DCIT (TDS) - 1(1), MUMBAI V. ASIAN HEART INSTITUTE & RESEARCH CENTRE PVT. LTD., MUMBAI

ITA 2211/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0468 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 25-05-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 06-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D D ANJARIA
• Assessee Lawyers: SAURABH K R AI
• Section: 194C; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH C MUMBAI BEFORE SHRI MAHAVIR SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 2211/MUM/2016 ASSESSMENT YEAR: 2012 - 13 DCIT (TDS) - 1(1) VS. M/S ASIAN HEART INSTITUTE & RESEARCH MUMBAI - 400051 G.N.BLOCK, BKC,BANDRA(E) MUMBAI - 400051 PAN NO. AAACC8811C (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SAURABH K. R AI, D R REVENUE BY: SHRI D . D. ANJA RI A, A R DATE OF HEARING : 25/05 /2017 DATE OF PRONOUNCEMENT: 31/05/2017 ORDER PER N.K. PRADHAN, AM THIS IS AN APPEAL FILED BY THE REVENUE . THE REL EVANT ASSESSMENT YEAR IS 2012 - 13 . THE APPEAL IS DIRECTED AGAINST THE ORDER COMMISSIONER (APPEALS) 59 , MUMBAI AND ARISES OUT OF ASSESSMENT MADE U/S 201(1) & 201(1A) OF THE INCOME TAX ACT, 1961 (THE ACT). 2. THE GROUNDS OF APPEAL RAISED BY THE REVENUE READ AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED BY HOLDING TH AT PROVISIONS OF SECTION 194C ARE APPLICABLE AND NOT THE PROVISIONS OF SECTION 194J AS HELD BY THE A.O. WITHOUT APPRECIATING THE FACT THAT THE MAINTENANCE OF SPECIALIZED MACHINES IN HOSPITALS CALL ITA NO. 2211/MUM/2016 2 FOR SKILLED PROFESSIONAL/ TECHNICAL ENGINEERS AND CANNOT BE HELD AS SINGLE CONTRACTUAL CHARGE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED BY HOLDING THAT THE PROVISIONS OF SECTION 194C ARE APPLICABLE AND NOT THE PROVISIONS OF SECTION 194J OF THE IT ACT AS HELD BY THE A.O. WITHOUT A PPRECIATING THAT THE VERY NATURE OF PEST CONTROL IN HOSPITAL IS AKIN TO INDUSTRIAL PEST CONTROL AND VARIES FROM REGULAR DAY - TO - DAY PEST CONTROL. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED BY HOLDING THAT THE PROVISIONS OF S ECTION 194J ARE APPLICABLE AND NOT THE PROVISIONS OF SECTION 192 OF THE IT ACT AS HELD BY THE A.O. WITHOUT APPRECIATING THAT THERE EXISTS EMPLOYER - EMPLOYEE RELATIONSHIP BETWEEN THE CONSULTANT DOCTORS AND THE COMPANY. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE DEMAND OF RS.7,40,08,412/ - WITHOUT PROPERLY APPRECIATING THE FACTUAL AND LEGAL MATRIX OF THE CASE AS CLEARLY BROUGHT OUT BY THE A.O. IN ORDER U/S 201(1)/201(1A) OF THE INCOME TAX ACT, 1961. 3. BRIEFLY S TATED, THE FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER (A.O.) FOUND THAT (I) THE ASSESSEE HAD BEEN DEDUCTING TDS @ 10% U/S 194J ON THE PAYMENT MADE TO CONSULTANT DOCTORS INSTEAD OF 30% U/S 192, (II) THE ASSESSEE HAD BEEN MAKING TDS @ 2% U/S 194C ON T HE PAYMENTS MADE FOR PEST CONTROL EXPENSES AND ANNUAL MAINTENANCE CONTRACT INSTEAD OF 10% U/S 194J OF THE ACT. THEREFORE, THE A.O. HELD THE FOLLOWING : U/S. 201(1) (RS.) U/S. 201(1A) FOR 36 MONTH S TOTA L (RS.) PAYMENT TOWARDS ANNUAL MAINTENANCE CONTRACT (AMC) & PEST CONTROL EXPENSES 16,66,034 5 , 99 , 772 22 , 65 , 806 ITA NO. 2211/MUM/2016 3 PAYMENT MADE TO F ULL T IME CONSULT ANTS 5,27,59,269 1,89,83,337 7,17,42,606 TOTAL 5 , 44 , 25 , 303 1 , 95 , 83 , 109 7 , 40 , 08 , 412 IN VIEW OF THE ABOVE, THE A.O. HELD THE ASSESSEE TO BE IN DEFAULT FOR NON - DEDUCTION OF TDS AND WORKED OUT THE TOTAL TAX LIABILITY OF THE ASSESSEE AT RS.7,40,08,412/ - . 4. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A) . W E FIND THAT HE LD. CIT(A) HAS FOLLOWED THE ORDER OF THE TRIBUNAL IN THE CASE OF THE ASSESSEE FOR THE A.Y. 2008 - 09 (ITA NO. 7051/MUM/2012), A.Y. 2009 - 10 (ITA NO. 7052/MUM/2012), A.Y. 2010 - 11 (ITA NO. 7053/MUM/2012) AND A.Y. 2011 - 12 (ITA NO. 7054/MUM/2012) AND ALLOW ED THE APPEAL FILED BY THE ASSESSEE. 5. THE LD. D.R. RELIES ON THE ORDER PASSED BY THE A.O. ON THE OTHER HAND THE LD. COUNSEL OF THE ASSESSEE SUPPORTS THE ORDER PASSED BY THE LD. CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIA L ON RECORD. WE FIND THAT THE ISSUES IN THE INSTANT APPEAL ARE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL RELIED ON BY THE LD. CIT(A) WHICH HAVE BEEN MENTIONED AT PARA 4 HERE - IN - ABOVE. FACTS BEING SIMILAR, WE FOLLOW THE ORDER O F THE CO - ORDINATE BENCH FOR THE A.Y. 2008 - 09, 2009 - 10, 2010 - 11 AND 2011 - 12 AND UPHOLD THE ORDER OF THE LD. CIT(A). 7. IN THE RESULT, THE APPEAL IS DISMISSED. ITA NO. 2211/MUM/2016 4 ORDER PRONOUNCED IN THE OPEN COURT ON 31/05/2017. SD/ - SD/ - (MAHAVIR SINGH) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI : DATED: 31/05/2017 RAHUL SHARAM, SR. P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI