S. 194J Maintenance of hospital equipments is ‘professional service’

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ITAT AMRITSAR BENCH

Income-tax Officer (TDS), Jammu

v.

Accounts Officer, Govt. Medical College, Jammu

IT Appeal NoS. 112 and 113 (Asr.) OF 2011

[Assessment years 2008-09 and 2009-10]

May 7, 2012

As per Explanation 2 to section 9(1)(vii) the fees for technical services means any consideration for the rendering of any managerial, technical or consultancy services including the provision of services of technical or other personnel, and fees paid for that shall be considered for the purpose of section 194J. As per conditions mentioned in the agreement with regard to theatre and surgical operation, the services of a technical qualified person are to be made available to the assessee to maintain equipments. Therefore, the said technical services as per CBDT Circular No. 715, dated 8-8-1995 cannot be services of routine and normal maintenance. The operation theatre and surgical are highly technical equipments for the operation of the persons. Therefore, they cannot be maintained in a routine or normal manner, but a technical person is required for maintenance of such equipments. Similar is the case with RO system, CT scan machine, MRI machine, lift and sterlisation and medical equipments. Therefore, these contracts cannot be the contracts in a routine or normal manner but for which technical service has been rendered and provisions of section 194J, read with Explanation 2 to section 9(1)(vii) are attracted. [Para 6.4]

The anti-termite treatment though does not require technical expertise, but it requires professional skill for the reason that the spray of the anti-termite chemicals in the premises or the machine requires a highly and professionalized skill. In the absence of which there can be a loss to the life of the human being living therein, especially in the Medical College. If spray is made by a person who is not professional or without any professional skill then consequences can be otherwise. Therefore, this service has to be treated as professional service to be included for the purpose of section 194J, read with Explanation 2 to section 9(1)(vii). In the facts and circumstances of the case, except for the supply of bread and butter and supply of security and personnel, the findings of the Assessing Officer deserved to be upheld. [Para 6.5]