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2015 (5) TMI 609 - AT - Income TaxTDS liability under S.194J in respect of payments made to news service agencies - Held that - Issue is covered by the decision of the Tribunal in assessee s own case for assessment years 2004-05 to 2006-07 2012 (7) TMI 120 - ITAT HYDERABAD against the assessee wherein held as unable to appreciate that no professional services are rendered by the reporters in collecting the data for publication of news. The work carried out by news paper agents requires professional qualifications and skills. Though, the data collected by such reporters has tobe reviewed glossed up and made fit to be published/presented. Nevertheless, procurement of the basic data cannot be done without qualified reporters who utilise their professional skills for collection of the same. Further, the newspapers employ reporters who have been trained to have interrogative ability, presence of mind and have specialised in a way for doing their work and hence they are rendering work in their professional capacity. - Decided against assesse. TDS liability - payments made on account of software expenses - Held that - Issue is covered by the decision of the Tribunal in assessee s own case for assessment years 2004-05 to 2006-07 2012 (7) TMI 120 - ITAT HYDERABAD against the assesse wherein held that the assessee is making payments to various agencies on revenue sharing basis from the income generated through advertisements by way of telecasting the serials or programmes produced by the agencies. The mode of payment is nothing but a payment for contract of work and is squarely covered by explanation III to section 194C which says work shall include programmes for such broadcasting or telecasting. In view of the same, we hold that the nature of payments fall within the purview of section 194C - Decided against assesse. Non deduction of tax at source - discounts on advertisements - Held that - Issue is covered by the decision of the Tribunal in assessee s own case for assessment years 2004-05 to 2006-07 in favour of assesse wherein held the assessee is not liable to deduct tax u/s 194H as relying on M/s TV Today Network Ltd 2011 (7) TMI 1095 - ITAT DELHI - Decided in favour of assesse. Non-deduction of tax at source - payment of band width charges - Held that - Issue is covered by the decision of the Tribunal in assessee s own case for assessment years 2004-05 to 2006-07 in favour of assesse wherein held the assessee is not liable to deduct tax u/s 194H as relying on Pacific Internet (India) P Ltd. Vs. ITO 2008 (12) TMI 429 - ITAT MUMBAI wherein it has been held that payment made for using bandwidth and network operation are not technical services and tax needed not be deducted from such payments u/s 194J - Decided in favour of assesse Non-deduction of tax at source - payment of internet charges - Held that - Issue is covered by the decision of the Tribunal in assessee s own case for assessment years 2004-05 to 2006-07 in favour of assesse wherein held the assessee is not liable to deduct tax as relying on Skycell Communications Ltd. Vs. DCIT 2001 (2) TMI 57 - MADRAS High Court - Decided in favour of assesseE - Decided in favour of assesse. Non-deduction of tax at source - payment of transponder rent - Held that - Issue is covered by the decision of the Tribunal in assessee s own case for assessment years 2004-05 to 2006-07 in favour of assesse wherein held in the case of ISRO satellite centre 2008 (10) TMI 15 - AUTHORITY FOR ADVANCE RULINGS the assessee was to make payment for taking on lease Space Segment Capacity consisting of L-1 and L-5 transponder Centered on an Inmarsat 4th Generation Satellite whose capacity is utilised through data commands sent from a ground station set up by applicant. The assessee paid a fixed annual charge regardless of actual use of transponder capacity. The AAR held that when by earmarking a space segment capacity of transponder for its use assessee does not get possession or control of equipment of IGL and the agency that received the payment charges paid by assessee cannot be regarded as payment for use of IGL s equipment. The AAR held that income arising to IGL out of payments received from applicant is neither in nature of royalty under Act nor is fee for technical service - Decided in favour of assesse.
Issues Involved:
1. TDS liability under Section 194J for payments made to news service agencies. 2. TDS liability under Section 194C for software expenses. 3. Non-deduction of tax at source for discounts on advertisements. 4. Non-deduction of tax at source on data circuit rentals under Section 194J. 5. Non-deduction of tax at source on bandwidth charges. 6. Non-deduction of tax at source on internet charges. 7. Non-deduction of tax at source on transponder rent. Detailed Analysis: 1. TDS Liability under Section 194J for Payments to News Service Agencies: The Tribunal upheld the decision that the assessee was required to deduct tax at source under Section 194J for payments made to news service agencies. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that the work carried out by news service agencies involved professional services, thus attracting TDS under Section 194J. The Tribunal dismissed the assessee's appeal on this issue. 2. TDS Liability under Section 194C for Software Expenses: The Tribunal upheld the CIT(A)'s decision that payments made for software expenses were liable for TDS under Section 194C. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that the payments were for a contract of work, thus falling under Section 194C. The Tribunal dismissed the assessee's appeal on this issue. 3. Non-Deduction of Tax at Source for Discounts on Advertisements: The Tribunal upheld the CIT(A)'s decision that the assessee was not liable to deduct tax at source on discounts given to advertising agencies. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that the amount retained by advertising agencies did not constitute "commission" under Section 194H. The Tribunal dismissed the Revenue's appeal on this issue. 4. Non-Deduction of Tax at Source on Data Circuit Rentals under Section 194J: The Tribunal upheld the CIT(A)'s decision that the assessee was not liable to deduct tax at source on data circuit rentals under Section 194J. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that data circuit rentals did not constitute technical services requiring TDS under Section 194J. The Tribunal dismissed the Revenue's appeal on this issue. 5. Non-Deduction of Tax at Source on Bandwidth Charges: The Tribunal upheld the CIT(A)'s decision that the assessee was not liable to deduct tax at source on bandwidth charges. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that payments for bandwidth did not constitute technical services under Section 194J. The Tribunal dismissed the Revenue's appeal on this issue. 6. Non-Deduction of Tax at Source on Internet Charges: The Tribunal upheld the CIT(A)'s decision that the assessee was not liable to deduct tax at source on internet charges. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that internet charges did not constitute technical services under Section 194J. The Tribunal dismissed the Revenue's appeal on this issue. 7. Non-Deduction of Tax at Source on Transponder Rent: The Tribunal upheld the CIT(A)'s decision that the assessee was not liable to deduct tax at source on transponder rent. This was based on the Tribunal's earlier decision for assessment years 2004-05 to 2006-07, which concluded that transponder rent payments were neither royalty nor fees for technical services. The Tribunal dismissed the Revenue's appeal on this issue. Conclusion: - The assessee's appeals were partly allowed for statistical purposes, with specific issues remitted to the CIT(A) for reconsideration. - The Revenue's appeals were dismissed in their entirety.
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