Revenue is in appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’ for short) challenging the order dated 3.7.2009 passed by the Income-Tax Appellate Tribunal – “B” Bench, Bangalore pertaining to the assessment years 2006-2007 and 2007-08 on the following substantial questions of law:

1. Whether the Appellate Authorities were correct in holding that the remuneration paid to consultant Doctors employed by the assessee hospital is not under an employer and employee relationship and therefore tax at source has to be deducted u/s. 192 of the Act and not u/s. 194J of the Act?

2. Whether the Appellate Authorities were correct in holding that the lease rent paid to Medical Relief Society of South Canara under the guise of repayment of loan taken by the lessor under a supplementary agreement would not attract section 194I of the Act and tax at source need not be deducted when the said arrangement was external to deductions at source?

2. Facts in brief are:

A survey under Section 133A of the Act was conducted at the business premises of the ass