ITO, WARD-8(1), Nagpur V. SHRI NIRAJ KUMAR VYAS, Nagpur

ITA 165/NAG/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1650 (ITAT-NAGPUR)
• Duration Of Justice: 2 year(s) 5 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 22-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA KANE
• Section: 194C

Judgement Text

1 ITA NO. 165/NAG/2013 IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI MUKUL K. SHRAWAT, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. I.T. A. NO.165/NAG/2013 ASSESSMENT YEAR : 2005 - 06 THE INCOME - TAX OFFICER, NIRAJ KUMAR VYAS, WARD - 8(1), NAGPUR. VS. C/O MANOJ MORYANI & CO., ADVOCATE, SUDAMA BHAVAN NEAR SUT MARKET, GANDHIBAGH, NAGPUR. PAN AAUPV8974A. (APPELLANT) RESPONDENT. APPELLANT BY : SHRI NARENDRA KANE. RESPONDENT BY : SHRI MANOJ MORYANI. DATE OF HEARING : 05 - 08 - 2015. DATE OF PRON OUNCEMENT : 24 TH SEPT. , 2015. O R D E R PER SHRI SHAMIN YAHYA, A.M . THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(APPEALS) - 19, MUMBAI (CAMP OFFICE NAGPUR) DATED 13 - 02 - 2015 AND PERTAINS TO ASSESSMENT YEAR 2005 - 06. THE GROUNDS OF APPEAL READ AS UNDER : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) ERRED IN DELETING THE DISALLOWANCE OF ` 32,25,011/ - U/S 40(A)( IA ) OF THE I.T. ACT. 2 ITA NO. 165/NAG/2013 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A ) ERRED IN DELETING THE ADDITION OF ` 1,17,759/ - ON ACCOUNT OF VEHICLE MAINTENANCE CHARGES. 2 . APROPOS GROUND NO.1 THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CONSTRUCTION. DURING THE COURSE OF ASSESSMENT THE AO NOTED THAT THE ASSESSEE HAS MADE TRUCK HIRE CHARGES AMOUNTING TO ` 32,25,011 . THE ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY TDS WAS NOT DEDUCTED ON THIS PAYMENT. THE ASSESSEE VIDE LETTER DATED 17 - 12 - 2007 SUBMITTED THAT AS PER PROVISO TO CLAUSE (I) OF SUB - SECTION (3) OF SECTION 194C, IF THE FORM N. 15 - 1 OBTAINED FROM AN INDIVIDUAL WHO HAS NOT OWNED MORE THAN TWO GOODS CARRIAGES AT ANY TIME DURING THE YEAR, ASSESSEE IS NOT REQUIRED TO DEDUCT THE TAX FROM TRANSPORTATION CHARGES PAID. CONSIDERING THE ABOVE, THE AO FOUND THAT THE ABOVE CONTENTION CANNOT BE ACCEPTED. HE REFERRED TO SECTION 194C(3). THEREAFTER THE AO OBSERVED THAT, FURTHER THE AMENDMENT TO THIS SECTION WAS MADE APPLICABLE FROM THE SUBSEQUENT ASSESSMENT YEAR AND THE SAME IS NOT RELEVANT T THE ASSESSMENT YEAR UNDER CONSIDERATION. IN VIEW OF THE ABOVE ASSESSING OFFICER HELD THAT THE TRUCK HIRE CHARGES PAID TO / CREDITED TO FOLLOWING PERSONS ARE NOT ADMISSIBLE : 1. GHANSHAM JACHAK ` 180000/ - 2. MD. IDRIS ` 260000/ - 3. KAWDU WAGHMARE ` 180000/ - 4. JAMIL AHMED ` 210000/ - 5. CHARANDAS GOGRE ` 274000/ - 6. LUPESH DUBE ` 436000/ - 7. NARAYAN THAKUR ` 217000/ - ============== 3 ITA NO. 165/NAG/2013 TOTAL : ` 1763000/ - ============= IN ADDITION ASSESSING OFFICER NOTED THAT ASSESSEE HAS MADE PAYMENTS TO FOLLOWING PERSONS FROM WHOM HE HAS OBTAINED FORM NO. 151. FORM NO. 151 WAS INTRODUCED BY THE IT (FOURTEENTH AMENDMENT RULES 2005, W.E.F. 17.6.2005 AND THEREFORE ARE NOT RELEVANT FOR THE YEAR UNDER CONSIDERATION. 1. RANJIT SINGH MEHTA. 2. BHIMRAO WANKHEDE. 3. CHARANDAS GORE 4. RIYAZ KHAN. 5. NARAYAN SINGH THAKUR. 6. MD. IDRIS ZAN. 7. AKTHAR BEG. HENCE ASSESSING OFFICER HELD THAT THE PAYMENTS MADE TO THESE PERSONS WITHOUT TDS DEDUCTION ARE ALSO NOT ADMISSIBLE U/S 40(A)(IA). THE PAYMENTS MADE TO THE PERSONS OTHER THAN MENTIONED ABOVE WITHOUT DEDUCTING TDS AMOUNTS TO ` 1462011/ - WHICH IS ALSO DISALLOWED U/S 40(A)(IA) FOR THE DETAILE D REASONS MENTIONED ABOVE, AND ADDED BACK TO THE TOTAL INCOME. 3. UPON ASSESSEES APPEAL, LEARNED CIT(APPEALS) CONSIDERED THE FACTS OF THE CASE AND HELD AS UNDER : I AM OF THE CONSIDERED VIEW THAT THE PAYMENT OF ` 35,69,072/ WAS ESSENTIALLY MADE TOWAR DS RENTING/HIRING OF TRUCK ON RENT AND HENCE CAN NOT BE TREATED TOWARD SUB CONTRACTS AS ALLEGEDLY CLAIMED BY THE AO. THE MADRAS HIGH COURT IN THE CASE OF POOMPUHAR CORPORATION LTD. (282 ITR 3) HAS HELD THAT HIRING OF SHIPS BY THE ASSESSEE AND USING THEM IN ITS BUSINESS IS NOT A CONTRACT TO ATTRACT THE PROVISION OF SECTION 194C. SIMILARLY, THE BOMBAY HIGH COURT IN THE CASE OF BDA LTD. (201 CTR 413) WAS OF THE VGIEW THAT 4 ITA NO. 165/NAG/2013 PRINTING ON PACKING LABEL BY THE SELLER AS PER SPECIFICATIONS OF THE ASSESSEE, DOES NOT AMOUNT TO ANY WORK CONTRACT AND THEREFORE, CAN NOT BE COVERED U/S. 194C OF THE ACT. THEREFORE, FOLLOWING THE AFORESAID JUDGMENT CITED (SUPRA), THE HIRE CHARGES FOR TRUCKS PAID BY THE APPELLANT CAN NOT BE TREATED AS CONTRACT WITHIN THE MEANING CONTAINE D IN SECTION 194C OF THE ACT. ACCORDINGLY THE TRUCKS HIRE CHARGES MADE BY THE APPELLANT WAS NOT LIABLE FOR TDS DEDUCTION U/S. 194C OF THE ACT. FURTHER REFERENCE IS MADE TO CBDTS CIRCULAR NO. 108 DT. 20.03.1993 AND CIRCULAR NO. 681 DT. 8.3.1994 WHICH CLARI FIES THAT THE PROVISIONS OF SECTION 194C WOULD NOT APPLY IN RELATION TO PAYMENTS MADE FOR HIRING OR RENTING OF TRUCK, ETC. IN THE LIGHT OF ABOVE, I AM THEREFORE, OF THE CONSIDERED VIEW THAT PAYMENT TOWARDS HIRING OF TRUCK WAS NEVER COVERED U/S. 194C OF THE ACT AND THEREFORE, THERE ARISES NO QUESTION OF DEDUCTION OF TDS IN THIS CASE. THEREAFTER LEARNED CIT(APPEALS) REFERRED TO THE PROVISIONS OF SECTION 40(A)(IA) AND OBSERVED AS UNDER: 6.3 THE READING OF THE AFORESAID PROVISION OF SECTION 40(A)(IA) CLEARL Y SHOWS THAT UPTO ACC O UNTING YEAR 2004 - 0 5 , ANY INTEREST, COMMISSION OR BROKERAGE, FEES FOR PROFESSIONAL/TECHNICAL SERVICES OR AMOUNT PAYABLE TO CONTRACTOR OR SUBCONTRACTOR ON WHICH TDS IS DEDUCTIBLE AND THE ASSESSEE FAILS TO DEDUCT OR PAYS SUCH TDS BEFORE THE EXPIRY OF TIME PRESCRIBED, U/S 200(1) OF THE ACT, THEN THE SAID AMOUNT SHALL NOT BE DEDUCTED IN COMPUTING THE INCOME. IT IS ONLY WITH EFFECT FROM 1.4.2006 THAT PAYMENT TOWARDS RENT AND ROYALTY HAS ALSO BEEN INSERTED IN SECTION 40(A)(IA) BY THE TAXATI ON LAWS (AMENDMENT ACT), 2006 AND HENCE IT IS NOT APPLICABLE IN THE APPELLANTS CASE RELEVANT FOR ACCOUNTING YEAR 2004 - 05. THUS PRIOR TO THE SAID AMENDMENT W.E.F. 1.4.2006, ANY PAYMENT TOWARDS RENT CHARGES LIABLE FOR TDS U/S 1941 WAS NOT HIT BY PROVISIONS OF SECTION 40(A)(IA) OF THE ACT. 6.4 HOWEVER, WITHOUT PREJUDICE TO THE ABOVE FINDING, IT IS ALSO RELEVANT TO MENTION HERE THAT THE RENT CHARGES FOR USE OF MACHINERY WAS INCLUDED IN THE DEFINITION OF RENT IN THE EXPLANATION TO PROVISION OF SECTION 194 W .E.F. 13.7.2006 BY THE TAXATION LAWS (AMENDMENT ACT), 2006. THUS PRIOR TO THE SAID AMENDMENT W.E.F. 13.07.2006 AS PER RULE 29D, AND PAYMENT TOWARDS RENT OF TRUCK WAS NOT LIABLE FOR TDS U/S 194I OF THE ACT AND THEREFORE, THE ASSESSEE CAN NOT BE TREATED IN D EFAULT FOR NON DEDUCTION OF TDS ON HIRING OF TRUCKS DURING THE PREVIOUS YEAR RELEVANT TO ASSTT. YEAR 2005 - 06. CONSEQUENTLY, THERE BEING NO DEFAULT OF TDS BY THE APPELLANT, THERE CAN NOT BE ANY CASE OF DISALLOWANCE OF THE SAID EXPENDITURE U/S 40(A)(IA) OF THE ACT. 5 ITA NO. 165/NAG/2013 THEREAFTER LEARNED CIT(APPEALS) REFERRED TO THE ALTERNATIVE ARGUMENT OF THE ASSESSEES COUNSEL THAT HE HAD OBTAINED FORM NO. 15G/15I FROM WHOM TRUCKS WERE TAKEN ON RENT. LEARNED CIT(APPEALS) REFERRED TO THE PROVISIONS OF SECTION 15I, REF ERRED TO ACTION POINT OF THE AFORESAID FORM OF 15I AS PER RULES AS UNDER : 1. THE FORM IS RELEVANT TO A SUB - CONTRACTOR WHO SATISFIES THE FOLLOWING CONDITIONS (A) THE SUB - CONTRACTOR IS AN INDIVIDUAL ENGAGED IN BUSINESS OF PLYING, HIRING OR LEASING OF GOODS CARRIAGES. (B) THE SUB - CONTRACTOR HAS NOT OWNED MORE THAN TWO GOODS CARRIAGES AT ANY TIME DURING THE PREVIOUS YEAR. 2. IF SUCH SUB - CONTRACTOR WISHES T O RECEIVE ANY PAYMENT GOVERNED UNDER SECTION 194C OF THE ACT WITHOUT DEDUCTION OF TAX AT SOURCE, HE SHOULD FURNISHED A DECLARATION IN THIS FORM TO THE PERSON PAYING OR CREDITING SUCH PAYMENT. 6.6 THE ABOVE MENTIONED RULES ALSO SUPPORTS THE CASE OF THE ASSE SSEE AND THIS RULES WERE AMENDED FROM 13/07/2006 AND SAME WERE NOT APPLICABLE FOR THE PREVIOUS YEAR RELEVANT TO ASSTT. YEAR 2005 - 06. REGARDING THE DATE OF APPLICABILITY OF THE AMENDED PROVISION OF THE ACT, I RELY ON THE RATIO OF THE DECISION OF MADRAS HIGH COURT IN THE CASE OF POOMPUHAR SHIPPING CORPORATION LTD. (282 ITR 3) (MAD.) WHEREIN IT HAS BEEN HELD THAT. THERE IS NO PRINCIPLE OF INTERPRETATION WHICH WOULD QUANTITY READING THE EXPLANATION OF SECTION 194C INSERTED W.E.F. 01/07/1995 AS OPERATING RETRO SPECTIVELY, WHEN THE EXPLANATION COMES INTO FORCE EFFECTIVE FROM A FUTURE DATE. IN THE CASE THE EXPLANATION INTRODUCED IS WITH EFFECT FROM 01 - 07 - 1995. HENCE IT WILL BE APPLICABLE ONLY FOR THE FUTURE ASSESSMENT YEARS AND IT WILL NOT BE APPLICABLE TO THE ASS ESSMENT YEAR IN CONSIDERATION. 6.7 THE HONBLE MADRAS HIGH COURT HAS RELIED IN THIS CASE ON THE RATIO OF THE DECISION OF THE SUPREME COURT IN THE CASE OF SEDCO FOREX INTERNATIONAL DRILL INC (279 ITR 710 (SC)). CONSIDERING THE ABOVE, I HOLD THAT THE PROVIS IONS OF 1 ST PROVISO TO SECTION 194C(3) OF THE ACT WOULD BE APPLICABLE FOR PAYMENTS MADE AFTER 01.10.2004 . CONSIDERING THE ABOVE I HOLD THAT THE 6 ITA NO. 165/NAG/2013 PROVISIONS FOR RENT HAS BEEN AMENDED BY THE FINANCE ACT, 2005, IN SUB - SECTION (3), IN CLAUSE (I) WITH EFFECT FROM THE 1 ST DAY OF JUNE, 2005 AND RULE 29D HAS BEEN AMENDED FROM 13.7.2006. IN THE LIGHT OF THE ABOVE FINDING, TO DISALLOWANCE OF ` 32,25,011/ - U/S 40(A)(IA) BY THE AO IS NOT JUSTIFIED AND HENCE DIRECTED TO BE DELETED. 4. AGAINST THE ABOV E ORD ER, REVENUE IS IN APPEAL BEFORE US. 5. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. LEARNED D.R. RELIED UPON THE ORDER OF THE AO. LEARNED COUNSEL OF THE ASSESSEE, ON THE OTHER HAND, RELIED UPON THE ORDERS OF LEARNED CIT(APPEALS). HE ALSO REFERRE D TO PROVISIONS OF SECTION 194C(3). LEARNED COUNSEL CONTENDED THAT THE ISSUE IS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE FOLLOWING CASE LAWS : 1. JUDGMENT OF HONBLE ITAT, NAGPUR BENCH DATED 17 - 07 - 2009 IN VARIOUS CASE LAWS VIDE APPEAL NO. 75,76,83/NA G/2009. 2. HONBLE APEX COURT DECISION IN THE CASE OF SEDCO FOREX INTERNATIONAL DRILL INC & ORS. VS. CIT & ANR. (2005) 279 ITR 310 (SC). 3. HONBLE MADRAS HIGH COURT DECISION IN THE CASE OF CIT VS. POOMPUHAR SHIPPING CORPORATION LTD. (2006) 282 ITR 03. 6. UPON CAREFUL CONSIDERATION WE FIND THAT THE ASSESSING OFFICER IN THIS CASE HAS INVOKED THE PROVISIONS OF SECTION 40(A)(IA) FOR THE DISALLOWANCE. WE NOTE THAT THE ASSESSING OFFICER HAS REFERRED TO BOTH THE PROVISIONS OF SECTION 194C AND 194I IN THIS REGARD WHICH IN HIS OPINION REQUIRED DEDUCTION OF TAX. 7. AS REGARDS SECTION 194I IS CONCERNED, WE FIND THAT THE SAME MANDATES DEDUCTION OF TAX ON THE PAYMENT OF RENT. THE RENT WAS INCLUDED IN SECTION 40(A)(IA) WITH EFFECT FROM 01 04 2006. THUS WE AGREE WITH THE LEARNED CIT(APPEALS) THAT UPTO ACCOUNTING YEAR 2004 05 RENT WAS NOT INCLUDED IN THE PROVISIONS OF SECTION 40(A)(IA) REQUIRING DEDUCTION OF TAX UNDER SECTION 194I. 7 ITA NO. 165/NAG/2013 8. AS REGARDS THE PROVISIONS OF SECTION 194C IS CONCERNED, THE SAID SECTION MANDATES DEDUCTION OF TAX AT SOURCE WHEN THE PAYMENT IS MADE TO A CONTRACTOR OR A SUB CONTRACTOR. SUB SECTION (3) OF THE EXTANT SECTION 194C PROVIDED THAT NO DEDUCTION SHALL BE MADE U NDER SUB SECTION (1) AND SUB SECTION (2) REGARDING ANY SUM CREDITED OR PAID IN PURSUANCE OF ANY CONTRACT THE CONSIDERATION OF WHICH DOES NOT EXCEED ` 20,000/ . THIS PROVISION WAS SUBSTITUTED BY FINANCE ACT, 2004 WITH EFFECT FROM 01 10 2004 AS UNDER : (I) THE AMOUNT OF ANY SUM CREDITED OR PAID OR LIKELY TO BE CREDITED OR PAID TO THE ACCOUNT OF, OR TO, THE CONTRACTOR OR SUB CONTRACTOR, IF SUCH SUM DOES NOT EXCEED TWENTY THOUSAND RUPEES: PROVIDED THAT WHERE THE AGGREGATE OF THE AMOUNTS OF SUCH SUMS CREDITED O R PAID OR LIKELY TO BE CREDITED OR PAID DURING THE FINANCIAL YEAR EXCEEDS FIFTY THOUSAND RUPEES, THE PERSON RESPONSIBLE FOR PAYING SUCH SUMS REFERRED TO IN SUB SECTION (1) OR, AS THE CASE MAY BE, SUB SECTION (2) SHALL BE LIABLE TO DEDUCT INCOME TAX UNDER T HIS SECTION. FURTHER MORE, FINANCE ACT, 2005 WITH EFFECT FROM 01 06 2005 PROVIDED AS UNDER : PROVIDED FURTHER THAT NO DEDUCTION SHALL BE MADE UNDER SUB SECTION (2), FROM THE AMOUNT OF ANY SUM CREDITED OR PAID OR LIKELY TO BE CREDITED OR PAID DURING THE P REVIOUS YEAR TO THE ACCOUNT OF THE SUB CONTRACTOR DURING THE COURSE OF BUSINESS OF PLYING, HIRING OR LEASING GOODS CARRIAGES, ON PRODUCTION OF A DECLARATION TO THE PERSON CONCERNED PAYING OR CREDITING SUCH SUM, IN THE PRESCRIBED FORM AND VERIFIED IN THE PR ESCRIBED MANNER AND WITHIN SUCH TIME AS MAY BE PRESCRIBED, IF SUCH SUB CONTRACTOR IS AN INDIVIDUAL WHO HAS NOT OWNED MORE THAN TWO GOODS CARRIAGES AT ANY TIME DURING THE PREVIOUS YEAR. 9. FIRST OF ALL WE FIND THAT THE EXTANT PROVISIONS APPLICABLE FOR THE Y EAR DID NOT REFER TO THE BUSINESS OF PLYING, HIRING, LEASING GOODS CARRIAGES. SO PAYMENT OF ACCOUNT OF HIRING OF TRUCK CAN BE CONSIDERED FOR DEDUCTION OF TAX UNDER THE EXTANT PROVISION OF SECTION 194C IF THERE WAS ANY CONTRACT FOR THE SAME. IN THIS REGARD LEARNED CIT(APPEALS) HAS REFERRED TO HONBLE MADRAS HIGH COURT DECISION IN THE CASE OF CIT V/S. POOMPUHAR SHIPPING CORPORATION LTD. 282 ITR 03. IN THIS CASE 8 ITA NO. 165/NAG/2013 HONBLE MADRAS HIGH COURT HAD HELD THAT HIRING OF SHIPS BY THE ASSESSEE AND USING THEM IN ITS BUSI NESS IS NOT A CONTRACT TO ATTRACT THE PROVISIONS OF SECTION 194C. FURTHER MORE LEARNED CIT(APPEALS) HAD REFERRED TO CBDT CIRCULAR NO. 108 DATED 20 03 1993 AND CIRCULAR N O. 681 DATED 08 03 1994 WHICH CLARIFIED THAT PROVISION OF SECTION 194C WOULD NOT APPLY IN RELATION TO PAYMENTS MADE FOR HIRING OR RENTING OF TRUCKS. CONSIDERING THESE ASPECTS LEARNED CIT(APPEALS) HAD HELD THAT HE WAS OF THE CONSIDERED VIEW THAT PAYMENT TOWARDS HIRING OF TRUCKS WAS COVERED UNDER SECTION 194C OF I.T. ACT AND, THEREFORE, THERE AROSE NO QUESTION OF DEDUCTION OF TDS. WE FIND THAT A READING OF THE EXTANT PROVISION OF THE ACT AND THE ABOVE SAID CASE LAW AND CIRCULARS MAKES IT CLEAR THAT LEARNED CIT(APPEALS) HAS APPRECIATED THE EXTANT LAW CORRECT L Y. HENCE WE AGREE WI TH THE LEARNED CIT(APPEALS) IN THIS REGARD THAT PAYMENT MADE FOR HIRING CHARGES OF TRUCK BY THE ASSESSEE WAS NOT COVERED UNDER SECTION 194C OF I.T. ACT. 10. FURTHER MORE WE NOTE THAT FINANCE ACT 2005 WITH EFFECT FROM 01 06 2005 PROVIDE THAT WHEN PAYMENT IS MADE ON ACCOUNT OF HIRING OR LEASING OF GOODS CARRIAGES NO DEDUCTION WAS REQUIRED IF THE PRESCRIBED FORM WAS SUBMITTED BY THE SAID CONTRACTOR WHO WAS AN INDIVIDUAL AND WHO HAS NOT OWNED MORE THAN TWO CARRIAGES AT ANY TIME DURING THE PREVIOUS YEAR. THE ASSESSEE HAS CLAIMED THAT THE ASSESSEE HAD COMPLIED WITH THESE PROVISIONS. HOWEVER, THE ASSESSING OFFICER HAS REJECTED THE SAME BY HOLDING THAT THE SAME IS APPLICABLE FROM THE NEXT YEAR. WE FIND THAT THIS VIEW OF THE ASSESSING OFFICER IS NOT CORRECT. WHEN HE IS TAKING INTO ACCOUNT THE AMENDMENT TO BRING INTO THE AMBIT OF DEDUCTION OF TAX AT SOURCE WHEN THE PAYMENT FOR RENTING AND HIRING OF GOODS CARRIAGES THEN HE MUST TAKE INTO ACCOUNT THE EXEMPTION PROVISIONS ALSO APPLICABLE ALONG WITH THE SAME AMENDMEN T. IN THIS VIEW OF THE MATTER, WE ARE OF THE CONSIDERED OPINION THAT THE 9 ITA NO. 165/NAG/2013 PLEA OF THE ASSESSEE THAT HE HAS OBTAINED FORM NO. 15I WITH REQUISITE CERTIFICATION ALSO SUPPORTS THE CASE OF THE ASSESSEE. HENCE WE CONCLUDE AS UNDER : AS PER THE EXTANT PROVISION S ECTION 194C IT DID NOT PROVIDE FOR DEDUCTION OF TAX AT SOURCE FOR PAYMENTS MADE FOR HIRING OF TRUCKS. FURTHER MORE THE PROVISIONS OF RENT UNDER SECTION 194I WERE NOT INCLUDED IN THE PROVISIONS OF SECTION 40(A)(IA) . I F IT IS CONSIDERED THAT ASSESSEE WAS R EQUIRED TO DEDUCT TDS UNDER THE PROVISIONS OF SECTION 194C THEN THE EXEMPTION PROVISIONS OF SECTION 194C(III) COMES TO THE RESCUE OF THE ASSESSEE. 11. ACCORDINGLY IN OUR CONSIDERED OPINION THERE IS NO INFIRMITY IN THE ORDER OF LEARNED CIT(APPEALS). ACCORD INGLY WE UPHOLD THE SAME. 12 . APROPOS GROUND NO.2: ON THIS ISSUE THE AO MADE THE ADDITION HOLDING AS UNDER : ASSESSEE HAS CLAIMED VEHICLE MAINTENANCE CHARGES AMOUNTING TO ` 117759/ - IN HIS RETURN. THE ASSESSEE HAS CLAIMED THAT THE SAME IN RESPECT OF THE VEHICLES TAKEN ON HIRE BY THE ASSESSEE. SINCE THE VEHICLES ARE TAKEN ON HIRE AND NO DETAILS OF THE AGREEMENT AND THE TERMS AND CONDITIONS THEREIN ARE FORTHCOMING AS ALSO ALL THE BILLS AND SUPPORTING DOCUMENTS TO THIS EFFECT, THE CLAIM OF THE ASSESSEE THAT THE MAINTENANCE CHARGES ARE BEING INCURRED BY HIM /OR WHETHER THE SAME ARE DEDUCTED OR REIMBURSED BY THE OWNERS OF THE VEHICLES ARE NOT CONCLUSIVELY PROVED. FOR WANT OF EVID ENCE AND DETAILS THE AMOUNT OF ` 117759 UNDER THE HEAD VEHICLE MAINTENANCE CHARGES ARE DISALLOWED AND ADDED BACK TO THE TOTAL INCOME. 13 . UPON ASSESSEES APPEAL, LEARNED CIT(APPEALS) DELETED THE ADDITION HOLDING AS UNDER : THE APPELLANT AT GROUND NO. 7 HAS DISPUTED THE DISALLOWANCE OF ` 1,17,759/ - . THE AR SUBMITTED THAT THE ASSESSEE HAS ALREADY PAID MAINTENANCE CHARGES OF ` 1,17,759/ - AS THE AFORESAID AMOUNT IS ACTUALLY PAID 10 ITA NO. 165/NAG/2013 BY THE ASSESSEE. THE AR SUBMITTED COPY OF ACCOUN T OF VEHICLE MAINTENANCE ACCOUNT WHICH IS PLACED ON PAPER BOOK PAGE - 43 - 45. SINCE THE AFORESAID EXPENDITURE DIRECTLY RELATED TO BUSINESS OF THE ASSESSEE AND THE SAME WERE ALLOWABLE EXPENDITURE, WHICH WERE ACTUALLY PAID BY THE ASSESSEE, I AM FULLY AGREED WIT H THE SUBMISSION OF THE AR THAT THE AFORESAID EXPENDITURE WERE ALREADY INCURRED BY THE ASSESSEE FOR VEHICLE MAINTENANCE CHARGES. THEREFORE, THE A.O. IS DIRECTED TO DELETE AN ADDITION OF ` 1,17,759/ - . 14 . AGAINST THE ABOVE ORDER REVENUE IS IN APPEAL BEFOR E US. 15 . WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. WE FIND THAT AS EVIDENT FROM THE AOS OBSERVATION AS ABOVE IT IS NOT THE CASE OF THE AO THAT PAYMENTS HAVE NOT BEEN MADE OR THAT PAYMENTS ARE BOGUS. THE AO HAS DOUBTED THE PAYMENTS ON A SURMISE THAT HE IS NOT SURE WHETHER THESE PAYMENTS HAVE BEEN REIMBURSED BY THE OWNERS OF THE VEHICLES. WE FIND THAT THE AO HAS NOT BROUGHT ANY EVIDENCE ON RECORD THAT THESE PAYMENTS HAVE BEEN REIMBURSED BY THE OWNERS OF THE VEHICLES. ADMITTEDLY NO DIS ALLOWANCE CAN BE MADE ONLY ON SURMISES OR CONJECTURES. ACCORDINGLY WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT(APPEALS) ON THIS ISSUE. ACCORDINGLY WE UPHOLD THE SAME. 1 6 . IN THE RESULT, THIS APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 24 TH DAY OF SEPT. , 2015. SD/ SD/ (MUKUL K. SHRAWAT) ( SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER. NAGPUR, DATED: 24 TH SEPT. , 2015. 11 ITA NO. 165/NAG/2013 COPY OF ORDER FORWARDED TO : 1. THE ASSESSEE. 2. REVENUE. 3. THE CIT(A) 4. THE CIT, NAGPUR. 5. THE D.R., ITAT, NAGPUR. 6. GUARD FILE. TRUE COPY. BY ORDER WAKODE ASSISTANT REGISTRAR, ITAT, NAGPUR