RUBY MACONS LTD, MUMBAI V. ADDL CIT 8(3), MUMBAI

ITA 4056/MUM/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1698 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-06-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 30-03-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 06-06-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: TDS
• Section: 40(a)(ia); 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D: MUMBAI BEFORE SHRI D.MANMOHAN, HONBLE VICE PRESIDENT AND SHRI RAJENDRA SINGH, ACCOUNTANT MEMBER ITA NO.4056/MUM/2008 (ASSESSMENT YEAR 2005-06) M/S RUBY MACONS LTD, 203/204, ANGELINA APARTMENTS, SAROJINI ROAD, VILEPARLE (WEST), MUMBAI 400 056 PAN AAACR 1939 A VS DCIT, ROOM NO.204, 2 ND FLOOR, AAYKAR BHAVAN, M K ROAD, MUMBAI 400 020 (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI HIRO RAI FOR RESPONDENT : SHRI DURGESH SUMROTT ORDER PER D.MANMOHAN, V.P. 1. THIS APPEAL, FILED BY THE ASSESSEE, IS DIRECTED AGAINST THE ORDER DATED 27.3.2008 PASSED BY THE CIT (A) XXIX, M UMBAI AND IT PERTAINS TO ASSESSMENT YEAR 2005-06. 2. DISALLOWANCE/ADDITION OF RS 14,98,181/-, BY INV OKING THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT, ON THE GROUND THAT THE ASSESSEE IS LIABLE TO DEDUCT TAX AT SOURCE U/S 194J OF THE A CT, IS CHALLENGED BEFORE US, CONTENDING, INTER ALIA , THAT THE PAYMENT MADE BY THE ASSESSEE, IN THE FORM OF EFFLUENT TREATMENT CHARGES, TO VAPI WASTE AND EFFLUENT MANAGEMENT COMPANY LTD (VWEMCL) CANNOT BE TREATED A S FEES FOR TECHNICAL SERVICES. 3. FACTS NECESSARY FOR DISPOSAL OF THE APPEAL ARE STATED IN BRIEF. ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF MANU FACTURE OF PAPER AND PAPER RELATED ACTIVITIES. DURING THE FINANCIAL YEAR, THE ASSESSEE PAID EFFLUENT TREATMENT CHARGES OF RS 14,98,081/- TO VWE MCL WITHOUT DEDUCTING TAX AT SOURCE ON THE AMOUNT SO PAID. ITA 4056/M/2008 M/S RUBY MACONS LTD 2 4. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICER CALLED UPON THE ASSESSEE TO EXPLA IN AS TO WHY TAX WAS NOT DEDUCTED AS PER PROVISIONS OF SECTION 194C. IN RESPONSE THERETO, IT WAS CONTENDED ON BEHALF OF THE ASSESSEE-COMPANY THA T IN ORDER TO INVOKE THE PROVISIONS OF SECTION 194C OF THE ACT, IT SHOUL D BE SHOWN THAT THERE IS A CONTRACT BETWEEN THE ASSESSEE AND THE OTHER PARTY , WHEREAS, IN THE INSTANT CASE, VWEMCL IS NOT A CONTRACTOR. THE SAID COMPANY WAS INCORPORATED PURSUANT TO THE SUGGESTION OF THE HON BLE GUJARAT HIGH COURT FOR THE WASTE AND EFFLUENT TREATMENT OF THE EFFLUEN TS AND WASTES DISCHARGED BY THE FACTORIES WITHIN THE LIMITS OF VA PI INDUSTRIAL ESTATE AND IT WAS RUNNING AND MAINTAINING A CENTRAL EFFLUENT TREA TMENT PLANT. SINCE IT BECAME MANDATORY FOR EVERY FACTORY TO FOLLOW THE SU GGESTION OF HONBLE GUJARAT HIGH COURT, JOINTLY A COMPANY WAS FLOATED B Y NAME VWEMCL AND EVERY FACTORY HAS TO DISCHARGE THEIR EFFLUENTS IN T HE CENTRAL EFFLUENT TREATMENT PLANT RUN BY THE NEW COMPANY IN WHICH PAR TNERS, NOMINEES, DIRECTORS OF THE LOCAL COMPANIES ARE NOMINATED AS T HE MEMBERS. IT WAS FOR A MUTUAL BENEFIT AND THUS, THERE IS NO CONTRACT . HENCE, RELATIONSHIP BETWEEN CONTRACTOR AND CONTRACTEE IS ABSENT. CONSE QUENTLY, THE PROVISIONS OF SECTION 194C ARE NOT APPLICABLE. 5. AT THIS JUNCTURE, THE ASSESSING OFFICER APPEARS TO HAVE INVOKED THE PROVISIONS OF SECTION 194J OF THE ACT, INSTEAD OF APPLYING THE SECTION 194C, AND BY ASSUMING THAT THE PAYMENT MADE BY THE ASSESSEE IS NOTHING BUT A FEE FOR TECHNICAL SERVICES, HE CONC LUDED THAT THE ASSESSEE DEFAULTED IN NOT COMPLYING WITH SECTION 194J AND HE NCE IMPUGNED PAYMENT WAS DISALLOWED U/S 40(A)(IA) OF THE ACT. 6. LEARNED CIT (A) AFFIRMED THE ORDER OF THE ASSES SING OFFICER ON THE GROUND THAT THE SECTION 194J WAS CORRECTLY A PPLIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. IT MAY NOT BE OUT OF PL ACE TO NOTICE THAT NEITHER THE ASSESSING OFFICER NOR THE CIT (A) SOUGH T TO APPLY THE PROVISIONS OF SECTION 194C OF THE ACT FOR THE YEAR UNDER CONSIDERATION AND DISALLOWANCE WAS MAINLY BASED UPON AN ANALYSIS OF P ROVISIONS OF SECTION ITA 4056/M/2008 M/S RUBY MACONS LTD 3 194J OF THE ACT. CASE OF THE ASSESSEE BEFORE THE L EARNED CIT (A) WAS THAT VWEMCL WAS NOT TAXED ON THE RECEIPTS; IT WAS A CCEPTED BY THE ASSESSING OFFICER IN THE ASSESSMENT YEAR 2005-06 TH AT THE PAYMENTS HAVING BEEN BASED ON ACTUAL EXPENDITURE INCURRED BY VWEMCL AND EXCESS AMOUNT, IF ANY, COLLECTED FROM THE MEMBERS WAS PASS ED ON TO THE MEMBERS BY WAY OF DISCOUNT, IT CAN BE SAID TO HAVE RUN ON THE LINES OF MUTUAL BENEFIT CONCERN. ACCORDINGLY, AMOUNT RECE IVED BY VWEMCL WAS NOT TAXED IN THE ASSESSMENT YEAR 2005-06. LEARNED CIT (A) DISREGARDED THE FINDING OF THE ASSESSING OFFICER TO HOLD THAT P ROVISIONS OF SECTION 194J ARE APPLICABLE TO THE FACTS OF THE CASE. 7. FURTHER AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. 8. LEARNED COUNSEL SUBMITTED THAT THE INTENTION OF THE LEGISLATURE IN INCORPORATING TDS PROVISIONS AS WELL AS SECTION 40 OF THE ACT WAS TO ENSURE THAT THE TAX OTHERWISE COLLECTIBLE FR OM THE RECIPIENT SHOULD NOT GO UNNOTICED AND TO BE COLLECTED AT THE POINT O F RECEIPT. IF TAX IS NOT PAYABLE BY THE RECIPIENT, QUESTION OF TDS DOES NOT ARISE AND DRACONIAN PROVISIONS OF SECTION 40 SHOULD NOT BE TAKEN AID OF MERELY BECAUSE SECTION 194J SPEAKS OF DEDUCTION OF TAX AT SOURCE IN RESPEC T OF PAYMENTS REFERABLE TO TECHNICAL SERVICES. HE FURTHER CONTENDED THAT THE EXPRESSION TECHNICAL SERVICES SHOULD NOT BE CONSTRUED IN AN ABSTRACT AN D GENERAL SENSE AND MEANING OF THE SAID EXPRESSION SHOULD BE UNDERSTOOD IN THE SETTING IN WHICH IT WAS USED IN THE RELEVANT PROVISION. BY AP PLYING THE RULE OF NOSCI TUR A SOCIIS EXPRESSION TECHNICAL SERVICES HAVING BEING USED IN THE COMPANY OF THE WORDS MANAGERIAL AND CONSULTANCY -BOTH OF WHICH INVOLVE A HUMAN ELEMENT-THE WORD TECHNICAL WOULD ALSO HAVE TO BE CONSTRUED AS INVOLVING A HUMAN ELEMENT. PLACING RE LEVANCE UPON THE FOLLOWING DECISIONS, LEARNED COUNSEL SUBMITTED THAT THE ASSESSEE AND OTHER COMPANIES HAVING FLOATED A NEW COMPANY KNOWN AS VWEMCL THROUGH WHICH STANDARD FACILITY IS BEING MADE AVAIL ABLE TO ALL THE COMPANIES, WITHOUT MUCH OF HUMAN INTERFACE, IT CANN OT BE CALLED AS TECHNICAL SERVICES. ITA 4056/M/2008 M/S RUBY MACONS LTD 4 I) (2009) 319 ITR 139 (DEL) CIT VS BHARTI CELLULAR LTD . II) (2001) 251 ITR 53 (MAD)-SKYCELL COMMUNICATIONS LTD & ANOTHER VS DCIT III) 124 TTJ 241 (MUM.) KOTAK SECURITIES LTD VS ADDL CI T IV) 125 TTJ 966(MUM.) PACIFIC INTERNET (INDIA)(P) LTD VS ITO V) (2010) 35 SOT 457 (MUM.) DCIT VS ANGEL BROKING LTD* VI) (2009) 123 TTJ 888 (JAIPUR) JAIPUR VIDYUT VITRAN NI GAM LTD VS DCIT 9. THE LEARNED COUNSEL HAS ALSO ADVERTED OUR ATTEN TION TO PAGE 4 OF THE PAPER BOOK (DETAILED NOTE WITH REGARD TO A FFLUENT MANAGEMENT) WHICH READS AS UNDER : GUJARAT INDUSTRIAL DEPARTMENT CORP. (GIDC) HAS NOTIFIED THE VAPI AS INDUSTRIAL BACKWARD ZONE AND H AS STARTED ALLOTTING LAND TO VARIOUS SMALL AND MEDIUM UNIT TO SET UP THEIR INDUSTRIAL UNIT IN VAPI. WITH THE P ASSAGE OF TIME NUMBER OF CHEMICAL AND PAPER UNIT HAS SET U P THEIR PLANT AT VAPI. WITH THE INCREASING NUMBER OF SMALL AND MEDIUM UNIT, THE WATER DISCHARGED BY THE INDUSTRIES WERE INCREASING. THE WATER DISCHARGE BEI NG POLLUTED IT WAS ADVERSELY AFFECTING THE NEARBY VILL AGERS AND CREATURE IN SEA. GUJARAT POLLUTION CONTROL BOAR D HAS STARTED GIVING WARNING TO INDUSTRY AND REQUESTED TH EM TO TREAT THE WATER BEFORE ITS BEING DISCHARGE. BUT IT WAS UNECONOMICAL AND PRACTICALLY IMPOSSIBLE FOR SMALL A ND MEDIUM SIZE COMPANY TO SETUP A POLLUTION CONTROL PL ANT. THEREFORE, GIDC HAS COIN AN IDEA OF SETTING UP COMM ON EFFLUENT TREATMENT PLANT (CETP) AT VAPI. THE CETP PROJECT IS TO BE FINANCE BY IDBI UNDER WORLD BANK C REDIT AS PER SCHEME OF GOVT. OF INDIA, THE SCHEME HAS BEE N APPROVED IN PRINCIPLE BY IDBI. THE GIDC HAS DISCUSS ED THE PROJECT WITH VAPI INDUSTRIES ASSOCIATION AND ASSOCIATION HAS GIVEN CONSENT. GIDC AND VAPI INDUST RIES ITA 4056/M/2008 M/S RUBY MACONS LTD 5 ASSOCIATION HAVE FORMED A COMPANY CALLED VAPI WASTE & EFFLUENT MANAGEMENT CO. LTD. (VWEMCL). ALL THE BENEFICIARY INDUSTRY ARE SHAREHOLDER/MEMBER OF THE VAPI WASTE & EFFLUENT MANAGEMENT CO. LTD. VWEMCL ARE NOT LIABLE TO INCOME TAX BEING ASSOCIATION OF P ERSON ACTING ON COMMON OBJECT FOR THE MEMBER ONLY. IT IS NOT ORGANIZATION FOR PROFIT. GUJARAT POLLUTION CONTROL BOARD HAS ALSO