Case Law Details
Shanmugar Services Vs ITO (ITAT Chennai)
As per the provisions of Sec.194C of the Act, any person responsible for making payment for any services needs to deduct TDS on such payment at the prescribed rate. From the plain reading of Sec.194C of the Act, it is abundantly clear that the person who makes payment is required to deduct TDS on such payment, whether the person makes the payment for himself or on behalf of the third party. In this case, the assessee is a Custom House Agent has made payment to CFS Agents on behalf of its customers and claimed that payment is in the nature of reimbursement of expenses and thus, outside the scope of Sec.194C of the Act. We do not find merits in the arguments of the assessee, because as per Sec.194C of the Act, it is abundantly clear that a person, who makes payment is required to deduct TDS and thus, we are of the considered view that there is no merit in the arguments of the assessee that payments made to CFS Agents, is outside the scope of Sec.194C of the Act.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
These two appeals filed by the assessee are directed against the order passed by the Commissioner of Income Tax (Appeals)-2, Chennai, dated 01.03.2017 and pertains to assessment years 2009-10 & 2010-11. Since, the facts are identical and issues are common, for the sake of convenience, these appeals were heard together and are being disposed off, by this consolidated order.
2. The assessee has, more or less, raised common grounds of appeals for both the assessment years. Therefore, for the sake of brevity, grounds of appeal for the AY 2009-10, are re-produced as under:
Please become a Premium member. If you are already a Premium member, login here to access the full content.
