The ACIT, TDS Circle, Baroda V. General Motors (I) Pvt.Ltd., Panchmahal

ITA 2068/AHD/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 6522 (ITAT-AHMEDABAD)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 18-03-2011
• Assessment Year: 2008-2009
• Appeal Filed On: 16-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K R MEGHWALDR
• Assessee Lawyers: VISHAL KALRAAR
• Keywords: Recovery proceedings
• Section: 133A; 194C; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'D' BEFORE SHRI D K TYAGI,JM & SHRI A N PAHUJA,AM ITA NOS.2068 & 2069/AHD/2010 (ASSESSMENT YEARS:-2008-09 & 2009-10) ASSISTANT COMMISSIONER OF INCOME-TAX, TDS CIRCLE, ROOM NO.5, GROUND FLOOR, AAYAKAR BHAVAN, RACE COURSE, BARODA V/S M/S GENERAL MOTORS (I) PVT. LTD., CHANDRAPURA INDUSTRIAL ESTATE, HALOL, DISTRICT: PANCHMAHAL PAN: AAACG 8371 P [APPELLANT] [RESPONDENT] REVENUE BY :- SHRI K R MEGHWAL,DR ASSESSEE BY:- SHRI VISHAL KALRA,AR O R D E R A N PAHUJA: THESE TWO APPEALS BY THE REVENUE DIRECTED AGAINST A COMMON ORDER DATED 26-03-2010 OF THE LD. CIT(APPEAL S)-VI, BARODA FOR THE ASSESSMENT YEARS 2008-09 AND 2009-10,RAISE THE FOLLOWING GROUNDS:- 1 THE LD. CIT(A) ERRED IN LAW AS WELL AS FACTS OF THE CASE IN DELETING THE ORDER PASSED BY THE AO U/S 201(1) & INTEREST CHARGE D U/S 201(1A) OF THE IT ACT AND RAISED DEMAND OF RS.29,87,995/- FOR AY 2008-09 AND RS.3,28,14,400/- U/S 201(1) & RS.24,97,814/- U/S 20 1(1A) FOR AY 2009- 10 BY TREATING THE USE OF VEHICLES FOR TRANSPORTATI ON U/S 194C OF THE ACT AS AGAINST U/S 194I AND BY TREATING THE PAYMENT OF INCENTIVES U/S 194H OF THE ACT BY THE AO. 2 THE LD. CIT(A) ERRED IN LAW AS WELL AS FACTS OF T HE CASE IN DELETING THE DEMAND RAISED U/S 194H OF THE ACT (ON THE AMOUNT OF INCENTIVES ) OF RS.50,29,264/- AND RS.78,81,661/- FOR AY 2008-09 & 2009-10 RESPECTIVELY. 3 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE AO. 4 THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND, WHICH MAY BE NECESSARY. 5 IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE LD . CIT(A) MAY BE CANCELLED AND THAT OF THE AO MAY BE RESTORED TO THE ABOVE EFFECT. ITA NOS.2068 & 2069/AHD/2010 2 2. SINCE THE FACTS AND CIRCUMSTANCES IN THESE TWO A PPEALS ARE SIMILAR, THESE APPEALS WERE HEARD SIMULTANEOUSLY A ND ARE BEING DISPOSED OF THROUGH THIS COMMON ORDER. 3. ADVERTING FIRST TO GROUND NOS.1 & 2 IN THESE APP EALS FOR AYS 2008-09 AND 2009-10, FACTS, IN BRIEF, AS PER RELEVA NT ORDERS ARE THAT A SURVEY U/S 133A OF THE INCOME-TAX ACT, 1961 [HERE INAFTER REFERRED TO AS THE ACT] WAS CONDUCTED IN THE CASE OF THE A SSESSEE ON 20-01- 2009 FOR VERIFICATION OF COMPLIANCE OF TDS PROVISIO NS. DURING THE COURSE OF SURVEY, THE ASSESSING OFFICER[AO IN SHORT ] NOTICED THAT THE ASSESSEE PAID SUBSTANTIAL AMOUNT OF INCENTIVES TO D EALERS AS ALSO MADE PAYMENTS FOR HIRING OF BUSES AND VEHICLES. ACC ORDINGLY, THE ASSESSEE WAS ASKED TO EXPLAIN AS TO WHY :- (I) THE INCENTIVES PAID TO DEALERS MAY NOT BE TREAT ED AS COMMISSION PAYMENT AND TAX MAY NOT BE CHARGED U/S 194H ? (II) PROVISIONS OF SECTION 194-I MAY NOT BE APPLIED FOR PAYMENTS FOR HIRING OF BUSES AND VEHICLES ON CONTIN UOUS LONG TERM BASIS UNDER AN AGREEMENT? 3.1. IN RESPONSE, THE ASSESSEE REPLIED THAT THEY DID NOT DEDUCT TAX AT SOURCE FROM PAYMENT TO DEALERS SINCE IT DEPENDED UPON AND NATURE OF INCENTIVES AND TRANSACTIONS WERE PRINCIP AL TO PRINCIPAL AND THAT THEY DEDUCTED TAX AT SOURCE ONLY ON PAYMENT TO RETAIL SALES PERSONNEL (RSP). THE ASSESSEE PLEADED THAT SINCE T HE AUTOMOBILE INDUSTRY WAS HIGHLY COMPETITIVE, VARIOUS DISCOUNTS AND INCENTIVES GIVEN TO THE DEALERS ON A MONTH TO MONTH BASIS THRO UGH THE RETAILER BULLETINS WERE DEBITED TO THE P&L ACCOUNT UNDER THE HEAD INCENTIVE TO DEALERS AND TDS PROVISIONS WERE NOT APPLICABLE TO DEALERS INCENTIVE, BEING NOT COMMISSION. HOWEVER, THE AO DI D NOT ACCEPT THE SUBMISSIONS OF THE ASSESSEE ON THE GROUND THAT INCE NTIVE WAS PAID TO THE DEALERS POST INVOICE I.E. AFTER THE SALE OF THE VEHICLE TO THE DEALER AND WAS NOT PART OF THE PROFIT MARGIN OF THE DEALER BUT WAS ATTRIBUTABLE TO INCREASED SALE MADE BY THE DEALER A ND THEREFORE, THE ITA NOS.2068 & 2069/AHD/2010 3 PAYMENT WAS NOTHING BUT COMMISSION TO THE DEALERS AND HENCE THE PROVISIONS OF SECTION 194-H WERE ATTRACTED. BESIDES , WHILE REFERRING TO DECISIONS IN KERALA STATE STAMP VENDORS ASSOCIAT ION. VS OFFICE OF THE ACCOUNTANT-GENERAL AND OTHERS, 282 ITR 7(KERALA ) AND M/S HINDUSTAN COCA-COLA BEVERAGES (P) LTD. VS. ITO, 97 ITD 105 AND AFTER ANALYZING THE MONTHWISE BREAKUP OF INCENTIVE / DISCOUNT TO DEALERS / EMPLOYEES OF DEALERS IN THE LIGHT OF DOCU MENTS RELATING TO INCENTIVES FURNISHED BY THE ASSESSEE AND REFERRED T O IN HIS ORDER , THE AO CONCLUDED THAT THE ASSESSEE HIRED VEHICLES FOR TRANSPORTING THEIR EMPLOYEES AND THUS, THE PROVISIONS OF SEC. 19 4I WERE APPLICABLE TO SUCH PAYMENTS AND THAT THE PROVISION S OF SC. 194C WERE NOT APPLICABLE. ACCORDINGLY, THE AO DETERMINED LIABILITY FOR TAX U/S 201(1) OF THE ACT TO THE EXTENT OF RS.2,96,50, 035/-BY APPLYING THE PROVISIONS OF SEC. 194H OF THE ACT ON THE AMOUN T OF COMMISSION/INCENTIVES FOR THE FY 2008-09 AND CONSEQ UENT INTEREST OF RS.22,65,824/- U/S 201(1A) OF THE ACT. LIKE WISE FOR THE FY 2007- 08, INTEREST OF RS. 29,87,995/- U/S 201(1A) WAS LEV IED WHILE HOLDING THAT DEMAND FOR TAX U/S 201(1)[ RS.5,31,99,162/-] H AS NOT BEEN RAISED IN VIEW OF CBDT CIRCULAR F NO. 276/201/96-IT (B) DATED 21.9.1997. MOREOVER, LIABILITY FOR TAX REQUIRED TO BE DEDUCTED AT SOURCE FOR HIRING OF VEHICLES IN TERMS OF PROVISION S OF SEC. 194I WAS DETERMINED AT RS.12,29,927/- FOR PUNE AND RS.19,34, 438/- FOR HALOL, RESULTING IN TOTAL LIABILITY OF RS.39,55,455/-.AFTE R REDUCING THE AMOUNT OF TAX DEDUCTED AT SOURCE-RS.7,91,090/- U/S 194C OF THE ACT, NET DEMAND OF RS.31,64,365/- WAS RAISED BESIDES CONSEQU ENT INTEREST OF U/S 201(1A) OF RS.2,31,990/-. 4. ON APPEAL, THE LEARNED CIT(A) ADJUDICATED THE IS SUE IN THE FOLLOWING TERMS:- 8.2 IN APPEAL, IT WAS SUBMITTED BY THE ID. AR THAT THE APPELLANT WAS IN THE BUSINESS OF MANUFACTURE AND SA LE OF PASSENGER CARS. THE APPELLANT APPOINTS DEALERS FOR EFFECTING SALE OF CARS. THE APPELLANT HAS A WRITTEN CONTRACT WITH ALL THE ITA NOS.2068 & 2069/AHD/2010 4 DEALERS WHEREIN IT HAD BEEN SPECIFICALLY STATED THA T ALL RISKS AND LIABILITIES OF THE CARS SENT TO THE DEALER LIES WITH THE DEALER AND NOT THE APPELLANT. THE AGREEMENT ALSO SPECIFICA LLY STATES THAT THE DEALERS DO NOT ACT ON BEHALF OF THE APPELL ANT BUT THEY ACT IN THEIR OWN CAPACITY AND THE APPELLANT HAS NO SAY IN THE MANNER IN. WHICH THE DEALER CONDUCTS HIS BUSINESS. ALL RISKS AND REWARDS RELATING TO SALE OF CARS, STORAGE OF CA RS, INSURANCE OF CARS, SECURITY OF CARS LIES WITH THE DEALER AND NOT THE APPELLANT. SALE OF CAR IS THE RESPONSIBILITY OF THE DEALER AND NOT THE APPELLANT. INVOICES ISSUED BY THE APPELLANT A LSO SHOW THAT THE SALE TO DEALER IS ON PRINCIPAL TO PRINCIPAL BAS IS. COMMISSION IS DEFINED BY EXPLANATION (I) TO SECTION 194H OF THE ACT. IT IS DEFINED AS 'COMMISSION OR BROKERAGE' INCLUDES ANY PAYMENT RECEIVED OR RECEIVABLE, DIRECTLY OR IND IRECTLY, BY A PERSON ACTING ON BEHALF OF ANOTHER PERSON FOR SERVI CES RENDERED (NOT BEING PROFESSIONAL SERVICES) OR FOR A NY SERVICES IN THE COURSE OF BUYING OR SELLING OF GOODS OR IN R ELATION TO ANY TRANSACTION RELATING TO ANY ASSET, VALUABLE ARTICLE OR THING, NOT BEING SECURITIES. IT WAS CONTENDED THAT A PAYMENT C AN BE TERMED AS COMMISSION ONLY IF THE PAYMENT WAS MADE T O A PERSON ACTING ON BEHALF OF ANOTHER PERSON. IF A PER SON IS ACTING IN HIS / ITS INDEPENDENT CAPACITY THE PAYMENT CANNO T BE TERMED AS COMMISSION PAYMENT. THE APPELLANT, IN ITS WRITTE N SUBMISSIONS, HAS DISCUSSED VARIOUS CLAUSES OF THE G M RETAILER AGREEMENT TO SUBSTANTIATE ITS CLAIM THAT THE SALE T O DEALERS IS ON PRINCIPAL TO PRINCIPAL BASIS AND THERE DOES NOT EXISTS ANY PRINCIPAL - AGENT RELATIONSHIP. THE TRANSACTIONS WI TH THE DEALERS MEET ALL THE CONDITIONS OF SALE OF GOODS. I T WAS THEREFORE CONTENDED THAT THE RETAILER DOES NOT ACT ON BEHALF OF THE APPELLANT BUT ACTS IN ITS INDIVIDUAL CAPACITY. CLAUSE NO. 19.1 OF THE GM RETAILER AGREEMENT SPECIFICALLY STATES THAT THERE IS NO PRINCIPAL - AGENT RELATIONSHI P. EACH PARTY WAS AN INDEPENDENT PARTY AND ACTS FOR ITS BENEFIT. THE AO HAS NOT FOUND ANY FAULT WITH THE AGREEMENT NOR HAS MENT IONED THAT THE AGREEMENT IS NOT ACTED UPON. UNDER THE GIVEN CIRCUMSTANCES IT WAS CONTENDED THAT NO TAX U/S. 194 H WAS REQUIRED TO BE DEDUCTED ON THE INCENTIVES ALLOWED T O THE DEALERS. 