1.  Assistant Commissioner of Income Tax (TDS) Vs. Lotus Valley Education Society, I.T.A. Nos. 230 & 231 of 2011, Date of Order: 12.09.2013, Allahabad High Court

TDS deductible u/s 194 C in case assessee took certain vehicles on hire for carrying its students and staff while making payments of hiring charges to transport contractor

Held that any person responsible for paying any sum to any resident for carrying out any work is liable to deduct an amount equal to one percent where the payment is being made or credit is being given to an individual or a Hindu undivided family and at two percent, where the payment is be made or credit is being given to a person other than an individual or a Hindu undivided family. The definition clauses for the purpose of Section 194-C provides that the term ' work' shall include (a) advertising; (b) broadcasting and telecasting including production of programmes for such broadcasting or telecasting: (c) carriage of goods or passengers by any mode of transport other than by railways; (d) catering; (e) manufacturing or supplying a product according to the requirement or specifications of a customer by using material purchased from such customer.

The Tribunal did not commit any error of law in invoking Section 194-C, which clearly provides under explanation-IIII to sub section (2) of Section 194-C that ' work' includes carriage of goods and passengers by any mode of transport other than by railway.

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2.   Commissioner of Income Tax Vs. Malayala Manorama Co. Ltd., I.T.A. No. 345 of 2009, Date of Order: 08.10.2013, High Court of Kerela

Provisions of TDS u/s 195 are not applicable to membership fee contribution paid to International Press Institute.

The first appellate authority found that since IPI is a non-resident body and has no permanent establishment in India section 9(1)(i) does not apply at all. It was hence found that since the IPI is a non-resident body incorporated by a law in another country having no business or other connection in India any reference to section 2(24)(ii)(a) of the Income Tax Act become superfluous and, therefore, section 195(1) of the Income Tax Act does not apply in the case of the payments made to the IPI. The provision of law under section 195(1) can have application only if the payment is made to an income tax assessee in India. It is found by the Tribunal that the IPI had no permanent establishment in India and the assessee is not an agent of IPI. The assessee is only a member of IPI and by giving advertisement membership fee or other donation the assessee is not getting any monetary advantage. The only benefit available to the assessee is the right to participate and to strive for achieving the objects of IPI through publications, seminars, conferences etc. Therefore it could be seen that on finding of fact itself the authorities have come to a conclusion that the assessee is not liable to comply with the provisions under section 195 of the Income Tax Act.

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