COMMISSIONER OF INCOME TAX Vs. APEEJAY SCHOOL

JUDGEMENT

(1.) The appeal filed by the revenue under Section 260A of the Income Tax Act, 1961 arises from a decision of the Income Tax Appellate Tribunal dated 1 March 2011 for Assessment Year 2008-09. The appeal has been admitted on 3 January 2012 on the following substantial questions of law :

(2.) The assessee conducts a school at NOIDA. As an incident of providing a facility for the transportation of students from their homes to the school and return, the assessee entered into a contract with a transporter. The contract envisaged the following salient conditions :

(3.) The Assessing Officer passed an order under section 201(1)/201(1-A) of the Act on 27 January 2010 and held that the assessee had erred in deducting tax at source under section 194C whereas its obligation was to deduct tax at source under section 194I on the payments made to the contractor. The Assessing Officer held as follows:-