Case Law Details
DCIT Vs Murugarajendra Oil Industry (P) Ltd. (ITAT Bangalore)
Assessee claimed that on obtaining of either the declaration contemplated under second proviso to the pre-amended section 194C(3) or the PAN details under the present section 194C(6), the assessee was not required to make any deduction at source on the payments made to the contractor or sub-contractor, irrespective of the fact whether or not such information was furnished to the authorities as prescribed under third proviso to the amended section 194C(3) or the present section 194C(7). So if assessee complies with the provisions of section 194C(6), disallowance under section 40(a)(ia) does not arise just because there is violation of provisions of section 194C(7) of the Act
Two reasons assigned by the AO for not accepting the plea of the Assessee to invoke the provisions of Sec. 40(a)(ia) of the Act in this case was held to be unsustainable. The first reason given by the AO was that the provisions of Sec.194C(6) are applicable only to transport contractors and not to any other payee and that reason has been held to be not correct in the aforesaid decision in which it was held Sec. 194C(6) made it plainly clear that from the A.Y. 2010-11 onwards, by virtue thereof when Transport Operators furnish their PAN to the person responsible for making payments to them, the Transport Operators would be outside the purview of TDS u/s 194C and that immunity from TDS u/s. 194C(1) in relation to payments to transporters, applies transporter and non-transporter contractees alike. The second reason given by the AO was that the Assessee failed to comply with the provisions of Sec.194C(7) of the Act and that reason has also been held to be not correct in the aforesaid decision and the view taken is that if the assessee complies with the provisions of section 194C(6), disallowance under section 40(a)(ia) does not arise just because there is violation of provisions of section 194C(7) of the Act.
FULL TEXT OF THE ITAT JUDGEMENT
This is an appeal by the Revenue against the order dated 20-04-2017 of the Commissioner of Income Tax (Appeals)-Davangere, relating to Assessment Year 2012-13.
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