TULIP INFRATECH PRIVATE LIMITED,GURGAON V. DCIT CIRCLE 76(1), DELHI

ITA 4401/DEL/2025

AI Insights

The case involves Tulip Infratech Private Limited, which appealed against the orders of the Addl./JCIT (Appeals)-1, Noida, concerning the assessment years 2014-15 and 2016-17. The primary issue was the failure to deduct TDS on payments made to HUDA for EDC. The assessee argued that no TDS was applicable as the payments were made to a state government authority without a direct contract. However, the Assessing Officer (AO) and the appellate authority held that TDS was applicable, referencing the case of Puri Constructions (Pvt. Limited) as a binding decision. The ITAT, acknowledging the precedent, dismissed the appeals, affirming the lower authorities' decisions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 792042 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 16-07-2025
• Other Referred Cases: Puri Constructions (Pvt. Limited) vs. DCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR DHANESTA
• Assessee Lawyers: VED JAIN; UMA UPADHYAY
• Keywords: TDS
• Section: 201(1); 194C

Judgement Text

"ITA Nos.4401 & 4405/Del/2025 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”NEW DELHI BEFORE SHRIMAHAVIR SINGH, HON’BLE VICE PRESIDENT AND SHRISANJAY AWASTHI, ACCOUNTANT MEMBER आ.अ.सं/.I.T.A Nos.4401 & 4405/Del/2025 िनधा रणवष /Assessment Years: 2014-15 & 2016-17 TULIP INFRATECH PRIVATE LIMITED, 1201-1204 Indra Prakash Building, Barakhamba Road, New Delhi. PAN No.AACCT3755E बनाम Vs. DCIT, Circle 76(1), Aaykar Bhawan, Laxmi Nagar, New Delhi. अपीलाथ\u0014 Appellant \u0016\u0017यथ\u0014/Respondent Assessee by Shri Ved Jain, Advocate & Ms. Uma Upadhyay, CA Revenue by Shri Rajesh Kumar Dhanesta, Sr. DR सुनवाईक\bतारीख/ Date of hearing: 09.12.2025 उ\u000eोषणाक\bतारीख/Pronouncement on 09.12.2025 आदेश /O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. This is a batch of two appeals arising from Ld. Addl./JCIT (Appeals)-1, Noida orders dated 23/05/2025, passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).In both these cases the single point of contention is that the assessee filed its TDS returns on which the Ld. AO held that the assessee had failed to deduct TDS on the payment of External Developmental Charges (hereinafter referred to as “EDC”) paid to Haryana Urban Development Authority (hereinafter referred to as “HUDA”). The Printed from counselvise.com ITA Nos.4401 & 4405/Del/2025 2 assessee had submitted before the Ld. AO that such EDC charges were being paid to HUDA, being a Development Authority of a State Government and hence there could be no TDS liability since there was effectively no contract between HUDA and the developer. However, the Ld. AO held that there was a liability to deduct tax at source and thereafter he passed an assessment order u/s 201(1) r.w.s. 201(1A) of the Act. 1.1 The aggrieved assessee approached the Addl./JCIT (Appeals), where also he could not succeed on the basis of the case of Puri Constructions (Pvt. Limited) reported in 159 taxmann.com 444 (Del.). 1.2Further aggrieved, the assessee has approached the ITAT, challenging this action of Ld. AO through various grounds of appeal. 2. Before us the ld. AR fairly mentioned that the case of Puri Constructions (supra) was against the assessee and since it was a binding decision of the Hon’ble Jurisdictional High Court. Hence, the ITAT was requested to take an appropriate decision in the matter. 2.1 The Ld. DR relied on the orders of the authorities below. Printed from counselvise.com ITA Nos.4401 & 4405/Del/2025 3 3. We have carefully considered the submissions of Ld. AR/DR and have gone through the records before us. We have also carefully perused the case of Puri Constructions (supra) and we find that this matter has to be decided against the assessee on the basis of the binding decision of the Hon’ble Delhi High Court. For the sake of reference the head notes from this case are extracted as under: “Section 194C, read with sections 196 and 271C of the Income- tax Act, 1961 - Deduction of tax at source - Contactors/subcontractors, payments to (Scope of provision) - Assessee was granted license to carry out a development project under Haryana Development and Regulation of Urban Areas Act, 1975 - Assessee paid External Development Charges (EDC) to Haryana Shahari Vikas Pradhikaran (HSVP) on directions of Department of Town and Country Planning (DTCP) - Assessing Officer opined that EDC would fall within ambit of section 194C - He, thus, held that assessee was in default for non-deduction of TDS and penalty was to be levied under section 271C - Assessees contended that payments made to HSVP were pursuant to directives of DTCP and in aid of external development work being carried out, those payments should be viewed as sums which were payable to Government of Haryana - It was noted from communication of DTCP that an arrangement was in existence as per which DTCP was used to collect EDC and sent to HSVP - Communication further asserted that HSVP was executing agency working for and on behalf of state government for carrying out external development works for which funds were provided to HSVP through DTCP - Whether since assessees effected a payment in favour of HSVP in connection with external development work which was to be executed by it pursuant to arrangement that existed between said entity and State Government, provisions of section 194C would stand attracted - Held, yes - Whether mere fact that HSVP was constituted under a statutory enactment and was discharging functions akin to or similar to governmental obligations or performing activities closely connected with State functions, same would not result in recognizing HSVP as Government - Held, yes - Whether thus, EDC payments would be covered under section 194C - Held, yes [Paras 63, 69 and 88] [In favour of revenue]” Printed from counselvise.com ITA Nos.4401 & 4405/Del/2025 4 4. Considering the discussion above, both the appeals of the assessee are hereby dismissed. Order pronounced in the open court on 09.12.2025 Sd/- Sd/- (MAHAVIR SINGH) (SANJAY AWASTHI) VICE PRESIDENT ACCOUNTANT MEMBER Dated: 11.12.2025 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "