Accounts Officer (O&M), Shriganganagar, JOdhpur Vidyut Vitran Nigam LImited, Sriganganagar V. DCIT-TDS, JOdhpur , Jodhpur

ITA 574/JODH/2008

AI Insights

The case involves multiple appeals by the Assessee, Jodhpur Vidyut Vitran Nigam Ltd., against the orders of the CIT(A), Jodhpur, which pertained to the demand of tax and interest under sections 201 and 201(1A) of the Income Tax Act, 1961. The primary issue was whether TDS was applicable on payments made for the purchase and installation of machinery under a works contract. The CIT(A) had held that the payments were part of a composite contract and thus subject to TDS under section 194C. However, the Tribunal found that no TDS was deductible on the purchase of machinery itself and only on the installation services. Consequently, the matter was remanded to the ITO-TDS-II for re-computation of the tax.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 122673 (ITAT-JODHPUR)
• Duration Of Justice: 15 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 21-09-2023
• Assessment Year: 2007-2008
• Appeal Filed On: 19-10-2008
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV MOHAN
• Keywords: TDS
• Section: 194C; 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH ‘DB’: JODHPUR (Through Video Conferencing) BEFORE, SHRI SAKTIJIT DEY, VICE PRESIDENT AND DR. B.R.R. KUMAR, ACCOUNTANT MEMBER ITA No.529/JODH/2009 (ASSESSMENT YEAR 2007-08) ITA No.568/JODH/2008 (ASSESSMENT YEAR 2006-07) ITA No.573/JODH/2008 (ASSESSMENT YEAR 2008-09) ITA No.574/JODH/2008 (ASSESSMENT YEAR 2007-08) ITA No.575/JODH/2008 (ASSESSMENT YEAR 2006-07) ITA No.577/JODH/2008 (ASSESSMENT YEAR 2006-07) Accounts Officer (O&M) Pali, Jodhpur Vidut Vitran Nigam Ltd., Industrial Area, Pali TAN-JDHJ0 2375C Vs. ITO-TDS-1, Jodhpur (Appellant) (Respondent) Appellant by None Respondent by Mr. Rajeev Mohan, JCIT-DR Date of Hearing 22/09/2023 Date of Pronouncement 27/10/2023 2 ITA Nos.529 & Ors /Jodh/2009 & 2008 Accounts Officer (O & M) Jalore Jodhpur Vidyut Vitran Nigam Limited vs. ITO-TDS-II ORDER PER BENCH: All the above six appeals are preferred by the Assessee against the orders of ld. CIT(A), Jodhpur dated 05.08.2008 & 16.07.2009 and are being adjudicated by the common order. 2. The order u/s 201/201 (1A) of the Income Tax Act, 1961 has been passed by the ITO-TDS-II, Jodhpur resulting in demand of tax u/s 201 interest u/s 201(1A). The matter reached to the Ld. CIT(A) and held that the total payments made by the assessee are liable to the provisions u/s 194C of the IT Act. 3. The Hon’ble High Court of Rajsthan at Jodhpur, has remanded the matter to the Tribunal to adjudicate afresh on merits. On going through the record, we find that the payments made by the assessee concern are of payments for purchase of machinery and payments for installation of machinery under works contract. The Ld. CIT(A) held that entire purchase is a composite contract and held that going to the nature that the activity is a composite 3 ITA Nos.529 & Ors /Jodh/2009 & 2008 Accounts Officer (O & M) Jalore Jodhpur Vidyut Vitran Nigam Limited vs. ITO-TDS-II contract, hence, the provisions of TDS are attracted on the entire amount. 4. On the contrary, we find that no TDS is deductible on the purchase of machinery, hence, keeping in view the facts on record, we remand the matter to the file of ITO-TDS-II to exclude the amounts paid for purchase of machinery and reiterate that no provisions of TDS are attracted for the purchase of machinery. The ITO-TDS-II is hereby directed to re-compute the tax deductible as per the provisions of 194C to the extent of work contract given in the erection/installation of the machinery. 5. In the result, all the appeals of the Assessee are allowed for statistical purposes. Order pronounced in the open Court on 27 th October, 2023. Sd/- Sd/- (SAKTIJIT DEY) (DR. B.R.R. KUMAR) VICE PRESIDENT ACCOUNTANT MEMBER Dated:27/10/2023 PK/Ps