9911796707
TMI Blog2015 (2) TMI 532X X X X Extracts X X X X X X X X Extracts X X X X ..... ssue in dispute are, the assessee, a partnership firm is engaged in the business of providing cable network services. For the A.Y under consideration, the assessee filed its return of income on 30.09.2009 declaring total income of Rs. 2,15,260. During the assessment proceedings, the AO while examining the P&L a/c of the assessee relevant to financial year noticed that the assessee has paid an amount of Rs. 36.15 lakhs to various pay channels like ESPN, Star Sports, ETV, Gemini TV, MAA TV, Sony TV, Star TV, 10Sports etc. He, therefore, called for information from the concerned pay channels to furnish the details of the service contract, the amount received from the assessee, mode of payment and whether any tax at source has been deducted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owance, assessee preferred appeal before the ld CIT (A). Before the first appellate authority the assessee, apart from reiterating that the payments made to the pay channels cannot be deemed to be in pursuance to works contract as envisaged u/s 194C of the Act, alternatively, also submitted that as the entire amount was paid within the relevant financial year and nothing remains to be paid, the ratio laid down by the ITAT Visakhapatnam Special Bench in the case of Merillyn Shipping & Transport vs. Add.CIT in ITA No.477/Viz/2008 dated 29.03.2012 would apply and no disallowance can be made u/s 40(a)(ia). The ld CIT (A) however, did not find merit in the contention of the assessee that the payments do not come within the purview of section 194 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in holding that this amounts to a service as held therein. 5. The ld CIT (A) erred in holding that provisions of section 40(a)(ia) attracts even when the amount did not remain payable on the ground that the decision in the case of Merillin Shipping is stayed by High Court failing to appreciate the fact that such stay will operate only to that assessee and the decision of Teja Constructions on similar lines holds good. 6. Any other ground that may eb urged at the time of hearing". 4. Ground Nos. 1 & 6 being general in nature, do not require any specific adjudication. At the outset, the ld AR requested for taking up the legal issue as raised in Ground No.5 in which event the other grounds on the merits of disallowance may not be nec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant financial year. Accordingly the ratio laid down by the ITAT Visakhapatnam Special Bench in the case of Merillyn Shipping & Transport vs. Add CIT (Supra) squarely applies to the facts of assessee's case. Further, it is to be noted that the Coordinate Bench of this Tribunal in case of Ushodaya Enterprises vs. DCIT (Supra) following the judgement of the Hon'ble A.P. High Court dated 24.06.2014 in case of CIT vs. Janapriya Engineers Syndicate in ITA No.352/14 has held as under: "8. We have heard both the parties. We direct that the AO may follow the decision of the Special Bench in the case of Merilyn Shipping & Transports v. ACIT in ITA No.477/Viz/2008 dated 29.03.2012 and the disallowance u/s 40(a)(ia) may not be made by the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X
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