The term "carrying out any work" as used in Section 194-C of the Income Tax Act does not include the activities of carriage of goods.

( 1 ) THERE are three petitioners; the first is theassociation of truck owners, transport operators and goods carriers, the 2nd isa company engaged in the business of carriage of goods and the 3rd is a transporter engaged in the business of giving on hire trucks for the purpose of carriage of goods.

( 2 ). The petitioners challenge Circular No. 681 dated 8/3/1994 issued by thecentral Board of Direct Taxes, directing the application of Section 194-C of theincome Tax Act to several categories of persons, including the carrier of goods,like the 2nd petitioner. Section 194-C provides for deduction of the prescribedpercentage by the payer of the consideration and hand over the same to therevenue.

( 3 ). Mr. Pandey the learned Counsel for the Revenue raised a preliminaryobjection against the maintainability of the writ petition, on the ground that the1st petitioner is not actually carrying on the business and affidavit in support ofthe writ petition is not filed by the 2nd or the 3rd petitioners.

( 4 ). Since, admittedly, the 2nd petitioner is affected by the impugned circular,we reject the preliminary objection; non-filing of an affidavit on behalf of the 2ndpetitioner can be ignored as an irregularity, since, question involved in the writpetition is purely one of law and basic facts are undisputed.

( 5 ). On merits, it was contended, by the learned Counsel for the petitioners that carriage of goods for transportation cannot come within the scope of thewords, "carrying out any work" and therefore. Section 194-C of the Act is notattracted to the payment made for carriage or transport of goods. The word"work connotes the bringing out of a tangible object as in the case of a constructionwork. This apart, the petitioners rely on the earlier circulars issued by the1st respondent, immediately on the enactment of Section 194-C clarifying that transport operation would not be covered by Section 194-C. Petitioners also relyon Section 44ae of the Act, indicating that the subject of transport of goods hasbeen separately dealt with and it is not possible to reconcile Section 44ae withsection 194-C.

( 6 ). This last submissions need not detain us long, because. Section 44ae wasenacted only in the year 1994, while Section 194-C was enacted in the year 1972,though it underwent several changes subsequently. Further, Section 194-C, admittedly covers the cases of supply of labour for carrying out any work and thesame subject is dealt by Section 44ad also. The purpose of Section 44ae isdifferent from the scope of Section 194-C. Section 44ae provides an alternativemode of computing the income and paying the tax, while Section 194-C providesfor the payer of the consideration to deduct a percentage from it for paying it tothe revenue. If excess amount is realised under Section 194-C, the assessee canalways seek its refund, after computing the tax under Section 44ae. There is noconflict between these two provisions.

( 7 ). The petitioners rely on the doctrine of contemporanea expositio and the exposition received by Section 194-C at the earliest point of time, from the 1st respondent.

( 8 ). In K. P. Verghese v. I. T. Officer, Emakulam; AIR 1981 SC 1922, the Supreme Court explained the relevant principle at page 1932:

"the rule of construction by reference to contemporanea expositio is a wellestablished rule for interpreting a statute by reference to the exposition ithas received from contemporary authority, though it must give way wherethe language of the statute is plain and unambiguous. This rule has beensuccinctly and felicitously expressed in Crawford on Statutory Construction (1940 ed) where it is stated in para 219 that administrative construction (i. e. contemporaneous construction placed by administrative or executive officers charged with executing a statute) generally should be clearly wrongefore it is overturned; such a construction, commonly referred to as practical construction, although non-controlling, is ne