DCIT, LAXMI NAGAR, DELHI V. M/S PVR INOX LTD., DELHI

ITA 3057/DEL/2025

AI Insights

The case involves the Deputy Commissioner of Income Tax (DCIT) as the appellant and M/s PVR Inox Ltd. as the respondent. The core issue was whether the common area maintenance charges paid by the Assessee are to be considered as contractual payments liable for Tax Deducted at Source (TDS) under Section 194C of the Income Tax Act, 1961. The Tribunal referenced its earlier decisions in the Assessee's own cases for the Assessment Years 2011-12 and 2012-13, where it was established that CAM charges should be treated separately from rent and governed by different sections of the Act. The Tribunal's decision led to a directive for the A.O. to re-compute the CAM charges in accordance with these provisions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 783704 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2025
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2016-2017
• Appeal Filed On: 06-05-2025
• Other Referred Cases: ITA No. 7290/Del/2019, ITA No. 209/Del/2020
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: OM PRAKASH
• Assessee Lawyers: TUSHAR BHUTANI; S. K
• Keywords: TDS
• Section: 194C

Judgement Text

"1 ITA No. 3057/Del/2025 DCIT Vs. M/s PVR Inox Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI (DELHI BENCH ‘C’ NEW DELHI) BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER ITA No. 3057/DEL/2025 (A.Y. 2016-17) DCIT Room No. 611, 6th Floor, Aayakr Bhawan, Laxmi Nagar, Delhi Vs. M/s PVR Inox Ltd. 61, Vasant Lok, Vasant Vihar, New Delhi PAN: AAACP4526D Appellant Respondent Assessee by Sh. Tushar Bhutani, CA & Sh. S. K. Aggarwal, CA Revenue by Sh. Om Prakash, Sr. DR Date of Hearing 15/09/2025 Date of Pronouncement 07/11/2025 ORDER PER YOGESH KUMAR, U.S. JM: The present appeal is filed by the Revenue against the order of the Commissioner of Income Tax (Appeals)-23, Delhi [‘Ld. CIT(A) ’ for short] dated 07/03/2025 pertaining to Assessment Year 2016-17. 2. The solitary issue involved in the present Appeal as to whether the Ld. CIT(A) was justified in holding that common area maintenance charges paid by the Assessee are in the nature of contractual payment and are liable to be deducted TDS u/s 194C of the Income Tax Act, 1961 ('Act' for short) or not?. 3. The Ld. Counsel for the Assessee submitted that the above issue is no more res-integra and is squarely covered in Assessee’s own case for Assessment Year 2011-12 and 2012-13 in ITA No. 7290/Del/2019 Printed from counselvise.com 2 ITA No. 3057/Del/2025 DCIT Vs. M/s PVR Inox Ltd. and ITA No. 209/Del/2020 vide order dated 09/02/2023, thus sought for allowing the Appeal. 4. Per contra, the Ld. Department's Representative relying on the orders of the Lower Authorities sought for dismissal of the Appeal. 5. We have heard both the parties and perused the material available on record. The Co-ordinate Bench of the Tribunal in Assessee’s own case for Assessment Year 2011-12 and 2012-13, while deciding the similar issue held that provisions for rent are governed u/s 194I and common area maintenance charges are governed u/s 194C of the Act, accordingly, directed the A.O. to recomputed common area maintenance charges by taking into consideration of those two Sections. The relevant portion of the order of the Tribunal in ITA No. 7290/Del/2019 and ITA 202/Del/2020 (supra) is as under:- “6. The undisputable fact in this case is that while the lease rentals are paid based on a fixed percentage on the net revenue, the CAM charges are based on the per sq.ft. area. The observation of the ld .CIT(A) is that the rent by any name , lease , sub-lease , tenancy or the reliance on the judgment wherein the services are intrapolated into the rent stand on a different pedestal. In the instant case, the determination of the rent or CAM are separate and the CAM arrangements are not essential and an integral part for use of the premises. While there are no expenses incurred against the rent except for general building maintenance and municipal charges, the CAM involves employment of separate staff and separate operations involved on day to day basis. Hence, we hold that the provisions for rent are governed by Section 194I and CAM charges by Section 194C of the Act. The AO is directed to re-compute the CAM charges, taking into consideration the two sections mentioned above.” 6. As the facts and circumstances being identical and in the absence of any contrary ratio brought to the notice of the Bench, by Printed from counselvise.com 3 ITA No. 3057/Del/2025 DCIT Vs. M/s PVR Inox Ltd. respectfully following order of the Tribunal in Assessee’s own case for Assessment Year 2011-12 and 2012-13 (supra), we hold that the provisions for rent are governed by Section 194I and CAM charges by Section 194C of the Act. The AO is directed to re-compute the CAM charges, taking into consideration the two sections mentioned above. 7. In the result, Appeal of the Revenue is partly allowed for statistical purpose. Sd/- Sd/- (S. RIFAUR RAHMAN) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Date:- 07.11.2025 R.N, Sr.P.S* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "