The Income Tax Appeal Tribunal (ITAT), Chandigarh Bench consisting of Diva Singh, Judicial Member, and Vikram Singh Yadav, Accounting Member, found that the gross receipts of freight services in relation to disbursements to former truck owners were required to claim TDS.

HP Ex Servicemen Corporation rated company is incorporated under the Himachal Pradesh Former Servicemen Society Act 1979. The purpose of the company is to provide social/financial benefits to retired defense personnel and has been engaged in various activities permitted by law and rules. . The subject matter to be examined in this appeal is the TDS inferred on behalf of the transport activities performed by the assessee for the cement plant of ACC Ltd., Ambuja JP Cement, etc. The company being assessed maintained that it did not own any trucks. etc and these were hired through the Ex-Service Corporation and therefore the deducted TDS was passed on by the assessee to the truck/clamp owners. The commission received from said activity, it was argued, is the sole income of the assessee. The Assessing Officer (AO), unaware of the facts, noticed that no freight receipt had been shown in the filed declaration and proceeded to reject TDS’ refund claim. The challenge before the CIT(A) failed because it also failed to take into account the facts available in the file. Injured by this, the assessee appeals to the ITAT.

The assessee’s attorney, Amitoz Singh Kamboj, argued that the assessee is only entitled to the commission income. Trucks etc. were hired through the Assessed by ACC Ltd. and the TDS deducted by the ACC is paid to the truckers and as far as the assessee is concerned, it is only a transfer agreement.

The Court said: “It is an accepted fact that the Company’s freight receipt was paid to the truck owners and it is asserted that the TDS deducted by the ACC Ltd. is also, according to practice, paid to the owners of trucks after receipt of the same from the income tax service.

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HP Ex Servicemen Corporation v ACIT

Counsel for the Appellant: Shri Amitoz Singh Kamboj

Counsel for the Respondent: Shri Vivek Nangia