Shri Sanjay Kumar Singh , Nagpur V. Income Tax Officer Ward 8(1), Nagpur

ITA 96/NAG/2020

AI Insights

The case involves an appeal by Shri Sanjay Kumar Singh against the order of the CIT(A)-2, Nagpur, which upheld the disallowance of Rs.9,22,133 made by the ITO under section 40(a)(ia) of the Income Tax Act, 1961. The disallowance was based on the grounds that the assessee failed to deduct TDS on truck hire charges payments. The Revenue argued that TDS was applicable as per section 194C, citing a precedent from the Supreme Court in Shree Choudhary Transport Company vs. ITO. However, the Tribunal found no evidence of any contractual relationship between the assessee and the payees that would necessitate TDS deduction under the cited section.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 136799 (ITAT-NAGPUR)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 01-11-2022
• Assessment Year: 2006-2007
• Appeal Filed On: 20-02-2022
• Other Referred Cases: Shree Choudhary Transport Company vs. ITO [2020] 118 taxmann.com 47 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: TDS
• Section: 143(3); 40(a)(ia); 194C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL NAGPUR BENCH, NAGPUR – VIRTUAL COURT BEFORE SHRI S. S. GODARA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.96/NAG/2020 िनधाᭅरण वषᭅ / Assessment Year : 2006-07 Shri Sanjay Kumar Singh, Hanshu Patel Building, Amravati Road, Wadi, Nagpur- 440023. PAN : AXBPS9499K Vs. ITO, Ward- 8(1), Nagpur. Appellant Respondent आदेश / ORDER PER S. S. GODARA, JM: This assessee’s appeal for assessment year 2006-07 arises against the CIT(A)-2, Nagpur’s order dated 21.08.2019 passed in case no. CIT(A)-2/141/2013-14, involving proceedings u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961; in short “the Act”. Case called twice. None appears at assessee’s behest. The very factual position existed on all previous hearing as well. He is accordingly proceeded ex-parte. Assessee by : None Revenue by : Shri G. J. Ninawe Date of hearing : 02.11.2022 Date of pronouncement : 27.12.2022 ITA No.96/NAG/2020 2 2. It emerges with the able assistance coming from the Revenue’s side that the assessee herein is aggrieved against both the learned lower authorities’ action invoking section 40(a)(ia) disallowance of Rs.9,22,133/- on account of his failure to deduct TDS on the alleged truck hire charges payments. 3. Mr. Ninawe vehemently contended that the assessee ought to have deducted TDS on the ground that hire charges paid to various brokers without deducting TDS. He further quotes section 194C Explanation (iii) that an oral contract with the payees also attracts TDS deduction in light of Shree Choudhary Transport Company vs. ITO [2020] 118 taxmann.com 47 (SC). 4. I have given my thoughtful consideration to the foregoing rival stands and find no merit in the Revenue’s arguments. This is for this precise reason that there is no material indicated either in the assessment order dated 21.03.2013 or in the CIT(A)’s order that the assessee’s payees herein had undertaken any contractual liability or that there existed any oral or written agreement between them which could form a contract inviting TDS deduction for the payments in issue u/s 194C of the Act. Faced with this situation, I delete the impugned section 40(a)(ia) disallowance of Rs.9,22,133/- in issue. ITA No.96/NAG/2020 3 The assessee succeeds in his sole substantive grievance. Ordered accordingly. 5. This assessee’s appeal is allowed in above terms. Order pronounced on this 27 th day of December, 2022. Sd/- (S. S. GODARA) JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 27 th December, 2022. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A)-2, Nagpur. 4. The Pr. CIT-1/2/3, Nagpur. 5. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, नागपुर / DR, ITAT, Nagpur. 6. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.