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Provisions of s 194C do not apply towards the transportation charges paid to partners by partnership firm for use of trucks owned by the partners
Case Law Details
- Case Name
- CIT Vs Grewal Brothers (High Court of Punjab and Haryana)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Courts
- All High Courts, Punjab and Haryana HC
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CIT Vs Grewal Brothers – No doubt the firm and the partners may be separate entities for income tax and it may be permissible for a firm to give a contract to its partners and deduct tax from the payment made as per s 194C, but it has to be determined in the facts and circumstances of each case whether there was any separate subcontract or the firm merely acted as an agent as pleaded in the present case. The case of the assessee is that it was the partners who were executing the transportation contract by using their trucks and the payment from the companies was routed through the firm a...
22-4-11
TO ME IT SEEMS IT SHOULD HAVE BEEN TREATED AS A SUB-CONTRACT AND THE FIRM SHOULD HAVE DEDUCTED TDS FROM THE COMMISSION PAID. OTHERWISE THERE IS NO JUSTIFICATION IN PAYING THE COMMISSION. IT AMOUNTS TO THE FIRM PAYING COMMISSION TO THEMSELVES.