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TMI Blog2013 (12) TMI 1061X X X X Extracts X X X X X X X X Extracts X X X X ..... re u/s 37(1) – Legal settlement for violation of Copyright Act - Held that:- A perusal of compromise petition filed before Hon’ble Delhi High Court show that it is a compromise in respect of the contractual liability and the compromise is in no way on account of penalty – Decided against Revenue. - ITA No.1514/Kol/2012 - - - Dated:- 14-3-2013 - P K Bansal and George Mathan, JJ. For the Appellant : Shri A K Mahapatra, CIT(DR) For the Respondent : Shri Soumitra Chowdhury, Adv. ORDER:- Per: Bench: This is an appeal filed by the Revenue against the order of ld. C.I.T.(A)-VIII, Kolkata in Appeal No.278/CIT(A)-VIII/Kol/11-12 dated 25.07.2012 for the Assessment year 2009-10. 2. Shri A.K.Mahapatra, CIT(DR) represented on be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at as the assessee had not deducted TDS u/s 194J of the Act the AO had invoked the provision of section 40(a)(ia) of the Act and disallowed the same. It was the submission that the ld. CIT(A) erred in holding that what is paid to the faculty members was salary and the TDS was not liable to be deducted u/s 194J of the Act. 4.1. In ground no.2 it was the submission that in the course of assessment it was noticed by the AO that the assessee had paid Rs.5 lakhs as assessee s share of the legal settlement due to Microsoft for violation of copyright Act. As the same is penal in nature, it was the submission that the AO has disallowed the same. It was the submission that the ld. CIT(A) treated the payment as business expenditure. It was the subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le disbursing the salary. Once it is shown that the assessee has only paid salaries to the person just because the teachers, are part time teachers, the same cannot be termed as professional fees for the purpose of invoking the provision of section 194J Of the Act. In the circumstances we are find no error in the finding of ld. CIT(A) and consequently the same stands confirmed. 6.1. In regard to ground no.2, being the payment of Rs.5 lakhs to Microsoft , a perusal of para 11 of compromise petition filed before Hon ble Delhi High Court clearly show that it is a compromise in respect of the contractual liability and the compromise is in no way on account of penalty. In any case this payment of Rs.5 lakhs has been made to Microsoft and obvio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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