges paid by the assessee does not amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r by the aforesaid person to the account of, or to, the payee, does not exceed one hundred and twenty thousand rupees. Explanation - For the purposes of this section, - (i) 'rent' means any payment, by whatever name called, under any lease, sub-lease, tenancy or any other agreement or arrangement for the use of any land or any building (including factory building), together with furniture, fittings and the land appurtenant thereto, whether or not such building is owned by the payee; (ii) where any income is credited to any account, whether called 'suspense account' or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ater Bombay and Ors. V/s. Indian Oil Corporation Ltd. (1991) 91 CTR 0135 submitted that almost identical situation had come up in Municipal Corporation of Greater Bombay and Ors. (Supra) where the issue to be decided was whether petroleum storage tanks are structures or things attached to land within the inclusive definition under Sections 3(s) and 3(r) respectively of the BMC Act and consequently exigible to property tax. Their Lordships, after indepth analysis of various issues, held that the property tax was exigible as petroleum storage tanks are structures or things attached to the land. Mr. Chhotaray submitted that the Hon'ble Apex Court analysed the meanings of the words land, building and structures on the basis of the dictionary me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that this Court in the case of Bharat Petroleum Corporation Ltd. and Anr. V/s. Municipal Corporation of Greater Bombay and Anr. AIR 1985 Bom 242 has held that the metal containers or receptacles meant for storing petrol are tanks and nothing else. 12. Since it is admitted that the facts of assessee's case are identical with those of Gulf Oil India Ltd. (Supra), we are not going into the details of rental terms and conditions. At the same time, considering the rental agreement, two of which have been made available, the tank owners had not only stored the vegetable oils imported by assessee in their tanks but also have rendered other ancillary services. In these appeals we are only deciding whether the payments made by assessee are liable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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