AGREED THAT MEMBER OF VWEMCL WILL BE GIVEN A NOC. A NEW UNIT, WHICH IS SETTING UP PLANT AFTER TH IS, EITHER THEY HAVE TO BE MEMBER OF COMPANY OR SET UP THEIR INDEPENDENT POLLUTION CONTROL PLANT. AS PER THE GUJRAT POLLUTION CONTROL BOARDS NORMS AN D TO OBTAIN NO OBJECTION CERTIFICATE AND CONSENT TO OP ERATE INDUSTRIAL UNITS, EACH INDUSTRIAL UNDERTAKING HAS T O SET UP THEIR PRELIMINARY TREATMENT PLANT & DISCHARGE TH E WATER TO DRAINAGE LINE OF VWEMCL, WITHIN PARAMETER PRESCRIBED BY GPCB. VWEMCL HAS TO COLLECT PRELIMINA RY TREATED WATER THROUGH THEIR PIPELINE TO COMMON EFFL UENT TREATMENT PLANT FOR SECONDARY TREATMENT AS PER NORM S OF GPCB. IN ORDER TO TREAT THE WATER, VWEMCL HAS TO INCUR CE RTAIN EXPENDITURE, WHICH THEY COLLECT FROM MEMBERS BASE O N SAME CRIETERIA. VWEMCL AFTER DISCUSSION WITH GIDC. VAPI INDUSTRIAL ASSOCIATION & MEMBER HAVE DECIDED T HAT BASED ON ACTUAL WATER CONSUMED BY MEMBER UNIT AND BASED ON DISCHARGE QUALITY NORMS, A MEMBER UNIT TO PAY EFFLUENT TREATMENT CHARGES. IF THE EFFLUENT TREA TMENT CHARGES COLLECTED FROM MEMBER IS EXCESS THAN AMOUN T ACTUALLY SPEND, IT IS PASS ON TO MEMBER BY WAY OF DISCOUNT. ITA 4056/M/2008 M/S RUBY MACONS LTD 6 **** **** **** AS EXPLAINED EARLIER, RUBY MACONS LTD. DID NOT SPEC IFY OR INSTRUCT, WHAT VWEMCL TO PERFORM. VWEMCL, TREAT THE WATER AS PER THE NORMS OF GUJRAT POLLUTION CONTROL BOARD AND ARE RESPONSIBLE TO GIDC AND GUJARAT POLLUTION CONTROL BOARD. AS FAR AS, RUBY MACONS LTD. IS CONCE RN, ITS A PURE COMMERCIAL DECISION TO BE MEMBER OF COMMON EFFLUENT TREATMENT PLANT AND PAY HIS SHARE O F EXPENSES INCURRED BY VWEMCL AND A COMPLIANCE TO OBTAIN NOC FROM GUJRAT POLLUTION CONTROL BOARD. 10. ON THE OTHER HAND, LEARNED DR STRONGLY RELIED UPON THE ORDERS PASSED BY THE TAX AUTHORITIES. HE SUBMITTED THAT AFFLUENT TREATMENT IS A TECHNICAL SERVICE RENDERED BY VWEMCL SINCE IT REQUIRES TECHNICAL ANALYSIS OF THE NATURE OF POLLUTANTS DISCHARGED BY EACH COMPANY AND DEPENDING ON THE MODE OF TREATMENT OF DIFFERENT KIN DS OF WASTE A PRICE IS FIXED WHICH INVOLVES HUMAN INTERFACE IN WHICH EVENT PAYMENT MADE BY THE ASSESSEE IN THE FORM OF EFFLUENT TREATMENT CHAR GES WOULD FALL WITHIN THE MEANING OF THE EXPRESSION TECHNICAL SERVICES. 11. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISS IONS AND PERUSED THE RECORD. WE HAVE ALSO CAREFULLY PERUSED THE CASE LAW RELIED UPON BY THE LEARNED COUNSEL, APPEARING ON BEHALF OF THE ASSESSEE. IN THE CASE OF CIT VS BHARTI CELLULAR LTD. (2009) 319 ITR 139 (DEL) THE HONBLE DELHI HIGH COURT OBSERVED THAT THE EXPRESSI ON TECHNICAL SERVICES HAS TO BE UNDERSTOOD IN THE SENSE IN WHIC H IT WAS USED IN EXPLANATION 2 TO SECTION 9 (1) (VII) OF THE ACT AND , BY APPLYING THE RULE OF NOSCITUR A SOCIIS, THE WORD TECHNICAL WOULD TAKE COLOUR FROM THE ADJUNCT WORDS I.E., MANAGERIAL AND CONSULTAN CY, BETWEEN WHICH IT IS SANDWICHED. SINCE THE WORDS MANAGERIAL AND CONSULTANCY INVOLVE A HUMAN ELEMENT, EVEN THE EXP RESSION TECHNICAL SERVICE HAS TO BE UNDERSTOOD AS A SERVI CE WHICH ITA 4056/M/2008 M/S RUBY MACONS LTD 7 PREDOMINANTLY INVOLVES HUMAN ELEMENT. IN THE SAID C ASE BHARATI CELLULAR LTD. PROVIDES INTERCONNECTION BETWEEN ONE NET WORK TO THE OTHER, WHICH ARE KNOWN AS PORTS AND PAYMENTS MADE B Y THE ASSESSEE FOR SUCH INTERCONNECTIONS WERE HELD TO BE NOT INVOLVING ANY SERVICES RENDERED BY A HUMAN AND THUS IT CANNOT BE CONSIDERED AS A TECHNICAL SERVICES AS CONTEMPLATED UNDER SEC TION 194J OF THE ACT. 12. IN THE CASE OF SKYCELL COMMUNICATIONS LTD. VS. DCIT (SUPRA) THE HONBLE MADRAS HIGH COURT ANALYSED THE PROVISIO NS OF THE ACT TO HOLD THAT MERE COLLECTION OF A FEE FOR USE OF A STANDARD FACILITY PROVIDED TO ALL THOSE WILLING TO PAY FOR IT DOES NOT AMOUNT TO FEE FOR TECHNICAL SERVICES. VSAT CHARGES, LEASED LINE CHARGES, BOLT CHARGES, DE MAT CHARGES ETC., PAID TO STOCK EXCHANGE WERE ALSO HELD TO BE NOT PRE DOMINANTLY REQUIRING HUMAN SERVICES BUT ONLY FEES COLLECTED FOR USE OF A STANDARD FACILITY. 13. IN THE CASE OF JAIPUR VIDYUT VITRAN NIGAM LTD. VS. DCIT (SUPRA) THE QUESTION FOR CONSIDERATION WAS AS TO WH ETHER PAYMENTS FOR TRANSMISSION, WHEELING AND SLDC CHARGES TO ELECTRIC ITY TRANSMISSION COMPANY WOULD FALL WITHIN THE MEANING OF THE EXPRES SION TECHNICAL SERVICES. THE BENCH OBSERVED THAT AS PER THE AGREE MENT THERE WAS OPEN ACCESS TO ALL USERS WITH REGARD TO TRANSMISSION LIN ES. MERELY BECAUSE OPERATION AND MAINTENANCE OF TRANSMISSION LINES AND MAINTAINING ITS GRID STATION WAS WITH THE HELP OF CERTAIN WORK FORCE, IT CANNOT BE CONSIDERED THAT THEY WERE RENDERING ANY TECHNICAL SERVICES TO THE ASSESSEE SINCE THEY CAN BE SAID TO BE SIMPLY DISCHARGING THEIR FUNCTION OF OPERATING AND MAINTAINING ITS GRID STATION AND TRANSMISSION LINES . ANALYSING SECTION 194J OF THE ACT, THE BENCH FURTHER NOTICED THAT ONLY WHE N THE TECHNOLOGY OR TECHNICAL KNOWLEDGE OF A PERSON IS MADE AVAILABLE T O OTHERS IT CAN FALL WITHIN THE EXPRESSION TECHNICAL SERVICE AND MERE PERMISSION TO USE TECHNOLOGY WOULD NOT ATTRACT PROVISIONS OF SECTION 194J OF THE ACT. ITA 4056/M/2008 M/S RUBY MACONS LTD 8 14. WE MAY TURN TO THE FACTS OF THE CASE ON HAND S O AS TO APPRECIATE AS TO WHETHER THE SERVICES RENDERED BY V WEMCL INVOLVES HUMAN INTERFACE OR WAS IT MERELY A STANDARD FACILIT Y PROVIDED TO ALL THE MEMBERS WHO WERE JOINTLY INVOLVED IN SETTING UP AFF LUENT TREATMENT PLANT. IT IS NOT IN DISPUTE THAT THE RATE IS FIXED DEPENDI NG ON THE ACTUAL WATER CONSUMED BY MEMBER UNIT AND ALSO BASED ON DISCHARGE QUALITY NORMS. IT IS ALSO NOT IN DISPUTE THAT AMOUNT COLLECTED IS ON NO PROFIT NO LOSS BASIS AND IF ANY EXCESS AMOUNT IS COLLECTED IT IS PASSED ON TO MEMBERS BY WAY OF DISCOUNT. THIS WAS ACCEPTED BY THE ASSESSING OFF ICER WHILE MAKING AN ASSESSMENT UNDER SECTION 143 (3) OF THE ACT IN THE CASE OF VWEMCL. SUCH BEING THE CASE IT HAS TO BE CONSIDERED AS A STANDAR D FACILITY AVAILABLE TO EACH MEMBER/INDUSTRIAL UNDERTAKING ; VWEMCL IS RUNN ING A TREATMENT PLANT PROVIDING A STANDARD FACILITY AND IF ANY WORK FORCE IS INVOLVED IN MAINTAINING THE STANDARD FACILITY IT CANNOT BE SAID THAT A SPECIAL SKILL/ KNOWLEDGE WAS PASSED ON BY INDIVIDUALS TO THE ASSES SEE IN LIEU OF A SPECIFIC FEE COLLECTED. SUCH BEING THE CASE, WE ARE OF THE CONSIDERED OPINION THAT IT CANNOT BE CONSIDERED AS A PAYMENT I N THE FORM OF FEE FOR TECHNICAL SERVICES. IN THE CASE OF RECIPIENT COMPA NY THE ASSESSING OFFICER ACCEPTED THAT CHARGES WERE RECOVERED FROM THE MEMBE R UNITS BY ADOPTING MUTUALITY CONCEPT. 15. IN FACT, IN THE SUBSEQUENT YEARS, ASSESSING OF FICER HAS NOT INVOKED THE PROVISIONS OF SECTION 194J OF THE ACT I N ASSESSEES OWN CASE. IT APPEARS THAT THE ASSESSEE AGREED TO DEDUCT 2% TA X UNDER SECTION 194C OF THE ACT BASED UPON AN UNDERSTANDING REACHED BY A LL THE INDUSTRIAL UNDERTAKINGS IN THAT LOCALITY AND SUCH UNDERSTANDIN G WAS ACCEPTED BY THE REVENUE. IT MAY BE POINTED OUT THAT IN THE SUBSEQUE NT YEARS THE ASSESSING OFFICER ADMITTED THAT PROVISIONS OF SECTI ON 194J OF THE ACT ARE NOT APPLICABLE IN RESPECT OF PAYMENTS, MADE BY MEMB ER INDUSTRIAL UNDERTAKINGS TO VWEMCL, IN THE FORM OF AFFLUENT TRE ATMENT CHARGES. ON A CONSCPECTUS OF THE MATTER, WE ARE OF THE VIEW THAT THE IMPUGNED PAYMENTS ARE NOT HIT BY THE PROVISIONS OF SECTION 1 94J OF THE ACT AND ITA 4056/M/2008 M/S RUBY MACONS LTD 9 CONSEQUENTLY DISALLOWANCE MADE BY THE ASSESSING OFF ICER UNDER SECTION 40(A)(I) OF THE ACT IS NOT IN ACCORDANCE WITH LAW. 16. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11-06-2010. SD/- SD/- (RAJENDRA SINGH) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATE 11 TH JUNE, 2010. VBP/- COPY TO 1. M/S RUBY MACONS LTD, 203/204, ANGELINA APARTMENTS, SAROJINI ROAD, VILEPARLE (WEST), MUMBAI 400 056 PAN AAACR 1939 A 2. DCIT, ROOM NO.204, 2 ND FLOOR, AAYKAR BHAVAN, M K ROAD, MUMBAI 400 020 3. THE CIT (A)-XXIX, MUMBAI. 4. THE CIT-8, MUMBAI. 5. DR D BENCH 6. GUARD FILE. BY ORDER ASST. REGISTRAR, ITAT, MUMBAI BENCHES MUMBAI SNO DATE INITIALS 1 DRAFT DICTATED ON 08-06-2010 SR.P.S. 2. DRAFT PLACED BEFORE AUTHOR 09-06-2010 SR.P.S. 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 09-06-2010 V.P. 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER A.M 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.P.S. 6. KEPT FOR PRONOUNCEMENT ON SR.P.S. 7. FILE SENT TO THE BENCH CLERK SR.P.S. 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER