M/s. Jindal Saw Ltd., V. The Income Tax Officer, TDS-4, GANDHIDHAM

ITA 220/RJT/2014

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 9049 (ITAT-RAJKOT)
• Duration Of Justice: 4 year(s) 8 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 28-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DM RINDANI
• Keywords: Recovery proceedings
• Section: 40(a)(ia); 201(1); 195

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT LOZJH LOZJH LOZJH LOZJH EGKOHJ EGKOHJ EGKOHJ EGKOHJ IZLKN] U; IZLKN] U; IZLKN] U; IZLKN] U;KF KFKF KF;D LNL; , ;D LNL; , ;D LNL; , ;D LNL; ,OA OAOA OA OLHE OLHE OLHE OLHE VGEN] YS[KK LNL; DS LE{KA VGEN] YS[KK LNL; DS LE{KA VGEN] YS[KK LNL; DS LE{KA VGEN] YS[KK LNL; DS LE{KA BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ I.T.A. NO. 220/RJT/2014 ( / ASSESSMENT YEAR : 2009-10) M/S. JINDAL SAW LIMITED, VILLAGE: SAMAGOGHA, TALUKA: MUNDRA, KUTCH. / VS. ITO, TDS-4, GANDHIDHAM. ./ ./ PAN/GIR NO. : AABCS 7280 C ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI D. M RINDANI, A.R. / RESPONDENT BY : SHRI PRAVEEN VERMA, SR. D.R. / DATE OF HEARING 27/09/2018 !'# / DATE OF PRONOUNCEMENT 03/12/2018 $% / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-II, RAJKOT, VI DE APPEAL NO. CIT(A)-II/RJT/0096/11-12 DATED. 21.01.2014 FOR THE ASSESSMENT YEAR (A.Y.) 2009-10. ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 2 - 2. FIRST WE TAKE UP ASSESSEES GROUNDS OF APPEAL IN ITA NO.220/RJT/2014 FOR ASST. YEAR 2009-10: 3) HON. CIT(A) ERRED IN LAW AS WELL AS ON FACT IN CONFIRMING DEDUCTION OF TAX AT SOURCE U/S. 194-I ON DEMURRAGE/ DETENTION CHARGES PAID TO NON-RESIDENT SHIPPING COMPANIES WHI CH ARE ASSESSED U/S.172 OF THE ACT. 4) HON. CIT(A) ERRED IN LAW AS WELL AS ON FACT I N CONFIRMING DEDUCTION OF TAX AT SOURCE U/S. 194-I ON DEMURRAGE/ DETENTION CHARGES, WHICH IS NOT APPLICABLE TO NONRESIDENT COM PANIES. 5) HON. CIT(A) ERRED IN LAW AS WELL AS ON FACT I N REMITTING MATTER BACK TO ASSESSING OFFICER. 3. THE ABOVE GROUNDS OF APPEAL WERE RECALLED FOR FR ESH ADJUDICATION IN PURSUANCE TO THE DIRECTION ISSUED BY THE ITAT IN MA NO.11/RJT/2017 VIDE ORDER DATED 3 RD AUGUST 2018. THEREFORE, WE PROCEED TO ADJUDICATE THE AFORESAID GROUNDS OF APPEAL. 4. THE ONLY ISSUE RAISED BY THE ASSESSEE IS THAT LD . CIT(A) ERRED IN CONFIRMING THE ORDER OF AO BY SUSTAINING THE DISALL OWANCE OF RS. 27,00,497/- ON ACCOUNT OF NON-DEDUCTION OF TDS U/S 194-I OF THE ACT. 5. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS A LIMITED COMPANY AND ENGAGED IN THE BUSINESS OF SHIPPING AGENCY. THE ASS ESSEE DURING THE YEAR HAS CLAIMED DEMURRAGE CHARGES AMOUNTING TO RS. 27,0 0,497/- ONLY. THE DEMURRAGE CHARGES WERE PAID TO A FOREIGN COMPANY WH ICH WAS LIABLE TO TAX U/S 172 OF THE ACT. HOWEVER, THE ASSESSEE PAID THE DEMURRAGE CHARGES WITHOUT DEDUCTING THE TDS U/S 194-I OF THE ACT. ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 3 - 6. HOWEVER, THE AO WAS OF THE VIEW THAT THE DEMURRA GE CHARGES ARE PAID FOR THE DELAY OF LOADING/UNLOADING OF THE GOOD S. AS SUCH, THE GOODS ARE STORED IN THE PREMISES OF THE COMPANIES WHICH W ERE NOT LIFTED BY THE ASSESSEE WITHIN THE SPECIFIED TIME. THEREFORE, THE DEMURRAGE CHARGES ARE LIKE RENT PAID BY THE ASSESSEE TO OTHER COMPANIES. ACCORDINGLY, THE PROVISION OF SECTION 194-I OF THE ACT IS ATTRACTED. ACCORDINGLY, THE AO SOUGHT AN EXPLANATION FROM THE ASSESSEE FOR NON-DED UCTION OF TDS U/S 194-I OF THE ACT ON THE DEMURRAGE CHARGES CLAIMED B Y IT. 6.1 IN COMPLIANCE WITH IT, THE ASSESSEE SUBMITTED T HAT THE DEMURRAGE CHARGES WERE PAID TO NONRESIDENT SHIPPING COMPANIES WHICH ARE SUBJECT TO TAX UNDER THE PROVISION OF SECTION 172 OF THE AC T. THEREFORE, THE ASSESSEE CLAIMED THAT THERE IS NO LIABILITY FOR DED UCTION OF TDS U/S 194-I OF THE ACT. THE ASSESSEE IN SUPPORT OF HIS CLAIM RE LIED ON THE CIRCULAR ISSUED BY THE CBDT BEARING NO.723 DATED 19.09.1995. HOWEVER, THE AO DISREGARDED THE CONTENTION OF THE A SSESSEE AND HELD THAT THE PAYMENT MADE TO THE FOREIGN SHIPPING COMPANIES ON ACCOUNT OF DEMURRAGE CHARGES ARE REPRESENTING THE RENT. THEREF ORE, THE ASSESSEE WAS LIABLE FOR DEDUCTION OF TDS U/S 194-I OF THE ACT. T HE AO IN HOLDING SO RELIED ON THE JUDGMENT OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. ORIENT (GOA) PVT. LTD. IN TAX APPEAL NO.7/2005 DATED 16.10.2009. IN THE VIEW ABOVE, THE AO TREATED THE ASSESSEE IN DEFA ULT U/S 201(1) OF THE ACT AND RAISED THE DEMANDS OF TDS FOR RS. 27,00,497 /- ALONG WITH ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 4 - INTEREST OF RS. 9,80,215/- AGGREGATING TO RS. 36,80 ,712/- U/S 201(1) AND 201(1A) OF THE ACT. 7. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL TO LD. C IT(A) WHO HAS CONFIRMED THE ORDER OF AO BY OBSERVING AS UNDER: 3. DEMURRAGE: AS REGARDS THE DEMURRAGE CHARGES, IT IS HELD BY TH E AO THAT IT IS A GENERAL TERM TO INDICATE SURCHARGE FOR DELAYS. IN THE INSTANT CASE THE DEMURRAGE HAS BEEN PAID BY THE APPELLANT FOR NOT SH IFTING THE CONTAINERS/GOODS WITHIN THE SPECIFIED TIME. THUS, T HEY ARE CLEARLY RELATED TO THE USE OF SPACE FOR CERTAIN TIME. SUCH CHARGES ARE THEREFORE CLEARLY IN HE NATURE OF RENT PAID BY THE APPELLANT COMPANY. THE AO HAS RELIED UPON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT PANAJI VS. ORIENT GOA P. LTD IN APPEAL NO.7/ 2005 DT. 16/10/2009. THE HONBLE HIGH COURT HAS UPHELD THE A OS ORDER THAT NON DEDUCTION OF TAX ON DEMURRAGE CHARGES MADE TO F OREIGN/ NON RESIDENT COMPANIES WAS LIABLE FOR DISALLOWANCE U/S 40(A)(IA) THEREBY IMPLYING THAT TAX SHOULD. HAVE BEEN DEDUCTED U/S 19 4-I. IT IS ALSO CATEGORICALLY MENTIONED THAT TAX SHOULD. HAVE BEEN DEDUCTED U/S 194-I. IT IS ALSO CATEGORICALLY MENTIONED THAT THE PROVISI ONS OF S.194C ARE NOT APPLICABLE. THE APPELLANT HAS RAISED AN ALTERNATIVE PLEA THAT MUNDRA PORT & KANDLA SEZ HAVE OFFERED THE SAID INCOME IN THEIR IN COME TAX RETURNS AND TAX HAS BEEN PAID ON THE SAME. HENCE, THE DEMAN D U/S 201(1) SHOULD. NOT BE ENFORCED. FOR THIS PURPOSE, THE APPE LLANT HAS RELIED ON THE DECISION OF THE HONBLE SUPREME COURT IN CASE O F HINDUSTAN COCA COLA BEVERAGE LTD. VS. CIT 211 CTR 545. THE AO IS D IRECTED TO VERIFY THE CONTENTION OF THE APPELLANT. IT WILL BE THE RES PONSIBILITY OF THE APPELLANT TO PROVIDE THE NECESSARY DETAILS TO THE A O IN SUPPORT OF ITS CONTENTION. THE AO WILL, IN TURN, DECIDE THE MATTER IN LIGHT OF THE DECISION OF THE HONBLE SUPREME COURT IN CASE OF HI NDUSTAN COCA COLA BEVERAGE P. LTD. (SUPRA). THIS GROUND OF APPEAL IS THUS PARTLY ALLOWED. ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 5 - GROUND NO.1: LEARNED AO ERRED IN LAW AS WELL AS ON FACT IN CHARGING INTEREST U/S 201A OF THE ACT. 6. AS REGARDS CALCULATION ON INTEREST U S.201(1A) I T WAS CONTENDED BY THE APPELLANT THAT SINCE THE PAYEE HAS ALREADY F ILED THE RETURN OF INCOME AND PAID THE TAX ON THE SAME DISCLOSING RECE IPTS FROM THE APPELLANT, THE INTEREST SHOULD. BE CALCULATED UPTO THE DALE ON WHICH THE PAYEE HAS FILED HIS RETURN OF INCOME. THE AO HAS RE LIED ON THE DECISION OF THE HON'BLE CHENNAI HIGH COURT IN CASE OF CIT VS . CHENNAI METRO POLITAN WATER SUPPLY & SEWAGE BOARD 202 TAXMANN 454 . THE APPELLANT'S CONTENTION IS CONSIDERED AND THE AO IS DIRECTED TO COMPUTE THE INTEREST US.201(1A) FROM THE DATE THE TAX WAS D EDUCTIBLE TO THE DATE OF FILING OF RETURN BY THE PAYEE. BEING AGGRIEVED BY THE ORDER OF LD. CIT(A) ASSESSEE IS IN APPEAL BEFORE US. 8. THE LD. AR BEFORE US FILED A PAPER BOOK RUNNING FROM PAGES 1-58 AND SUBMITTED THAT THE JUDGMENT RELIED BY THE AO IN THE CASE OF ORIENT (GOA) PVT. LTD. AS DISCUSSED ABOVE HAD BEEN REVERSE D BY THE LARGER BENCH OF BOMBAY HIGH COURT IN THE CASE OF CIT VS. DEMPO & COMPANY PVT. LTD. REPORTED IN 95 CCH 0030. 9. ON THE OTHER HAND, LD. DR VEHEMENTLY SUPPORTED T HE ORDER OF AUTHORITIES BELOW. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. THE ISSUE IN THE INSTANT CASE RELATES WHETHER THE ASSESSEE IS LIABLE TO DEDUCT THE TDS U/S 194-I OF T HE ACT ON ACCOUNT OF THE PAYMENT MADE TO NONRESIDENT SHIPPING COMPANY FOR DE MURRAGE CHARGES. ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 6 - IN THIS REGARD, WE NOTE THAT THE AO HAS MADE THE DI SALLOWANCE AFTER HAVING RELIANCE ON THE JUDGMENT OF BOMBAY HIGH COUR T IN THE CASE OF ORIENT (GOA) PVT. LTD. WHICH HAS BEEN REVERSED BY T HE LARGER BENCH OF HONBLE BOMBAY HIGH COURT IN THE SUBSEQUENT JUDGMEN T IN THE CASE OF DEMPO & COMPANY PVT. LTD. (SUPRA) . THE RELEVANT PORTION AND THE OBSERVATION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF DEMPO AND COMPANY PVT. LTD. IS EXTRACTED BELOW: 6. THAT IS HOW THE REVENUE REQUESTED THIS COURT T O ADMIT THIS APPEAL AS IT RAISES SUBSTANTIAL QUESTIONS OF LAW. T HE APPEAL TOGETHER WITH OTHER TAX APPEALS WAS PLACED BEFORE A DIVISION BENCH OF THIS COURT AND IT CAME TO BE ADMITTED ON THE FOLLOWING S UBSTANTIAL QUESTIONS OF LAW : (I) WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE, THE ITAT HAS ERRED IN APPLYING THE PROVISION OF SECTION 172 IN HOLDING TH AT SECTION 40(A)(I) IS NOT APPLICABLE, PARTICULARLY WHEN SECTION 173 CONCE RNED WITH LEVY AND RECOVERY OF TAX IN A CASE OF ANY SHIP, AS AGAINST S ECTION 195 R/W 40(A)(I) OF THE IT ACT, REFERS TO NON-RESIDENT ASSESSEE AS I N THE PRESENT CASE? ******** 7. OUT OF THE ABOVE SUBSTANTIAL QUESTIONS, WE ARE CONCERNED WITH QUESTION NO. I. 8. AFTER ADMISSION, THE PRESENT APPEAL AND THE OTH ER APPEALS CAME TO BE PLACED FOR FINAL HEARING BEFORE A DIVISION BE NCH OF THIS COURT AND THE DIVISION BENCH NOTED THE STAND OF THE ASSESSEE IN PARAGRAPH 4 OF ITS ORDER. IN PARAGRAPH 5, THE DIVISION BENCH NOTED THE REFERENCE BY THE TRIBUNAL TO ITS DECISION IN DEPUTY? COMMISSIONER OF INCOME TAX VS. ORIENT (GOA) AND FOLLOWING IT, THE TRIBUNAL ALLOWED THE ASSESSEE'S APPEAL. THE ORDER PASSED BY THE TRIBUNAL HOLDS THA T SECTION 40(A)(I) OF THE INCOME TAX ACT, 1961 (FOR SHORT 'IT ACT') WOULD . APPLY ONLY WHEN THERE IS AN OBLIGATION TO DEDUCT TAX AT SOURCE. RE LIANCE WAS PLACED UPON THE CIRCULAR NO. 723 ISSUED BY THE CENTRAL BOA RD OF DIRECT TAXES TO SUPPORT THE CONCLUSION THAT THERE WAS NO OBLIGAT ION TO DEDUCT TAX AT SOURCE IN RESPECT OF PAYMENT MADE TOWARDS DEMURRAGE CHARGES IN CASES WHERE SECTION 172 OF THE IT ACT APPLIES. THE REVE NUE DID NOT DISPUTE IN THE PRESENT CASE THAT SECTION 172 APPLIED. THE TRIB UNAL HELD THAT SECTION ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 7 - 172 IS A CHARGING AS WELL AS MACHINERY PROVISION IN RESPECT OF NON- RESIDENT SHIPPING COMPANIES. IT PROVIDES FOR DETERM INATION AND COLLECTION OF TAX. THUS, CHAPTER XVI OF THE ACT I N RESPECT OF DEDUCTING TAX AT SOURCE WOULD. NOT APPLY IN SUCH CASES. CONSEQUENTLY, THE DISALLOWANCE OF EXPENDITURE ON ACCOUNT OF SECTION 40(A)(I) OF THE ACT WAS DELETED. 9. THE REVENUE PLACED RELIANCE, BEFORE THE DIVISIO N BENCH HEARING PRESENT APPEALS, ON THE DECISION OF ORIENT (GOA) BY WHICH THIS COURT REVERSED THE TRIBUNAL'S ORDER IN THAT ASSESSEE'S CA SE. IN OTHER WORDS, THE TRIBUNALS VIEW TAKEN IN THE CA SE OF DGIT VS. ORIENT (GOA) WAS EXPRESSLY REJECTED BY THIS COURT WAS THE SUBMISSION OF THE REVENUE. ********* 47. TO OUR MIND, THE DIVISION BENCH JUDGMENT IN COMMISSIONER OF INCOME-TAX VS. ORIENT (GOA) PVT. LTD. SEEN IN THIS LIGHT DOES NOT, WITH GREATEST RESPECT, TAKE INTO ACCOUNT THE SCHEME AND SETTING AS UNDERSTOOD ABOVE. THERE NEED NOT BE APPREHENSION BECAUSE THERE IS NO ESCAPE FROM THE LEVY AND RECOVERY OF TAX. THE TAX HAS TO BE LEV IED AND COLLECTED. THE SHIP CANNOT LEAVE THE PORT OR IF ALLOWED TO LEAVE A NY PORT IN INDIA, IT MUST EITHER PAY OR MAKE ARRANGEMENT TO PAY THE TAX. HENCE, THE APPREHENSION OF AVOIDANCE OR EVASION BOTH ARE TAKEN CARE OF BY THE LEGISLATURE. THAT IS HOW ADVISEDLY THE LEGISLATURE CAST THE OBLIGATION TO DEDUCT, TAX AT SOURCE ON THE PERSON RESPONSIBLE TO MAKE PAYMENT TO A NON-RESIDENT IN SHIPPING BUSINESS. 48. THE RESIDENT ASSESSES CONTENDED BEFORE THE DIVISION BENCH IN ORIENT (GOA) (SUPRA) AS WELL AS THE DIVISION BENCH WHICH MADE THE REFERRING ORDER THAT SECTION 172 OF THE INCOME TAX ACT HAS A BEARING AND AN IMPORTANT ONE ON THE OBLIGATION TO DEDUCT TA X AT SOURCE. THEREFORE, IT IS THE RECIPIENT'S POSITION AND THE PERSPECTIVE IN WHICH THE RECIPIENT'S INCOME WOULD. BE TAXED WILL H AVE TO BE BORNE IN MIND. THE NON-RESIDENT SHIPPING COMPANY IN RESPECT OF IT'S INCOME WOULD. BE IN A POSITION TO RELY UPON SECTION 44B AN D CONSEQUENTLY SECTION 17S, HOWEVER, WE DO NOT SEE HOW THERE IS AN OBLIGATION TO DEDUCT TAX AT SOURCE ON THE RESIDENT ASSESSEE/INDIA N COMPANY BEFORE US. WHILE COMPUTING THE INCOME O F THE NON-RESIDENT INDIAN / FOREIGN ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 8 - COMPANY, ASSISTANCE CAN BE DERIVED BY SUCH NON-RESI DENTS FROM SECTION 44B IF THEY ARE IN SHIPPING BUSINESS. IT WOULD. ALS O BE IN A POSITION TO RELY UPON SECTION 172 BUT THE RESPONSIBILITY OF THE PERSON MAKING PAYMENT TO A NON-RESIDENT IN SUB-SECTION (1) OF SEC TION 195 CANNOT BE AVOIDED IN THO MANNER GET NUT IN OTHER CASES. THE S CHEME AS ABOVE OPERATES ONLY TO CASES COVERED BY SECTION 172 OF TH E IT ACT AND NONE ELSE. 49. THE TERM 'NON-RESIDENT' MEANS A PERSON WHO IS NOT A RESIDENT AS PER SECTION 2(30) OF THE INCOME TAX ACT AND FOR THE PURPOSES OF SECTIONS 93, 93 AND 168, INCLUDES A PERSON WHO IS NOT ORDINA RILY A RESIDENT WITHIN THE MEANING OF CLAUSE (6)OF SECTION 6. THE T ERM 'PERSON' INCLUDES AN INDIVIDUAL, A HUF, A COMPANY, FIRM AND EVERY ART IFICIAL JURIDICAL PERSON NOT FALLING WITHIN ANY OF THE PRECEDING SUB- CLAUSES OF CLAUSE (31) OF SECTION 2. BY SECTION 2(23A), A FOREIGN COMPA NY IS DEFINED TO MEAN A COMPANY WHICH IS NOT A DOMESTIC COMPANY. HE NCE, ANY PERSON RESPONSIBLE FOR PAYING TO A NON-RESIDENT, NOT BEING A COMPANY, OR TO A FOREIGN COMPANY, ANY INTEREST OR ANY OTHER SUM CHAR GEABLE UNDER THE PROVISIONS OF THIS ACT NOT BEING INCOME CHARGEABLE UNDER THE HEAD 'SALARIES', WOULD. HAVE TO DEDUCT THE TAX THEREON A T THE RATES IN THE FORCE. 50. THE VIEW THAT WE ARE TAKING IS BASED ON THE ENU NCIATION AND EXPOSITION OF LAW BY THE HON'BLE SUPREME COURT OF I NDIA, FIRSTLY IN THE CASE OF UNION OF INDIA VS. GOSALIA SHIPPING (PVT.) LTD. REPORTED IN (1978) 3 SCC 23. INSOFAR AS SECTION 172 OF THE IT A CT AS IT STOOD THEN, ITS AMBIT AND SCOPE, THE HONBLE SUPREME COURT OF I NDIA HELD AS UNDER:- *********** 53. IN THE VIEW THAT WE HAVE TAKEN, IT IS NOT NE CESSARY TO REFER THE JUDGMENT OF A DIVISION BENCH OF THE DELHI HIGH IN T HE CASE OF EMIRATES SHIPPING LINE, FZE VS. ASSISTANT DIRECTOR OF INCOME TAX A REPORTED IN (2012) 349 ITR 493. SUFFICE IT TO NOTE THAT THE VIEW TAKEN BY THE DIVISION BENCH AND PARTICULARLY IN PARAS 17 AND 18 OF THIS JUDGMENT ACCORDS WITH THE CONCLUSION REACHED BY US. 54. THE DIFFICULTY IS PRESENTED ONLY WHEN PROVISIO NS ARE NOT READ TOGETHER AND HARMONIOUSLY SO ALSO WITHOUT BEARING I N MIND THE SETTING ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 9 - AND PLACEMENT THEREOF IN THE CHAPTERS. THESE CHAPT ERS OF THE INCOME TAX ACT COVER SEVERAL ASPECTS IN RELATION TO IMPOSI TION, LEVY, ASSESSMENT, COLLECTION AND RECOVERY OF TAX ON THE I NCOME SPECIFIED ABOVE. TO THE EXTENT CONTRARY TO ABOVE, WE OVERRULE THE VIEW IN ORIENT GOA'S CASE (SUPRA). THE QUESTION REFERRED IS ANSWER ED ACCORDINGLY. SINCE THE QUESTION ABOVE IS REFERRED TO US, HAVING ANSWERED IT, LET THE APPEALS BE NOW LISTED FOR HEARING BEFORE APPROPRIAT E DIVISION BENCH. *********** IN VIEW OF ABOVE, THEIR REMAINS NO AMBIGUITY THAT T HE ASSESSEE WAS NOT LIABLE FOR DEDUCTION OF TDS U/S 194-I OF THE ACT ON THE PAYMENT MADE TO THE FOREIGN SHIPPING COMPANIES ON ACCOUNT OF DEMURR AGE CHARGES. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD. CIT(A) A ND DELETE THE ADDITION MADE BY THE AO. HENCE, THE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 03/12/2018 SD/- SD/- EGKOHJ IZLKN EGKOHJ IZLKN EGKOHJ IZLKN EGKOHJ IZLKN OLHE VGEN OLHE VGEN OLHE VGEN OLHE VGEN U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; YKS[KK LN YKS[KK LN YKS[KK LN YKS[KK LN L; L; L; L; (MAHAVIR PRASAD) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 03/12/2018 PRITI YADAV, SR.PS ITA NO.220/RJT/201 4 JINDAL SAW LTD VS. ITO ASST.YEAR 2009-10 - 10 - !'#$ %$' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. & '( ) / CONCERNED CIT 4. ) () / THE CIT(A)-II, RAJKOT. 5. ,-. //'( , '(# , 12$&$ / DR, ITAT, AHMEDABAD. 6. .34 5 / GUARD FILE. & ' / BY ORDER, , / //TRUE COPY// (/') * ( DY./ASSTT.REGISTRAR) , ) / ITAT, AHMEDABAD 1. DATE OF DICTATION 23/10/2018 (DICTATION PAGES 4 ) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 12/11/2018 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 15/11/2018. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER