- (1.) THE Superintending Engineer (SE) of Jodhpur Vidhyut Vitaran Nigam Ltd. awarded certain works to various contractors involving supply of material and erection by separate agreements with separate consideration for the payment schedule, performance guarantee, bank guarantee, warranty in respect to material etc. The ITO, TDS -I, Jodhpur conducted a survey for verification of the TDS at the office of the Accounts Officer, O&M, Jodhpur Vidhyut Vitaran Nigam Ltd., Pali (hereinafter referred to as 'the appellant') and the appellant was called upon to show -cause as to why short deduction of tax under s. 194C of the IT Act, 1961 (hereinafter referred to as 'the Act of 1961') be not recovered as per provisions of s. 201(1) with interest as per provisions of s. 201(1A) of the Act aforesaid. The notice calling upon the appellant was in respect of three financial years those are 2005 -06, 2006 -07 and 2007 -08. The ITO, TDS -I by order dt. 21st April, 2008 ordered for recovery of short deduction of tax and interest thereon by holding that the assessee has admitted the default.
(2.) BEING aggrieved by the order dt. 21st April. 2008 passed by the ITO, TDS -I, the appellant preferred an appeal before the CIT(A), Jodhpur, but that came to be dismissed on the ground that no appeal can be maintained if the default is admitted. Suffice to mention here that while rejecting the appeal the CIT(A) also looked into the merits and arrived at the conclusion that the transactions undertaken by the appellant termed as sale/purchase, are nothing but composite contract for work on which tax is deductible as per provisions of s. 194C of the Act of 1961. The appellant assailed correctness of the order passed by the CIT(A) by way of approaching Tribunal with following grounds: "1. That the learned authority below has erred in treating the appellant as principal officer while passing the order under s. 201/201(1A) for the alleged default. 2. That without prejudice to the ground No. 1 2.1 The authorities below have erred in holding that provisions of s. 194C of the IT Act was applicable to the contract for supply of goods and thereby creating a demand of Rs. 32,37,985 towards TDS and interest under s. 201(1A) amounting to Rs. 11,65,644. 2.2 The authorities below have erred in assuming and holding that there is one indivisible contract in contrast to the fact that there two separate contracts, one for supply of goods and second for erection. 2.3 The authorities below have erred in not properly appreciating the nature of contract and terms and conditions contained in the contract for supply of goods. 3. That the authorities below have erred in holding that the appellant has admitted the liability for deduction of tax at source from the payments made for contract for supply of goods.
(3.) THAT , without prejudice to the above grounds, the authorities below have erred in pressing the TDS provisions for recovery of tax whereas the tax has already been recovered from the contractor under other provisions of the IT Act, rendering the recovery of TDS a double taxation of the same amount.;