ACIT (TDS), Chandigarh V. M/s Fortis Healthcare Ltd., Mohali

ITA 649/CHANDI/2015

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 2539 (ITAT-CHANDIGARH)
• Duration Of Justice: 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Next Hearing Date: 26-11-2015
• Assessment Year: 2012-2013
• Appeal Filed On: 18-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R M MEHTA
• Assessee Lawyers: MANJIT SINGH
• Section: 133A; 201(1); 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.296/CHD/2015 (ASSESSMENT YEAR : 2010-11) ITA NO.297/CHD/2015 (ASSESSMENT YEAR : 2011-12) ITA NO.649/CHD/2015 (ASSESSMENT YEAR : 2012-13) AND ITA NO.650/CHD/2015 (ASSESSMENT YEAR : 2013-14) THE A.C.I.T.(TDS), VS. M/S FORTIS HEALTHCARE LTD., CHANDIGARH. PHASE-8, SECTOR 62, MOHALI. PAN: PTLF10062D (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MANJIT SINGH, DR DEPARTMENT BY : SHRI R.M. MEHTA DATE OF HEARING : 22.11.2015 DATE OF PRONOUNCEMENT : 14.01.2016 O R D E R PER RANO JAIN, A.M . : THESE FOUR APPEALS APPEAL FILED BY THE REVENUE ARE DIRECTED AGAINST THE SEPARATE ORDERS OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-2, CHANDIGAR H DATED 20.1.2015, 20.1.2015, 27.4.2015 AND 27.4.201 5 FOR 2 ASSESSMENT YEARS 2010-11, 2011-12, 2012-13 AND 2013 -14 RESPECTIVELY. THE APPEALS BEFORE THE CIT (APPEALS ) WERE AGAINST THE ORDER OF THE ASSESSING OFFICER MADE UND ER SECTION 201(1) & 201(1A) OF THE INCOME TAX ACT, 196 1 (IN SHORT THE ACT). 2. SINCE THE FACTS AND CIRCUMSTANCES ARE IDENTICAL IN ALL THE APPEALS, THE SAME WERE HEARD TOGETHER AN D ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR T HE SAKE OF CONVENIENCE. THE DECISION GIVEN IN ITA NO.296/CHD/2015 FOR ASSESSMENT YEAR 2010-11 SHALL APPLY MUTATIS MUTANDIS TO ALL THE APPEALS. ITA NO.296/CHD/2015 : 3. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS RUNNING A HOSPITAL UNDER THE NAME AND S TYLE OF FORTIS HEALTHCARE LTD. AT MOHALI. THE TDS INSPE CTION UNDER SECTION 133A OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSEE AS ON 20.4.2012. THE ASSESSEE HAD DEDUCTE D TAX AT SOURCE IN RESPECT OF PAYMENTS TO DOCTORS APPOINT ED ON RETAINERSHIP BASIS UNDER SECTION 194J OF THE ACT BY TREATING THE PAYMENTS AS PROFESSIONAL CHARGES. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE PAYMENTS MADE TO THESE DOCTORS WERE REQUIRED TO BE TREATED AS SAL ARY AND TAXES WERE REQUIRED TO BE DEDUCTED UNDER SECTION 19 2 OF THE ACT. THE ASSESSEE SUBMITTED BEFORE THE ASSESSI NG OFFICER THAT THERE DOES NOT EXIST EMPLOYER AND EMPL OYEES RELATIONSHIP BETWEEN THE ASSESSEE AND THESE D OCTORS, 3 THEREFORE, TDS HAS TO BE DEDUCTED UNDER SECTION 194 J OF THE ACT. RELIANCE WAS PLACED ON THE ORDER OF THE HYDERABAD BENCH OF I.T.A.T. IN THE CASE OF DCIT VS . YASHODA SUPER SPECIALITY HOSPITAL (2010) 33 TTJ 17 (HYD.), IN THE CASE OF ITO VS. APOLLO HOSPITALS INTERNATIONAL LTD., ITA NO.3363/AHD/2008 AND THAT O F I.T.A.T., CHANDIGARH BENCH IN THE CASE OF IVY HEAL TH LIFE SCIENCES VS. DEPARTMENT OF INCOME TAX, ITA NO.731 & 732/CHD/2012. THE ASSESSING OFFICER REJECTED ALL T HE CONTENTIONS OF THE ASSESSEE AND ALSO STATING THAT T HE CASE OF IVY HEALTH LIFE SCIENCES (SUPRA) WAS NOT ACCEPTA BLE TO THE REVENUE AND THE APPEAL AGAINST THE SAME IS PEND ING BEFORE THE HON'BLE PUNJAB & HARYANA HIGH COURT, WOR KED OUT THE TAX AND INTEREST LIABILITY UNDER SECTION 20 1(1) AND 201(1A) OF THE ACT AND CREATED THE DEMAND AGAINST T HE ASSESSEE. 4. BEFORE THE LEARNED CIT (APPEALS), DETAILED SUBMISSIONS WERE MADE BY THE ASSESSEE, AGAIN REFERR ING TO VARIOUS CLAUSES OF THE AGREEMENTS BETWEEN THE DOCTO RS AND THE ASSESSEE AND RELIANCE WAS ALSO PLACED ON TH E JUDGMENTS WHICH WERE EARLIER PLACED BEFORE THE ASSE SSING OFFICER. AFTER CONSIDERING THE SUBMISSIONS OF THE A SSESSEE, THE LEARNED CIT (APPEALS) HELD THAT TO DETERMINE WH ETHER PARTICULAR RELATIONSHIP AMOUNTS TO EMPLOYER AND EMP LOYEE RELATIONSHIP, THE EXISTENCE OF A RIGHT OF CONTROL I N RESPECT OF THE MANNER IN WHICH WORK IS TO BE DONE BY THE PERSON 4 EMPLOYED IS VERY IMPORTANT. HE ALSO DISTINGUISH BE TWEEN CONTRACT FOR SERVICE AND CONTRACT OF SERVICE. HE ANALYZED THE VARIOUS CLAUSES OF THE AGREEMENT WITH THE DOCTORS AND HELD THAT THERE DOES NOT EXIST ANY EMPL OYER AND EMPLOYEE RELATIONSHIP. THE LEARNED CIT (APPEAL S) ALSO MENTIONED THAT THE ASSESSING OFFICER OUGHT TO HAVE CONSIDERED THE ISSUES OF CASE OF THE I.T.A.T., CHAN DIGARH BENCH IN THE CASE OF IVY HEALTH LIFE SCIENCES (SUP RA) ON MERITS RATHER THAN SUMMARILY REJECTING THE RELIANCE PLACED BY THE ASSESSEE. IN THIS WAY, THE LEARNED CIT (APP EALS) ALLOWED THE APPEAL OF THE ASSESSEE. 5. AGGRIEVED BY THIS ORDER OF THE LEARNED CIT (APPEALS), THE REVENUE HAS COME UP IN APPEAL BEFORE US, RAISING FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LD, C1T(A), CHANDIGARH HAS ERRED IN LAW IN DELETING THE ADDITION MADE BY THE AO ON THE GROUND T HAT THE AO WAS NOT RIGHT IN CONCLUDING THAT THERE EXISTE D AN EMPLOYER-EMPLOYEE RELATIONSHIP BETWEEN THE HOSPITAL AND THE PROFESSIONAL DOCTORS AND IN TREATING THE PR AS ASSESSEE IN DEFAULT U/S 201(1) OF THE ACT FOR SHORT DEDUCTION OF TAX AT SOURCE BY TAKING THE AMOUNTS TO BE U/S 192 AND NOT U/S 194J AND IN CHARGING INTEREST U /S 201(1 A) OF THE ACT, ON THE FOLLOWING GROUNDS:- I) THE LD, CIT(A), CHANDIGARH HAS RELIED UPON THE FOLLOWING CASES JAWS GIVEN BY THE COUNSEL OF THE ASSESSEE:- A) DCIT VS. YASHODA SUPER SPECIALITY HOSPITAL (2010) 33 TTJ 17 (HYD), ITAT HYDERABAD BENCH, 'B' B) ITO VS. APOLLO HOSPITALS INTERNATIONAL LTD., ITA NO.3363/AHD/2008 A.Y.2007-08. 5 C) DCIT VS. IVY HEALTH LIFE SCIENCES PVT. LTD., IN I TA NO.731 & 732/CHD/2012. THE FACTS OF THE CASE LAWS CITED BY THE ASSESSEE AR E DIFFERENT FROM THE PRESENT CASE, AS THE DOCTORS 'ENGAG ED IN THE ABOVE HOSPITALS WERE PART-TIME CONSULTANTS WHERE AS THE DOCTORS IN THE PRESENT EASE WERE FULL TIME CONS ULTANTS ENGAGED BY THE HOSPITAL AND AS PER THE AGREEMENTS SIGNED BETWEEN THE HOSPITAL AND THE DOCTORS WERE EXCLUSIVELY MEANT TO WORK FOR THE ASSESSEE HOSPITAL AN D WERE NOT PERMITTED TO DO THEIR OWN PRIVATE PRACTIC E OR WITH ANY OTHER ORGANIZATION. 2) THE LD, CIT(A), CHANDIGARH HAS ALSO NOT APPRECIA TED THE FACTS ESTABLISHED BY THE AO THAT THE FACTS OF THE C ASES (CASE LAWS) QUOTED BY THE ASSESSSEE WERE TOTALLY DIFFERENT FROM THE CASE IN HAND, AND FROM THE (TERM S END CONDITIONS OF THE WRITTEN AGREEMENTS BETWEEN THE HOSPITAL AND THE (DOCTORS IT STANDS PROVED THAT THE HOSPITAL AUTHORITIES HAD FULL CONTROL OVER THE DOCTORS AS THEIR WORKING HOURS & WORKING DAYS WERE FIXED BY TH E EMPLOYER AND THEY WERE ALSO SUPPOSED TO DO THE OTHER WORKS RELATED TO THE HOSPITAL ACTIVITIES AS AND WHEN REQUIRED. FROM THIS IT IS CLEAR THAT THERE EXIST ED AN EMPLOYER-EMPLOYEE RELATIONSHIP BETWEEN THE HOSPITAL AND DOCTORS. 3) THAT THE APPELLANT CRAVES FOR PERMISSION TO ADD, D ELETE OR AMEND THE GROUNDS OF APPEAL BEFORE OR AT THE TIM E OF HEARING OF APPEAL. 6. THE LEARNED D.R. RELIED ON THE ORDER OF THE ASSESSING OFFICER, SPECIFICALLY MENTIONING THE GROU NDS OF APPEAL RAISED BEFORE US, HE TRIED TO DISTINGUISH TH E FACTS OF THE PRESENT CASE WITH THAT OF THE CASES RELIED ON BY THE 6 ASSESSEE. FURTHER, HE PLACED RELIANCE ON THE JUDGM ENT OF THE HON'BLE SUPREME COURT IN THE CASE OF PADMASUND ARA RAO (DECD.) & ORS. VS. STATE OF TAMIL NADU & ORS. 2 55 ITR 147 FOR THE PROPOSITION THAT WHILE INTERPRETING THE PROVISIONS, THE COURT ONLY CAN INTERPRET THE LAW AN D CANNOT LEGISLATE IT. THE LEGISLATIVE INTENT IS OF PRIME MATTER AND IN THE PRESENT CASE, ONE HAS TO GO BEHIN D WHAT IS APPARENT AND TO FIND OUT THAT WHETHER THERE EXIS TS A RELATIONSHIP OF MASTER AND SERVANTS BETWEEN THE ASS ESSEE AND THESE DOCTORS ON RETAINERSHIP BASIS. 7. THE LEARNED COUNSEL FOR THE ASSESSEE RELIED ON THE ORDER OF THE LEARNED CIT (APPEALS). HE STATED THAT THE LEARNED CIT (APPEALS) HAS TAKEN PAINS TO STATE AT L ENGTH WHY THERE DOES NOT EXIST ANY EMPLOYER AND EMPLOYEES RELATIONSHIP BETWEEN THE ASSESSEE AND THESE DOCTORS . THE RELIANCE WAS PLACED ON THE JUDGMENTS WHICH WERE PLA CED BEFORE THE LOWER AUTHORITIES. IT WAS STATED AT BAR THAT THE ORDER OF THE I.T.A.T., CHANDIGARH BENCH IN THE CASE OF IVY HEALTH LIFE SCIENCES VS. DEPARTMENT OF INCOME TAX, ITA NO.731 & 732/CHD/2012, WHICH WAS RELIED ON BY THE ASSESSING OFFICER AS WELL AS BY THE LEARNED CIT (AP PEALS) HAS HENCE BEEN CONFIRMED BY THE HON'BLE PUNJAB & HARYANA HIGH COURT IN ITA NO.142 OF 2013 (O&M) DATE D 26.8.2015. A COPY OF THE JUDGMENT WAS ALSO PLACED ON RECORD. RELYING ON THESE JUDGMENTS, IT WAS PLEADED THAT THE ORDER OF THE LEARNED CIT (APPEALS) BE CONFIRMED . 7 8. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. THE UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSES SEE HAS ENGAGED THREE TYPES OF DOCTORS I.E. (I) EMPLOYED DO CTORS (ON PAY ROLLS), (II) EMPANELLED DOCTORS AND, (III) RETAINERS. THE ONLY DISPUTE IS WITH REGARD TO RETAINERS, IN WH ICH CASE THE ASSESSING OFFICER FOUND THAT THE PAYMENT MADE T O THESE RETAINERS SHOULD BE TREATED AS SALARY AND CONSEQUENTLY, TAX HAS TO BE DEDUCTED UNDER SECTION 192 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) INSTE AD OF SECTION 194J OF THE ACT, WHICH THE ASSESSEE HAS DED UCTED. ON PERUSAL OF THE ORDER OF THE ASSESSING OFFICER MA DE UNDER SECTION 201 OF THE ACT, WE FIND THAT THE ASSE SSING OFFICER HAS RAISED AT PAGE 5, PARA 6 OF HIS ORDER S EVEN OBJECTIONS BASED ON WHICH HE HAS HELD THAT THESE DO CTORS ARE BEING MADE PAYMENT OF SALARY. THE FIRST OBJECT ION RAISED BY THE ASSESSING OFFICER IS WITH REGARD TO T HE CLAUSE OF AGREEMENT THAT THE RETAINER DOCTORS SHALL BE ASSOCIATED EXCLUSIVELY WITH THE ASSESSEE AS FULL TI ME CONSULTANT AND SHALL NOT ASSOCIATE HIMSELF WITH ANY OTHER HOSPITAL. THE POINT NO.(V) IS ALSO RELATED TO THIS POINT NO.(I) ONLY, WHEREBY IT HAS BEEN OBJECTED BY THE ASSESSING OFFICER THAT THE RETAINERS ARE BARRED FROM ENGAGEMENT WITH ANY OTHER ORGANIZATION ENGAGED IN A SIMILAR BUSINESS. ON PER USAL OF THE AGREEMENT WITH THESE RETAINER DOCTORS FILED BEFORE US IN THE PAPER BOOK, WE SEE THAT THERE IS A CLAUSE AT PO INT NO.8 IN THIS AGREEMENT WHICH READS AS UNDER : 8 8. YOU SHALL NOT ACT IN A SIMILAR, OR ANY CAPACITY, FOR ANY OTHER COMPANY ENGAGED IN A BUSINESS SIMILAR TO THAT OF THE COMPANY. 9. THE EXPLANATION OF THE ASSESSEE IN THIS REGARD HAS ALL ALONG BEEN THAT THERE IS NO BAR ON RETAINER CONSULTANTS UNDERTAKING ANY PROFESSIONAL ASSIGNMENT OR TO HAVE INDEPENDENT PRACTICE AND THE ONLY BAR IS TO JOIN ANY OTHER SIMILAR COMPANY. EVEN THE LEARNED CIT (APPEALS) HAS CONSIDERED THIS ARGUMENT OF THE ASSES SEE IN A VERY POSITIVE PERSPECTIVE IN THE SENSE THAT THESE DOCTORS ARE NOT BARRED FROM HAVING THEIR OWN PRACTICE AND B ARRING THEM TO JOIN ANY OTHER SIMILAR ORGANIZATION IS JUST TO AVOID SHIFTING OF PATIENTS TO OTHER PLACES, ALSO THIS BAR ITSELF DOES NOT CREATE EMPLOYER AND EMPLOYEE RELATIONSHIP BETWEEN THE ASSESSEE AND THE RETAINER DOCTORS. 10. AT POINT NO.(II), THE ASSESSING OFFICER STATED THAT THE RETAINER DOCTORS ARE BOUND TO WORK FROM TIME TO TIME IN ACCORDANCE WITH THE REQUIREMENTS OF THE HOSPITAL AND PATIENTS AND IN THE BEST INTEREST OF THE MANAGEMENT . FROM THE PERUSAL OF THIS CONDITION, WE DO NOT UNDER STAND AS TO HOW THE ASSESSING OFFICER INFERS THAT BY IMPO SING SUCH A CONDITION THE RELATIONSHIP BETWEEN THE DOCTO RS AND THE ASSESSEE BECOMES THAT OF EMPLOYER AND EMPLOYEE. THIS IS A COMMON CLAUSE, PROVIDED IN SUCH AGREEMENT S IN ORDER TO PROTECT THE INTEREST OF THE ASSESSEE HOSPI TAL AND TO PROVIDE SERVICE TO THE PATIENTS AS PER THE WORK CULTURE IN THE HOSPITAL. 9 11. THE POINT RAISED BY THE ASSESSING OFFICER AT NO.(III) IS WITH REGARD TO THE FACT THAT THE RETAIN ERS ARE DUTY BOUND TO PARTICIPATE IN ALL ACADEMIC ACTIVITIE S, SUCH AS CMES, CONFERENCES, SEMINARS, PUBLICATIONS OF ART ICLES UNDERTAKEN BY THE HOSPITAL AND AS ADVISED BY THE HO SPITAL MANAGEMENT FROM TIME TO TIME. FROM THIS CONTENTION ALSO, IT CANNOT BE INFERRED THAT THE RELATIONSHIP I S THAT OF THE EMPLOYER AND EMPLOYEE. 12. AT POINT NO.(IV), THE ASSESSING OFFICER REFERR ED TO THE SUBMISSION OF THE ASSESSEE THAT THE RETAINERS A RE ENGAGED ONLY FOR SHORT DURATION, WHEREAS IT IS SEEN THAT THE RETAINERSHIP IS OFFERED FOR A PERIOD RANGING FR OM 4 YEARS TO 2 YEARS. IN THIS REGARD, WE SEE THAT THE RETAINERSHIP AGREEMENTS ARE RENEWABLE AGREEMENTS AN D CAN BE RENEWED ON AGREEMENT BY BOTH THE PARTIES. T HERE IS NOTHING WRONG IN THIS KIND OF ARRANGEMENT SINCE IF THE ASSESSEE HOSPITAL FINDS THE SERVICES OF THE DOCTORS TO BE APPROPRIATE, THE AGREEMENT CAN BE RENEWED. JUST BE CAUSE THE ASSOCIATION BETWEEN THE ASSESSEE AND THE DOCTOR S IS A LONG TERM ASSOCIATION, IT CANNOT BE SAID THAT THE RELATIONSHIP BETWEEN THE ASSESSEE AND THE DOCTORS I S THAT OF EMPLOYER AND EMPLOYEES. 13. THE POINT NO.(VI) RAISED BY THE ASSESSING OFFI CER IS WITH REGARD TO THE CONDITION THAT THE RETAINERS MAY DEVELOP OR CREATE EITHER INDIVIDUALLY OR JOINTLY WI TH COMPANY ANY ORIGINAL CONCEPTS, IDEAS, PLANS, DESIGN S, PRESENTATIONS, DATA BASE, FLOPPIES, PRODUCTS ETC. B UT AS 10 PER THE CLAUSES OF THE AGREEMENT THESE CREATIONS SH ALL BE TREATED AS SOLE AND EXCLUSIVE PROPERTY OF THE COMPA NY AND THE RETAINERS SHALL NOT CLAIM TO HAVE ANY LEGAL TIT LE OR INTEREST IN ANY SUCH CREATIONS AT ANY POINT OF TIME . EVEN ON PERUSAL OF THIS CLAUSE WE DO NOT SEE HOW THE ASS ESSING OFFICER CAN INFER THAT THE PAYMENTS MADE BY THE ASS ESSEE TO THESE DOCTORS ARE IN THE NATURE OF SALARY. ONCE THE PERSON IS HIRED FOR SOME SPECIFIC PURPOSE IN ORDER TO PROVIDE QUALITY SERVICES TO THE PATIENTS AND TO PRO TECT THE INTEREST OF THE ASSESSEE HOSPITAL, THIS KIND OF CON DITION IMPOSED IS VERY COMMON. 14. WE SEE THAT SOME OF THE OBJECTIONS TAKEN BY TH E ASSESSING OFFICER ARE ON BASIC AND GENERAL CONDITIO NS LAID DOWN IN THE RETAINERSHIP AGREEMENT WHICH DO NOT IN ANY WAY INFER THAT THE PAYMENT IS SALARY IN NATURE. TH E LEARNED CIT (APPEALS) HAS VERY APPROPRIATELY DEALT WITH THESE OBJECTIONS OF THE ASSESSING OFFICER IN HIS OR DER AND GIVEN A FINDING THAT BY THESE TYPES OF CONDITIONS, IT DOES NOT MAKE THE RETAINER DOCTORS EMPLOYEES OF THE ASSE SSEE. 15. WE ARE ALSO IN AGREEMENT WITH THE FINDINGS GIV EN BY THE LEARNED CIT (APPEALS) THAT SINCE ALL THESE R ECIPIENT DOCTORS RECEIPTS HAVE BEEN TAXED AS PROFESSIONAL R ECEIPTS IN THE HANDS OF DOCTORS AND NOT AS INCOME FROM SALA RY, IN A WAY, THE DEPARTMENT HAS ACCEPTED THE POSITION THA T THESE DOCTORS ARE NOT EMPLOYEES OF THE HOSPITAL. 11 16. THE ASSESSING OFFICER WHILE FRAMING THE ORDER HAS ALSO DISTINGUISHED THE CASES RELIED ON BY THE A SSESSEE. EVEN IN THE GROUNDS OF APPEAL RAISED BY THE REVENUE BEFORE US, IT HAS BEEN VERY SPECIFICALLY STATED THA T THE CASES RELIED ON BY THE ASSESSEE ARE DISTINGUISHABLE ON FACTS. WE NOW ADVERT TO ANALYZE WHETHER THE FACTS OF THESE CASES ARE APPLICABLE TO THE ASSESSEE OR NOT. THE FIRST CASE IS THAT OF YASHODA SUPER SPECIALITY HOSP ITAL (SUPRA). THIS CASE IS RELIED ON BY THE ASSESSEE AS IN THIS CASE, THE DOCTORS WERE REQUIRED TO WORK ONLY FOR TH E ASSESSEE AND CANNOT DO ANY PRACTICE ELSEWHERE. IT HAS BEEN HELD BY THE HYDERABAD BENCH OF THE TRIBUNAL TH AT THERE IS NO PROHIBITION IN LAW TO ENGAGE SERVICES O F A PROFESSIONAL EXCLUSIVELY FOR A PARTICULAR HOSPITAL AND THUS BY NOT ALLOWING THE DOCTORS TO WORK ELSEWHERE, IT D OES NOT INFER THAT THE RELATIONSHIP IS THAT OF THE MASTER A ND SERVANT. IN THE PRESENT CASE ALSO, THE RETAINER D OCTORS ARE NOT ALLOWED TO JOIN ANY SIMILAR COMPANY, WHICH FACT DOES NOT MAKE THE PAYMENT MADE TO THEM AS SALARY IN NATURE. 17. THE SECOND CASE RELIED ON BY THE ASSESSEE IS THAT OF APOLLO HOSPITALS INTERNATIONAL LTD. (SUPRA) FOR THE PROPOSITION THAT THE CONSULTANT DOCTORS ENGAGED BY THE ASSESSEE HOSPITAL WERE RECEIVING FIXED SALARY AND GUARANTEE MONEY AND ARE NOT ENTITLED TO ANY ALLOWAN CE OR BENEFIT. IN SUCH A CIRCUMSTANCE, PAYMENTS WERE HEL D TO BE SUBJECT TO DEDUCTION UNDER SECTION 194J AND NOT UNDER 12 SECTION 192 OF THE ACT. IN THE PRESENT CASE ALSO, THE RETAINER DOCTORS ARE NOT PROVIDED WITH ANY ALLOWANC E OR BENEFIT IN THE FORM OF RETIREMENT BENEFIT, GRATUITY , PF OR ANY OTHER ALLOWANCES ETC. THEREFORE, THE FACTS OF THESE CASES ARE ALSO APPLICABLE TO THE PRESENT CASE. 18. A VERY HEAVY RELIANCE WAS PLACED ON THE ORDER OF THE CHANDIGARH BENCH OF THE TRIBUNAL IN THE CASE OF IVY HEALTH LIFE SCIENCES (SUPRA). THE ASSESSING OFFICE R HIMSELF HAD STATED IN HIS ORDER THAT THIS CASE WAS UNDER THE SAME ASSESSING OFFICER AS THAT OF THE CURRENT ASSESSEE. HOWEVER, SINCE THE DECISION OF THE I.T.A .T., CHANDIGARH BENCH IS NOT ACCEPTABLE TO THE REVENUE A ND AN APPEAL HAS BEEN FILED BEFORE THE HON'BLE PUNJAB & HARYANA HIGH COURT, HE DID NOT APPLY THE FACTS OF T HE SAID CASE TO THE PRESENT CASE. WE ALSO OBSERVE THAT THE SAID CASE HAS NOT BEEN DISCUSSED ON FACTS BY THE ASSESSI NG OFFICER IN HIS ORDER. THE LEARNED CIT (APPEALS) IS CORRECT IN HOLDING THAT THE ASSESSING OFFICER OUGHT TO HAVE CONSIDERED THE ISSUE ON MERITS RATHER THAN SUMMARIL Y REJECTING THE RELIANCE PLACED BY THE ASSESSEE. DUR ING THE COURSE OF HEARING BEFORE US, IT WAS STATED THAT THI S ORDER OF THE I.T.A.T., CHANDIGARH BENCH WAS LATER ON AFFI RMED BY THE HON'BLE PUNJAB & HARYANA HIGH COURT IN ITA NO.1 42 OF 2013 (O&M) (SUPRA). WE HAVE PERUSED THE ORDER OF T HE I.T.A.T., CHANDIGARH BENCH AS WELL AS THAT OF THE H ON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF IVY HEAL TH LIFE SCIENCES (SUPRA) AND WE SEE THAT THE FACTS OF PRESENT 13 CASE ARE SIMILAR TO THAT IN THE CASE OF IVY HEALTH LIFE SCIENCES (SUPRA) AND THE ORDER BEING THAT OF JURISD ICTION HIGH COURT, IT IS BINDING ON ALL THE LOWER AUTHORIT IES. 19. APART FROM THESE FINDINGS GIVEN IN THE ORDER O F THE ASSESSING OFFICER, WE HAVE ALSO GONE INDEPENDEN TLY TO THE TERMS AND CONDITIONS IN THE SAMPLE OF AGREEMENT S WITH THE DOCTORS ENGAGED BY THE ASSESSEE, FILED BY IT IN THE PAPER BOOK. DIFFERENT TYPES OF AGREEMENTS ARE MAD E BOTH FOR DOCTORS ENGAGED ON RETAINERSHIP AND THOSE WHO A RE REGULAR EMPLOYEES. AFTER PERUSING BOTH TYPES OF AGREEMENTS, WE SEE THAT THERE ARE A NUMBER OF DIFFE RENCES BETWEEN VARIOUS CLAUSES IN BOTH TYPES OF AGREEMENT. TO THE EMPLOYED DOCTORS, THERE ARE CONDITIONS AS WITH REGARD TO SALARY REVISION OF SALARY IN THE FORM OF INCREME NT AND ALSO THERE IS A CONDITION AS TO THE RETIREMENT AGE BEING 58 YEARS. HOWEVER, IN CASE OF RETAINER DOCTORS, THERE IS NO CLAUSE AS TO THE INCREMENT OR RETIREMENT. PROBATIO N PERIOD OF SIX MONTHS HAS ALSO BEEN LAID DOWN FOR SA LARIED DOCTORS, WHILE THERE IS NO SUCH CONDITION IN CASE O F RETAINER DOCTORS. NO RETIREMENT BENEFITS IN THE FO RM OF GRATUITY, PF, ETC. WERE GIVEN TO THE RETAINER DOCTO RS, WHILE SAID CLAUSES ARE THERE IN THE AGREEMENT WITH THE SA LARIED DOCTORS. ANOTHER INTERESTING CLAUSE WITH REGARD TO POSTING AND TRANSFER ALSO APPEARS IN THE CASE OF SALARIED D OCTORS, WHEREBY THE ASSESSEE COMPANY MAY DETERMINE TO TRANS FER THE DOCTORS AT THE SOLE DISCRETION OF THE MANAGEMEN T TO ANY DEPARTMENT, SECTION, LOCATION, ASSOCIATE, SISTE R 14 CONCERN OR SUBSIDIARY AT ANY PLACE IN INDIA OR ABRO AD, WHETHER EXISTING TODAY OR WHICH MAY COME UP IN FUTU RE. WHILE IN THE CASE OF RETAINER DOCTORS, IT HAS BEEN VERY SPECIFICALLY MENTIONED AS TO IN WHICH DEPARTMENT TH E SERVICES OF THESE DOCTORS ARE REQUIRED. FROM THE A NALYSIS OF THESE FACTS, IT IS QUITE CLEAR THAT THERE IS A L OT OF DIFFERENCE BETWEEN CLAUSES OF AGREEMENT WITH THE RE TAINER DOCTORS AND THAT OF THE SALARIED DOCTORS. 20. TO DECIDE THE ISSUE WHETHER TDS HAS TO BE DEDUCTED AS PER SECTION 192 OR 194J OF THE ACT, THE BASIC REQUIREMENT IS TO INTERPRET THE RELATIONSHIP BETWEE N THE ASSESSEE AND THE DOCTORS. FURTHER, A DISTINCTION I S ALSO TO BE DRAWN BETWEEN THE CONTRACT FOR SERVICE AND CO NTRACT OF SERVICE. THIS ISSUE HAS BEEN VERY APTLY DEALT WITH BY THE LEARNED CIT (APPEALS) IN HIS ORDER AT PARA 5.1. THE CONTRACT FOR SERVICE IMPLIES A CONTRACT, WHEREBY ONE PARTY UNDERTAKES TO RENDER THE SERVICE, FOR EXAMPLE PROFESSIONAL OR TECHNICAL SERVICES, TO OR FOR ANOTH ER IN THE PERFORMANCE OF WHICH HE IS NOT SUBJECT TO DETAILED DIRECTIONS AND CONTROL BUT EXERCISES PROFESSIONAL O R TECHNICAL SKILL AND USES HIS OWN KNOWLEDGE AND DISC RETION. A CONTRACT OF SERVICE IMPLIES RELATIONSHIP OF MAS TER AND SERVANT AND INVOLVES AN OBLIGATION TO OBEY ORDERS I N THE WORK TO BE PERFORMED AND ALSO AS TO ITS MODE AND MA NNER OF PERFORMANCE. AS WE HAVE ALSO STATED THAT FROM THE PERUSAL OF THE AGREEMENTS WITH THE DOCTORS, WE DO N OT SEE ANY RELATIONSHIP THAT OF MASTER AND SERVANT BETWEEN THE 15 ASSESSEE AND THE DOCTORS ON RETAINERSHIP BASIS. IT IS ALSO SEEN FROM THESE AGREEMENTS THAT THE DOCTORS WHO ARE ON THE PAY ROLL OF THE ASSESSEE ARE DEBARRED FROM TAKI NG UP ANY OTHER WORK FOR REMUNERATION PART TIME OR OTHERW ISE OR WORK IN ADVISORY CAPACITY OR ON INTEREST DIRECTLY O R INDIRECTLY IN ANY OTHER TRADE OR BUSINESS DURING TH E EMPLOYMENT WITH THE ASSESSEE WITHOUT PERMISSION OF THE ASSESSEE, WHILE THE DOCTORS ON RETAINERSHIP BASIS A RE ONLY DEBARRED FROM NOT GETTING IN SIMILAR OR ANY CAPACIT Y FOR ANY OTHER COMPANY ENGAGED IN A BUSINESS SIMILAR TO THAT OF THE ASSESSEE. THE DIFFERENCE BETWEEN THIS CLAU SE IN TWO TYPES OF AGREEMENTS ITSELF GOES TO PROVE THAT D OCTORS WHO ARE ENGAGED ON RETAINERSHIP BASIS ARE NOT THE SERVANTS OF THE ASSESSEE SINCE THEY ARE ALLOWED TO DO WHATEVER THEY WANT EXCEPT JOINING THE SIMILAR BUSIN ESS WHILE OTHER DOCTORS WHO ARE ON THE PAY ROLL OF THE ASSESSEE ARE DEBARRED FROM DOING ANY OTHER ACTIVITY APART FR OM THAT OF THE ASSESSEE. 21. FROM THE PERUSAL OF ALL THE MATERIAL PLACED BEFORE US AS WELL AS THE JUDICIAL PRONOUNCEMENTS CI TED, WE SEE THAT NO RELATIONSHIP OF MASTER AND SERVANT EXIS TS BETWEEN THE ASSESSEE AND THE RETAINER DOCTORS. 22. THE LEARNED D.R. RELIED ON THE JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF PADMASUNDARA RAO (DECD.) & ORS. (SUPRA). THE PROPOSITION OF THE SAI D JUDGMENT IS THAT WHILE INTERPRETING THE STATUTES LEGISLATIVE INTENTION MUST BE FOUND IN THE WORDS US ED BY 16 THE LEGISLATURE ITSELF AND THE LEGISLATIVE CASUS OM ISSUS CANNOT BE SUPPLIED BY JUDICIAL INTERPRETATIVE PROCE SS. WE DO NOT SEE ANY SUCH ACT BEING DONE BY THE LEARNED C IT (APPEALS) WHILE GRANTING RELIEF TO THE ASSESSEE. T HE INTENTION OF THE LEGISLATURE TO FRAME DIFFERENT PRO VISIONS IN THE FORM OF SECTIONS 192 AND 194J OF THE ACT IS THAT THE PERSONS TO RECEIVE SALARY ARE LIABLE TO BE DEDUCTED TAX AT SOURCE UNDER SECTION 192 OF THE ACT WHILE THOSE TO RECEIVE PAYMENT FOR PROFESSIONAL SERVICES, THE TDS HAS TO B E DEDUCTION UNDER SECTION 194J OF THE ACT. THE LEARN ED CIT (APPEALS) WHILE DISCUSSING IN DETAIL THE AGREEMENTS BETWEEN DIFFERENT TYPES OF DOCTORS ENGAGED BY THE A SSESSEE AND PLACING RELIANCE ON THE OTHER MATERIAL ON RECOR D ONLY HAS GIVEN HIS FINDING. IN VIEW OF THE ABOVE, WE U PHOLD THE ORDER OF THE LEARNED CIT (APPEALS) AND DISMISS THE APPEAL OF THE DEPARTMENT. 23. IN THE RESULT, ALL THE APPEALS FILED BY THE DEPARTMENT ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14 TH DAY OF JANUARY, 2016. SD/- SD/- (BHAVNESH SAINI) (RANO JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 14 TH JANUARY, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 17