ITO (TDS) 3(1), MUMBAI V. ROHM & HASS (INDIA) P.LTD, MUMBAI

ITA 1820/MUM/2012

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0956 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 26-03-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 15-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA P YADAV
• Section: 133A; 194C

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI . . , , !' # $, % & BEFORE SHRI B.R. BASKARAN, AM AND SHRI AMIT SHUKLA, JM . / ITA NOS. 1820,1821,1822/MUM/MUM/2012 ( / ASSESSMENT YEARS : 2007-08, 2008-09 & 2009-10 ) & . / ITA NOS. 4043,4044 & 4045 /MUM/2013 ( / ASSESSMENT YEARS : 2007-08, 2008-09 & 2009-10 ) ITO (TDS) 3(1) 10 TH FLOOR, SMT. K.G. MITTAL AYURVEDIC HOSPITAL BLDG, CHARNI RD. (W) MUMBAI-40002 .. / APPELLANT V/S ROHM & HAAS (INDIA) P. LTD. 121/122, SOLITAIRE PARK, CHAKALA, ANDHERI (E), MUMBAI 400093 .... / RESPONDENT . / PERMANENT ACCOUNT NUMBER AAACR2855F REVENUE BY : SHRI AKHILENDRA P. YADAV (DR) RESPONDENT BY : SHRI M.P. LOHIA (AR) ! ' # $% / DATE OF HEARING 26.03.2015 &' () # $% / DATE OF ORDER 08 .04.2015 # / ORDER !' # $, % ' / PER AMIT SHUKLA, J.M. THE AFORESAID APPEALS HAVE BEEN FILED BY THE REVENU E AGAINST ORDER DATED 30 TH DECEMBER 2011, PASSED BY THE LEARNED COMMISSIONER ROHM AND HAAS INDIA PVT. LTD. 2 (APPEALS), MUMBAI, UNDER SECTION 201(1A), FOR THE AS SESSMENT YEARS 2007-08,2008-09 & 2009-10. SINCE THE ISSUES INVOLVE D IN ALL THE APPEALS ARE COMMON, THEREFORE, THE SAME ARE BEING DI SPOSED OFF BY WAY OF THIS CONSOLIDATED ORDER. 2. FIRST, WE WILL TAKE UP APPEALS AGAINST ORDER U/S .201(1) FOR THE A.YS. 2007-08 TO 2009-10 WHICH ARE BASED ON SIMILAR FACTS AND SIMILAR ISSUES. FOR THE SAKE OF READY REFERENCE, THE APPEALS FOR THE A.Y. 2007- 08 IS BEING TAKEN UP FIRST, WHEREIN THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL. 1. (I). THE LD. CIT(A) HAS ERRED ON FACTS AND IN LA W IN HOLDING THAT T.D.S. IS NOT DEDUCTIBLE ON PAYMENT OF RS. 3,85,29,427/- B EING REIMBURSEMENT WITHOUT APPRECIATING THAT THERE NO MATERIAL ON RECO RD TO SUGGEST THAT THESE PAYMENT ARE IN NATURE OF REIMBURSEMENT AND ARE NOT REFLECTED IN RUNNING ACCOUNT WHERE ADVANCE IS RECEIVED AND THEREAFTER EX PENDITURE IS APPROPRIATED ON BEHALF OF PRINCIPAL. (II). THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT REIMBURSEMENT ATTRACT TDS AS PER ANSWER TO QUE STION NO. 30 CONTAINED IN CBDT CIRCULAR NO. 715 DT: 08/08/1995. (III). THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN HOL DING THAT THE AMOUNT PAID BY ROHM & HAAS (I) PVT. LTD. TO M/S PRO LOGISTICS (I) PVT. LTD. AS WAREHOUSING CHARGES AND FORKIT CHARGES ARE NOT I N THE NATURE OF RENT AS DEFINED U/S. 1941 OF THE ACT WITHOUT APPRECIATIN G THAT THE DEFINITION OF RENT AS CONTAINED IN EXPLANATION (I) TO SECTION 1941 IS WIDE ENOUGH TO INCLUDE ANY PAYMENT FOR THE USE OF ITEMS MENTIONED IN THE EXPLANATION (I) TO SECTION 1941. (IV). THE LD. CIT (A) HAS ERRED ON FACTS AND IN LAW IN HO LDING THAT THE ROHM AND HAAS INDIA PVT. LTD. 3 AMOUNT PAID BY ROHM & HAAS (I) PVT. LTD. TO MIS. SK AN MARINE SERVICES PVT. LTD. AS WAREHOUSING CHARGES AND FORKIT CHARGES ARE NOT IN THE NATURE OF RENT AS DEFINED U/S 1941 OF THE ACT WITHOUT APPR ECIATING THAT THE DEFINITION OF RENT AS CONTAINED IN EXPLANATION (I) TO SECTION 1941 IS WIDE ENOUGH TO INCLUDE ANY PAYMENT FOR THE USE OF ITEMS MENTIONED IN THE EXPLANATION (I) TO SECTION 1941. 2. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER AN Y GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY AT THE TIME OF TH E HEARING OF THE CASE OR THEREAFTER. 3. THE BRIEF FACTS OF THE CASE ARE THAT, THE ASSESSE E COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF SPECIALTY CHEMICALS. A TDS SURVEY WAS CONDUCTED AT THE PREMISES OF THE ASSESSEE UNDER SECTION 133A ON 02.02.2009. THE ASSES SING OFFICER, IN THE PURSUANCE OF THE SURVEY PROCEEDINGS NOTED THAT THE ASSESSEE COMPANY HAS FAILED TO DEDUCT TAX OR THERE HAS BEEN SH ORT DEDUCTION OF TAX AT SOURCE IN RELATION TO THE PAYMENTS MADE TO VARIO US PARTIES. ACCORDINGLY, ORDER U/S.201 AND 201(1A) WAS PASSED B Y TREATING THE ASSESSEE IN DEFAULT AND INTEREST WAS LEVIED. THE MAIN REASON GIVEN BY THE ASSESSING OFFICER WAS THAT, IN RELATION TO THE PAYME NT MADE TO THREE PARTIES THERE HAS BEEN SHORT DEDUCTION OF TAX OR THE TAX HAS BEEN DEDUCTED UNDER WRONG SECTION. THE DETAILS OF THE PAYME NTS OF THESE PARTIES ARE DISCUSSED HERE UNDER; (I) PAYMENTS MADE TO M/S. BABAJI SHIVRAM CLEARING A ND CARRIERS PVT. LTD:- ROHM AND HAAS INDIA PVT. LTD. 4 THE AO NOTED THAT THE ASSESSEE COMPANY HAD NOT DEDUCTED TDS ON PAYMENTS OF RS.3,85,29,427/- MADE TO THIS PARTY ON A CCOUNT OF REIMBURSEMENTS WHEREAS, ON SIMILAR PAYMENTS MADE TO TH E SAME PARTY, THE ASSESSEE HAD DEDUCTED TDS U/S 194C. IN RE SPONSE TO SHOW CAUSE NOTICE, THE ASSESSEE SUBMITTED THAT IT HAD ENTER ED INTO AN AGREEMENT WITH BABAJI FOR AVAILING IMPORT CLEARANCE A ND TRANSPORTATION SERVICES CONSIGNMENT, EX-CHENNAI (PORT/AIRPORT). IN TERMS OF THE SAID AGREEMENT, THE ASSESSEE WAS REQUIRED TO MAKE REIMBURSE MENT OF VARIOUS EXPENSES AS PER ACTUALS LIKE, CONTAINER DETEN TION, GROUND RENT, BONDED WAREHOUSE CHARGES, CUSTUMS DUTY, STAMP D UTY AND ADMINISTRATIVE CHARGES. THE ASSESSEE WAS ALSO REQUIR ED TO MAKE PAYMENT WITH REGARD TO THE SERVICE CHARGES. THUS, THE RE WERE TWO CATEGORIES OF PAYMENTS; ONE; SERVICE CHARGES AND OTHE R, REIMBURSEMENT OF EXPENSES. BABAJI HAS RAISED SEPARAT E INVOICES FOR BOTH THE KINDS OF PAYMENTS. SO FAR AS THE SERVICE CHAR GES ARE CONCERNED, THE ASSESSEE HAD DEDUCTED TDS U/S.194C, HO WEVER, ON THE INVOICES RAISED SEPARATELY FOR THE REIMBURSEMENT, NO TDS HAVE BEEN DEDUCTED AS IT HAS NO INCOME ELEMENT OR MARK-UP AT AL L. THE ASSESSING OFFICER AFTER GIVING DETAILED REASONING AND RELYING UPON THE BOARD CIRCULAR NO.715 DATED 8 TH AUGUST 1995, HELD THAT THE ASSESSEE WAS REQUIRED TO DEDUCT TDS ON THE PAYMENT OF REIMBURSEMENT ALSO AND ROHM AND HAAS INDIA PVT. LTD. 5 ACCORDINGLY, HE TREATED THE ASSESSEE IN DEFAULT WITHI N THE MEANING OF SECTION 201(1A). (II) PAYMENTS MADE TO M/S. PROLOGISTICS (I) PVT. LT D:- THE ASSESSEE HAD DEDUCTED TDS PAYMENT MADE TO THE SAID P ARTY U/S.194C, WHICH ACCORDING TO THE AO SHOULD HAVE BEEN DEDUCTED U/S.194I, AS IT WAS MAINLY ON ACCOUNT OF WAREHOUSING CHARGES, FORKLI FT HIRE CHARGES, MANAGEMENT FEES ETC. IN RESPONSE TO THE SHOW CAUSE NO TICE, THE ASSESSEE SUBMITTED THAT IT HAD ENTERED INTO TWO SEPARA TE AGREEMENT WITH THE SAID PARTY, FIRST AGREEMENT, FOR APPOINTING PR O LOGISTICS AS THE CLEARING AND FORWARDING AGENT(CFA) AT MUMBAI AND SEC OND AGREEMENT, FOR APPOINTING AS CFA AND FOR PROVIDING WAREHOUSE FA CILITIES AT DELHI. AS PER THE TERMS OF CLAUSE 1 OF THE AGREEMENTS, THE CFA IS REQUIRED TO PROVIDE WAREHOUSING, CONSIGNMENT CLEARING/HANDLING, FREIGHT FORWARDING, TRANSPORTATION AND OTHER RELATED SERVICES IN RELATION TO THE GOODS BELONGING TO THE ASSESSEE. THUS, IT WAS A COMPO SITE AGREEMENT FOR CARRYING OUT ANY WORK FOR THE ASSESSEE AND THEREF ORE, THE TDS HAS BEEN DEDUCTED U/S.194C. HOWEVER, THE ASSESSING OFFICE R HELD THAT ON CERTAIN PAYMENTS MADE IN THE FINANCIAL YEAR 2006-07, 2008-09, THE ASSESSEE HAD DEDUCTED TDS U/S.194I, WHEREAS THE OTHE R PAYMENTS THE ASSESSEE HAS DEDUCTED TDS U/S.194C. ON PERUSAL OF TH E LEDGER ACCOUNT, THE AO NOTED THAT THE ASSESSEE HAS MADE VARIOU S PAYMENTS TO THE PARTY ON ACCOUNT OF RENT FOR WAREHOUSE AT DELHI, FORKLIFT HIRE ROHM AND HAAS INDIA PVT. LTD. 6 CHARGES AND WAREHOUSE CHARGES ETC. AGGREGATING TO RS. 14,43,676/- ON WHICH THE ASSESSEE SHOULD HAVE DEDUCTED TDS U/S.194I AS IT WAS IN THE NATURE OF RENT ONLY. (III) PAYMENTS TO SKAN MARINE SERVICES PVT. LTD. - THE ASSESSING OFFICER NOTED THAT AS PER THE LEDGER ACCOUNT, THE ASSE SSEE HAS DEBITED AN AMOUNT OF