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TMI Blog2016 (3) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... (Addl.CIT) ORDER PER BENCH : These are seven connected appeals filed by the assessee against the order of ld. CIT (Appeals)-III, Jaipur dated 15th November, 2012 for the A.Ys. 2004-05 to 2010-11. The common grounds raised in the appeals are as under :- 1) On the facts and circumstances of the case and in law, the learned CIT (A) has erred in holding that the order passed under section 201(1)/201(1A) of the Act for the subject assessment year is not barred by limitation and hence, is not bad in law. 2) On the facts and circumstances of the case and in law, the learned CIT (A) has erred in holding that roaming charges paid by the appellant qualify as Fee for Technical Services and thus, subject to tax deduction at source under section 194J of the Act. 3) On the facts and circumstances of the case and in law, the learned CIT (A) has erred in not directing the learned TDS Officer to verify payment of tax in respect of the recipient telecom operators for whom the appellant could not furnish confirmations despite the fact that other requisite details for such verification were available with the learned CIT (A)/TDS Officer. 4) On the facts and circumstances of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s payment of part access / interconnect charges whereas in the present case, the issue is regarding payment of roaming charges. Further, in the above case, the Hon ble court found that there was no involvement of human interface in providing interconnect/part access facility whereas in present case there is necessarily human interface involved in providing roaming service. There is no doubt that there is intensive use of sophisticated machines and modern technology but simultaneously there is constant involvement of human mind and skill which is required for providing roaming services. For example, there is requirement of technical and skilled employees for following procedures involved in providing roaming services :- 1. To maintain and operate customer care centre round the clock for the subscribers of assessee company. 2. To implement GSM services in accordance with the GSM specifications. 3. Settlement of Bills. 4. To monitor technical aspects concerning both the pre-commercial and commercial phases of GSM national roaming. 5. To implement fraud prevention procedures. All the above activities require constant human involvement for monitoring and for unhindered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s subscriber in Mumbai, who is temporarily registered as Airtel s subscriber makes calls in Mumbai and the minutes are registered in his identity for which he has to pay through Hexacom Jaipur. * Alternatively, a called from Jaipur makes a call to Hexacom s subscriber which is routed to the home network of Hexacom subscriber in Jaipur. * Home network then forwards all incoming calls to the temporary phone number which terminates at the device of roaming, subscriber (in Mumbai) who is now using the services of the visiting network (i.e. Airtel): * The entire process above is automatic and does not involve any human intervention at any stage. Billing process * Usage of roaming subscriber in visited network is captured in a file called TP, i.e. transferred account procedure for GSM/CIBER, i.e., cellular inter-carrier billing exchange record for. * TAP file contains details of calls made by subscriber, viz., location, calling party, time of call and duration, etc. * TAP/CIBER files are rated as per tariffs charged by visiting network operator. * Such TAP/CIBER file is transferred to home network of subscriber (i.e. to Hexacom). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a telecom network breaks down there is no business and thus no payment. Existence of IMSI is only a facility to communicate and does not result the roaming services provided on a standard facilities to be a technical service. The whole roaming process is automatically and there is no human interference in it. The human interference is required to maintain the robust network only to ensure break down free service to the subscriber. The network owner has to maintain for itself, its network in robust condition. The technical support of the staff is required to maintain the equipment and gazettes but it is not a service for roaming facility provided to the subscriber. There is commercial arrangement to connect the technical networks basically to be able to do business. In fact DOT mandates that it should be so connected. There is no payment made for connecting the networks. Payments are made for calls which the roaming subscriber makes. If no calls are made no payment is made in spite of the fact that the networks are inter connected. He further relied on the decision in the case of CIT Vs. Bharti Cellular Ltd. 319 ITR 139 (Del) wherein it has been held by the Hon ble Delhi High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 9(1)(vii) Explanation-2. He also relied on the decision of Hon ble Bangalore ITAT in the case of Bangalore Electricity Supply Co. Ltd. Vs. ITO(TDS) order dated 16/3/2012 2012(20) ITR (Trib) 265 wherein payment made by State Load Dispatch Center (SLDC) is held not liable to be deducted TDS U/s 194J of the Act. The ld AR further relied on the decision of Hon ble Mumbai ITAT in the case of Maharastra State Electricity Distribution Co. Ltd. 25 Taxman 164, Siemens Limited 30 Taxmann.com 200, ITAT Kolkata Bench decision in the case of Right Florists Pvt. Limited ITA No. 1336/Kol/2011 and ITA Delhi bench decision in the case of Delhi Transco Ltd. (ITA No. 755(Del)/2011 A.Y. 2005-06. He also relied on the decision in the case of DCIT Vs. Parasrampuria Synthetics Ltd. 20 SOT 248 (Delhi). The revenue filed appeal against the order of Hon ble Delhi High Court in the case of Bharti Cellular Ltd. before the Hon'ble Supreme Court. The Hon'ble Supreme Court has held as under:- In cases requiring examination by technical experts, the Department ought not to proceed only by the contracts placed before the officers. With the emergence of our country as one of the BRIC countries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng, servicing, maintenance are separate activities, they are back office functions and are require human intervention. But the roaming process between participating entities is fully automatic and does not require any human intervention. Accordingly, the interconnected uses charge will not attract the provisions of Section 194J read with Section 9(1)(vii) read with Explanation-2 thereto. Therefore, he prayed to delete the addition. If we examine the issue in both the matters, a irresistible conclusion about the lis involved in both the appeals are the same. Accordingly, we have no hesitation to apply the reasoning given in ITA No. 656/JP/2010 to the present set of facts. For the sake of clarity, we are hereby reproducing para 6 of the said order as under :- 6. We have heard the rival contentions of both the parties and perused the material available on the record. Recently this Bench has decided similar issue in the case of Tata Tele Services, which is identical to the assessee s case. The facts of the case has been demonstrated by the AR that the assessee was issuing bill on net amount on MRP has been fixed on prepaid card sold. The assessee has not transferred any income t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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