INCOME TAX ACT, 1961

Section 194C Section 194J Section 196

Tax deduction at source - Under section 194C or 194H - Passenger service fee payments by airline to Airport operators -

Assessee was engaged in transportation of passengers by Aircraft and uses airport, collected from passengers on behalf of the airport operator a passenger service fees. It had two components, security components and facilitation components. On security service charges, assessee did not deduct tax at source taking shelter under section 196. However, on facility component assessee had deducted tax under section 194C with respect to certain licensees and with respect to the other licencee no tax was deducted. According to AO, tax should have been deducted on both the above components under section 194J.Held: Undisputedly, provision of facilities was service provided by Airport operators to passengers of Airline assessee. and the services provided to assessee were not any specialized services but only standard facilities, which were available to all the Airlines. Hence, there was no reason to hold that section 194J applied to passenger service fee payments. Accordingly, assessee was liable to deducted tax under section 194C.

REFERRED :

FAVOUR : Partly in assessee's favour.

A.Y. :

INCOME TAX ACT, 1961

Section 194H

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