RS.33,55,492/- UNDER THE HEAD RENTAL EXPE NSES, EQUIPMENTS, ON WHICH THE ASSESSEE HAS DEBITED TDS U/ S.194C INSTEAD OF U/S.194I. IN RESPONSE TO THE SHOW CAUSE NOTICE, TH E ASSESSEE SUBMITTED THAT IT HAD ENTERED INTO THE AGREEMENT WITH THE SAID PARTY FOR AVAILING MATERIAL HANDLING SERVICES UNDER WHICH, THE ASSESSEE WAS REQUIRED TO PROVIDE THE SERVICE OF HANDLING AND MOVI NG OF MATERIAL OF THE ASSESSEE WITH THE HELP OF FORKLIFTS. THE SAID AGRE EMENT FURTHER ELABORATES THE NATURE OF SERVICES PROVIDED IN THIS R EGARD. AFTER INCORPORATING THE ASSESSEES DETAILED SUBMISSION, HE HELD THAT THE INVOICES RAISED BY SKAN MARINE IS ONLY FOR USAGE OF FORKLIFTS WHILE RENDERING MATERIAL HANDLING SERVICES WHICH IS NOTHIN G BUT USE OF EQUIPMENTS AND HENCE FALLS WITHIN THE DEFINITION OF RENT AS DEFINED UNDER SECTION 194I. 4. BEFORE THE LD. CIT(A), THE ASSESSEE FILED DETAILS SUBMISSIONS AND ALSO RELIED UPON VARIOUS CASE LAWS WHICH HAS BEEN D EALT EXTENSIVELY BY ROHM AND HAAS INDIA PVT. LTD. 7 THE LD. CIT(A). AFTER CONSIDERING THE ENTIRE MATERIAL ON RECORD. THE LD. CIT(A) DELETED THE DEMAND AFTER OBSERVING AND HOLDING AS UNDER:- 5.7 I HAVE CONSIDERED THE FACTS OF THE CASE, WRITT EN SUBMISSIONS, COPY OF AGREEMENT AND ORAL ARGUMENTS O F THE LD. ARS ADVANCED DURING THE COURSE OF APPEAL AS AGA INST THE OBSERVATIONS/ FINDINGS OF THE AO IN HIS ORDER A PERU SAL OF THE AGREEMENT SHOWS THAT PAYRIENT TO BABAJI CAN BE CLAS SIFIED IN TWO CATEGORIES VIZ (A) SERVICE CHARGES (B) REIMBURS EMENT OF EXPENSES. IN FACT, BABAJI HAS RAISED SEPARATE INVOIC ES FOR BOTH KINDS OF PAYMENTS. IT IS AN ADMITTED FACT THAT THE APPE LLANT HAS DEDUCTED TAX UNDER SECTION 194C OF THE ACT ON PAYMENTS MADE FOR SERVICE CHARGES AND HAS NOT DEDUCTED TAX ON REIMBURSEMENT OF EXPENSES. THE FACT OF REIMBURSEMEN T OF EXPENSES IS NOT IN DISPUTE. I AGREE THAT PURE REIMBURSEMENT OF EXPENSES DO NOT CONSTITUTE INCOME AN D HENCE, THE SAME IS NOT LIABLE FOR TAX DEDUCTION. ALSO, RELY ING ON THE VARIOUS DECISIONS QUOTED BY APPELLANT, IT IS HELD TH AT THE PAYMENTS MADE TO BABAJI BY WAY OF REIMBURSEMENTS ARE N OT LIABLE FOR TAX DEDUCTION AND THEREFORE, THE APPELLANT CA NNOT BE DEEMED TO BE 'AN ASSESSEE IN DEFAULT' FOR NON DEDUC TION OF TAX THE DEMAND OF RS 864,000/- IS HENCE DELETED. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXX 8.7 I HAVE CONSIDERED THE FACTS OF THE CASE AND TH E WRITTEN SUBMISSIONS OF THE APPELLANT AS THE ESSENCE OF THE AGREEMENT IS PROVISION OF SERVICES AND NOT THE HIRE OF EQUIPMENT (IE FORKLIFT), THE PROVISIONS OF SECTION 194C OF THE ACT ARE APPLICABLE IN THE PRESENT CASE FOR SERV ICES PROVIDED BY CLEARING & FORWARDING AGENT. THIS VIEW IS ALSO ROHM AND HAAS INDIA PVT. LTD. 8 SUPPORTED BY THE ORDER OF THE JURISDICTIONAL TRIBUNA L IN THE CASE OF ACCENTURE SERVICES P LT (ITA NO 59205921 & 5922/MUM/2009), RELIED ON BY THE APPELLANT. OTHER D ECISION CITED BY THE APPELLANT ALSO SUPPORT THE SAME VIEW. THUS, THE APPELLANT CANNOT BE DEEMED TO BE AN ASSESSEE IN DEF AULT FOR NON/ SHORT DEDUCTION OF TAX. I ADCORDINGLY HOLD AND DELETE THE DEMAND RAISED OF RS. 74,409/-. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXX 10.3 IN TERMS OF THE AGREEMENT, SKAN MARINE IS REQ UIRED TO PROVIDE THE SERVICE OF HANDLING AND MOVING OF MATER IAL TO THE APPELLANT WITH THE HELP OF FORKLIFTS OPERATED BY TR AINED OPERATORS OF SKAN MARINE FURTHER, THE FORKLIFTS ARE TO BE MANAGED AND OPERATED IN A SAFE MANNER BY TRAINED OPER ATORS OF SKAN MARINE.THE AGREEMENT ALSO PROVIDES THAT SKAN MAR INE SHALL SOLELY BE RESPONSIBLE FOR ALL REPAIRS, MAINTENANCE, REPLACEMENTS AND ADDITIONS PERTAINING TO THE FORKLI FTS. THUS, IT CAN BE SAID THAT SKAN MARINE IS PROVIDING MATERIAL HANDLING SERVICES TO RHIPL. ON A PERUSAL OF VARIOUS TERMS OF THE AGREEMENT, IT IS SEEN THAT THE AGREEMENT IS PRIMARIL Y FOR PROVISION OF MATERIAL HANDLING SERVICES BY SKAN MAR INE TO APPELLANT. SINCE THE FORKLIFTS ARE UNDER THE CONTRO L AND SUPERVISION OF SKAN MARINE, PAYMENTS ARE IN THE NATUR E OF SERVICES AND NOT IN THE NATURE OF RENT. ACCORDINGLY, TH E PAYMENT MADE BY THE APPELLANT TO SKAN MARINE IS NOT FOR USE OF THE FORKLIFTS BUT FOR MATERIAL HANDLING SERVICES AND TH EREFORE, THE PAYMENTS TO SKAN MARINE WOULD ATTRACT TAX DEDUCTION AT SOURCE UNDER SECTION 194C OF THE ACT AND NOT U/S 194-I. ROHM AND HAAS INDIA PVT. LTD. 9 XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 10.4 I HAVE CONSIDERED THE FACTS OF THE CASE, WRITTE N SUBMISSIONS AND ORAL ARGUMENTS OF THE LD. ARS. THIS ISSUE IS SIMILAR TO THE ISSUE I HAVE DECIDED IN FAVOUR OF TH E APPELLANT IN GROUND NO.4 ABOVE. THE CASE LAWS CITED BY THE APPELL ANT ALSO SUPPORT THE CONTENTION OF THE APPELLANT. THUS, THE APPELL ANT CANNOT BE DEEMED TO BE AN ASSESSEE IN DEFAULT FOR NON /SHORT DEDUCTION OF TAX. HENCE THIS GROUND IS HELD IN FAVO UR OF THE APPELLANT AND DEMAND OF RS.6,77,675/- IS DELETED. 5. BEFORE US THE LD. COUNSEL HAD FILED A COPY OF AG REEMENTS WITH THESE PARTIES HIGHLIGHTING THE NATURE OF SERVICES AND A LSO SAMPLE COPY OF INVOICES RAISED BY THESE PARTIES. FURTHER, IN SUP PORT OF HIS CONTENTION HE HAS ALSO RELIED UPON VARIOUS CASE LAWS , WHEREIN ON SIMILAR TYPE OF SERVICES, THE ISSUE HAVE BEEN DECIDE IN FAVOUR OF THE ASSESSEE. 6. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE MAJ OR DISPUTE IN THESE APPEALS ARE WHETHER ON THE PAYMENTS MADE BY THE ASSESSEE TO VARIOUS PARTIES, THE TDS SHOULD BE DEDUCTED U/S.194C OR U/S 194I OR WHETHER THE ASSESSEE WAS LIABLE TO DEDUCT TDS ON REIMBU RSEMENT OF EXPENSES OR NOT. SO FAR AS THE PAYMENTS MADE TO M/S. BABAJI SHIVRAM CLEARING AND CARRIERS PVT. LTD. ON ACCOUNT OF REIM BURSEMENT OF EXPENSES, IT IS SEEN FROM THE COPY OF AGREEMENT THAT THE ASSESSEE HAD ROHM AND HAAS INDIA PVT. LTD. 10 ENTERED INTO AN AGREEMENT FOR CONTRACT FOR IMPORT CLEA RANCE AND TRANSPORTATION OF CONSIGNMENT. UNDER THE SAID AGREEMEN T, SO FAR AS VARIOUS SERVICES ARE CONCERN, THE ASSESSEE HAS MADE THE PAYMENT AFTER DEDUCTING TDS ON WHICH THERE IS NO DISPUTE. HOWE VER, CERTAIN CHARGES HAVE BEEN MENTIONED LIKE CONTAINER DETENTION, G ROUND RENT, CONTAINER DAMAGE CHARGES, (IF ANY), CWS BONDED WAREH OUSE CHARGES, CUSTOMS DUTY, STAMP DUTY AND SERVICE TAXES ETC. THE SAME WERE REQUIRED TO BE REIMBURSED AS PER THE ACTUALS ON THE SUBMISSION OF ORIGINAL PROOF OF PAYMENTS. SINCE THE SAID PARTY WAS R ENDERING SERVICES RELATING TO CUSTOMS CLEARANCE AND FOR THESE PURPOSES C ERTAIN CHARGES ARE INCURRED ON BEHALF OF THE ASSESSEE WHICH WAS TO BE REIMBURSED BY THE ASSESSEE AS PER ACTUALS ON THE SUBMISSION OF ORI GINAL PROOF/EVIDENCE. THE SAID PARTY HAS RAISED SEPARATE INVOICES FOR THESE CHARGES WHICH HAVE BEEN PLACED IN THE PAPER BOOK. FR OM THE PERUSAL OF THESE INVOICES AND THE TERMS OF THE AGREEMENT, IT I S AMPLY CLEAR THAT THESE REIMBURSEMENT OF EXPENSES ARE NOT IN THE NAT URE OF PAYMENT IN LIEU OF SERVICES, ALBEIT THESE CHARGES H AVE BEEN INCURRED BY THE PARTY ON BEHALF OF THE ASSESSEE WHICH HAS BEE N REIMBURSED. THUS THERE WAS NO LIABILITY TO DEDUCT TDS ON SUCH RE IMBURSEMENT OF EXPENSES. THIS IS ALSO SUPPORTED BY VARIOUS TRIBUNAL DECISIONS VIZ; (I)SHRI ALTAF I. MOTORWALA (ITA NO.4755/MUM/2012 DA TED 26 AUGUST 2013)(MUM) ROHM AND HAAS INDIA PVT. LTD. 11 (II)M/S. OM SATYA EXIM PVT. LTD. (ITA NO.1335/AHD/2010 DATEE 13MAY 2011) (AHD). (III)DR. WILLMAR SCHWADE INDIA (P) LTD. 95 TTJ 5 CIRCULAR NO.715 DATED 8 AUGUST 1995 THUS, THE FINDING OF THE CIT(A) ON THIS SCORE IS UPH ELD AND REVENUES GROUND IS DISMISSED. 7. NOW COMING TO THE PAYMENT MADE TO PROLOGISTIC, IT IS SEEN THAT UNDER THE TERMS OF AGREEMENT, THE ASSESSEE HAD ENTERED INTO CLEARING AND FORWARDING AGENCY AGREEMENT BY WHICH THE SAID PA RTY WAS ALSO REQUIRED TO PROVIDE WAREHOUSING FACILITY ALL OVER T HE COUNTRY CONSIGNMENT CLEARING/ HANDLING, FREIGHT FORWARDING, TRANSPORTATION AND OTHER RELATED SERVICES. THE WAREHOUSING CHARGES WAS PART OF THE COMPOSITE AGREEMENT FOR VARIOUS KIND OF SERVICES WHIC H HAVE BEEN RENDERED BY THE ASSESSEE PARTY. THE HONBLE DELHI H IGH COURT IN THE CASE OF CIT VS. HINDUSTAN LEVER LTD. 265 CTR DEL. 5 18 HELD THAT, IF THE PAYMENT IS MADE TO A CFA FOR VARIOUS SERVICES WHICH CONSISTS SOME ELEMENT OF RENT ON ACCOUNT OF WAREHOUSING CHARGES UN DER A COMPOSITE AGREEMENT, THEN THE TDS WAS DEDUCTIBLE U/S.194C ONL Y. FURTHER IN OTHER DECISIONS ALSO, THE TRIBUNAL HAS HELD THAT IN A COMPOSITE SERVICE AGREEMENT WITH CFA FOR WAREHOUSING OR FORKLIFTS CHAR GES, THE TDS IS TO BE DEDUCTED U/S.194C. THE LIST OF SUCH DECISION ARE A S UNDER:- ROHM AND HAAS INDIA PVT. LTD. 12 (I) M/S. UNIVERSAL TRAFFIC CO. (ITA NO.1426 & 1429 /MUM/2013 DATED 17 DECEMBER 2014) (MUM) (II) HINDUSTAN LEVER LTD. (ITA NO.516 OF 2012 DATED 1 2 DECEMBER 2012) (DELHI HC). (III)NATIONAL PANASONIC INDIA (P) LTD. 94 TTJ 899 (D ELHI) (IV)ACCENTURE SERVICES (P) LTD. (44 SOT 290)(MUM). THUS, THE DECISION OF THE LD. CIT(A) BASED ON MERITS ON RECORD AND RELYING ON VARIOUS DECISIONS OF THE TRIBUNAL ON THIS ISSUE IS UPHELD. 8. LASTLY, REGARDING PAYMENTS MADE TO SKAN MARINE, I T IS SEEN THAT THE SAME HAS BEEN MADE UNDER THE TERMS OF AGREEMENT F OR PROVIDING SERVICES OF HANDLING WHICH IS MOVING OF MATERIALS WI TH THE HELP OF FORKLIFTS. SUCH A PAYMENT HAVE BEEN MADE FOR RENDER ING OF SERVICES THOUGH FORKLIFTS WHICH UNDER THE CONTROL AND SUPERVISIO N OF SKAN MARINE AND THEREFORE, IT CANNOT BE IN THE NATURE OF RE NT. THUS, THE FINDING OF THE CIT(A), ON THIS SCORE ALSO UPHELD. 9. IN THE RESULT GROUNDS RAISED BY THE REVENUE FOR T HE A.Y.2007-08 IS DISMISSED. 10. THE LD. COUNSEL HAS ALSO RAISED CONTENTION THAT T HE PAYEE HAD PAID THEIR TAXES AND THEREFORE, THE ASSESSEE CANNOT B E TREATED AS ASSESSEE IN DEFAULT. IN SUPPORT OF HIS CONTENTION, HE RELIED UPON THE ROHM AND HAAS INDIA PVT. LTD. 13 DECISION OF HONBLE SUPREME COURT IN THE CASE OF HIN DUSTAN COCA COLA BEVERAGE (P) PVT. LTD. 293 ITR 226) (SC). THIS ALTERNATE CONTENTION OF THE LD. COUNSEL HAD BECOME ACADEMIC IN VIEW OF FINDINGS GIVEN ABOVE, HENCE NO ADJUDICATI ON IS REQUIRED. 11. IN THE ASSESSMENT YEAR 2008-09, PAYMENTS MADE TO THE SAME PARTIES HAVE BEEN DISPUTED ON THE SAME REASONING, TH EREFORE, THE FINDING GIVEN IN THE APPEAL FOR THE A.Y. 2007-08 WOU LD BE SQUARELY APPLICABLE FOR THIS YEAR ALSO AND THEREFORE, IN VIEW OF THE REASONING GIVEN THEREIN, THE APPEAL OF THE REVENUE IS TREATED AS DISMISSED. 12. IN THE APPEAL FOR THE A.Y. 2009-10, THE REVENUE H AS CHALLENGED THE PAYMENT ON SIMILAR PAYMENT MADE TO THREE PARTIES V IZ. PROLOGISTICE (I) PVT. LTD., SKAN MARINE SERVICE PVT. LTD. AND PAYME NT MADE TO NAVJEEVAN AGENCY. SO FAR AS THE PAYMENT MADE TO FIRS T TWO PARTIES, THE SAME ARE COMMON AND THEREFORE, THE FINDINGS GIVEN IN THE EARLIER YEAR WILL APPLY MUTATIS MUTANDIS IN THIS YEAR ALSO. AS REGARDS THE PAYMENT MADE TO NAVJEEVAN AGENCY, IT IS SEEN THAT WITH THE SAID PARTY THE ASSESSEE HAD ENTERED INTO CFA WITH THE AGREEMENT UNDER THE TERMS OF WHICH THE SAID PARTY WAS REQUIRED TO PROVIDE W AREHOUSING FACILITY CONSIGNMENT CLEARING/ HANDLING, FREIGHT FORWA RDING, TRANSPORTATION AND OTHER RELATED SERVICES. THE ASSESS ING OFFICER HAS HELD THAT THE PAYMENT TO THE SAID PARTY IS FOR WAREHOUSIN G, EQUIPMENT ROHM AND HAAS INDIA PVT. LTD. 14 AND PLANT AND THEREFORE, FALLS WITHIN THE MEANING OF RENT AS DEFINED IN SECTION 194I. THE ASSESSEES CASE HAD BEEN THAT THE AG REEMENT WAS FOR CFA WHICH ELABORATES VARIOUS COMPOSITE SERVICES AND THEREFORE, TDS HAS BEEN DEDUCTED U/S.194C. SINCE THE NATURE OF PAYMENT TO THE SAID PARTY IS SIMILAR THE PAYMENT MADE TO PROLOGISTIC INDIA PVT. LTD. AND THEREFORE, IN VIEW OF THE FINDING GIVEN WITH RE GARD TO THE SAID PARTY AND ALSO IN LIGHT OF THE VARIOUS DECISION AS D ISCUSSED ABOVE, WE HOLD THAT THE ASSESSEE HAS RIGHTLY DEDUCTED TDS U/S. 194C. ACCORDINGLY, THE GROUND RAISED BY THE REVENUE ON THIS SCORE IS DISMISSED. 13. IN THE RESULT APPEAL OF THE REVENUE FOR THE A.Y. 2007-08 & 2008- 09 & 2009-10 ARE DISMISSED. 14. AS REGARDS THE APPEALS IN ITA NO.4043, 4044 & 4 045/MUM/2013 FOR THE ASSESSMENT YEARS 2007-08, 2008-09 & 2009-10 R ESPECTIVELY, ARE ARISING OUT OF ORDER U/S.201(1A). SINCE WE HAVE ALREADY UPHELD THAT THE ASSESSEE IS NOT IN DEFAULT U/S.201(1), THEREFOR E, THERE IS NO QUESTION OF LEVY OF INTEREST U/S.201(1A) AND THEREFOR E, THE APPEAL OF THE REVENUE HAVE BECOME PURELY ACADEMIC AND HENCE TRE ATED AS INFRUCTUOUS. ROHM AND HAAS INDIA PVT. LTD. 15 15. IN THE RESULT, ALL THE APPEALS OF THE REVENUE AR E DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH DAY OF APRIL 2015. SD/- SD/- SD/ - . . B.R. BASKARAN ACCOUNTANT MEMBER SD/ - !' # $ % AMIT SHUKLA JUDICIAL MEMBER MUMBAI, () DATED:08 .04.2015 PATEL &' # $*+ ,+$ / COPY OF THE ORDER FORWARDED TO : (1) -$ / THE ASSESSEE; (2) . / THE REVENUE; (3) ! /$( ) / THE CIT(A); (4) ! /$ / THE CIT, MUMBAI CITY CONCERNED; (5) +2 $3, % 3, ! ' / THE DR, ITAT, MUMBAI; (6) 2 5' / GUARD FILE. +$ $ / TRUE COPY &' ! / BY ORDER 6 / 7 . / (DY./ASSTT. REGISTRAR) % 3, ! ' / ITAT, MUMBAI