The assessee, engaged in business of stevdoring and container freight services, was a registered employer under Dock Workers (Regulation of Employment) Act, 1948 read with provisions of Calcutta Dock Workers (Regulation of Employment) Scheme, 1970. During assessment years in question, assessee deposited a certain sum with Calcutta Dock Labour Board in discharge of its obligations under Act 1948 and Regulation Scheme 1970 for purposes of disbursement of wages of its employees through Board. Assessing Officer held that main function of Board was to provide labour to stevedore, i.e., assessee and, thus, while making payment to Board, assessee was bound to deduct tax at source under section 194C hence applied the provision of S. 40(a)(ia) of the Act. CIT(A) deleted the disallowance. Tribunal set aside the order of the CIT(A). On appeal High Court held that   the  contract of employment is between the assessee and the dock workers and not between the assessee and the Dock Labour Board; Board has merely discharged its statutory obligation with regard to regulation of dock workers; s. 194C has no application on facts of the present case with regard to payment of wages by the assessee to the dock workers through the Administrative Committee/Board. Therefore  payment of wages to dock workers through  Labour Board is  not liable to deduct tax at source.  (AY.2006-07,  2007-08)