H- ONE INDIA PVT. LTD.,UTTAR PRADESH vs. ACIT (TDS), NOIDA

The Grounds of appeal are as under:-

For that the CIT (A) also did not take into account the order of the jurisdictional High court in the case of ACIT (TDS), NOIDA vs. Lotus Valley Education Society. [2014] 45 Taxmann.com 37 (All.), despite that the same was duly brought to his notice during the course of hearing of the appeals.

For that the CIT (A) also did not take in to a/c the clarification given by CBDT vide its circular no. 720 dt. 30-08-1995. This clarification asserts that: “It is hereby clarified that each section, regardin'! TDS under Chapter XVII. deals with a particular kind of payment to the exclusion of all other sections in this Chapter. Thus, payment of any sum shall be liable for deduction of tax only under one section. ”

For that the Assessing Officer’s assertion that “As the section 194I has been substituted by the Finance Act, 2007 after the date of insertion Le. 1.7.1995 of work in Explanation - III, hence the provision of section 194-I read with section 43(3) of the Income Tax Act becomes operative in respect of Rent (hiring of vehicle) instead of provisions of section 194C” is not relevant because the definition of work u/s 194C has not been changed. It is obvious that the Parliament never intended to disturb the import and scope of “work” as defined in section 194C.

For that the CIT (A) has completely overlooked the fact that w. e. f. 1.10. 2009, the applicable TPS rate u/s!94-I was reduced to 2%. instead of 10%. despite that the same was duly brought to his notice during the course of hearing of the appeals.

For that the CIT(A) also did not take in to a/c the universal rule of interpretation of Tax laws that where 02 separate provisions could be applied in a particular case, the more specific one must be applied; and also that where 02 separate provisions could be applied in a particular case, the one more beneficial to the assessee must be applied. This resulted in the huge demand in the present case.

The Assessee craves leave to put, alter and/or amend the ground(s) at the time of hearing.

The assessee made payment to the transporters and did not deduct tax as was considered necessary by the Assessing Officer u/s. 194C of Income Tax Act, 1961. The assessee claimed that the vehicle hiring charges was covered under the provisions of section 194C and not u/s. 194-I of Income Tax Act, 1961. The Assessing Officer rejected this claim and held that the provisions of section 194-I of the Act, 1961 are applicable in the instant case and passed assessment order u/s 201(1)/201(1A) of the Act raising demand of Rs.10,54,097/- for A.Y. 2014-15.

The Ld. AR submitted that the order of the CIT(A) is consolidated order for A.Y. 2012-13 & 2013-14 as well as 2014-15. The Tribunal in A.Y. 2012-13 & 2013-14 remanded back this issue to the file of the CIT(A). The Ld. AR submitted that the issue is covered in favour of the assessee by the Hon’ble Allahabad High Court decision in case of ACIT(TDS), Noida vs. Lotus Valley Education Society 223 taxman 82. Therefore, the Ld. AR submitted that since for A.Y. 2012-13 & 2013-14 the assessee did not appear the matter may be decided on merit for A.Y. 2014-15 and we allowed in assessee’s favour as per the decision of the Hon’ble Allahabad High Court.

The Ld. DR submitted that the Assessing Officer has rightly rejected the claim of the assessee that the vehicle hiring charges was covered under the provisions of section 194C and not u/s. 194-I of Income Tax Act, 1961. The CIT(A) has also taken into account the statutory provision as well as the CBDT Circular No.715 dated 08.08.1995 and Circular No.720 dated 30.08.1995. The Ld. DR relied upon the order u/s 201(1)/201(1A) of the Act as well as order of the CIT(A).