MUMBAI METROPOLITAN REGION DEVELOPMENT AUTHORITY (MMRDA), MUMBAI V. ACIT (TDS) CIRCLE - 1(3), MUMBAI

ITA 5186/MUM/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0567 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 16-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice; Maximum Marginal Rate; Additional evidence
• Section: 194C; 201(1)

Judgement Text

I IN THE INCOME TAX APPELLATE TRIBUNAL I BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO.5186 & 5187/ MUM/2016 ( / ASSESSMENT YEAR: 2012 - 13 & 2013 - 14) MUMBAI METROPOLITAN REGION DEVELOPMENT AUTHORITY (MMRDA) , BKC, BANDRA(E), MUMBAI - 400051 / V. ACIT (TDS) CIR - 1(3) R.NO. 703, 7 TH FLOOR, K.G. MITTAL HOSPITAL BUILDING, CHARNI ROAD (W) , MUMBAI - 400002 ./ PAN :AAATM7106R (TDS MUM16747D) ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY: SHRI. J.P BAIRAGRA REVENUE BY : SHRI. SAURABHKUMAR RAI ,DR / DATE OF HEARING : 05 - 02 - 2018 / DATE OF PRONOUNCEMENT : 07 - 02 - 2018 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THESE TWO APPEAL S, FILED BY THE A SSESSEE, BEING ITA NO. 5186 & 5187/ MUM/2016 FOR ASSESSMENT YEAR S 2012 - 13 & 2013 - 14 RESPECTIVELY ARE DIRECTED AGAINST THE COMMON APPELLATE ORDER DATED 12.05.2016 PASSED BY LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) - 59, MUMBAI (HEREINAFTER CALLED THE CIT(A)) FOR ASSESSMENT YEAR S 2012 - 13 & 2013 - 14 RESPECTIVELY , APPELLATE PROCE EDINGS HAD ARISEN BEFORE LEARNED CIT(A) FROM THE SEPARATE ORDER S BOTH DATED 25.03.2015 PASSED BY LEARNED ASSESSING OFFICER (HEREINAFTER CALLED THE AO) U/S 201(1)/201(A) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER CALLED THE ACT). 2. FIRST WE SHALL TAKE A PPEAL OF THE ASSESSEE IN ITA NO. 5186/MUM/2016 FOR ASSESSMENT YEAR 2012 - 13. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN THE MEMO OF APPEAL FILED WITH THE INCOME - TAX APPELLATE TRIBUN AL, MUMBAI (HEREINAFTER CALLED THE TRIBUNAL) IN ITA NO. 5186/MUM/2016 FOR ASSESSMENT YEAR 2012 - 13 READ AS UNDER: - I .T.A. NO.5186 & 5187/MUM/2016 2 1. THE LEARNED CIT (APPEALS) ERRED IN HOLDING THAT CONTRACT TO M/S. DBM GEOTECHNICS CONSTRUCTION PVT. LTD. HAS NOT BEEN GIVEN FOR SIMPLE ROCK EXCAVATION WORK BUT IS GIVEN FOR MARINE GEO TECHNICAL INVESTIGATIO N FOR ROCK EXCAVATION IN MITHI RIVER. THEREFORE, IT IS COVERED BY THE PROVISIONS OF SECTION 194J AND NOT AS PER THE PROVISIONS OF SECTION 194C FOR DEDUCTION OF TDS ON TOTAL PAYMENT AMOUNTING TO RS. 7,59,32,109/ - MADE TO M/S. DBM GEOTECHNICS CONSTRUCTION PV T. LTD. 2. THE APPELLANT CRAVES TO ADD TO, ALTER OR AMEND THE FOREGOING GROUNDS, WHICH ARE WITHOUT PREJUDICE TO ONE ANOTHER, AT THE TIME OF HEARING. 3. THE ASSESSEE IS A LOCAL AUTHORITY CREATED BY THE GOVERNMENT OF MAHARASHTRA BY ENACTING MMRDA ACT , 1974 AND IT IS ENGAGED IN THE BUSINESS OF PLANNING, COORDINATING AND SUPERVISING THE DEVELOPMENT OF THE AREAS IN THE REGION AND OF EXECUTING PLANS, PROJECTS AND SCHEMES OF SUCH DEVELOPMENTS. THE ASSESSEE HAS MADE PAYMENTS TO THE TUNE OF RS. 7,59,32,109/ - T O M/S DBM GEOTECHNICS AND CONSTRUCTION PVT. LTD. ON WHICH INCOME - TAX WAS DEDUCTED AT SOURCE ( HEREINAFTER CALLED TDS ) U/S. 194C BY THE ASSESSEE , WHILE AO WAS OF THE VIEW THAT THE ASSESSEE IS REQUIRED TO DEDUCT TDS U/S. 194J OF THE ACT. THE ASSESSEE IN R ESP ONSE TO THE QUERY RAISED BY THE AO SUBMITTED BEFORE THE AO AS UNDER: - THE AUTHORITY HAS GIVEN CONTRACT FOR ROCK EXCAVATION IN MITHI RIVER SITUATED AT THE SEASIDE OF THE MAHIM CAUSEWAY TO M/S. DBM GEOTECHNICS AND CONSTRUCTION P. LTD. FOR DOING THE WOR K, THE CONTRACTOR HAS USED MACHINED AS WELL AS MANUAL LABOUR. 2. DURING THE YEAR, THE ASSESSEE HAS MADE TOTAL PAYMENT OF RS. 7,59,32,109/ - TO DBM IN CONSIDERATION OF WORKS EXECUTED BY IT. ON THE SAID PAYMENT THE ASSESSEE HAS DEDUCTED TDS @ 2% U/S. 194C. W E ENCLOSING HEREWITH COPY OF EXTRACT OF TENDER DOCUMENTS AND COPY OF ACCOUNT APPEARING IN THE BOOKS OF THE ASSESSEE FOR THE PERIOD FROM 01 - 04 - 2011 TO 31 - 03 - 2013 AS ANNEXURE - 2 3. FOR THE ASSTT. YEAR 2008 - 09 AND 2011 - 12, YOUR PREDECESSOR HAS CONSIDERED THE PAYMENT MADE TO M/S. DBM GEOTECHNICS AS FEES FOR TECHNICAL SERVICE AND HELD THAT TDS IS TO BE DEDUCTED U/S. 194J WHEREAS THE ASSESSEE HAS DEDUCTED U/S. 194C. AGGRIEVED BY THE SAID ORDER, THE ASSESSEE HAS FILED AN APPEAL BEFORE CIT(A)'S BUT CIT(A) HAS A LSO CONFIRMED THE VIEW OF THE AO THAT TDS IS TO BE DEDUCTED UNDER SECTION 194J AND NOT UNDER SECTION 194C. TO CHALLENGE THE ORDER PASSED BY LD. CI T(A), ASSESSEE HAS FILED A N APPEAL BEFORE THE HON'BLE ITA T, THE HEARINGS OF WHICH IS PENDING TILL DATE. I .T.A. NO.5186 & 5187/MUM/2016 3 4. AS PER THE PROVISIONS OF SECTION 194C, CONTRACT MEANS WORK TO BE DONE BY UNSKILLED OR TECHNICAL PERSON ON COMBINATION OF TWO OR THREE AND THEREFORE THE FINDING BY YOUR PREDECESSOR IN EARLIER YEARS THAT FOR CARRYING OUT THIS CONTRACT WORK SPECIAL SKILLS, KNOWLEDGE AND EXPERIENCE IS REQUIRED, DOES NOT MEAN THAT IT IS NOT A CONTRACT WORK AND CONSTITUTE FEES FOR TECHNICAL OR PROFESSIONAL SERVICES. THEREFORE, IT IS VERY CLEAR THAT PROVISIONS OF SECTION 194C REGARDING FEES FOR TECHNICAL FEES ARE NOT APPLICAB LE IN THIS CASE. SINCE THE CONTRACT IS GIVEN TO DBM, THE ASSESSEE HAS RIGHTLY DEDUCTED TDS U/S. 194C OF THE I. T. ACT AND THE PROVISIONS OF SECTION 194 C ARE NOT APPLICABLE . THE PROVISIONS OF SECTION 194C ARE APPLICABLE ONLY IF THE PAYMENTS ARE MADE FOR T ECHNICAL SERVICES AND PROFESSIONAL SERVICES. WITHOUT PREJUDICE TO ABOVE, WE HEREBY CONTENDED THAT SINCE M/S. DBM GEOTECHNICS CONSTRUCTION PVT. (DEDUCTEE) HAS ALREADY INCLUDED THE PAYMENTS MADE BY THE ASSESSE IN THEIR RETURN OF INCOME AS RECEIPT AND PAID TAXES ON THE SAME, NO DEMAND SHOULD BE RAISED ON ACCOUNT OF BEING DIFFERENCE BETWEEN THE TDS A S PER PROVISIONS OF SECTION 194J AND AS PER SECTION 194C AS PER THE FIRST PROVISO TO SECTION 201 OF THE I.T. ACT. HOWEVER, THE DEMAND MAY BE RAI SED ON ACCOUNT OF INTEREST U/S. 201(1 A) FROM THE DATE OF DEDUCTION TO THE DATE OF FILING RETURN BY THE DEDUCTEE AS PER THE PROVISIONS OF FIRST PROVISO TO SECTION 201 (1 A) OF THE ACT. IN A. Y. 2011 - 12 AND 2008 - 09, THE LD. CIT(A) HAS ALSO ACCEPTED THE ABOVE CONTENTION OF THE ASSESSEE AND DIRECTED TO AO TO REDUCE THE DEMAND BY GIVING THE RELIEF ON THE SAME GROUNDS.' THE AO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE HELD THAT THE ASSESSEE HAS MADE PAYMENTS AMOUNTING OF RS. 7,59,32,109/ - TO DBM GEOTECHNICS CONSTRUCTION PV T. LTD. FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER ON WHICH TDS HAS BEEN WRONGLY DEDUCTED U/S. 194C INSTEAD OF SECTION 194J . THE AO WHILE PASSIN G ORDER DATED 25 - 03 - 2015 U/S 201(1) AND 201(1A) , HELD AS UNDER: - 5.1 PAYMENT MADE TO DBM GEOTECHNICS CONSTRUCTION PRIVATE LIMITED: DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD MADE PAYMENT TOTALLING TO RS. 7,59,32,109/ - TO M/S DBM GEOTECHNICS CONSTRUCTION PVT. LTD FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EX CAVATION IN MITHI RIVER ON WHICH TDS HAS BEEN DEDUCTED U/S 194C . FROM THE NATURE OF SERVICES RENDERED BY M/S DBM GEOTECHNICS CONSTRUCTION PVT. LTD. IT APPEARS TO BE IN THE NATURE OF PROFESSIONAL/TECHNICAL SERVICES. HENCE THE AMOUNT PAID TO M/S DBM GEOTECH NICS CONSTRUCTION PVT. LTD. (DBM) SHOULD HAVE BEEN SUBJECTED TO TDS U/S 194J, AS GEOTECHNICAL INVESTIGATION WORK IS PROFESSIONAL IN NATURE. 5 .2 MARINE GEOTECHINCAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER APPROACH CHANNEL(2.14KM) SITUATED AT SEA S IDE OF MAHIM CAUSEWAY. I .T.A. NO.5186 & 5187/MUM/2016 4 5.2.1 FURTHER REFERENCE IS ALSO SEEN ON PAGE NO. 3 OF THE TENDER DOCUMENT (ENCLOSED TO THIS ORDER, MARKED AS ANNEX B) PUBLISHED IN THE NEWS PAPER. IN THIS ADVERTISEMENT ALSO, IT IS MENTIONED THAT TENDER WAS FOR MARINE GEOTECHNICAL LNVESTIGATION OF ROCK EXCAVATION IN MITHI RIVER APPROACH CHANNEL. IT IS QUITE APPARENT THAT THE NATURE OF WORK WAS NOT THAT OF SIMPLE CONTRACT WORKS BUT REQUIRES SPECIAL TECHNICAL SKILLS, KNOWLEDGE AND EXPERIENCE. 5.2.2 ON FURTHER OBSERVATION OF THE TEND ER DOCUMENT, IT IS SEEN THAT PAGE NO. 12 HAS A TITLE 'INDICATIVE CHECK LIST FOR INFORMATION FROM CONSULTANTS'. ON THIS PAGE, THE DETAILS OF CONTRACT EXPERIENCE IN CARRYING OUT CADASTRAL SURVEY UNDER TIDAL CONDITION AS MEASUREMENT AND COLLECTION OF HYDRAULI C AND PHYSIO - CHEMICAL PARAMETERS ARE GIVEN. IT IS FURTHER REQUIRED THAT THERE SHALL BE AT LEAST 3 KEYS PERSONNEL HAVING BACHELOR'S DEGREE IN CIVIL ENGINEERING/DIPLOMA IN SURVEY TECHNOLOGY/MASTER'S IN SCIENCE/EN VIRONMENT. COURSE/DEGREE IN GEOG RAPHICAL INFOR MATION SYSTEMS. THIS PAGE NO. 12 IS ANNEXED TO THIS ORDER MARKED AS ANNEX. 'C'. 5.2.3 ON FURTHER EXAMINATION OF THE TENDER DOCUMENT, IT IS SEEN IN CHAPTER VII(E) SCHEDULE B AT PAGE NO. 82 ONWARDS OF TENDER DOCUMENTS(ENCLOSED AS ANNEX. 'D' TO THIS ORDER) S PEAKS ABOUT ITEM OF WORK TO BE CARRIED OUT AND RATE FOR THE SAME WORK. IN THIS SCHEDULE AT ITEM NO. 7 ON PAGE NO. 83 IS THE LIST OF LABORATORY TEST AND NUMBER OF SUCH TESTS REQUIRED TO BE CONDUCTED TO CARRY OUT EXCAVATION OF ROCKS BY THE CONTRACTOR. THE SA ME ARE LISTED OUT AS UNDER: LABORATORY TESTS: 1) MOISTURE CONTENT 2) SPECIFIC GRAVITY 3) CONSISTENCY LIMITS. 4) GRAVEL & FINE SIEVE ANALYSIS 5) HYDRO METER ANALYSIS 6) CONSOLIDATION 7) DIRECT SHEAR TEST 8) TRIAXIAL (UU) 9) UDS ALL ABOUT TESTS. ROCK SAMPLES 10) SPECIFIC GRAVITY 11) WATER ABSORPTION 12) POROSITY 13) CRUSHING STRENGTH 14) TENSILE TEST 15) MODULUS OF ELASTICITY & POISSION'S RATIO 16) CHEMCIAL ANALYSIS OF SOIL TO DETERMINE CHLORIDE & SULPHATE CONTENT AND 17) CHEMICAL ANALYSIS OF GROUNDWATER TO DETERMINE CHLORINE AND SULPHATE CONTENT AND PH 5.2.4 FROM THE ABOVE LIST OF LABORATORY TEST AND ROCK EXAMINATION, IT IS CRYSTAL CLEAR THAT THE CONTRACT WAS NOT JUST A SIMPLE WORK CONTRACT, BUT WAS FOR PROVIDING HIGHLY TECHNICAL SERVICES. THE EVERY ENTRY IN THIS LIST CLEARLY SPEAKS OUT THE DBM WAS REQUIRED TO PROVIDE SCIENTIFIC AND TECHNICAL SERVICES COUPLED WITH CONSULTANCY. SUCH SPECIALIZED SERVICES I .T.A. NO.5186 & 5187/MUM/2016 5 CANNOT BE ACCOMPLISHED WITHOUT INVOLVEMENT OF PROFESSIONAL CALIBER AND MERIT. 5.2.5 IT IS WORTH TO MENTION HERE THAT THE ASSESSEE HAS CONVENIENTLY NOT FURNISHED THE COPY OF TECHNICAL BID, WHICH MAY BETTER DESCRIBE THE NATURE OF SERVICES REQUIRED. HOWEVER ON EXAMINATION OF LIMITED INFORMATION FURNISHED BY THE ASSESSEE, IT IS SEEN THA T IT WAS NOT A CONTRACT INTENDED TO BE COVERED BY THE SECTION 194C OF THE ACT WHICH COVERS A SIMPLE WORK CONTRACT INCLUDING SUPPLY OF LABOUR ETC., BUT IS DEFINITELY A CONTRACT COVERED BY THE PROVISIONS OF SECTION 194J BEING FEES FOR PROFESSIONAL OR TECHNIC AL SERVICES. THE WORD 'FEES FOR TECHNICAL SERVICES' MEANS ANY CONSIDERATION(INCLUDING ANY LUMP SUM CONSIDERATION) FOR RENDERING ANY MANAGERIAL/TECHNICAL OR CONS ULTANCY SERVICE (INCLUDING THE PROVISIONS OF SERVICES OF TECHNICAL OR OTHER PERSONNEL) . 5.2. 6 KEEPING IN VIEW THE ABOVE DEFINITION OF FEES FOR TECHNICAL SERVICES AS WELL AS THE CONTENT OF THE CONTRACT AWARDED BY THE ASSESSEE DEDUCTOR, IT IS ABSOLUTELY CLEAR THAT THE SERVICES PROVIDED BY D BM ARE ABSOLUTELY IN THE NATURE OF TECHNICAL SERVICES AND T HEREFORE T HE PROVISIONS OF SECTION 194J ARE APPLICABLE IN RESPECT OF PAYMENTS MADE TO M/S. D BM GEOTECHNICS & CONSTRUCTION PVT. LTD. 6. IN ASSESSEE'S OWN CASE, EARLIER, ON THE SAME ISSUE THE THEN ASSESSING OFFICER WHILE PASSING ORDER U/S 201(1)/201(LA) FO R ASSESSMENT YEAR 2008 - 09 TO 2011 - 12 TREATED THE ASSESSEE AS ASSE SSEE IN DEFAULT FOR DEDUCTING TD S U/S 194C, INSTEAD OF SECTION 194J. THE ASSESSEE BEING AGGRIE VED BY THE ORDER OF THE THEN ITO (TOS) - 2(2) PREFERRED AN APPEAL BEFORE CIT(A) - 14. THE LEARNED CI T(A) VIDE HIS ORDE R NO. CIT(A) - 14/IT.810 TO 816/TD S RG. 2/11 - 12 DATED 24.10.2012, DECIDED THE ISSUE IN FAVOUR OF THE ASSESSING OFFICER. FURTHER, THE CIT(A) AS PER PARA 7.3 OF THE A.O'S ORDER RESTORED THE ISSUE TO THE FILE OF AO WITH THE FOLLOWING DIRECTION : - 'SINCE THE FACTS, AS STATED BY THE AO AND AS STATED BY THE APPELLANT ARE OPPOSITE, THE APPELLANT IS DIRECTED TO FURNISH NECESSARY EVIDENCE IN SUPPORT OF THE ABOVE FACTS, IF ANY BEFORE THE AO. AFTER VERIFYING THE CORRECTNESS OF THE FACTS PLEADED BY THE APPELLANT, THE AO SHALL ACCORDINGLY TAKE A DECISION IN THIS REGARD. IF THE CONTRACT TO DBM GEOTECHNICS CONSTRUCTION PRIVATE LTD. HAS BEEN GIVEN FOR ROCK EXCAVATION WORK, THE AO SHALL NOT TREAT THE APPELLANT TO BE IN DEFAULT AND SHALL ACCORDINGLY DELETE THE DEMAND RAISED. HOWEVER, IF AS OBSERVED BY THE AO, THE CONTRACT IS FOR MARINE GEO - TECHNICAL INVESTIGATION FOR THE PURPOSES OF ROCK EXCAVATION IN MITHI RIVER, THE AO'S DECISION IN THIS REGARD SHALL BE UPHEL D. IN THAT CASE, HOWEVER, THE AO SHALL GIVE RELIEF TO THE APPELLANT IN RESPECT OF THE TAX ALREADY PAID BY DBM GEOTECHNICS CONSTRUCTION PRIVATE LTD. IF ANY, ON ITS RECEIPTS FROM THE APPELLANT, IN VIEW OF THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGE (P ) LTD. VS. CIT [2007] 293 ITR 226. THE A O IS THEREFORE DIRECTED ACCORDINGLY. I .T.A. NO.5186 & 5187/MUM/2016 6 6.1 THE ASSESSE HAS ALSO FURNISHED THE FOLLOWING DETAILS FOR CLAIM OF RELIEF U/S. 201(1) IN RESPECT OF HON'BLE APEX COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGE (P) LTD. VS. CIT [2007] 293 ITR 226. IN SUPPORT OF IT, THE ASSESSEE HAS SUBMITTED 1 . AUDI TED FINAN CIAL STATEMENTS OF ACCOUNTS OF D BM GEOTECHNICS & CONSTRUCTION PVT. LTD. INCLUDING AUDITORS REPORT UNDER THE COMPANIES ACT. 2. ACKNOWLEDGEMENT OF INCOME TAX RETURN FILED BY THE COMPANY. 3. COMPUTATION OF TOTAL INCOME. 4. TAX AUDIT REPORT UNDE R THE INCOME TAX ACT IN FORM 3CA AND 3CD. 5. COPY OF LEDGER ACCOUNT OF MMR D A IN THE BOOKS OF M/S. DBM GEOTECHNICS & CONSTRUCTION PVT. LTD. 6. FORM 26A ISSUED BY THE CHARTERED ACCOUNTANT OF THE DEDUCTEE CERTIFYING THAT THE AMOUNT RECEIVED FROM MMR D A AMO UNTING TO RS. 7,59,32,109/ - IS ALREADY INCLUDED IN THE INCOME OF M/S. D BM GEOTECHNICS & CONSTRUCTION PVT. LTD IN THEIR RETURN OF INCOME. 7. IN THE BACKDROP OF DISCUSSION, THE UNDERSIGNED IS FULLY CONVINCED AND SATISFIED THAT THE PAYMENTS MADE BY THE ASSESSEE DEDUCTOR TO DBM SQUARELY FALL WITHIN THE AMBIT OF SECTION 194J AS IT SATISFIED ALL THE PARAMETERS PRESCRIBED IN SEC. 194J, AS ALSO HELD BY THE CIT(A) IN ITS ORDER FOR A.Y . 2008 - 09 TO 2011 - 12. 8 DURING THE YEAR UNDER CONSIDERATION, TH E ASSESSEE HAS MADE THE FOLLOWING PAYMENTS TO M/S. DBM GEOTECHNICS CONSTRUCTION PVT. LTD. AND DEDUCTED TDS @ 2% AS PER PROVISION OF SECTION 194C, THE DETAILS OF THE SAME ARE AS UNDER: DATE OF PAYMENT AMOUNT PAID TO TAX DEDUCTED RATE AT WHICH TAX IS DBM DEDUCTED 19 . 05 . 2011 1,17 , 40 , 706 2,34,814 2 % 23 . 05 . 2011 1,75 , 28,681 3 , 50,574 2 % 08 . 07 . 2011 1,85,24,236 3,70 , 485 2 % 30.08.2011 1 , 50,66 , 839 3,01 , 337 2% 20.09 . 2011 50,24 , 936 1 , 00,499 2 % 14 . 03 - 2012 80 , 46 , 711 1 , 60 , 934 2 % TOTAL 7,59,32,109 15,18,642 2% 9. IN VIEW OF THE ABOVE DESCRIPTION AND FACTS AND CIRCUMSTANCES OF THE CASE, I HOLD THAT THE PROVISIONS OF SECTION 194J OF THE IT ACT ARE CLEARLY APPLICABLE IN THE ASSESSEE'S CASE. ACCORDINGLY, TDS LIABILITY IS DETERMIN ED UNDER SECTION 194J @ 10% WHICH WORKS OUT TO RS. 75,93,211/ - SINCE THE ASSESSEE HAS ALREADY DEDUCTED TDS@2% AMOUNTING TO RS. 15,18,642/ - , BALANCE AMOUNT REPRESENTING SHORT DEDUCTION OF TDS IS DETERMINED AT RS. 60,74,569/ - AND INTEREST U/S. 201(1A) IS WOR KED OUT AT RS. 9,71,931/ - FOR 16 MONTHS. I .T.A. NO.5186 & 5187/MUM/2016 7 10, HOWEVER, SINCE THE ASSESSEE HAS FILED CERTIFICATE FROM THE AUDITOR OF DBM GEOTECHNICS & CONSTRUTIONS TO WHOM PAYMENT WAS MADE TO THE EFFECT THAT IT HAS FILED ITS RETURN OF INCOME INCLUDING THE PAYMENT RECEIVED BY THE ASSESSEE COMPANY AND PAID TAXES THEREON. IT HAS BEEN CONTENDED THAT IN VIEW OF JUDGMENT OF THE HON'BLE SUPREME COURT IN HINDUSTAN COCA COLA BEVERAGE (P) LTD. V / S. CIT IN (2007) 211 CTR (S C ) 545, NO FURTHER TAX CAN BE RECO VERED FROM THE ASSESSEE COM PANY . CONSIDERING THESE FACTS OF THE CASE, TAX LIABILITY U/S 201(1) IS WORKED OUT TO RS. NIL AND TAX LIABILITY U/S. 201(1 A) IS WORKED OUT AT RS. 9,71,931/ - .( FROM 19/05/2011 TILL THE DATE OF FILING OF RETURN BY DBM GEOTECHNICS & CONSTRUCTION - 24/09/2012 I.E . 16 MONTHS @1%). THE AO THEREFORE HELD THAT ASSESSEE WAS REQUIRED TO DEDUCT INCOME - TAX AT SOURCE U/S. 194J AT THE RATE OF 10% WHICH WORKOUT TO RS.75,93,211 , WHILE INCOME - TAX WAS DEDUCTED AT SOURCE AT THE RATE OF 2% BY THE ASSESSEE WHICH AMOUNTING TO RS . 15,18,642/ - AND HENCE FOR BALANCE SHORT DEDUCTION OF INCOME - TAX AT SOURCE WAS DETERMINED TO BE RS. 60,74,569/ - , BUT SINCE HOWEVER THE ASSESSEE FILED CERTIFICATE FROM AUDITORS OF DBM GEOTECHNICS AND CONS TRUCTION PRIVATE LIMITED TO THE EFFECT THAT IT FILE D ITS RETURN OF INCOME INCLUDING THE PAYMENT RECEIVED FROM THE ASSESSEE COMPANY AND PAID DUE TAXES TO THE REVENUE , THE LIABILITY U/S 201(1) WAS DETERMINED BY THE AO AGAINST THE ASSESSEE WAS COMPUTED AT NIL U/S 201(1) BUT INTEREST U/S. 201(A) WAS WORKOUT B Y THE AO TO BE RS. 9,71,931/ - , VIDE ORDER PASSED BY THE AO U/S. 201(1)/201(A) DATED 25.03.2015. 4. AGGRIEVED BY THE ORDER DATED 25 - 03 - 2015 PASSED BY THE AO U/S 201(1) AND 201(1A), THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LEARNED CIT - A WHO DISMISS ED THE APPEAL OF THE A SSESSEE BY HOLDING AS UNDER , VIDE APPELLATE ORDER DATED12 - 05 - 2016 : - 5. GROUND NO. 2 FOR THE AYS 2012 - 13 & 2013 - 14 IS RAISED AS UNDER: - THE LEARNED ASSESSING OFFICER FURTHER ERRED IN HOLDING THAT ON THE PAYMENT MADE TO M/S DB M GEOTECHNICS CONSTRUCTION PVT. LTD., TDS SHOULD HAVE BEEN DEDUCTED A S PER PROVISIONS OF SECTION 194J AND NOT AS PER THE PROVISIONS OF SECTION 194C OF THE ACT. 5.1 IT IS OBSERVED BY THE AO THAT THE CONTRACT WAS NOT SIMPLE WORKS CONTRACT BUT WAS PROVIDING SCIENTIFIC AND TECHNICAL SERVICES COUPLED WITH CONSULTANCY. SUCH SPECIALIZED SERVICE CANNOT BE ACCOMPLISHED WITHOUT INVOLVEMENT OF PROFESSIONAL CALIBER AND ME RIT. THE SERVICES PROVIDED BY M/S. D BM GEOTECHNICS CONSTRUCTION PVT. LTD. ARE IN THE NATURE OF PRO FESSIONAL SERVICES AND THEREFORE THE ASSESSEE WAS LIABLE TO DEDUCT TDS U/S.194J AND NOT U/S.194C OF THE ACT. I .T.A. NO.5186 & 5187/MUM/2016 8 5.2 IN APPEAL, IT IS SUBMITTED AS UNDER: - 1) THE AUTHORITY HAS MADE PAYMENT TO DBM GEOTECHNICS &. CONSTRUCTION PVT. LTD AGAINST CONTRACT FOR EXCAVATION OF ROCK FROM MITHI RIVER ON WHICH THE TDS IS DEDUCTED AS PER THE PROVISIONS OF SECTION 194C OF THE ACT. HOWEVER AS PER THE ASSESSING OFFICER, THE TDS SHOULD HAVE BEEN DEDUCTED AS PER THE PROVISIONS OF SECTION 194 J AND HENCE AN ORDER WAS PASSED U /S 201(1)/201(1A) AND A DEMAND WAS RAISED O N ACCOUNT OF INTEREST U/S 201(1 A) OF RS. 9,71,931/ - AND 33,62,190/ - FOR AY 2012 - 13 & 2013 - 14 RESPECTIVELY. SINCE DBM GEOTECHNICS & CONSTRUCTION PVT. LTD HAS ALREADY INCLUDED THE AMOUNT PAID TO THEM IN THEIR RETURN OF INCOME AND PAID THE TAXES THEREON AND EVIDENCE IN RESPECT TO THE SAME WAS FILED BEFORE THE AO, HE HAS NOT RAISED THE DEMAND OF THE TDS AMOUNT BUT RAISED THE DEMAND ONLY FOR THE INTEREST. 2) THE SIMILAR ISSUES WERE T HERE IN THE AY 2008 - 09 & AY 201 1 - 12. THE ASSESSEE HAD PREFERRED AN APPEAL TO THE CIT(A). FURTHER, THE CIT(A) HAS UPHELD THE ORDER PASSED BY AO THAT TDS SHOULD BE DEDUCTED AS PER THE PROVISION OF SECTION 194 J AND NOT AS PER THE PROVISIONS OF SECTION 194C FOR THE TWO ASSESSMENT YEARS. 3) HOWE VER, THE ASSESSEE HAD FILED AN APPEAL BE FORE THE HON. ITAT FOR AY 2008 - 09 & AY 2011 - 12 WHICH IS STILL PENDING BEFORE THE TRIBUNAL THE HEARING FOR THE TWO APPEALS HAS BEEN FIXED ON 26 - 10 - 2016. 5.3 I HAVE CONSIDERED THE FACTS OF THE CASE, AO'S ORDER, SUBMIS SION OF THE APPELLANT. MY LD. PREDECESSOR IN THE APPELLANT'S OWN CASE FOR AY 2008 - 09, VIDE HER ORDER DATED 07.07.2014 HAS DISCUSSED THE ISSUE IN DETAIL AND HELD AS UNDER: - 4.3 I HAVE CONSIDERED THE FACTS OF THE CASE, SUBMISSIONS OF THE APPELLANT, ORDER GI VING APPEAL EFFECT OF THE CIT(A) ORDER AND THE ORDER OF MY LD. PREDECESSOR. MY LD. PREDECESSOR HAS SET THIS ISSUE TO THE FILE OF THE A.O TO VERIFY THE CORRECTNESS OF THE FACT AND ACCORDINGLY TAKE A DECISION HOLDING INTER - ALIA HELD AS UNDER: - 'THAT IF THE C ONTRACT TO DBM GEOTECHNICS CONSTRUCTION PVT. LTD. HAS BEEN GIVEN FOR ROCK EXCAVATION WORK, THE A.O. SHALL NOT TREAT THE APPELLANT TO BE IN DEFAULT AND SHALL ACCORDINGLY DELETE THE DEMAND RAISED. HO WEVER, IF AS OBSERVED BY THE A. O. THE CONTRACT IS FOR MARINE GEO - TECHNICAL INVESTIGATION FOR THE PURPOSES OF ROCK EXCAVATION IN MITHI RIVER, THE AO'S DECISION IN THIS REGARD SHALL BE UPHELD' 4.4 I HAVE PERUSED THE CONTRACT DOCUMENT FILED BY THE APPELLANT. THE NAME OF WORK FOR THE CONTRACT IS 'MARINE GEOTECHNI CAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER APPROACH CHANEL'. THE NATURE OF WORK DEFINED IN SCHEDULE B IS AS UNDER: - ITEM NO. 1 : ESTABLISH ON SITE ROTARY CORE DRILLING RIG AND OTHER EQUIPMENTS WITH MOUNTED A FLOATING CRAFT, FOR SINKING MARINE BORE HOLE COMPLETE WITH ALL ACCESSORIES AND TRANSPORT TO THE SITE FIXING LAYING IN POSITION ETC. COMPLETE AND INCLUDING DEMOBILIZATION. I .T.A. NO.5186 & 5187/MUM/2016 9 ITEM NO.2 : MOVE CORE DRILLING RIG AND OTHER EQUIPMENTS MOUNTED ON FLOATING CRAFT WITH ALL ACCESSORIES INTO POSITION AT FIRST BORE HOLE AND FROM BOREHOLE TO BORE HOLE INCLUDING ACCURATE MOUNTING OF CRAFT AND JACKING UP AT EACH BORE HOLD, HIRE OF TUGS, SURVEY WORK ETC. COMPLETE. ITEM NO.3 : BORING 1OOMM/ 150MM DIA IN ALL TYPE OF SOILS INCLUDING BOULDERS INCLUDING USE OF ALL MATERIAL SUCH AS CSING PEIPE AND ACCESSORIES CONSUMABLES ETC. AS REQUIRED [INCLUDING CONVEYING THE MATERIAL TO SITE OF WORK] CARRYING OUT SET AT 1.5M. INTERV AL AND TAKING UNDISTURBED SAMPLES OF COHESIVE SOIL, PREPARING THE LOOSE SAMPLES SERIALLY IN GLASS/PLASTIC JARS, ON SITE OF WORK AND CONVEYING THE SAME TO HEADQUARTERS OF CONCERNED OFFICE AS DIRECTED BY ENGINEER - IN - CHARGE. INCLUDES GEOTECHNICAL LOGGING OF T HE SAMPLES AND CARRYING OUT FIELD TESTS USING POCKET PENETRO METER AND HANDS HEAR VANE. ITEM NO.4 : CORING 'NX' SIZE USING TRIPLE TUBE CORE BARREL OF 100/150 MM AS DIA. IN WEATHERED AND UNWEATHERED BASALT ROCK BY DIAMOND DRILLING INCLUDING PRESERVATION OF CORES IN STANDARD CORE BOX TAKING CORE PHOTOGRAPHS ETC. COMPLETE. ITEM NO. 5 : PROVIDING CORE BOXES OF JUNGLE WOOD OF SIZE 1.25 M X 0.55 M X 0.15M FOR PRESERVING CORE SAMPLES WITH ALL FIXTURES TO FASTENING HANDLES LOCKING ARRANGEMENTS WITH LOCK AN D KEY ETC. COMPLETE. ITEM NO. 6 : PREPARATION OF FACTUAL AND INTERPRETIVE REPORT AND SUBMISSION OF ONE COPY DRAFT REPORT AND SIX COPIES OF FINAL REPORT ALONG WITH C.D. ITEM NO. 7 : LABORATORY TESTS (I) MOISTURE CONTENT (II) SPECIFIC GRAVITY (II I) CONSISTENCY LIMITS [L.L.P.L. S.L.] (IV) GRAVEL AND FINE SIEVE ANALYSIS (V) HYDRO METER ANALYSIS (VI) CONSOLIDATION (VII) DIRECT SHEAR TEST (VIII) TRIAXIAL (UU) (IX) UDS ALL ABOVE TEST ROCK SAMPLES: (X) SPECIFIC GRAVITY (XI) WATER A BSORPTION (XII) POROSITY (XII) CRUSHING STRENGTH (XIV) TENSILE TEST (XV) MODULUS OF ELASTICITY AND POISSIORI'S RATIO (XVI) CHEMICAL ANALYSIS OF SOIL TO DETERMINE CHLORIDE AND SULPHATE CONTENT (XVII) CHEMICAL ANALYSIS OF GROUND WATER TO DETERMINE CHLORI DE AND SULPHATE CONTENT AND P.H. 4.5 THUS, FROM THE ABOVE IT IS CLEAR THAT THE CONTRACT TO DBM IS NOT GIVEN FOR SIMPLE ROCK EXCAVATION WORK BUT IT IS GIVEN FOR 'MARINE GEO TECHNICAL INVESTIGATION' FOR ROCK EXCAVATION IN MITHI RIVER. THEREFORE RESPECTFULLY I .T.A. NO.5186 & 5187/MUM/2016 10 FOLLOWING THE DECISION OF MY LD. PREDECESSOR, THE ACTION OF THE A.O. IS UPHELD. GROUND IS DISMISSED. 5.4 RESPECTFULLY, FOLLOWING THE DECISION OF MY LD. PREDECESSOR, THE ACTION OF THE AO HOLDING THE ASSESSEE AS ASSESSEE - IN - DEFAULT FOR NON - DEDUCTION OF TAX AT SOURCE U/S 194J AS AGAINST 194C IN RESPECT OF PAYMENTS MADE TO M/S DBM GEO TECHNICS CONSTRUCTION PVT . LTD. IS UPHELD GROUND IS DISMISSED. 6. FOR THE AYS 2012 - 13 & 2013 - 14, THE APPELLANT HAS TAKEN ALTERNATIVE GROUND VIDE GROUND NO. 3. SINCE IT IS HELD THAT THE APPELLANT WAS REQUIRED TO DEDUCT THE TAX U/S 194J AS AGAINST THE 194C FOR THE PAYMENTS MADE T OWARDS M/S DBM GEOTECHNICS CONSTRUCTIONS PVT. LTD., THE ALTERNATIVE GROUND TAKEN BY THE APPELLANT THAT THE INTEREST U/S 201 (1A) SHOULD LEVIED FROM THE DATE OF DEDUCTION TO THE DATE OF FILING RETURN OF INCOME MERITS CONSIDERATION. 6.1 IT IS EVIDENT FROM THE PROVISION OF SECTION 201 (1A) ITSELF THAT THE INTEREST IS TO BE LEVIED FROM THE DATE ON WHICH SUCH TAX WAS DEDU C TIBLE/ DEDUCTED TO THE DATE ON WHICH SUCH TAX IS DEDUCTED/ACTUALLY PAID AS THE CASE MAY BE. HENCE, THE INTEREST U/S 201 (1 A) IS TO BE CALCUL ATED FROM THE DATE OF DEDUCTION OF TAX TILL THE DATE OF DEPOSIT IN GOVERNMENT TREASURY AND NOT FROM THE BEGINNING OF THE FINANCIAL YEAR AND TILL THE DATE OF PASSING THE ORDER. THE APPELLANT IS DIRECTED TO FILE THE COPIES OF THE CHALLAN OF THE TAX DEDUCTED BEFORE THE AO AND THE AO IS DIRECTED TO RE - COMPUTE THE INTEREST U/S 201 (1A) OF THE ACT. GROUND IS ALLOWED. 5 . AGGRIEVED BY THE APPELLATE ORDER DATED 12 - 05 - 2016 PASSED BY THE LEARNED CIT(A), THE ASSESSEE HAS COME IN AN APPEAL BEFORE THE TRIBUNAL AND S UBMITTED THAT THE MATTER IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE TRIBUNAL VIDE COMMON ORDER DATED 30 - 01 - 2017 IN ITA NO. 6029/MUM/2014 FOR AY 2008 - 09, 6030/MUM/2014 AND 5950/MUM/2014 AY 2011 - 12 RESPECTIVELY . I T WAS SUBMITTED BY LEARNED COUNSEL FOR THE ASSESSEE THAT THE ORDER /CONTRACT AWARDED BY THE ASSESSEE IN FAVOUR OF DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED FOR WHICH PAYMENT WAS MADE BY THE ASSESSEE WAS FOR THE CONSTRUCTION OF RETAINING WALL ALONG WITH BANK OF MITHI RIVER FOR W HICH TWO TENDERS DOCUMENTS ARE PLACED IN PAPER BOOK PAGE 25 - 60 . IT IS THE CLAIM OF THE ASSESSEE THAT THE TENDER WAS NOT FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER FOR WHICH PAYMENTS WERE MADE BY THE ASSESSEE TO DBM GEOTECHNIC S AND CONSTRUCTION PRIVATE LIMITED DURING THE RELEVANT PERIOD UNDER CONSIDERATION AND LEARNED CIT(A) MISTOOK THE TENDER /CONTRACT TO BE FOR MARINE GEOTECHNICAL I .T.A. NO.5186 & 5187/MUM/2016 11 INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER WHILE ADJUDICATING APPEAL. IT IS PERTINENT TO ME NTION HERE THAT TRIBUNAL WHILE ADJUDICATING APPEAL S VIDE COMMON ORDERS DATED 30 - 01 - 2017 FOR AY 2008 - 09 AND 2011 - 12 HAS HELD THAT PAYMENTS TO DBM GEOTECHNICS CONSTRUCTION PRIVATE LIMITED TOWARDS TENDER FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATI ON IN MITHI RIVER IS COVERED BY PROVISIONS OF SECTION 194J SO FAR AS DEDUCTIBILITY OF INCOME TAX AT SOURCE IS CONCERNED, WHILE PAYMENTS TO DBM GEOTECHNICS CONSTRUCTION PRIVATE LIMITED TOWARDS TENDER FOR CONSTRUCTION OF RETAINING WALL ALONG BANK OF MITHI RIVER IS COVERED BY PROVISIONS OF SECTION 194C AS THE ASSESSEE HAS AWARDED BOTH THE TYPES OF CONTRACT UNDER TENDER TO DBM G EOTECHNICS CONSTRUCTION PRIVATE LIMITED . IT WAS CLAIMED THAT LEARNED CIT(A) MISTOOK THE TENDER TO BE TOWARDS MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER WHILE INFACT THE TENDER WAS FOR CONSTRUCTION OF RETAINING WALL ALONG BANK O F MITHI RIVER FOR WHICH PAYMENTS WERE MADE BY THE ASSESSEE TO DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED DURING RELEVANT PERIOD UNDER CONSIDERATION . IT WAS SUBMITTED BY LEARNED COUNSEL FOR THE ASSESSEE THAT THE MATTER CAN BE VERIFIED BY THE AO AND IF CONTENTIONS ARE FOUND CORRECT, THE TRIBUNAL ORDER CAN BE FOLLOWED ACCORDINGLY AND IN ANY CASE THE TRIBUNAL HAS ADJUDICATED ON BOTH THE TYPES OF TENDERS /CONTRACTS AWARED BY ASSESSEE IN FAVOUR OF DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED . THE LD. DR RAISED NO OBJECTION IF THE MATTER IS RESTORED TO THE FILE OF THE AO FOR NECESSARY VERIFICATION S ON MERITS AS TO THE NATURE OF THE PAYMENTS HAVING BEEN MADE TO THE TUNE OF RS. 7.59 CRORE TO DBM GEOTECHNICS CONSTRUCTION PVT. LTD. DURING RELEVANT PERIOD FOR C ONSTRUCTION OF RETAINING WALL ALONGWITH BANK OF MITHI RIVER. 6 . WE HAVE CONSIDER ED RIVAL CONTENTION S AND PERUSED THE MATERIAL ON RECORD . W E HAVE OBSERVED THAT TRIBUNAL HAS TAKEN A VIEW TO WHICH ONE OF US WAS A PARTY (LD. ACCOUNTANT MEMBER) IN THE APPEALS IN ITA NO. 6029/MUM/2014 FOR AY 2008 - 09, 6030/MUM/2014 AND 5950/MUM/2014 FOR AY 2011 - 12 RESPECTIVELY WHEREIN THE TRIBUNAL HAS DISCUSSED AND ANALYSED BOTH THE TYPES OF TENDERS AWARDED BY THE ASSESSEE TO DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED IN DE TAILS ON MERITS VIZ. FIRSTLY TENDER /CONTRACT AWARDED BY THE ASSESSEE TO DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER WHICH WAS HELD TO BE COVERED UNDER THE PROVISIONS I .T.A. NO.5186 & 5187/MUM/2016 12 OF SECTION 1 94J SO FAR AS DEDUCTIBILITY OF INCOME TAX AT SOURCE IS CONCERNED WHILE SECONDLY TENDER /CONTRACT AWARDED BY THE ASSESSEE TO DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED FOR CONSTRUCTION OF RETAINING WALL ALONG WITH BANK OF MITHI RIVER WAS HELD TO BE CO VERED BY PROVISIONS OF SECTION 194C SO FAR AS DEDUCTIBILITY OF INCOME TAX AT SOURCE IS CONCERNED . IT IS VERY IMPORTANT FOR THE AUTHORITIES BELOW TO CORRECTLY ANALYSE AS TO AGAINST WHICH TENDER THE PAYMENTS WERE MADE BY THE ASSESSEE TO M/S DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED DURING THE RELVANT PERIOD TO ARRIVE AT CORRECT DECISION. THE RELEVANT PARAS OF THE AFORESAID COMMON ORDER OF THE TRIBUNAL ARE EXTRACTED BELOW WHICH ARE PARA 8 AND P ARA 14 OF THE TRIBUNAL ORDER DATED 30 - 01 - 2017 WITH RESPECT TO THE DECISION OF TRIBUNAL AS TO BOTH THE TYPES OF TENDERS , WHICH ARE REPRODUCED AS UNDER: - 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO CAREFULLY GONE THROUGH THE TENDER DOCUMENTS RUNNING FROM PAGES 39 TO 145 IN THE PAPER BOOK FILED WITH THE TRIBUNAL. WE HAVE OBSERVED THAT THE TENDER WA S FLOATED BY THE ASSESSEE FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER APPROACH CHANNEL (2.14 KM) SITUATED AT SEA SIDE OF MAHIM CAUSEWAY . M/S DBM GEOTECHNICS CONSTRUCTION PVT. LTD. WAS THE SUCCESSFUL BIDDER IN THE TENDER. WE HA VE OBSERVED THAT THE TENDER WAS NOT FLOATED FOR EXCAVATION OF ROCKS IN MITHI RIVER RATHER THE TENDER WAS FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER AND THE WORK WAS MAINLY TOWARDS RENDERING OF TECHNICAL SERVICES INVOLVING MARI NE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION WHICH WERE TECHNICAL IN NATURE WHICH ARE COVERED U/S 194J OF THE ACT FOR DEDUCTION OF TAX AT SOURCE. THE AUTHORITIES BELOW HAVE RIGHTLY CONCLUDED THAT THESE SERVICES ARE TECHNICAL SERVICES WHICH ARE COVERED U/S 194J OF THE ACT FOR DEDUCTION OF TAX AT SOURCE AND NOT U/S 194C OF THE ACT FOR DEDUCTION OF TAX AT SOURCE . WE HAVE ALSO GONE THROUGH THE VARIOUS ITEMS OF WORK REFLECTED IN TENDER DOCUMENTS AS CONTAINED INCHAPTER VIII(E), SCHEDULE B WHICH ARE PLACED ON RECORD IN PAPER BOOK /PAGE 139 - 142 AND ALSO DETAILED ITEM WISE SPECIFICATION IN TENDER DOCUMENT PLACED IN PAPER BOOK/PAGE 143 - 145 , WHICH CLEARLY LEAD TO THE IRRESISTIBLE CONCLUSION THAT THESE ARE TECHNICAL SERVICES RENDERED BY M/S DBM GEOTECHNICS CONS TRUCTION PVT. LTD. TO THE ASSESSEE FOR MARINE GEO TECHNICAL INVESTOGATION. THE LEARNED AO VIDE ORDERS DATED 11 - 03 - 2013 IN PARA 2 AS WELL LEARNED CIT(A) IN HIS APPELLATE ORDERS DATED 16 - 07 - 2014 IN PARA 4.4/4.5 HAVE RIGHTLY CONCLUDED THAT SERVICES RENDERED BY M/S DBM GEOTECHNICS CONSTRUCTION PVT. LTD. TO THE ASSESSEE ARE TECHNICAL IN NATURE AND DULY COVERED U/S 194J OF THE ACT FOR DEDUCTIBILITY OF TAX AT SOURCE, WHICH ORDERS OF THE AUTHORITIES BELOW WE ARE NOT INCLINED TO INTERFERE. IN OUR CONSIDERED VIEW T HESEARE TECHNICAL SERVICES RENDERED BY THE DBM GEOTECHNICS CONSTRUCTION PVT. LTD. TO THE ASSESSEE FOR MARINE GEO TECHNICAL INVESTIGATION FOR WHICH PAYMENTS WERE MADE BY THE ASSESSEE WHICH ARE COVERED U/S 194 J OF THE ACT FOR DEDUCTIBILITY OF TAX AT SOURCE . SECTION 194J OF THE ACT AS APPLICABLE FOR IMPUGNED ASSESSMENT YEAR IS REPRODUCED BELOW: - [FEES FOR PROFESSIONAL OR TECHNICAL SERVICES. 194J.(1) ANY PERSON, NOT BEING AN INDIVIDUAL OR A HINDUUNDIVIDED FAMILY, WHO IS RESPONSIBLE FOR PAYING TO A RESIDENT ANY SUM BY WAY OF I .T.A. NO.5186 & 5187/MUM/2016 13 (A) FEES FOR PROFESSIONAL SERVICES, OR (B) FEES FOR TECHNICAL SERVICES, [OR] [(C) ROYALTY, OR (D)ANY SUM REFERRED TO IN CLAUSE (VA)OF SECTION 28,] SHALL, AT THE TIME OF CREDIT OF SUCH SUM TO THE ACCOUNT OF THE PAYEE OR AT THE TIME OF PAYMENT THEREOF IN CASH OR BY ISSUE OF A CHEQUE OR DRAFT OR BY ANY OTHER MODE, WHICHEVER IS EARLIER, DEDUCT AN AMOUNT EQUAL TO [TEN]PER CENT OF SUCH SUM AS INCOME - TAX ON INCOME COMPRISED THEREIN : PROVIDED THAT NO DEDUCTION SHALL BE MADE UNDER THIS SECTIO N - (A) FROM ANY SUMS AS AFORESAID CREDITED OR PAID BEFORE THE 1ST DAY OF JULY, 1995; OR (B) WHERE THE AMOUNT OF SUCH SUM OR, AS THE CASE MAY BE, THE AGGREGATE OF THE AMOUNTS OF SUCH SUMS CREDITED OR PAID OR LIKELY TO BE CREDITED OR PAID DURING THE FINANCI AL YEAR BY THE AFORESAID PERSON TO THE ACCOUNT OF, OR TO, THE PAYEE, DOES NOT EXCEED (I) TWENTY THOUSAND RUPEES, IN THE CASE OF FEES FORPROFESSIONAL SERVICES REFERRED TO IN CLAUSE (A), OR (II) TWENTY THOUSAND RUPEES, IN THE CASE OF FEES FOR TECHNICAL S ERVICES REFERRED TO IN [CLAUSE (B), OR] [(III) TWENTY THOUSAND RUPEES, IN THE CASE OF ROYALTY REFERRED TO IN CLAUSE (C), OR (IV) TWENTY THOUSAND RUPEES, IN THE CASE OF SUM REFERRED TO IN CLAUSE (D ) : ] [PROVIDED FURTHER THAT AN INDIVIDUAL O R A HINDU UNDIVIDED FAMILY, WHOSE TOTAL SALES, GROSS RECEIPTS OR TU RNOVER FROM THE BUSINESS OR PROFESSION CARRIED ON BY HIM EXCEED THE MONETARY LIMITS SPECIFIED UNDER CLAUSE ( A) OR CLAUSE (B) OF SECTION 44AB DURING THE FINANCIAL YEAR IMMEDIATELY PRECEDING THE FINANCIAL YE AR IN WHICH SUCH SUM BY WAY OF FEES FOR PROFESSIONA L SERVICES OR TECHNICAL SERVICE S IS CREDITED OR PAID, SHALL BE LIABLE TO DEDUCT INCOME - TAX UNDER THIS SECTION :] [PROVIDED ALSO THAT NO INDIVIDUAL O R A HINDU UNDIVIDED FAMILY REFERRED TO IN THE SECOND PROVISO SHALL BE LIA BLE TO DEDUCT INCOME - TAX ON THE SUM B Y WAY OF FEES FOR PROFESSIONAL SERVICES IN CASE SUCH S UM IS CREDITED OR PAID EXCLU SIVELY FOR PERSONAL PURPOSES OF SUCH INDIVIDUAL OR ANY ME MBER OF HINDU UNDIVIDED FAMILY. ] (2) [***] (3) [***] EXPLANATION. FOR THE PURPOSES OF THIS SECTION, (A ) PROFESSIONAL SE RVICES MEANS SERVICES RENDERED BY A PER SON IN THE COURSE OF CARRYING ON LEGAL, M EDICAL, ENGINEERING OR ARCHITEC TURAL P ROFESSION OR THE PROFESSION OF ACCOUNTANCY OR TECHN ICAL CONSULTANCY OR INTERIOR DE CORATIO N OR ADVERTISING OR SUCH OTHER PROFESSION AS IS NOT IFIED BY THE BOARD FOR THE PURPOSES OF SECTION 44AA OR OF THIS SECTION; (B ) FEES FOR TECHNI CAL SERVICES SHALL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE (VII) O F SUB - SECTION (1) OF SECTION 9; [ (BA )ROYALTY SHA LL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE (VI ) OF SUB - SECTION (1) OF SECTION 9;] (C ) WHERE ANY SUM RE FERRED TO IN SUB - SECTION (1) IS CR EDITED TO ANY ACCOUNT, WHETHER CALLED SUSPENSE ACC OUNT OR BY ANY OTHER NAME, IN THE BOOKS OF ACCOUNT OF THE PERSON LIABLE TO PAY SUCH SUM, SUCH CREDITING SHALL BE DEE MED T O BE CREDIT OF SUCH SUM TO THE ACCOUNT OF THE PAYEE AND THE PROVISIONS OF THIS SECTION SHALL APPLY ACCORDINGLY. I .T.A. NO.5186 & 5187/MUM/2016 14 THE FEE FOR TECHNICA L SERVICES HAS BEEN DEFINED IN IN EXPLANATION 2 TO CLAUSE (VII ) OF SUB - SECTION (1) OF SECTION 9 ; WHICH IS REPRODUCED HEREUNDER: - EXPLANATION [2] . FOR THE PURPOSES OF THIS CLAUSE, FEES FOR TECHNICAL SERVICES MEANS ANY CONSIDERAT ION (INCLUDING ANY LUMP SU M CON SIDERATION) FOR THE RENDERING OF ANY MANAGERIAL, TECHNICAL OR CONSULTAN CY SERVICES ( INCLU DING THE PROVISION OF SERVICES OF TECHNICAL OR OTHE R PERSONNEL) BUT DOES NOT INCLUDE CONSIDERATION FOR ANY CONSTRUCTION, ASSEMBLY, MINING O R LIKE PROJECT UNDERTAK EN BY TH E RECIPIENT OR CONSIDERATION WHICH WOULD BE INCOME OF THE RECIPIENT CHARGEABLE UNDER THE HEAD SALARIES.] IN OUR CONSIDERED VIEW THESE ARE TECHNICAL SERVICES RENDERED BY THE DBM GEOTECHNICS CONSTRUCTION PVT. LTD. TO THE ASSESSEE FOR MARINE GEO T ECHNICAL INVESTIGATION FOR WHICH PAYMENTS WERE MADE BY THE ASSESSEE WHICH ARE COVERED U/S 194 J OF THE ACT FOR DEDUCTIBILITY OF TAX AT SOURCE. THE DECISION OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF ESSAR OIL LTD. V. ITO [2013] 30 TAXMANN.COM 39 (GUJ HC) AS RELIED UPON BY THE ASSESSEE IS DISTINGUISHABLE AND NOT APPLICABLE IN THE INSTANT CASE AS IN THAT CASE THREE DIFFERENT AGREEMENTS ENTERED INTO BY THE TAX - PAYER WERE HELD TO BE COMPOSITE CONTRACT BEING HELD TO BE SINGLE INTEGRATED AGREEMENT FOR CONST RUCTION OF REFINERY PLANT WHICH WAS HELD TO BE WORK CONTRACT LIABLE FOR DEDUCTION OF TAX AT SOURCE U/S 194C OF THE ACT . HOWEVER, THE ASSESSEE HAS PLACED ON RECORD FORM 26A TO CONTEND THAT THE AMOUNT RECEIVED HAS BEEN DULY CONSIDERED IN THE RETURN OF INCOM E FILED BY M/S DBM GEOTECHNICS CONSTRUCTION PVT. LTD. AND ALL TAXES WERE DULY PAID BY THE SAID M/S DBM GEOTECHNICS CONSTRUCTION PVT. LTD. TO THE REVENUE . THIS CONTENTION OF THE ASSESSEE NEEDS VERIFICATION BY THE AUTHORITIES BELOW AND WE ARE INCLINED TO SE T ASIDE THIS ISSUE TO THE FILE OF THE AO FOR VERIFICATION AND IF THE CONTENTION OF THE ASSESEE ARE FOUND TO BE CORRECT, THE AO SHALL GRANT RELIEF KEEPING IN VIEW RATIO OF DECISION OF HONBLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA - COLA BEVERAGES PRIVAT E LIMITED (SUPRA) 293 ITR 226(SC). THE ASSESSEE IS DIRECTED TO APPEAR BEFORE THE AO AND FILE NECESSARY EVIDENCES TO SUPPORT ITS CONTENTIONS, AS PER OUR ABOVE DIRECTION . NEEDLESS TO SAY THAT PROPER AND ADEQUATE OPPORTUNITY OF BEING HEARD SHALL BE PROVIDED BY THE AO IN ACCORDANCE WITH PRINCIPLES OFNATURAL JUSTICE IN ACCORDANCE WITH LAW. THIS APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES.WE ORDER ACCORDINGLY. 14. WE HAVE CONSIDERED THE RIVAL SUBMIS SION AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. WE HAVE OBSERVED THA T THE ASSESSEE HAS PAID AN AMOUNT OF RS. 32,47,68,465/ - TO M/ S DBM GEOTECHNICS CONSTRUCTION PVT. DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2011 - 12 ON WHICH TAX WAS DEDUCTED AT SOURCE U/S 194C OF TH E ACT BY THE ASSESSEE. THE ASSESSEE HAS CONTENDED THAT THE AUTHORITIES BELOW HAVE FRAMED THE ORDERS BASED ON EVALUATION OF A WRONG TENDERS/ORDER WHICH WAS ALSO AWARDED TO THE ASSESSEE EARLIER BEING MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN M ITHIRIVER APPROACH CHANNEL (2.14 KM) SITUATED AT SEA SIDE OF MAHIM CAUSEWAY OF WHICH WORK WAS COMPLETED WAY BACK IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2008 - 09. THUS, THE ASSESSEE ADMITTED ITS MISTAKE OF SUBMITTING WRONG TENDER DOCUMENTS BEFO RE THE AUTHORITIES BELOW FOR EVALUATION OF THE APPLICABILITY OF SECTION 194C OF THE ACT VIS - - VIS PAYMENTS MADE. IT IS ALSO SEEN THAT FURTHER FRESH TENDERS WERE AWARDED BY THE ASSESSEE TO M/S DBM GEOTECHNICS CONSTRUCTION PVT LTD. FOR THE CONSTRUCTION OF RE TAINING WALL ALONG THE BANK OF MITHI RIVER FROM CHANNEL 3500.0M TO CHANNEL 5883.0M TOWARDS LBS MARG INCLUDING SERVICE ROAD AND CONSTRUCTION OF RETAINING WALL I .T.A. NO.5186 & 5187/MUM/2016 15 ALONG THE BANK OF MITHI RIVER FROM CHANNEL 2600.0M TO CHANNEL5883.0 M TOWARDS BKC SIDE INCLUDING S ERVICE ROAD , WHICH ARE PLACED AS ADDITIONAL EVIDENCES BEFORE THE TRIBUNAL(PAGE 221 - 516 AND IT IS CLAIMED THAT THE PAYMENT HAS BEEN MADE BY THE ASSESSEE OF RS. 32,47,68,465/ - TO DBM GEOTECHNICS CONSTRUCTION PRIVATE LIMITED TOWARDS THESE TENDERS VIZ. FOR TH E CONSTRUCTION OF RETAINING WALL ALONG THE BANK OF MITHI RIVER FROM CHANNEL 3500.0M TO CHANNEL 5883.0M TOWARDS LBS MARG INCLUDING SERVICE ROAD AND CONSTRUCTION OF RETAINING WALL ALONG THE BANK OF MITHI RIVER FROM CHANNEL 2600.0M TO CHANNEL 5883.0M TOWARDS BKC SIDE INCLUDING SERVICE ROAD AND NOT TOWARDS THE EARLIER TENDER I.E. MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER APPROACH CHANNEL (2.14 KM) SITUATED AT SEA SIDE OF MAHIM CAUSEWAY WHICH WAS STATED TO BE COMPLETED IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2008 - 09. THESE NEW TENDERS ARE NOW PLACED AS ADDITIONAL EVIDENCES BEFORE THE TRIBUNAL (PAGE 221 - 516/PB) WHICH IN OUR CONSIDERED VIEW GOES TO THE ROOT OF MATTER AND IN THE INTEREST OF SUBSTANTIAL JUSTICE THESE ADDITIONAL EVIDENCES NEED TO BE ADMITTED AS WE HAVE ALSO OBSERVED THAT THE AUTHORITIES BELOW ERRED IN PASSING THE ORDERS BY RELYING ON THE EARLIER TENDER VIZ. TENDER FOR MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION IN MITHI RIVER APPROACH CHANNEL (2.14 KM) SITUATED AT SEA SIDE OF MAHIM CAUSEWAY WHICH WAS A SMALL ORDER STATED TO BE COMPLETED IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2008 - 09. HOWEVER, THESE ADDITIONAL EVIDENCES PLACED IN PAPER BOOK PAGE 221 - 516 NEEDS VERIFICATION BY THE A.O. AND ACC ORDINGLY WE SET ASIDE THIS MATTER TO THE FILE OF THE A.O. FOR REDETERMINATION OF THE ISSUE ON MERITS AFTER EVALUATION OF THE TENDER DOCUMENTS AND CO - RELATING THE SAME WITH THE PAYMENTS MADE BY THE ASSESSEE. NEEDLESS TO SAY THAT PROPER AND ADEQUATE OPPORTUN ITY OF BEING HEARD SHALL BE PROVIDED BY THE AO TO THE ASSESSEE IN ACCORDANCE WITH PRINCIPLES OF NATURAL JUSTICE IN ACCORDANCE WITH LAW AND THE ASSESSEE BE ALLOWED TO SUBMIT EVIDENCES AND EXPLANATIONS TO SUPPORT ITS CONTENTIONS IN ITS DEFENSE. THUS, THIS AP PEAL IS ALLOWED FOR STATISTICAL PURPOSES. WE ORDER ACCORDINGLY. THUS, THE AO IS DIRECTED TO VERIFY AND EVALUATE THE TENDER /CONTRACTS UNDER WHICH THE PAYMENTS WERE MADE BY THE ASSESSEE TO DBM GEOTECHNICS CONSTRUCTION PRIVATE LIMITED DURING THE RELEVANT PER IOD TO THE TUNE OF RS.7,59,32,109/ - AND IF THE PAYMENTS WERE FOUND TO BE MADE BY THE ASSESSEE TO DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED FOR THE CONSTRUCTION OF THE RETAINING WALL ALONGWITH THE BANK OF MITHI RIVER , THEN THE PROVISION OF SECTION 194C SHALL BE APPLICABLE SO FAR AS DEDUCTIBILITY OF INCOME TAX AT SOURCE IS CONCERNED, WHILE IF THE PAYMENTS WERE MADE BY THE ASSESSEE TO DBM GEOTECHNICS AND CONSTRUCTION PRIVATE LIMITED TOWARDS MARINE GEOTECHNICAL INVESTIGATION FOR ROCK EXCAVATION, THEN P ROVISIONS OF SECTION 194J WILL BE APPLICABLE SO FAR AS DEDUCTIBILITY OF INCOME - TAX AT SOURCE IS CONCERNED, AS WAS HELD BY THE TRIBUNAL VIDE AFORE - STATED COMMON ORDERS DATED 30 - 01 - 2017 FOR AY 2008 - 09 AND 2011 - 12. NEEDLESS TO SAY THAT PROPER AND ADEQUATE OPP ORTUNITY OF BEING HEARD SHALL BE PROVIDED BY THE AO TO THE ASSESSEE IN SET ASIDE PROCEEDINGS IN ACCORDANCE WITH PRINCIPLES OF NATURAL I .T.A. NO.5186 & 5187/MUM/2016 16 JUSTICE IN ACCORDANCE WITH LAW AND THE ASSESSEE WILL BE ALLOWED TO SUBMIT EVIDENCES AND EXPLANATIONS TO SUPPORT ITS CONTEN TIONS IN ITS DEFENCE WHICH SHALL BE EVALUATED BY THE AO ON MERITS. THUS, THE APPEAL OF THE ASSESSEE IN ITA NO. 5186//MUM/2016 FOR AY 2012 - 13 IS ALLOWED FOR STATISTICAL PURPOSES. WE ORDER ACCORDINGLY 7. IN THE RESULT APPEAL OF THE ASSESSEE IN ITA NO. 5186/MUM/2016 FOR AY 2012 - 13 IS ALLOWED FOR STATISTICAL PURPOSES. 8. O UR ABOVE DECISION IN ITA NO. 5186/MUM/2016 FOR AY 2012 - 13 SHALL APPLY MUTATIS MUTANDIS TO THE APPEAL OF THE ASSESSEE IN ITA NO. 5187/MUM/2016 FOR AY 2013 - 14 . THUS, THE APPEAL OF THE ASS ESSEE IN ITA NO. 5187/MUM/2016 FOR AY 2013 - 14 IS ALSO ALLOWED FOR STATISTICAL PURPOSES. WE ORDER ACCORDINGLY. 9. IN THE RESULT APPEAL OF THE ASSESSEE IN ITA NO. 5187/MUM/2016 FOR AY 2013 - 14 IS ALLOWED FOR STATISTICAL PURPOSES. 10. IN THE RESULT BOTH THE AP PEALS OF THE ASSESSEE IN ITA NO. 5186/MUM/2016 AND 5187/MUM/2016 FOR AY 2012 - 13 AND 2013 - 14 RESPECTIVELY ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 0 7 . 02.2018 0 7 .02.2018 S D / - S D / - (MAHAVIR SINGH ) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBA I, DATED: 0 7 .02.2018 NISHANT VERMA SR. PRIVATE SECRETARY COPY TO 1 . THE APPELLANT 2 . THE RESPONDENT 3 . THE CIT(A) CONCERNED, MUMBAI 4 . THE CIT - CONCERNED, MUMBAI 5 . THE DR BENCH, 6 . MASTER FILE I .T.A. NO.5186 & 5187/MUM/2016 17 // TUE COPY// BY ORDER DY/ASSTT. REGISTRAR ITAT, MUMBAI