January 2023
Where the assessee was hiring trucks from an open market on individual and need basis and payments had not been made to any sub-contractor since the assessee did not have any contract with the truck owner and therefore the question of TDS did not arise in respect of payments towards lorry hire charges
52. Dineshbhai Bhavanbhai Bharwad vs. ITO
[2022] 96 ITR(T) 429 (Ahmedabad – Trib.)
ITA No.:1488 (Ahd.) of 2016
A.Y.:2007-08
Date: 31st March, 2022
Section: 194C r.w.s 40(a)(ia)
Where the assessee was hiring trucks from an open market on individual and need basis and payments had not been made to any sub-contractor since the assessee did not have any contract with the truck owner and therefore the question of TDS did not arise in respect of payments towards lorry hire charges.
FACTS
During the year under consideration, the assessee had debited sum of Rs. 10,41,14,765 as ‘Lorry Hire Charges’.
In the course of the assessment proceedings, the assessee was asked to furnish the complete details and copy of account of said expenses. The assessee had produced all the ledger accounts of the said expenses and submitted that as individual payments do not exceed Rs. 20,000, no TDS was deducted. On going through the ledger accounts, it was noticed by the AO that the assessee ought to have deducted tax at source u/s 194C of the Act, since in a number of individual cases the payment exceeded Rs. 50,000. The AO partly disallowed lorry hire charges u/s 40(a)(ia), since the assessee failed to deduct tax at source u/s 194C in individual cases where payment exceeded Rs. 50,000.
Against the order of the learned AO, the assessee preferred the first appeal before the
