Case Law Details
Case Name : Commissioner of Income Tax (TDS) Vs M/s. Rajasthan Urban Infrastructure (Rajasthan High Court)
Related Assessment Year :
Courts :
All High Courts Rajasthan High Court
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The assessee, Rajasthan Urban Infrastructure Development Project(in short ‘RUIDP’), is a project of Government of Rajasthan for the Infrastructure Development and Civic Amenities in the specified areas/cities in the State of Rajasthan. The project is financially assisted by the Loan from the Asian Development Bank through the Government of India.
The project is working under the Urban Development Department of the Government of Rajasthan. The accounts are maintained on cash basis of accounting and also audited by the Chartered Accountant as per the requirement of the Asian Developm...
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My company is registered in Maharastra,
this order should be made applicable to
all over India, The Tax authority should issue
circular for the same and avoid double taxation
process.
Readers may refer to a detailed article on the subject published on Tax Management India .Com as follows and some comments of other learned authors and readers:
taxmanagementindia.com/visitor/detail_article.asp?ArticleID=102
The judgment is binding in Rajasthan. In other states it has pursuasvie value. As a precedence it must be followed all over India by junior courts, untill and unless a contrary judgment of any other High Court is applicable.
However, Service tax collected is necessarily to be deposited in GOI treasury. Therefore, there is diversion at source, and there is no accrula as income. Therefore, service tax cannot be income of any service provider.
I am totally unable to understand to the logic of CBDT when it says that ST collected by landlord from tenant is not income of landlord but in case of other serviced providers apply different rule and instruct to deduct tax at source from total payment.
The correct legal position is that on the element of ST,VAT, Municipal tax and similar other levies which are collected for onward deposit in governemtn account, is not income and income-tax is not deductible at source.
Its a good judgement and pending litigation should take the help of this decision as application to the fact as mentioned that as per the contract of service agreement it has been mentioned that service tax shall be paid accordingly as applicable on the fee charged separately as held by the hon’ble court in this judgment:
“The service tax was to be paid separately or not, is purely a question of fact and as per the agreement entered in the present case, it was to be paid separately and there is a finding of fact in this regard, recorded by the Appellate Authority as well as the Appellate Tribunal also. Even if the Circular dated 28.04.2008, is held to be not applicable in the present case, we find that the orders passed by both the authorities below, are in accordance with the provisions of Section 194J of the Income Tax Act, looking to the facts and circumstances of the present case.”
Our firm in the state of Maharashtra and above order is applicable for all India Basis.
Pl. give your opinion.
Thanks & regards,
L.D.Dharmadhikari