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TMI Blog2013 (5) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... the part of the assessee, the relief granted by the CIT(A) though on different reasoning is sustained. In favour of assessee. Non deduction of TDS on link charges as technical services u/s 194J - demand raised u/s 201(1)/201(1A) - CIT(A) allowed the claim by deleting the demand raised u/s 201(1) - Held that:- Admittedly the payments are made to MTNL & BSNL etc. for providing space for transmission of date for carriage of voice and for availing the service of inter-communication, port access for which as per the settled uncontested legal position is that no human intervention is necessary. Nothing has been placed on behalf of the department to show that the facts have not been correctly appreciated in the case of the assessee. The lack of human intervention in making use of the service provided by BSNL and MTNL etc domains and in the fact as they stated the finding cannot be faulted with. Accordingly, being satisfied by the reasoning and finding arrived in the impugned order, ground of the department is also dismissed. In favour of assessee. - ITA Nos.3966 & 3967/Del/2011 - - - Dated:- 22-3-2013 - S V Mehrotra and Diva Singh, JJ. For the Appellant : Shri Rajendra Jha, Sr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03-04 and 2004-05 as discussed are as under :- F.Y 2003-04 Non-deduction of TDS Interest u/s 201(1H) Total Default HRA 6,48,027 3,88,816 Rs.1036843 Link Charges 9,29,554 5,57,732 Rs.1487286 F.Y. 2004-05 Link Charges 9,87,815 9,87,815 Rs.1461966 Rs.3986095 5. In appeal before the First Appellate Authority, the CIT(A) allowed the appeal of the assessee by deleting the demand raised u/s 201(1) vide para 3.5 holding as under qua the computation of HRA :- 3.5. I have considered the submissions of the Ld. AR and also the finding in the assessment order. It is clear from the reading of section 10(13A) of the Act read with rule 2A of the Rules and also the definition of the term salary as provided in clause (h) of ruled 2 of Fourth Schedule that for computing exemption of house rent allowance, only basic salary and the dearness allowance, if any, to be taken into account and other allowances and perquisites are to be excluded. The decision of the Kernataka High Court in the case of CIT vs. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tivity was merely to give access to the broadband available with the transponder to the customer and was held to be not in the nature of royalty. {The Hon ble Mumbai bench the Tribunal in the case of DCIT v/s Angel Broking Ltd. 134 TTJ 681, too held payment made for VSAT, and land line charges etc was nominal fee paid for use of facilities provided by the stock exchange, and cannot be said to in the nature of fees for any technical services.} 4.10. In view of the aforesaid, it is held that the appellant cannot be held to be in default for not deduction of tax at source from payment of tele-communication charges in terms of section 194J of the Act. This ground of appeal is accordingly decided in aforesaid terms. The appellant company uses modern technology to transmit its data to consumers in India and abroad, like telephone and internet connection. Hence section 194 J is not applicable here for payments to service providers. Hence the grounds of appeals of appellant are allowed. 6. Aggrieved by this, the Revenue is in appeal before the Tribunal. The Ld. Sr. DR inviting attention to the order u/s 201(1) and 201(1A) of the Act referred to page 4 of the same so as to cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y settled in favour of the assessee. Inviting attention to page 3 of the order of the ACIT, it was urged that before the said authority that the assessee makes payments of fixed remuneration to the employees under several components namely basic salary, house rent allowance etc. and the payment of performance incentive is made at the discretion of the management and on their approval and cannot be demanded by the employee as a matter of right. It was submitted that it was pointed out that the performance incentive is subject to the achievement of fixed percentage and becomes part of salary only at that stage. Accordingly in the facts of the present case, the estimate made by the employer, it was urged is a bona fide estimate and has been honestly estimated. Reliance was placed upon the judgement of the Madhya Pradesh High Court in the case of Gwalior Rayon Silk Co. Limited. vs. CIT, 140 ITR 832 M. P. High Court and the judgement of the jurisdictional High Court in the case of CIT vs. Nestle India Ltd. 243 ITR 435 (Delhi) which have been followed by the Jurisdictional High Court in the case of CIT vs Maruti Udyog Ltd. 350 ITR 81 (Del.) (2013) in which their lordship in para 4.4 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upheld. The fact that there is a short deduction of tax in the present case where it was linked with the performance incentive paid to the employee on the basis of achievement of fixed percentage, the estimated TDS deducted in a bona fide manner as per the settled legal position cannot be faulted with. There being no allegation of even an iota of mala fide on the part of the assessee, the relief granted by the CIT(A) though on different reasoning is sustained. 11. Qua to next issue agitated by the Revenue, the Sr. DR relying on the order of the ACIT invites specific attention to page 10 11 of the said order. 12. The Ld. AR on the other hand relying upon the various judgements referred to in the impugned order contends that the issue is settled in favour of the assessee. Specific attention was invited to the judgement of the Delhi High Court in the case of Asia Satellite Telecommunication Co. Ltd. 332 ITR 340 (Del.), copy of which placed at page 91-118 of the original paper book filed. Reliance was also placed on the judgement of the Hon ble Madras High Court in the case of Skycell Communication Ltd. Vs DCIT 251 ITR 53 (Madras), copy of which is placed at page 119-122. Inviti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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