8.2.1 DURING THE COURSE OF APPELLATE PROCEEDINGS, A QUERY WAS RAISED TO THE ID. AR WHETHER THE VEHICLES SOLD BY THE APPELLANT TO THE DEALERS WERE REGISTERED IN THE NAM E OF THE DEALERS WITH RTO, IT WAS MENTIONED THAT DEALERS ARE NOT REQUIRED TO REGISTER THE VEHICLES IN THEIR NAMES IN VIEW OF SPECIFIC EXEMPTION GRANTED BY SECTION 39 OF THE MOT OR VEHICLE ACT, 1988. SECTION 39 OF THE MOTOR VEHICLE ACT, 198 8 IS AS UNDER: ITA NOS.2068 & 2069/AHD/2010 5 '39. NECESSITY FOR REGISTRATION - NO PERSON SHALL D RIVE ANY MOTOR VEHICLE AND NO OWNER OF A MOTOR VEHICLE SHALL CAUSE OR PERMIT THE VEHICLE TO BE DRIVEN IN ANY PUB LIC PLACE OR IN ANY OTHER PLACE UNLESS THE VEHICLE IS REGISTERED IN ACCORDANCE WITH THIS CHAPTER AND THE CERTIFICATE OF REGISTRATION OF THE VEHICLE HAS NOT BEEN SUSPENDED OR CANCELLED AND THE VEHICLE CARRIES A REGISTRATION MARK DISPLAYED IN THE PRESCRIBED MANNE R. , PROVIDED THAT NOTHING IN THIS SECTION SHALL APPLY T O.A MOTOR VEHICLE IN POSSESSION OF A DEALER SUBJECT TO SUCH CONDITIONS AS MAY BE PRESCRIBED BY THE CENTRAL GOVERNMENT.' (EMPHASIS SUPPLIED) IT WAS CONTENDED THAT REGISTRATION OF VEHICLE IS RE QUIRED ONLY FOR THE PURPOSE OF PLYING THE VEHICLE IN ANY PUBLIC PLACE OR ANY OTHER PLACE. DEALERS BEING EXEMPT U/S. 39 OF THE MO TOR VEHICLE ACT, 1988, THE CARS SOLD BY THE APPELLANT ARE NOT R EQUIRED TO BE REGISTERED IN THE NAME OF THE DEALERS. 8.3 I HAVE CONSIDERED THE SUBMISSIONS OF ID. AR AND THE FACTS OF THE CASE. I HAVE ALSO GONE THROUGH THE GM RETAILER AGREEMENT. IT IS TRUE THAT THE DEALER IS SOLELY RES PONSIBLE FOR THE SALE OF CARS. AT THE TIME OF SALE OF VEHICLE TO THE DEALER, COMPLETE RISKS AND REWARDS ARE TRANSFERRED TO THE D EALER. IN CASE THE DEALER WAS NOT ABLE TO SELL THE CARS, THE LOSS WAS TO BE BORNE BY THE DEALER AND NOT THE APPELLANT. IT WA S THE DEALER WHO WAS RESPONSIBLE TO ARRANGE FOR NECESSARY INFRASTRUCTURE AT ITS OWN RISK AND COSTS FOR SELLIN G THE CARS. THE APPELLANT'S RISKS CEASES ONCE THE CAR WAS SOLD TO THE DEALER. THE FINANCERS ALSO PROVIDE LOANS TO THE DEALERS AND THE INTEREST COST WAS ALSO BORNE BY THE DEALER. THE DEALERS DO. HOT HAVE RECOURSE TO THE COMPANY. THE INVOICE RAISE D BY THE APPELLANT ON THE DEALER STATE THAT IT IS A SALE TRA NSACTION AND NOT A CONSIGNMENT. ON THE BASIS OF THE VARIOUS CLAU SES OF THE GM RETAILER AGREEMENT IT IS CLEAR THAT THERE DOES N OT EXISTS ANY PRINCIPAL - AGENT RELATIONSHIP WHICH IS VERY MUCH NECESSARY FOR INVOKING THE PROVISIONS OF SECTION 19 4H OF THE ACT. THE SALES ARE ON PRINCIPAL TO PRINCIPAL BASIS AND THEREFORE THE INCENTIVES ALLOWED BY THE APPELLANT CANNOT BE T ERMED AS COMMISSION. THE AGREEMENT ALSO PROVIDES THAT THERE IS NO AGENT OR LEGAL REPRESENTATIVE STATUS BETWEEN THE AP PELLANT- COMPANY AND THE DEALER. THE AGREEMENT FURTHER PROVI DES THAT NO PARTY TO THE CONTRACT CAN ASSUME OR CREATE ANY O BLIGATION ON BEHALF OF OR IN THE NAME OF THE OTHER. THIS IS I N CONTRAST TO THE PRINCIPAL-AGENT RELATIONSHIP WHEREIN THE AGEN T CAN BIND THE PRINCIPAL FOR ITS ACT. IT IS ALSO NOT THE CAS E OF THE AO THAT ITA NOS.2068 & 2069/AHD/2010 6 THE PARTIES TO THE AGREEMENT HAVE NOT ACTED AS STAT ED THEREIN. IN VIEW OF THE SAME IT IS HELD THAT THE SALE OF CAR TO DEALERS IS ON PRINCIPAL TO PRINCIPAL BASIS AND THE INCENTIVES ALLOWED BY THE APPELLANT TO THE DEALERS ARE NOT COMMISSION PAY MENTS. THE PROVISIONS OF SECTION 194H ARE NOT ATTRACTED LAND THEREFORE THE APPELLANT WAS NOT REQUIRED TO DEDUCT ANY TAX U/S. 194H OF THE ACT. 8.3.1 HOWEVER, ON THE PERUSAL OF CLAUSE 5.3.2 OF T HE GM RETAILER AGREEMENT, IT WAS NOTED THAT THE APPELLANT -COMPANY HAS A RIGHT OF MAKING DIRECT SALES UNDER THE INFORM ATION TO THE DEALER. UNDER THE SAID CLAUSE THE COMPANY MAY INVOI CE DIRECTLY TO THE CUSTOMER UNDER THE INFORMATION TO T HE RETAILER AND DELIVER THE VEHICLE TO THE RETAILER FOR ONWARD DELIVERY. IN VIEW OF THE SAID CLAUSE THE ID. AR WAS DIRECTED TO SUBMIT THE DETAILS OF SALES DIRECTLY MADE BY THE COMPANY AND A LSO TO STATE WHETHER ANY INCENTIVE WAS PAID TO THE DEALER ON SUC H SALES. 8.3.2 IT WAS SUBMITTED BY THE ID. AR THAT MOST OF T HE DIRECT SALES MADE BY THE COMPANY WERE TO THE GOVERNMENT OF INDIA, MAJOR SALES WERE TO THE POLICE DEPARTMENT OF THE CO NCERNED STATE. THE APPELLANT ALLOWED A REASONABLE MARK UP OF RS.2,000 TO RS.7,500 PER CAR TO THE DEALER OF THE C ONCERNED STATE ON ACCOUNT OF SALE OF CARS DIRECTLY MADE BY T HE COMPANY. IT WAS ALSO CONTENDED THAT THE MARK UP ALLOWED TO THE DEALER WAS NOT INCENTIVE / COMMISSION BUT PAYMENTS FOR MEE TING THE COST TOWARDS SUPPLYING THE CAR AND AFTER SALES SERV ICES TO BE PROVIDED BY THE DEALERS TO THE CONCERNED GOVERNMENT DEPARTMENT. IT WAS STATED THAT ONCE THE APPELLANT -COMPANY RECEIVES A DIRECT SALES ORDER, IT DIRECTS THE DEALER TO SUPPLY THE CAR TO THE CONCERNED DEPARTMEN T OF THE GOVERNMENT. IT WAS SUBMITTED THAT IF HARYANA POLIC E ORDERS 20 TAVERA MODEL CARS, THE APPELLANT-COMPANY CONTACTS T HE NEAREST DEALER IN THE STATE OF HARYANA AND DIRECTS THE DEALER TO SUPPLY THE CARS TO THE HARYANA POLICE. IT WAS NOT FEASIBLE FOR THE COMPANY TO SUPPLY CARS FROM HALOL (GUJARAT) OR TALEGAON (PUNE) TO HARYANA, IT WAS NOT COST EFFECTIVE AND WITHOUT ANY REASON INCREASES THE COST OF THE CAR TO BE SUPPLIED TO THE CONCERNED GOVERNMENT DEPARTMENT. THE APPELLANT THE REFORE DIRECTS THE NEAREST DEALER TO SUPPLY THE CARS. TH E APPELLANT; ALLOWS, NOMINAL MARK-UP / INCENTIVE TO TH E DEALER FOR REIMBURSING THE DEALER ON ACCOUNT OF COST OF HOLDIN G THE CAR AND ALSO OTHER ADMINISTRATIVE EXPENSES. FURTHER, TH E DEALER UNDERTAKES THE ENTIRE ACTIVITY OF SUPPLYING THE CAR IN READY TO USE CONDITION. THE ENTIRE PRE-DELIVERY CHECK UPS A ND OTHER TESTS ARE DONE BY THE DEALER BEFORE SUPPLYING THE C ARS TO THE CONCERNED DEPARTMENT. IN ORDER TO REIMBURSE SUCH CO STS, THE APPELLANT ALLOWS NOMINAL MARK-UP / INCENTIVE. FURTH ER, THE AFTER ITA NOS.2068 & 2069/AHD/2010 7 SALES SERVICES WERE ALSO TO BE PROVIDED BY THE DEAL ER TO THE CONCERNED GOVERNMENT DEPARTMENT ON DIRECT SALES MAD E BY THE COMPANY. IT WAS SUBMITTED THAT ONCE THE COMPANY DIRECTS THE DEALER TO SUPPLY THE CARS TO THE GOVERNMENT DEP ARTMENT, THE ROLE OF THE COMPANY WAS OVER AND THE ENTIRE RES PONSIBILITY OF DELIVERING THE CAR AND SERVICING OF CAR INCLUDIN G FREE SERVICES AND AFTER SALES SERVICES WAS TO BE DONE BY THE DEALER. IN ORDER TO REIMBURSE SUCH COSTS TO THE DEALER, THE APPELLANT- COMPANY ALLOWED SOME MARK-UP TO THE DEALERS ON THE DIRECT SALES. THE APPELLANT RELIED ON THE LETTER DATED 1-4 -2008 FOR SUBSTANTIATING THE FACT THAT THE INCENTIVES / MARK- UPS ALLOWED TO THE DEALERS WAS NECESSARY FOR REIMBURSING THE CO STS INCURRED BY THE DEALERS. IT WAS THEREFORE SUBMITTED THAT THE PAYMENTS OF MARK-UPS / INCENTIVES ON DIRECT SALES M ADE BY THE COMPANY MAY NOT BE TREATED AS COMMISSION PAYMENTS U /S. 194H OF THE ACT. TOTAL PAYMENTS MADE TO THE DEALERS ON ACCOUNT OF DIRECT SALES MADE BY THE COMPANY AMOUNTS TO RS.50,29,264 FOR AY 2008-09 AND RS.78,81,661 FOR AY 2009- 10. 8.3.3 I HAVE CONSIDERED THE SUBMISSIONS OF THE ID. AR AND THE FACTS OF THE CASE. I HAVE GONE THROUGH THE ORDERS O F THE AO. I HAVE ALSO GONE THROUGH THE CONTENTS OF AGREEMENT BE TWEEN PRINCIPAL AND THE RETAILER. HERE IT HAS TWO TYPES O F TRANSACTIONS; ONE IS SALES TO THE RETAILER ON WHICH INCENTIVES WE RE GIVEN BY THE PRINCIPAL, WHICH THE RETAILER TREATS IT AS DISC OUNT. THE SECOND TYPE OF TRANSACTION IS DIRECT SALES BY THE P RINCIPAL, THROUGH THE RETAILER, ON WHICH ALSO SOME LESSER AMO UNT OF INCENTIVE IS GIVEN, THIS ALSO THE RETAILER TREATED AS DISCOUNT. NEEDLESS TO EMPHASIZE, THE PRINCIPAL HAS NOT DEDUCT ED TDS ON BOTH THE TYPES OF TRANSACTIONS. IT IS WORTHWHILE TO NOTE THAT THE APPELLANT HAS NOT PRODUCED ANY DOCUMENTARY EVIDENCE TO SUBSTANTIATE THAT THE DEALER OR RETAILER HAS INCURR ED ANY EXPENSES FOR SUPPLYING THE CARS ON BEHALF OF THE APPELLANT IN DIRECT SALES. IN THE ABSENCE OF AN Y PROOF OR DOCUMENTARY EVIDENCE, THE CLAIM OF THE APPELLANT CA NNOT BE ACCEPTED, THAT IT IS A DISCOUNT. IN ADDITION IT MAY BE NOTED THAT THE RETAILER HAS SUPPLIED THE CARS, IN DIRECT SALES , TO THE END USERS NOT AS SALES FROM HIM (RETAILER) BUT AS SALE S ON BEHALF OF THE PRINCIPAL AND UNDER HIS INSTRUCTIONS AND D IRECTIONS. FURTHERMORE, SINCE THE AGENT IS NOT THE OWNER OF TH E CARS, IF ANY LOSS IS SUFFERED BY THE AGENT HE IS TO BE INDEM NIFIED BY THE PRINCIPAL. THIS IS YET ANOTHER DOMINANT FACTOR WHIC H DISTINGUISHES AN AGENT FROM A BUYER PURE AND SIMPLE . A FEE PAID TO AN AGENT OR EMPLOYEE FOR TRANSACTING A PIEC E OF BUSINESS OR PERFORMING A SERVICE, NATURALLY COM ES UNDER COMMISSION AND THE PROVISIONS OF SECTION 194H ARE APPLICABLE IN AS MUCH AS THE DIRECT S ALES ARE ITA NOS.2068 & 2069/AHD/2010 8 CONCERNED. IN THE CIRCUMSTANCES, THE AO IS DIRECTED TO TREAT THE MAKEUP CHARGES/INCENTIVES ALLOWED BY THE APPELL ANT TO THE RETAILER ON DIRECT SALES AS COMMISSION UNDER SECTIO N 194H AND RECOVER TAX ON THE SAME. THUS, THIS GROUND OF APPEA L IS PARTLY ALLOWED. FROM THE DETAILS SUBMITTED BY THE APPELLAN T IT IS SEEN THAT THE AMOUNT OF INCENTIVES ALLOWED BY THE APPELL ANT ON DIRECT SALES FOR AY 2009-10 IS RS.78,81,661/- AND FOR AY 2008-09 THE SAME IS RS.50,29,264/-. FOR AY 2009- 10 THE AO WILL RECOVER TAX U/S. 201(1) AS WELL AS I NTEREST U/S. 201(1A) ON A SUM OF RS.78,81,661/-. THE AO IS ALSO DIRECTED TO CHARGE SURCHARGE AT APPLICABLE RATES IN CASES WH ERE THE PAYMENTS EXCEEDS THE THRESHOLD LIMIT OF RS.10.00 LA CS / RS.1.00 CRORES AS THE CASE MAY BE. FOR AY 2008-09 THE AO WILL RECOVER ONLY INTEREST U/S, 201(1A) ON AN AMOUNT OF RS.50,29,264/- AND NO TAX WOULD BE RECOVERED IN V IEW OF CBDT CIRCULAR F NO. 276/201/96-IT(B) DATED 21-09-19 97. THE AO IS DIRECTED TO CHARGE INTEREST U/S. 201(1A) OF T HE ACT GOT BOTH THE YEARS TILL THE DATE ON WHICH THE ACTUAL PA YMENT HAS BEEN MADE BY THE APPELLANT TO THE CONCERNED DEALER. THESE GROUNDS OF APPEAL ARE THUS, PARTLY ALLOWED. 4.1 AS REGARDS TAX REQUIRED TO BE DEDUCTED AT S OURCE FROM HIRING CHARGES, THE LEARNED CIT(A) HELD AS UNDER:- 5.3 I HAVE CONSIDERED THE SUBMISSIONS OF ID. AR AND THE FACTS OF THE CASE. THE VEHICLES WERE HIRED BY THE A PPELLANT AS PER THE SERVICE CONTRACT. THE CONTRACTOR PROVIDES T HE VEHICLES WITH DRIVER. THE VEHICLES WERE PUT AT THE DISPOSAL OF THE APPELLANT AND CHARGES WERE COLLECTED AS PER THE USA GE OF THE VEHICLES. THE VEHICLES WERE NEVER PUT AT THE DISPOS AL OF THE APPELLANT, BUT ONLY SERVICES, DRIVEN BY THE DRIVERS PROVIDED BY THE CONTRACTOR. THE MAINTENANCE, FUEL EXPENSES, KEE PING THE VEHICLES IN PERFECT RUNNING CONDITION ETC WERE THE LOOK OUT OF THE CONTRACTOR, BUT NOT THAT OF THE APPELLANT. IN T HE ACT, CARS OR VEHICLES WERE INCLUDED UNDER THE HEAD PLANT & MACHI NERY AND AS SUCH THE AO MUST HAVE BEEN UNDER THE IMPRESSION THAT CARS OR VEHICLES ARE PLANT AND MACHINERY FOR THE PURPOSE OF DEDUCTING TAX AT SOURCE. AS COMMONLY UNDERSTOOD, PL ANT OR MACHINERY HAS TO PRODUCE THINGS OR ARTICLES AS OUTP UTS FROM INPUTS OF RAW MATERIALS, WHERE AS SUCH A THING IS N OT FOUND IN HIRING OF CARS OR VEHICLES. THE BUSES / VEHICLES TR ANSPORT EMPLOYEES OF THE APPELLANT FROM PLACE TO PLACE, SAY , FROM RESIDENCE TO WORK PLACE AND BACK AS PER THE TIME SC HEDULE OF THE CONTRACTEE. THERE IS NO STIPULATION IN THE AGRE EMENT THAT THE SAME CAR OR VEHICLE HAS TO BE PROVIDED, BUT IT IS ENOUGH IF THE SAME TYPE OR MODEL OF VEHICLE IS PLACED AT THE DISPOSAL OF THE APPELLANT, FOR THE PURPOSE FOR WHICH, THE CAR O R VEHICLE HAS ITA NOS.2068 & 2069/AHD/2010 9 BEEN HIRED. IN VIEW OF THESE FACTS AND CIRCUMSTANCE S OF THE CASE, THERE IS NO HESITATION IN TREATING THE ABOVE CONTRACT AS ONE FOR RENDERING SERVICES, RATHER THAN HIRE FOR VE HICLES. AS ALREADY POINTED OUT, CAR OR VEHICLE COULD BY NO STR ETCH OF IMAGINATION BE CONSIDERED AS A PLANT OR MACHINERY A S THE FACTS INVOLVED IN THIS CASE SUGGEST. THUS, I AM OF THE OP INION THAT THE AO WAS NOT JUSTIFIED IN APPLYING THE PROVISIONS OF SECTION 1941, INSTEAD OF THE PROVISIONS OF SECTION 194C, AS APPLIED BY THE APPELLANT. HENCE, THE AO IS DIRECTED TO TREAT T HE PAYMENTS AS COVERED BY SECTION 194C OF THE ACT AND TAX @ 2% HAS BEEN CORRECTLY DEDUCTED BY THE APPELLANT. PROVISIONS OF SECTION 194-I ARE NOT APPLICABLE AND THEREFORE RATE OF 10% CANNOT BE APPLIED. THUS THESE GROUNDS OF APPEAL ARE ALLOWED. 5. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LEARNED CIT(A). THE LEARNED DR SUPP ORTED THE ORDERS OF THE AO FOR BOTH THESE YEARS WHILE THE LEARNED AR ON BEHALF OF THE ASSESSEE CONTENDED THAT THE FIGURES MENTIONED IN GR OUND NO.2 IN THESE APPEALS ARE INCORRECT AND EVEN OTHERWISE ISSU E HAVING BEEN DECIDED IN FAVOUR OF THE REVENUE, THIS GROUND DOES NOT ARISE OUT OF THE IMPUGNED ORDER. 5.1 ON THE OTHER HAND, THE LD. AR ON BEHALF OF T HE ASSESSEE WHILE REFERRING TO RULE 27 OF THE ITAT RULES CONTENDED TH AT THE LD. CIT(A) DID NOT ISSUE SIMILAR DIRECTIONS FOR THE FY 2008-09 [AY 2009-10] AS HAVE BEEN ISSUED BY HIM FOR THE FY 2007-08[AY 2008- 09] IN RESPECT OF RECOVERY OF TAX IN VIEW OF CBDT CIRCULAR NO.276 /201/96-IT(B) DATED 29.1.1997.TO A QUERY BY THE BENCH, THE LD. AR ADMITTED THAT THE ASSESSEE IS NOT IN APPEAL BEFORE US AGAINST THE FINDINGS OF THE LD. CIT(A) NOR FILED ANY CROSS-OBJECTION. 6. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE FACTS OF THE CASE. AS IS APPARENT FROM THE AFORECITED UNDISP UTED FACTS POINTED OUT BY THE LD. CIT(A), THE ASSESSEE ENTERED IN TO TWO TYPES OF TRANSACTIONS- ONE SALES TO THE RETAILER ON WHIC H INCENTIVES ARE GIVEN BY THE PRINCIPAL, WHICH THE RETAILER TREATS I T AS DISCOUNT WHILE THE SECOND- DIRECT SALES BY THE PRINCIPAL THROUGH T HE RETAILER, ON ITA NOS.2068 & 2069/AHD/2010 10 WHICH LESSER AMOUNT OF INCENTIVE IS GIVEN, WHICH AL SO THE RETAILER TREATS DISCOUNT. THE ASSESSEE DID NOT DEDUCT TAX AT SOURCE ON BOTH THE TYPES OF TRANSACTIONS NOR PRODUCED ANY DOCUMENT ARY EVIDENCE TO SUBSTANTIATE THAT THE DEALER OR RETAILER INCURRED ANY EXPENSES FOR SUPPLYING THE CARS ON BEHALF OF THE ASSESSEE IN DIRECT SALES. ACCORDINGLY, THE LD. CIT(A) CONCLUDED THAT FEE PAI D TO AN AGENT OR EMPLOYEE FOR TRANSACTING A PIECE OF BUSINESS OR PER FORMING A SERVICE IS NOTHING BUT COMMISSION AND THUS, THE PROV ISIONS OF SEC. 194H OF THE ACT ARE APPLICABLE IN AS MUCH AS DIRECT SALES ARE CONCERNED. THEREFORE, THE MAKEUP CHARGES/INCENT IVES ALLOWED BY THE ASSESSEE TO THE RETAILER ON DIRECT SALES HAS BE EN TREATED AS COMMISSION U/S 194H AND AO HAS BEEN DIRECTED TO REC OVER TAX U/S. 201(1) & SURCHARGE THEREON AS WELL AS INTEREST U/S. 201(1A) ON A SUM OF RS.78,81,661/- FOR THE FY 2008-09 RELEVANT T O THE AY 2009- 10. FOR THE FY 2007-08 RELEVANT TO THE AY 2008-09 , ONLY INTEREST U/S 201(1A) OF THE ACT WAS DIRECTED TO BE RECOVERED O N AN AMOUNT OF RS.50,29,264/- WHILE HOLDING THAT NO TAX WOULD BE RECOVERED IN VIEW OF CBDT CIRCULAR F NO. 276/201/96-IT(B) DATED 29.1. 1997 STIPULATING THAT WHERE THE ASSESSEE PAID TAX HIMSELF UNDER SEC TION 191, THE LIABILITY UNDER SECTION 201(1) SHALL BE ELIMINATED. THE ASSESSEE H AS NOT CHALLENGED THESE FINDINGS OF THE LD. CIT(A) IN FURTHER APPEAL. AS REGARDS APPLICABILITY OF PROVISIONS OF SEC. 194I OF THE ACT , THE LD. CIT(A) AFTER ANALYZING THE TERMS AND CONDITIONS OF THE RELEVANT AGREEMENT FOR TRANSPORTATION OF EMPLOYEES CONCLUDED THAT THE AO W AS NOT JUSTIFIED IN APPLYING THE PROVISIONS OF SECTION 194I AND THAT THE PROVISIONS OF SECTION 194C OF THE ACT ,FOLLOWED BY THE ASSESSE, A RE APPLICABLE. THE LD. DR NOT PLACE ANY MATERIAL BEFORE US SO AS T O ENABLE US TO TAKE A DIFFERENT VIEW IN THE MATTER NOR POINTED OUT ANY INFIRMITY IN THE DIRECTIONS OF THE LD. CIT(A) TO FOLLOW CBDT CIR CULAR DATED 29.1.1997 FOR THE FY 2007-08 RELEVANT TO THE AY 200 8-09. IN THESE CIRCUMSTANCES, WE ARE NOT INCLINED TO INTERFERE WIT H THE FINDINGS OF THE LD. CIT(A). EVEN OTHERWISE, THE LD. AR CONCEDED THAT GROUND NO.2 RAISED BY THE REVENUE, THOUGH MENTIONED INCORRECT F IGURES , DOES ITA NOS.2068 & 2069/AHD/2010 11 NOT ARISE OUT OF THE IMPUGNED ORDER, HAVING BEEN AD MITTEDLY DECIDED BY THE LD. CIT(A) IN FAVOUR OF THE REVENUE AND AGAI NST THE ASSESSEE. IN VIEW OF THE FOREGOING, GROUND NOS.1 & 2 IN THE A PPEAL ARE DISMISSED. . 