Case Law Details

Case Name : Assistant CIT Vs Indraprastha Medical Corporation Ltd. (ITAT Delhi)
Appeal Number : 07/08/2009
Date of Judgement/Order : 2004- 05
Related Assessment Year :

In the case of: Assistant CIT Vs. Indraprastha Medical Corporation Ltd., Decided by: ITAT Delhi, Asst. Yr. 2004- 05, Decision dated- 7th August, 2009

Gist of decision: U/s. 194J  a person is liable to deduct tax at source for any payment in excess of Rs. 20,000 to a resident for availing professional or technical services. There was no relationship of the service provider and the service recipient between the consultants and the assessee. Rather, such relationship existed between the doctors/ consultants and the patients.

The collection of fee was paid and passed it on to the doctors by the pooled secretarial staff of the assessee hospital. Nothing inured for the benefit of the assessee. Rather, it was the assessee providing services to the doctors by providing them consultation chambers and secretarial staff, and not other way round. Where a hospital engaged consulting doctors and provided them with consulting chambers with secretaries assistance and the fees collected from out-patients and paid to the consultants each day after deducting certain amount towards rent and secretarial assistance, it was not a case of payment of professional fee and neither s. 192 nor s. 194J was attracted and the hospital cannot be  treated as assessee in default for not deducting tax from such payments.


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