9911796707
TMI Blog2013 (6) TMI 597X X X X Extracts X X X X X X X X Extracts X X X X ..... Per B. R. Mittal, JM:- This appeal by the Revenue is directed against the order of the Ld. CIT(A)-10, Mumbai dt.22.11.2010 taking following grounds: "1 (i) On the facts and in the circumstances of the case and in law, the ld. CIT(A) erred in deleting the disallowance of Rs.7,73,845/- made in respect of leaseline charges and Rs.4,35,427/- on account of Transaction charges of u/s 40(a)(ia), without appreciating the facts that these were composite charges for professional and technical services rendered by the stock exchange to its members and the assessee has failed to deduct TDS thereon; (ii) On the facts and in the circumstances of the case and in law the ld. CIT(A) erred in ignoring the fact that these services are essential in natu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the year but has incurred lease line expenses and transaction charges. The AO was of the opinion that the above charges are technical in nature and therefore, provisions of section 40(a)(ia) of the Act are attracted as assessee failed to deduct TDS thereon. Accordingly he disallowed the claim of the assessee and added the same to the total income of the Assessee. 3. The assessee carried the matter before the Ld. CIT(A) and contended that the assessee is a SEBI registered share and stock broking company having membership of Bombay Stock Exchange. The assessee contended these charges have been incurred towards payment of lease line charges to BSE/MTNL/BSNL for use of lease liens provided by them for executing share transactions. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck Exchange. With regard to the issue of addition of transaction charges of Rs.4,35,472/-, the ld. CIT(A) by relying on the decision in the case of Kotak Securities V/s Addl. CIT (2008) 25 SOT 440 (Mum) deleted the addition on the ground that the transactions fee paid could not be said to be fee paid in consideration of any technical services rendered by stock exchange to the assessee, therefore, the provisions of section 194J were not attracted. Being aggrieved by this finding of the Ld. CIT(A), Revenue is before us. 5. The Ld. Departmental Representative supported the findings of the AO and ld. AR justified the order of the ld. CIT(A). He further submitted that the issue is covered by the decision of the ITAT, Mumbai and the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concerned, the findings of fact recorded by the ITAT is that VSAT and Leaseline charges paid by the assessee to Stock Exchange were merely reimbursement of the charges paid/payable by the Stock Exchange to the Department of Telecommunication. Since the VSAT and Leaseline charges paid by the assessee do not have any element of income, deducting tax while making such payments do not arise. Hence question Nos. (A) and (B) cannot be entertained." 8. Facts being identical, respectfully following the decision of the Hon'ble Jurisdictional High Court, we hold that ld. CIT(A) has rightly deleted the addition made by the AO on account of leaseline charges of Rs.7,73,845/-. 9. So far as transaction charges of Rs. 4,35,472/- are concerned, we fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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