7. AS REGARDS PLEA OF THE LD. AR ON BEHALF OF THE ASSESSEE, SEEKING SIMILAR DIRECTIONS FOR THE FY 2008-09[AY 2009-10] A S HAVE BEEN ISSUED BY THE LD. CIT(A) FOR THE FY 2007-08[AY 2008 -09] IN RESPECT OF RECOVERY OF TAX IN VIEW OF CBDT CIRCULAR NO.276 /201/96-IT(B) DATED 29.1.1997, THE LD. AR RELIED UPON RULE 27 OF THE ITAT RULES,1963 AND CITED THE DECISIONS IN ITO VS. SMT. GURINDER KAUR,102 ITD 189(DELHI), HINDUSTAN COCA-COLA BEVERAGES (P.) LIMITED. VS COMMISSIONER OF INCOME-TAX293 ITR 226(S C) AND MAHINDRA AND MAHINDRA LIMITED. VS DEPUTY COMMISSION ER OF INCOME-TAX.313 ITR(AT) 263(MUMBAI). THE LD. DR VEHE MENTLY OPPOSED THE AFORESAID PLEA OF THE LD. AR ON THE GR OUND THAT RULE 27 OF THE ITAT RULES,1963 IS NOT APPLICABLE IN THE IN STANT CASE SINCE NO SUCH PLEA WAS TAKEN BEFORE THE LD. CIT(A) OR THE AO IN THE PROCEEDINGS FOR THE FY 2008-09[AY 2009-10] NOR THE RELEVANT FACTS EMERGE FROM THE IMPUGNED ORDERS. 7.1 RULE 27 OF THE ITAT RULES,1963, SAYS THAT T HE RESPONDENT IN AN APPEAL CAN SUPPORT THE ORDER APPEALED AGAINST ON ANY OF THE GROUNDS DECIDED AGAINST HIM EVEN THOUGH HE MAY NOT HAVE FILED AN INDEPENDENT APPEAL OR CROSS-OBJECTION. IT IS AN ENA BLING PROVISION WHICH THE RESPONDENT CAN AVAIL HIMSELF OF IN ORDER TO RET AIN THE BENEFIT WHICH HAS ACCRUED TO HIM FROM THE ORDER APPEALED AGAINST. THE POWERS OF THE TRIBUNAL UNDER THE ACT AND RULES ARE THE SAME AS THOSE OF AN APPELLATE COURT UNDER THE CODE OF CIVIL PROCEDURE WHICH HAVE BEEN SUCCINCTLY SUMMED UP BY HONBLE CHAGLA C.J. IN NEW INDIA LIFE ASSURANCE CO.'S CASE [1957] 31 ITR 844, IN THE FOLLOWING PASSAGE AT PAGE 855 : ITA NOS.2068 & 2069/AHD/2010 12 ' WHEN AN APPELLANT COMES BEFORE A COURT OF APPEAL, HE COMES THERE BECAUSE HE IS DISSATISFIED WITH THE DECISION OF THE TRIAL COUR T AND HE CHALLENGES THAT DECISION ; AND HE CHALLENGES THAT DECISION ON CERTAIN GROUNDS WHICH ARE SET OUT IN THE GROUNDS OF APPEAL OR IN THE MEMO OF APPEAL. THE RES PONDENT, IF HE HAS NOT APPEALED OR HAS NOT CROSS-OBJECTED, IS SATISFIED WI TH THE DECISION OF THE TRIAL COURT AND HE IS BEFORE THE COURT OF APPEAL TO SUPPORT THE JUDGMENT OF THE TRIAL COURT. THE APPELLANT MAY CHALLENGE THE DECISION OF THE TRIAL C OURT EVEN ON GROUNDS NOT CONTAINED IN THE GROUNDS OF APPEAL IF THE COURT OF APPEAL GRANTS HIM LEAVE TO DO SO. UNDOUBTEDLY, IN GRANTING LEAVE THE COURT OF APP EAL WOULD CONSIDER VARIOUS FACTORS : WHETHER THE QUESTION RAISED WOULD INVOLVE QUESTIONS OF FACT WHICH MAY NECESSITATE A REMAND ; WHETHER THE CONDUCT OF THE A PPELLANT IS SUCH AS TO DISENTITLE HIM TO RAISE THE NEW GROUND ; AND SO ON. BUT IF LEAVE IS GRANTED AND IT THE OTHER SIDE HAS NOTICE OF THE NEW GROUND WHICH T HE APPELLANT SEEKS TO URGE, THERE DOES NOT SEEM TO BE ANY REASON WHY THE COURT OF APPEAL SHOULD NOT PERMIT THE APPELLANT TO CHALLENGE THE DECISION OF THE TRIA L COURT ON A GROUND OTHER THAN THOSE TAKEN IN THE GROUNDS OF APPEAL. THE POSITION WITH REGARD TO THE RESPONDENT IS DIFFERENT; IT IS NOT OPEN TO HIM TO URGE BEFORE THE COURT OF APPEAL AND GET A RELIEF WHICH WOULD ADVERSELY AFFECT THE APPELLANT. IF THE RESPONDENT WANTED TO CHALLENGE THE DECISION OF THE TRIAL COURT, IT WAS OPEN TO HIM TO FILE A CROSS-APPEAL OR CROSS- OBJECTIONS. BUT THE VERY FACT THAT HE HAS NOT DONE SO SHOWS THAT HE IS QUITE CONTENT WITH THE DECISION GIVEN BY THE TRIAL COURT. THEREFORE, UNDER THESE CIRCUMSTANCES, HIS ONLY RIGHT IS TO SUPPORT THE DEC ISION OF THE TRIAL COURT. IT IS TRUE THAT HE MAY SUPPORT THE DECISION OF THE TRIAL COURT , NOT ONLY ON THE GROUNDS CONTAINED IN THE JUDGMENT OF THE TRIAL COURT, BUT O N ANY OTHER GROUND. IN APPRECIATING THE QUESTION THAT ARISES BEFORE US, ON E MUST CLEARLY BEAR IN MIND THE FUNDAMENTAL DIFFERENCE IN THE POSITIONS OF THE APPE LLANT AND THE RESPONDENT. THE APPELLANT IS THE PARTY WHO IS DISSATISFIED WITH THE JUDGMENT ; THE RESPONDENT IS THE PARTY WHO IS SATISFIED WITH THE JUDGMENT.' 7.11 IN THE LIGHT OF VIEW TAKEN IN THE AFORES AID DECISION, ESPECIALLY WHEN THE LD. AR DID NOT EXPLAIN AS TO WHICH BENEFIT ACCRUED TO THE ASSESSEE FROM THE ORDER APPEALED AGAINST FOR THE FY 2008-09[AY 2009-10] ,WHICH THE ASSESSE RESPONDENT WANTED TO RETAIN BY MAKING THE AFORESAID PLEA BEFORE US, THE SAID PLEA RELATING TO INVOCATION OF RULE 27 OF THE ITAT RULES,1963 BY THE LD. AR IS TOTALLY MISPLACED. MOREOVER, THE LD. AR MERELY CITE D THE AFORESAID THREE DECISIONS BEFORE US, WITHOUT DEMONSTRATING AS TO HOW THESE DE CISIONS ARE APPLICABLE IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND HOW THE ASS ESSE IS ENTITLED TO CLAIM FURTHER RELIEF WITHOUT FILING ANY APPEAL OR CROSS- OBJECTION. EVEN THERE IS NOTHING TO SUGGEST AS TO WHETHER OR NOT THE ASSESSEE RAISED AN Y SUCH PLEA OF PAYING THE TAX ITSELF UNDER SECTION 191 AND CONSEQUENTLY ELIM INATION OF LIABILITY UNDER SECTION 201(1) AS CLARIFIED BY CBDT IN F.NO.276/201/96-IT ( B) DATED 29.1.1997 , RELIED ITA NOS.2068 & 2069/AHD/2010 13 UPON BY THE LD. AR. NO SUCH FACTS OF PAYMENT OF TA X U/S 191 IN THE FY 2008- 09[AY 2009-10] EMERGE FROM THE IMPUGNED ORDERS NOR HAVE BEEN PLACED BEFORE US. EVEN RELIANCE ON DECISION OF HONBLE SUPREME CO URT IN HINDUSTAN COCA-COLA BEVERAGES (P.) LIMITED.(SUPRA) IS ALSO TOTALLY MISP LACED. IN THE SAID DECISION, IT WAS HELD INTER ALIA, AS UNDER: BE THAT AS IT MAY, CIRCULAR NO. 275/201/95-IT(B) DA TED JANUARY 29, 1997, ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES, IN OUR CONSID ERED OPINION, SHOULD PUT AN END TO THE CONTROVERSY. THE CIRCULAR DECLARES 'NO D EMAND VISUALIZED UNDER SECTION 201(1) OF THE INCOME- TAX ACT SHOULD BE ENF ORCED AFTER THE TAX DEDUCTOR HAS SATISFIED THE OFFICER-IN-CHARGE OF TDS, THAT TA XES DUE HAVE BEEN PAID BY THE DEDUCTEE-ASSESSEE. HOWEVER, THIS WILL NOT ALTER THE LIABILITY TO CHARGE INTEREST UNDER SECTION 201(1A) OF THE ACT TILL THE DATE OF P AYMENT OF TAXES BY THE DEDUCTEE-ASSESSEE OR THE LIABILITY FOR PENALTY UNDE R SECTION 271C OF THE INCOME- TAX ACT'. IN THE INSTANT CASE, THE APPELLANT HAD PAID THE INT EREST UNDER SECTION 201(1A) OF THE ACT AND THERE IS NO DISPUTE THAT THE TAX DUE HA D BEEN PAID BY THE DEDUCTEE- ASSESSEE (M/S. PRADEEP OIL CORPORATION). IT IS NOT DISPUTED BEFORE US THAT THE CIRCULAR IS APPLICABLE TO THE FACTS SITUATION ON HA ND. 7.11 A MERE GLANCE AT THE ORDERS OF THE LOWER AU THORITIES FOR THE FY 2008-09[AY 2009-10] REVEALS THAT NO SUCH FACTS OF PAYMENT OF TAXES BY THE DEDUCTEE- ASSESSEE EMERGE FROM THE SAID ORDERS NOR THESE HAV E BEEN PLACED BEFORE US BY THE LD. AR ON BEHALF OF THE ASSESSE. EVEN THERE IS NOTHING TO SUGGEST THAT ANY SUCH PLEA WAS RAISED BEFORE THE LD. CIT(A) IN THE PROCEEDINGS FOR THE FY 2008- 09[AY 2009-10]. THUS , WHEN THE RELEVANT FACTS RELA TING TO PAYMENT OF TAXES BY THE DEDUCTEE-ASSESSEE NEITHER EMERGE FROM THE IMPUG NED ORDER NOR HAVE BEEN PLACED BEFORE US , WE ARE NOT INCLINED TO ACCEPT TH E PLEA OF THE LD. AR . 7.2 AS REGARDS RELIANCE ON DECISION IN MAHINDRA AND MAHINDRA LIMITED.(SUPRA), IN THE CITED CASE, THE ISSUE RELAT ED TO DEDUCTION OF TAX AT SOURCE FROM THE ENTIRE AMOUNT PAID BY THE ASSESSEE IN RELATION TO THE FCCB ISSUE, VIZ., MANAGEMENT, SELLI NG AND UNDERWRITING COMMISSION ALONG WITH THE REIMBURSEMEN T OF EXPENSES , WHICH WAS NOT TAXABLE IN THE HANDS OF THE NON-RESID ENT AND RESULTANTLY, IT WAS HELD THAT THERE CAN BE NO OBLIG ATION ON THE ASSESSEE TO DEDUCT TAX AT SOURCE UNDER S. 195 OF TH E ACT . SUCH ARE ITA NOS.2068 & 2069/AHD/2010 14 NOT THE FACTS IN THE INSTANT CASE. THEREFORE, RELIA NCE ON THE SAID DECISION IS ALSO MISPLACED. 7.3 IN THE LIGHT OF AFORESAID DISCUSSION, THE PL EA OF THE LD. AR FOR INVOCATION OF RULE 27 OF THE ITAT RULES,1963 WHILE RELYING UPON AFORESAID THREE DECISIONS IS REJECTED. 8. GROUND NOS. 3 & 5 BEING MERE PRAYER AND GENERAL IN NATURE NOR ANY SUBMISSIONS HAVING BEEN ON THESE GROUNDS, DO NO T REQUIRE ANY SEPARATE ADJUDICATION WHILE NO ADDITIONAL GROUND H AVING BEEN RAISED BEFORE US IN TERMS OF THE RESIDUARY GROUND NO.4 IN THE APPEAL, THESE GROUNDS ARE, THEREFORE, DISMISSED. 9. IN THE RESULT, BOTH THESE APPEALS ARE DISMISSED . ORDER PRONOUNCED IN THE COURT TODAY ON 27-05-2011 SD/- SD/- (D K TYAGI) JUDICIAL MEMBER (A N PAHUJA) ACCOUNTANT MEMBER DATED : 27-05-2011 COPY OF THE ORDER FORWARDED TO: 1. M/S GENERAL MOTORS (I) PVT. LTD., CHANDRAPURA IN DUSTRIAL ESTATE, HALOL, DISTRICT: PANCHMAHAL 2. ASSISTANT COMMISSIONER OF INCOME-TAX, TDS CIRCL E, ROOM NO.5, GROUND FLOOR, AAYAKAR BHAVAN, RACE COURSE, BA RODA 3. CIT CONCERNED 4. CIT(A)-VI, BARODA 5. DR, ITAT, AHMEDABAD BENCH-D, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABAD