The ITO,TDS Ward-1,, Baroda v. Gujarat Flurochemicals Ltd.,, Baroda

ITA 1984/AHD/2012 | 2009-2010
Pronouncement Date: 31-10-2013 | Result: Dismissed

Appeal Details

RSA Number 198420514 RSA 2012
Assessee PAN AAACG6725H
Bench Ahmedabad
Appeal Number ITA 1984/AHD/2012
Duration Of Justice 1 year(s) 1 month(s) 25 day(s)
Appellant The ITO,TDS Ward-1,, Baroda
Respondent Gujarat Flurochemicals Ltd.,, Baroda
Appeal Type Income Tax Appeal
Pronouncement Date 31-10-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 31-10-2013
Date Of Final Hearing 22-10-2013
Next Hearing Date 22-10-2013
Assessment Year 2009-2010
Appeal Filed On 05-09-2012
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT JUDICIAL MEMBER AND SHRI T.R. MEENA ACCOUNTANT MEMBER ITA NOS.1956 1957 1958/AHD/2012 A.YS. 2008-09 2009-10 2010-11 GUJARAT FLUOROCHEMICALS LIMITED BARODA. PAN: AAACG 6725H VS ACIT (TDS) CIRCLE BARODA. (APPELLANT) (RESPONDENT) ITA NOS.1983 1984 1985/AHD/2012 A.YS. 2008-09 2009-10 2010-11 INCOME TAX OFFICER (TDS) WARD-1 ROOM NO.4 AAYAKAR BHAVAN R.C. CIRCLE BARODA. VS GUJARAT FLUOROCHEMICALS LIMITED BARODA. PAN: AAACG 6725H (APPELLANT) (RESPONDENT) REVENUE BY : SHRI O.P. BATHEJA SR.D.R. ASSESSEE(S) BY : SHRI S.N. SOPARKAR A.R. / DATE OF HEARING : 23/10/2013 / DATE OF PRONOUNCEMENT: 31/10/2013 / O R D E R PER BENCH IN ALL THERE ARE SIX APPEALS BEFORE US THREE BY THE ASSESSEE AND REST ARE FROM THE SIDE OF THE REVENUE PERTAINING TO ASSE SSMENT YEARS 2008- 09 2009-10 2010-11 ARISING FROM A CONSOLIDATED OR DER OF LEARNED CIT(A)-IV BARODA DATED 11.06.2012. FOR ALL THE TH REE YEARS THE ASSESSEE HAS RAISED IDENTICALLY WORDED GROUNDS REP RODUCED FROM THE LEAD ASSESSMENT YEAR 2008-09 AS FOLLOWS:- ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 2 - IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-IV BARODA ER RED IN CONFIRMING THAT TDS IS REQUIRED TO BE DEDUCTED AT SOURCE ON DISCOUNTS AND REBATES GIVEN TO DEALER AND CONSEQUENTIAL INTEREST U/S. 201(1A) OF R S.4 75 584/- HE ERRED 1. IN RESPECT OF NON-DEDUCTION OF TAX AT SOURCE ON THE PAYMENTS ON ACCOUNT OF DISCOUNTS AND REBATES GIVEN TO THE DEALERS. (A) IN HOLDING THAT THE COMPANY WAS LIABLE TO DEDU CT THE TAX AT SOURCE ON THE PAYMENTS ON ACCOUNT OF DISCOUNTS AND REBATES ALSO A S PER PROVISIONS OF SECTION 194H OF THE IT ACT. (B) IN CONFIRMING THAT EVEN THE DISCOUNTS AND REBAT ES PAID BY THE APPELLANT COMPANY TO SUCH CONSIGNMENT STOCKIEST / DEALERS ARE NOTHING BUT COMMISSION OR INCENTIVE ONLY. (C) IN CONFORMING THE CHARGING OF INTEREST OF RS.4 75 584/- (D) IN DIRECTING THE ACIT(TDS) TO WORK OUT NON-DEDU CTION OF TAX AT SOURCE U/S.201(1) OF THE I.T. ACT FOR APPLYING OTHER PROVI SIONS OF SECTION OF THE IT ACT AND ALSO CHARGING INTEREST FOR THE SAID YEAR. 2. WITHOUT PREJUDICE TO ABOVE IN CONFIRMING THE IN TEREST OF RS.4 75 584/- WHEREAS AS PER THE ASSESSEES WORKING INTEREST COME S TO ONLY RS.2 76 823/- (RS. 4 00 903/- FOR A.Y. 2009-10 & RS.2 84 924/- FO R A.Y. 2010-11 3. THE APPELLANT CRAVES LEAVE TO ADD TO WITHDRAW O R MODIFY ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING. 2. AN ORDER U/S. 201(1)/201(1A) WAS PASSED FOR ALL THE THREE YEARS BY AO DATED 29.03.2010. IT WAS NOTED THAT A SURVEY U/S. 133A WAS CONDUCTED ON 17.11.2009. THE ASSESSEE COMPANY IS IN THE BUSINESS OF MANUFACTURING OF REFRIGERANT GASES CHLOROMETHANE PTFE ETC. THE COMPANY HAS A MANUFACTURING UNIT AT RANJIT NAGAR D AHEJ NEAR BHARUCH. THE COMMERCIAL ACTIVITIES ARE CONDUCTED FROM THE RE GISTERED OFFICE SITUATED AT BARODA. DURING THE COURSE OF SURVEY IT WAS NOTICED THAT THE ASSESSEE WAS PAYING COMMISSION TO ITS DEALERS AND AGENTS. IT WAS FURTHER NOTED THAT ON SOME PAYMENT THE TDS WAS DEDU CTED HOWEVER A SUBSTANTIAL AMOUNT WAS ALSO PAID TO THOSE DEALERS A ND AGENTS WITHOUT DEDUCTION OF TDS ON THE PRETEXT OF PAYMENT OF DISC OUNTS AND REBATES. THEREFORE THE ISSUE WAS WHETHER THE PAYMENT OF DISCOUNT A ND ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 3 - REBATE WAS SUBJECT TO DEDUCTION OF TDS. AS FAR AS THE PAYM ENT OF COMMISSION TO DEALERS AND AGENTS WAS CONCERNED THE RE WAS NO DISPUTE BECAUSE THE ASSESSEE HAD ALREADY DEDUCTED THE TDS. IN RESPECT OF REBATES AND DISCOUNTS THE EXPLANATION OF THE ASSESSEE WAS THAT NO AMOUNT HAD BEEN PAID TO THE DEALERS DIRECTLY BY THE ASSESSEE C OMPANY BUT THOSE DEALERS HAVE DEDUCTED THE AMOUNT ON ACCOUNT OF FLUC TUATIONS IN THE MARKET PRICE. THE ASSESSEE HAS FURNISHED THE AGENCY AGREEMENT TO THE AO. THE ASSESSEE HAS ALSO FURNISHED AGREEMENT FOR THE APPOINMENT OF CONSIGNMENT STOCKIST . THE ASSESSEES REPLY WAS AS UNDER: A. THE AMOUNT DOES NOT REPRESENT EXPENDITURE BUT A LOSS AND EFFECTIVELY REPRESENTS REDUCTION IN SALE PRICE. B. THE AMOUNTS ARE CREDITED TO CUSTOMERS AND NOT T HIRD PARTIES. C. THE OWNERSHIP OF GOODS PASSES TO DEALERS AT THE TIME OF TRANSFER OF GOODS. THE DEALER PURCHASES GOODS ON PRINCIPAL TO PRINCIPA L BASIS AND RE-SELLS IT IN THE MARKET. THE RELATIONSHIP WITH THE DEALER IS NOT OF PRINCIPAL AN D AGENT . D. SECTION 194H REQUIRES DEDUCTION OF INCOME-TAX AT SOURCE FROM PAYMENTS OF INCOME IN THE NATURE OF COMMISSION OF BROKERAGE. CO MMISSION OR BROKERAGE IS DEFINED AS PAYMENT RECEIVED BY A PERSON ACTING O N BEHALF OF ANOTHER FOR SERVICES RENDERED. IN THE LIGHT OF THE ABOVE FACTS AND LAW THERE IS N O REQUIREMENT TO DEDUCT TAX AT SOURCE FROM THE AMOUNT OF DISCOUNT IN VIEW OF THE F OLLOWING: E. TAX IS DEDUCTIBLE FROM PAYMENTS OF COMMISSION AN D BROKERAGE. DISCOUNT IS NOT COMMISSION OR BROKERAGE. THE DIFFERENCE BETWEEN DISCOUNT AND COMMISSION IS CLEAR. THERE IS NO REQUIREMENT TO DED UCT TAX AT SOURCE FROM DISCOUNT. AND REBATE AS THEY ARE NOT COMMISSION OR BROKERAGE AS CONTEMPLATED U/S. 194H IN FACT THEY ARE REDUCTION AND DEDUCTION FROM THE SALES PRICE. 3. THE AO WAS NOT CONVINCED. IN HIS OPINION THE RELATIONSHIP AS PER THE AGENCY AGREEMENT WAS THAT OF AGENT. THE ASSESSEE IS THE PRINCIPAL; HENCE THE AMOUNT WAS IN THE NATURE OF C OMMISSION. THE NEXT OBSERVATION OF THE AO WAS THAT THE CONTRACT BETWEEN THE PARTIES WAS NOT IN THE NATURE OF CONTRACT OF SALE. ACCORDING TO A O IT WAS A CONTRACT OF AGENCY. THE AGENTS WERE AUTHORIZED TO SALE ON BEHA LF OF PRINCIPAL I.E. ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 4 - THE ASSESSEE. HE HAS CONCLUDED THAT AS PER THE TERM S OF THE AGREEMENT THE PAYMENT WAS IN THE NATURE OF COMMISSION BUT A DIFFE RENT NAME WAS GIVEN I.E. REBATES AND DISCOUNTS BUT TDS WAS DEDUCTIBLE U/S. 194H OF IT ACT. A DETAILED CHART WAS MADE BY THE AO IN RESPECT OF T HE DISCOUNT AND REBATE GIVEN TO THOSE PARTIES AND THEREAFTER AO HAS ARRIVED AT THE CONCLUSION THAT THERE WAS A SHORT DEDUCTION OVER WH ICH INTEREST U/S. 201(1) AND U/S. 201(1A) WAS IMPOSED RS.71 53 162 F OR THE YEARS UNDER CONSIDERATION. 4. THE EXPLANATION OF THE ASSESSEE BEFORE LEARNED C IT(A) WAS AS UNDER: WE ARE ENGAGED IN THE BUSINESS OF MANUFACTURE AND SALE OF REFRIGERANT GASES & CAUSTIC SODA HYDROGEN CHLOROMETHANE PTFE ETC. AS REGARDS THE DEDUCTION OF TDS ON DISCOUNTS & REBA TES THE ASSESSING OFFICER HAS TREATED THE SAME AS A PART OF COMMISSION TO THE DEALER AND HENCE IN HIS OPINION TDS WAS ALSO REQUIRED TO BE DEDUCTED ON SUC H AMOUNTS OF DISCOUNT & REBATES. THE ISSUE IS INVOLVED IN CASE OF 10 PARTIE S. THE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTU RING OF REFRIGERANT GASES & CAUSTIC SODA HYDROGEN CHLOROMETHANE PTFE ETC. THE COMPANY HAS ENTERED IN TO THE AGENCY AGREEMENTS WITH ALL TH E ABOVE PARTIES. THESE PARTIES ARE DEALERS/DISTRIBUTORS OF OUR PRODUCT CAU STIC SODA HYDROGEN MDC ETC. THE MARKET CONDITIONS OF THESE PRODUCTS ARE AL WAYS FLUCTUATING AND THEREFORE PRICES ARE SUBJECT TO VARIATION ON MONTH TO MONTH BASIS. THEREFORE WHILE ENTERING TO THE AGREEMENT EVEN THOUGH THE COMMISSION AT THE RATE OF RS.250/- PER MT WAS FIXED AS PER ANNEXURE-1 OF THE AGREEMENT REGARDING THE QUANTITY DISCOUNT/INCENTIVE THE CLAUSE NO.6 PR OVIDE AS UNDER: IN ADDITION TO THE PAYMENT AS STATED IN CLAUSE 5 A BOVE THE COMPANY MAY AT ITS SOLE DISCRETION ALLOW ANNUAL QUANTITY DISCOUNTS/INCENTIVES AS PER SLABS OR OTHER CRITERION AS THE COMPANY MAY DEEM FIT FROM TI ME TO TIME. THE COMPANY RESERVES ITS RIGHT TO ADJUST ANY QUANTITY DISCOUNTS /INCENTIVE PAYABLE BY THE COMPANY UNDER THIS AGREEMENT AGAINST ANY OVERDUE IN TEREST OR OTHER SUMS RECOVERABLE BY THE COMPANY FROM RESPECTIVE CUSTOMER S WHERE THE BILLS HAVE BEEN RAISED DIRECTLY TO THE CUSTOMER BY COMPANY. SIMILARLY EVEN THOUGH THE TERMS OF CREDIT PERIOD I S 30 DAYS INCENTIVE IN THE FORM OF CASH DISCOUNT I S ALSO MENTIONED IF THE DEALERS MAKES THE PAYMENT WITHIN 7 DAYS AS PER CLAUSE 7 WHICH READ AS UNDER: ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 5 - 4.1 CERTAIN CASE LAWS HAVE BEEN CITED AS UNDER: 1. FOSTER INDIA (P) LIMITED VS. ITO ITAT PUNE A BENCH 117 TTJ 346. 2. AHMEDABAD STAMP VENDORS ASSOCIATION VS. UNION OF INDIA GUJ. HC 257 ITR 202. 3. CIT VS. JAI DRINKS (P) LIMITED DELHI HC 57 D TR 261 4.2 IN ADDITION TO THE ABOVE SUBMISSIONS IT HAS AL SO BEEN CONTESTED THAT THOSE RECIPIENTS OF REBATES AND DISCOUNTS WERE INDEPENDENTLY ASSESSED TO TAX. THE AMOUNT WHICH WAS RECEIVED BY THE ASSESSEE COMPANY WAS THEREFORE DISCLOSED IN THEIR RESPECTI VE RETURNS; HENCE IT WAS TAXED IN THE HANDS OF THE RECIPIENTS. LEARNED C IT(A) HAS CONSIDERED ALL THOSE ARGUMENTS. HOWEVER HE HAS TAKEN A VIEW I N RESPECT OF THE YEAR 2010-11 AS UNDER: IN VIEW OF THE ABOVE DISCUSSION I HOLD THAT THE APPELLANT COMPANY WAS LIABLE TO DEDUCT THE TAX AT SOURCE ON THE PAYMENTS ON ACCOUNT OF DISCOUNT AND REBATES ALSO AS PER PROVISIONS OF SECTION 194H OF THE I.T. ACT WHICH IT HAS FAILED TO DO. IN VIEW OF THIS THE NON DEDUCTION OF TAX AT SOU RCE OF RS. 43 83 405/- ON PAYMENTS OF DISCOUNT AND REBATES AS WORKED OUT BY THE ACIT ( TDS) CIRCLE BARODA U/S 201(1) & 201(1A) OF THE ACT FOR A.Y 2010-11 AND CHARGING OF INTEREST OF RS. 8 54 802/- U/S 201(1A) ARE HEREBY CONFIRMED. 4.3 IN RESPECT OF ASSESSMENT YEARS 2008-09 AND 2009-10 LEARNED CIT(A) HAS GIVEN THE VERDICT AS FOLLOWS:- AS REGARDS A.Y 2008-09 & 2009-10 ON PERUSAL OF OR DER U/S 201(1) & 201(1A) OF THE I.T. ACT OF THE ACIT(TDS) CIRCLE BA RODA IT IS SEEN THAT HE HAS NOT WORKED OUT NON DEDUCTION OF TAX AT SOURCE ON PA YMENTS ON ACCOUNT OF DISCOUNTS AND REBATES AS PER PROVISIONS OF SECTION 194H OF THE I.T. ACT . THE ACIT(TDS) CIRCLE BARODA HAS ONLY WORKED OUT THE IN TEREST U/S 201(1A) FOR THESE TWO ASSESSMENT YEARS WHICH ARE CHARGEABLE ON SUCH AMOUNTS OF NON DEDUCTION OF TAX AT SOURCE. IN VIEW OF THIS THE ACIT(TDS) CIRCLE BAROD A IS DIRECTED TO WORK OUT NON DEDUCTION OF TAX AT SOURCE U/S 201(1) OF THE I.T. ACT FOR A.Y 2008-09 & FOR A.Y 2009-10 ALSO WHICH IN MY OPINION MAY BE NECESSARY FOR APPLYING OTHER PROVISIONS OF SECTION OF THE I.T. ACT I.E SECTION 271C ETC. IN THIS REGARD IT WOULD BE RELEVANT TO MENTION THAT T HE RATIO OF DECISION OF HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGES PVT. LTD. VS CIT [2007] 293 ITR 226 IS APPLICABLE IN THE CASES WHERE THE DEDUCTEE (I.E RECIPIENT OF THE INCOME) HA S ALREADY PAID TAXES ON AMOUNT RECEIVED FROM THE DEDUCTOR AND IN SUCH CIRCU MSTANCES THE DEPARTMENT ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 6 - ONCE AGAIN CANNOT MAKE THE RECOVERY OF THE TAX FROM THE DEDUCTOR ON THE SAME INCOME. HOWEVER IN CASE IF THE ASSESSEE FAILS TO DEDUCT THE TAX AT SOURCE ON ANY PAYMENTS AS PER CHAPTER XIV OF THE I.T. ACT TH EN THE TDS OFFICER IS REQUIRED TO HOLD SUCH ASSESSEE AN ASSESSEE IN DEFAU LT U/S 201(1) OF THE I.T ACT FOR SUCH NON DEDUCTION OF TAX AT SOURCE ON THE PAYM ENTS. THIS IS A DIFFERENT ISSUE THAT THE RECOVERY OF TAX FROM SUCH DEDUCTOR A SSESSEE CANNOT BE MADE IN VIEW OF ABOVE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGES PVT. LTD. VS. CIT IN CASE IF T HE DEDUCTEE ASSESSEE I.E THE RECIPIENT OF INCOME HAS ALREADY PAID TAXES ON INCOM E RECEIVED FROM THE DEDUCTOR. SINCE I HAVE HELD THAT THE APPELLANT COMP ANY WAS LIABLE TO DEDUCT THE TAX AT SOURCE ON THE PAYMENTS OF DISCOUNTS AND REBATE AS PER PROVISIONS OF SECTION 194C OF THE I.T. ACT AND THEREFORE THE IN TEREST AS WORKED OUT BY THE ACIT(TDS) CIRCLE BARODA U/S 201(1A) FOR A.Y 2008- 09 AND U/S 201(1A) A.Y 2009-10 ARE HEREBY CONFIRMED AS CHARGING OF SUCH IN TEREST ON THE AMOUNT OF NON DEDUCTION OF TAX AT SOURCE IS MANDATORY. AGAIN AS DIRECTED ABOVE THE A.O IS ALSO REQUIRED TO WORK OUT NON DEDUCTION OF TAX A T SOURCE ON PAYMENTS OF DISCOUNT AND REBATES U/S 201(1) AND SUCH NON DEDUCT ION OF TAX AT SOURCE AS WORKED OUT BY THE A.O FOR THESE TWO ASSESSMENT YEAR S WILL NOT BE RECOVERED FROM THE APPELLANT (I.E. DEDUCTEE ASSESSEE) IN CASE IF THE PAYER (I.E. DEDUCTOR ASSESSEE) HAS PAID THE DUE TAXES ON SUCH PAYMENTS ( I.E. INCOME) RECEIVED FROM THE APPELLANT ON ACCOUNT OF REBATES AND DISCOUNTS B Y FILING RETURN OF INCOME U/S 139 AND BY TAKING INTO ACCOUNT THE SUM FOR COMP UTING INCOME IN SUCH RETURN OF INCOME IN VIEW OF ABOVE DECISION OF HON'B LE SUPREME COURT IN THE CASE OF HINDUSTAN COCO COLA BEVERAGES PVT. LTD. VS. CIT. 5. WE HAVE HEARD BOTH THE SIDES AT SOME LENGT H. WE HAVE PERUSED THE AGENCY AGREEMENT AND THE AGREEMENT FOR THE A PPOINTMENT OF CONSIGNMENT STOCKIST. A CLAUSE NO. 6 PRESCRIBES THAT IN ADDITION TO THE COMMISSION THE COMPANY AT ITS DISCRETION ALLOW AN ANNUAL QUANTITY DISCOUNT AS PER SLABS. FURTHER AS PER CLAUSE NO.7 IT HAS ALSO BEEN PROVIDED IN THE SAID AGREEMENT THAT ALTHOUGH A CRED IT PERIOD OF 30 DAYS IS PERMISSIBLE FOR PAYMENT BUT AN INCENTIVE OF CASH-D ISCOUNT SHALL BE ALLOWED IF THE DEALERS MAKE THE PAYMENT WITHIN 7 DA YS. ON THE BASIS OF THE TERMS AND CONDITIONS OF THOSE AGREEMENTS AND AL SO THE NATURE OF BUSINESS ACTIVITY OF THE ASSESSEE WE ARE OF THE CO NSIDERED OPINION THAT THE ASSESSEE WAS NOT REQUIRED TO DEDUCT THE TDS ON THE IMPUGNED DISCOUNTS AND REBATES. WE HAVE TAKEN THIS VIEW IN THE LIGHT OF A DECISION ALREADY TAKEN IN THE CASE OF FOSTERS INDIA PVT. LIMITED 29 SOT 32 ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 7 - (PUNE). FACTS OF THE CASE HAVE REVEALED THAT ON ACCOMPLISH MENT OF THE TARGETS THE CONSIGNMENT STOCKIEST IS PERMISSIBLE TO RETAI N THE SETTLED DISCOUNT. IT IS NOT THE CASE THAT THE ASSESSEE IS PASSING THE DISCO UNTS/REBATES TO THE CONSIGNMENT STOCKIEST. SUCH STOCKIEST IS REQUIRED TO SELL CERTAIN MINIMUM GUARANTEED QUANTITIES OF THE ASSESEES PRODUCT PER MONTH AND THEREFORE PERMITTED TO RETAIN ITS DISCOUNT ON PASSING OVER O F THE PROCEEDS. THE DISCOUNTS AND REBATES DEPEND UPON THE QUANTITY OF P URCHASE AS ALSO THE EARLY PAYMENT. THEREFORE THE REBATES ARE IN THE NATURE OF DEDUCT ION FROM THE SALE PRICE. WE HAVE BEEN INFORMED THAT THE PAYMENTS REQUIRED TO BE MADE WITHIN A SPECIFIC TIME AS PER THE SCHEDULE FIXED. T HEREFORE THERE WAS A REBATE IN RESPECT OF EARLY PAYMENT. WE ARE OF THE VIEW THA T CERTAIN INCENTIVES AS GIVEN BY THE ASSESSEE DID NOT CONSTITUTE A COMMISSION; HENCE OUT OF THE PURVIEW OF THE PROVISIONS OF SECTION 194H OF IT ACT. WE THERE FORE HOLD THAT FOR ALL THE YEARS LEARNED CIT(A) SHOULD HAVE ADOPTED A CONSIST ENT VIEW. THE NECESSARY RELIEF IS HEREBY GRANTED. WITHOUT PREJUDICE TO THE ABOVE FINDINGS ONCE THE UNDISPUTED FACT WAS THAT THE ASSESSEE HAS PLACED ON RECORD THE INFORMATION ABOUT THE PAYMENT OF TAX ON THE REBATES AND DISCOUN TS BY THE RECIPIENTS IN THEIR RESPECTIVE HANDS THEREFORE IN THE LIGHT OF THE JU DGMENTS CITED ABOVE I.E. HINDUSTAN COCA COLA BEVERAGES 293 ITR 226 (SC) THE ASSESSEE WAS NOT SIMULTANEOUSLY REQUIRED TO DEDUCT THE TAX AT SOURCE . 6. GROUND NO.2 IS IN RESPECT OF CALCULATION OF INTE REST. THIS IS AN ALTERNATE CLAIM AND IN THE LIGHT OF THE VIEW TAKEN HEREINABOV E THE INTEREST CALCULATION HAS BECOME REDUNDANT; HENCE THIS GROUND MAY BE TRE ATED AS ALLOWED. IN THE RESULT ASSESSEES APPEAL IS ALLOWED. B. ITA NO.1983 1984 & 1985/AHD/2012 (REVENUES AP PEAL) 7. FOR ALL THE YEARS REVENUE HAS TAKEN IDENTICALLY WORDED GROUNDS REPRODUCED FROM A.Y. 2008-09 AS UNDER: ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 8 - THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACT S OF THE CASE IN DELETING THE ORDER PASSED U/S.201(1) OF THE IT ACT OF RS.4 5 2 525/- FOR A.Y. 2010-11 AND INTEREST CHARGE UNDER SECTION 201(1A) OF THE IT ACT OF RS.2233/- FOR A.Y. 2008-09 RS. 17 159/- FOR 2009-10 & 14 599/- FOR A. Y. 2010-11 BY TREATING THE PAYMENT TO M/S. NANDESARI ENVIRONMENT CONTROL LTD. (NECL) AND M/S. GUJARAT ENVIRONMENT PROTECTION & INFRASTRUCTURE LTD . (GEPIL) FOR LIFTING THE MATERIAL AND SUBSEQUENTLY DISPOSING IT BY TRANSPORT ING THE HAZARDOUS SOLID WASTE IN NATURE OF CONTRACT PAYMENTS U/S.194C AS AG AINST U/S. 194J OF THE IT ACT BY THE AO. 8. THESE GROUNDS OF THE REVENUE PERTAINED TO NON DE DUCTION OF TAX AT SOURCE ON PAYMENTS MADE TO M/S. NANDESARI ENVIRONME NT CONTROL LTD. AND GUJARAT ENVIRO PROTECTION & INFRASTRUCTURE LTD. AS PER SECTION 194J OF IT ACT. AN ARRANGEMENT WAS MADE WITH THOSE PARTI ES TO LIFT THE MATERIAL AND DISPOSE OF THE WASTE. THE ASSESSEE COM PANY WAS MAKING THE PAYMENTS FOR TREATMENT OF AN AFFLUENT UP TO THE PLA NTS. ACCORDING TO AO SUCH SERVICES OF CARRYING ON THE WASTE TO THE AFFLU ENT PLANT WAS A TECHNICAL SERVICE. ACCORDING TO AO PAYMENT MADE FOR THE DISPOSAL OF THE WASTE WAS A PROFESSIONAL SERVICE; THEREFORE THE PROVISION OF SECTION 194J WAS APPLIED. 9. WHEN THE MATTER WAS CARRIED BEFORE LEARNED CIT(A ) IT WAS HELD THAT INSTEAD OF PROVISION OF SECTION 194J ONLY THE PROVISION OF SECTION 194C WOULD BE APPLICABLE. RELEVANT PARAGRAPH OF LEA RNED CIT(A) IS REPRODUCED BELOW: THE REASONS OF THE ACIT(TDS) CIRCLE BARODA FOR AR RIVING AT THE CONCLUSION THAT THE PROVISIONS OF SECTION 194J OF THE I.T. ACT ARE APPLICABLE IN I RESPECT OF PAYMENTS MADE BY THE APPELLANT COMPANY TO THE NANDE SARI ENVIRONMENT CONTROL LTD. AND M/S GUJARAT ENVIRO PROTECTION & INFRASTRUCTURE LTD. AS WELL AS ABOVE ENTIRE SUBMISSION OF THE APPELLANT HAVE BEEN CONSIDERED. I N MY OPINION THE ITO(TDS) CIRCLE BARODA IS NOT CORRECT IN HOLDING THE VIEW T HAT SERVICES RENDERED FOR HANDLING AND DISPOSAL OF HAZARDOUS CHEMICAL WASTE MANAGEMENT ARE SERVICES OF TECHNICAL NATURE. THE SCOPE OF WORK OF NANDESARI ENVIRONMENT CONTROL LTD. AND M/S GUJARAT ENVIRO PROTECTION & INFRASTRUCTURE LTD. WAS FOR COL LECTION TRANSPORTATION AND DISPOSAL OF HAZARDOUS SOLID WASTE FROM GFL DAHEJ S ITE TO GUJARAT ENVIRO PROTECTION & INFRASTRUCTURE LTD. SURAT AS PER GPCB NORMS. AGAIN THE WORK OF NANDESARI ENVIRONMENT CONTROL LTD. WAS FOR OPERATIO N AND MAINTENANCE CHARGES AND WAS ALSO BASED ON THE QUANTITY LIFTED. THE WORK OF THESE TWO COMPANIES WERE OF COLLECTION TRANSPORTATION AND DISPOSABLE OF WASTE AND THESE TWO COMPANIES WERE ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 9 - NOT GIVING ANY TECHNICAL OR MANAGERIAL OR CONSULTAN CY SERVICES AS ENVISAGED IN SECTION 194J OF THE I.T. ACT. AS PER THE APPELLANT IN ITS CASE THE WASTE IS ALSO PROCESSED IN ITS OWN FTP PLANT AT FACTORY LOCATION AND THE ABOVE TWO COMPANIES DO NOT HAVE ANY ROLE IN SUCH PROCESS. AS PER THE APPEL LANT THESE TWO COMPANIES WERE CARRYING OUT IT ONLY FOR COLLECTION TRANSPORTATION AND DISPOSAL OF WASTE AND THEREFORE SAME ARE COVERED UNDER THE PROVISION OF SECTION 194C OF THE I.T. ACT. I AGREE WITH THIS SUBMISSION OF THE APPELLANT COMPANY AND IN MY OPINI ON COLLECTION TRANSPORTATION AND DISPOSAL OF WASTE BY THESE TWO C OMPANIES CANNOT BE SAID TO BE IN THE NATURE OF TECHNICAL MANAGERIAL OR CONSULTANCY SERVICES AS ENVISAGED IN SECTION 194J OF THE IT ACT. I THEREFORE HOLD THAT THE ACIT(TDS) CIRCLE BARO DA IS NOT CORRECT IN HOLDING THE VIEW THAT THE SERVICES RENDE RED BY ABOVE TWO COMPANIES ARE IN TECHNICAL NATURE. I THEREFORE DIRECT THE ACIT(TDS ) CIRCLE BARODA TO WORK OUT THE TAX AT SOURCE ON THE PAYMENTS MADE TO NANDESARI ENV IRONMENT CONTROL LTD. AND M/S GUJARAT ENVIRO PROTECTION & INFRASTRUCTURE LTD. AS PER PROVISIONS OF SECTION194C OF THE I.T. ACT AND ALSO TO CHARGE THE INTEREST IN CAS E IF REQUIRED ACCORDINGLY. THUS THE GROUNDS OF APPEAL OF THE APPELLANT RELATED TO THE P AYMENTS MADE BY IT TO ABOVE TWO COMPANIES ARE DECIDED IN ITS FAVOUR. 10. HAVING HEARD THE SUBMISSION OF BOTH THE SI DES AND AFTER CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTA NCES OF THE CASE WE ARE OF THE CONSIDERED OPINION THAT THE COLLECTION TRANSPORTATION AND DISPOSAL OF WASTE BY THOSE TWO COMPANIES CAN BE SAI D TO BE COVERED UNDER THE PROVISIONS OF SECTION 194C OF IT ACT. THE VIEW TAKEN BY LEARNED CIT(A) IS THEREFORE CONFIRMED. WE HAVE BE EN INFORMED THAT THE PAYEE I.E. THE ASSESSEE COMPANY HAD ALREADY DEDUC TED THE TAX AS PER THE PROVISIONS OF SECTION 194C OF IT ACT. HOWEVER THIS FACT CAN BE VERIFIED BY THE AO. IN THE RESULT WE FIND NO FORCE IN THE G ROUND OF THE REVENUE HENCE DISMISSED. RESULTANTLY ALL THE APPEALS OF TH E REVENUE ARE DISMISSED. 11. TO SUM UP ALL THE THREE APPEALS OF THE ASSESSE E ARE ALLOWED AND THE APPEALS OF THE REVENUE ARE DISMISSED. SD/- SD/- (T.R. MEENA) (MUKUL KR. SHRAWAT) ACCOUNTANT MEMBER JUDI CIAL MEMBER AHMEDABAD; DATED 31/10/2013 PRABHAT KR. KESARWANI SR. P.S. ITA NO.1956 1957 1958 1983 1984 1985/AHD/2012 GUJARAT FLUROCHEMICALS LTD. BARODA. FOR A.YS. 2008-09 2009-10 2010-11 - 10 - / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)-III AHMEDABAD 5. / DR ITAT AHMEDABAD 6. / GUARD FILE. / BY ORDER / ( DY./ASSTT.REGISTRAR) / ITAT AHMEDABAD