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TMI Blog2016 (10) TMI 891X X X X Extracts X X X X X X X X Extracts X X X X ..... r setting off business loss of Rs. 2,01,95,300/-. 'Book Profits' under section 115JB of the Act was computed at Rs. 1,28,29,061/-. The return was processed under section 143(1) of the Income Tax Act, 1961 (in short, 'the Act') and the case was subsequently taken up for scrutiny. The assessment was completed under section 143(3) of the Act vide order dated 12.12.2012, wherein the income of the assessee under normal provisions was determined at Rs. 64,58,213/- in view of the following additions/disallowances: - (i) Under section 14A Rs. 4,90,318/- (ii) Under section 40(a)(ia) Rs. 9,18,509/- 'Book Profits' under section 115JB of the Act was computed at Rs. 1,33,19,379/- . 2.2 Aggrieved by the order of assessment dated 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1 In this ground, the assessee contends that the learned CIT(A) erred in confirming the disallowance of Rs. 4,90,318/- under section 14A r.w. Rule 8D of the I.T. Rules. It is submitted by the learned counsel for the assessee that the very same issue of disallowance under section 14A r.w. Rule 8d was before a Coordinate Bench of this Tribunal in the assessee's own case for A.Y. 2009-10 and the Coordinate Bench in its order in ITA 966/Mum/2013 dated 19.03.2015 had restored the matter to the file of the Assessing Officer (AO) to re-work the disallowance, if any, thereunder after taking into consideration the assessee's contention that no such disallowance should have been made by the AO since its investments are entirely in group concerns whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rules. 4.3.2 We find that the Coordinate Bench of this Tribunal in the assessee's own case for A.Y. 2009-10 in its order in ITA No. 966/Mum/2013 dated 19.03.2015 has restored this issue to the file of the AO for verification of the assessee's similar contentions holding as under at para 4 thereof: - "4. We have heard both the parties and their contentions have carefully been considered. The calculation prescribed under Rule 8D itself describe that basis of calculation will be ½% of the average of the value of investment, income from which does not or shall not form part of total income. Therefore, the investment out of which income is taxable, cannot be included for the purpose of computation of disallowance. In this view of the si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in the case of CIT vs. Kotak Securities Ltd. (2016) 383 ITR 1 (SC), wherein it was held that transaction charges paid to BSE, etc. by its members are not 'technical services' rendered, but the nature of such payments are for facilities provided by the Stock Exchange and therefore no TDS on such payments would be deductible under section 194C or 194J of the Act. 5.2 Per contra, the learned D.R. supported the impugned order of the learned CIT(A) on this issue. 5.3.1 We have heard the rival contentions and perused and carefully considered the material on record; including the judicial pronouncements cited. The facts of the matter on this issue are that in the period under consideration, the assessee paid transaction charges amounting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of the stock exchange in respect of every transaction that is entered into. There is nothing special, exclusive or customised service that is rendered by the Stock Exchange. "Technical services" like "Managerial and Consultancy service" would denote seeking of services to cater to the special needs of the consumer/user as may be felt necessary and the making of the same available by the service provider. It is the above feature that would distinguish/identify a service provided from a facility offered. While the former is special and exclusive to the seeker of the service, the latter, even if termed as a service, is available to all and would therefore stand out in distinction to the former. The service provided by the Stock Exchange for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alue) over and above the charges for the membership in the Stock Exchange. The above features of the services provided by the Stock Exchange would make the same a kind of a facility provided by the Stock Exchange for transacting business rather than a technical service provided to one or a section of the members of the Stock Exchange to deal with special situations faced by such a member(s) or the special needs of such member(s) in the conduct of business in the Stock Exchange. In other words, there is no exclusivity to the services rendered by the Stock Exchange and each and every member has to necessarily avail of such services in the normal course of trading in securities in the Stock Exchange. Such services, therefore, would undoubtedly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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