Case Law Details
DCIT Vs. P.Z. Cussons India (P) Ltd. (ITAT Mumbai)
Seminal features of the contract entered into by the assessee with the three concerns for purchase of goods clearly bring out that the contract for supply of goods is on principal-to-principal basis and is a contract for purchase of goods by the assessee and sale of goods by the respective manufacturers. No doubt, the manufacturers are obliged to manufacture products as per the specifications and standards provided by the assessee but it is a case where the contractual obligations are entered into on a principal-to-principal basis. The manufacturers buy raw material and packing material at their own cost and as per their requirements and it is the obligation of the manufacturers to deliver the products as per specifications provided by the assessee. Accordingly, impugned agreements were purchase and sale contracts simpliciter, which did not require any deduction of tax under section 194C.
FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:-
The captioned three appeals relate to the same assessee and involve certain common issues, therefore, they have been clubbed, heard together and a consolidated order is being passed for the sake of convenience and brevity.
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