9911796707
TMI Blog2016 (12) TMI 488X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Non-deduction of tax at source u/s.194H - default in respect of payment of bank guarantee charges - Held that:- The Mumbai Bench of Tribunal in the case of Kotak Securities Ltd. vs. DCIT, (supra) has held that bank guarantee charges are not liable for deduction of tax under section 194H on the ground that such transactions are on principal to principal basis and the element of agency which is essential to cover it as 'commission' as per Explanation to section 194H is absent. Appeal of the Revenue is dismissed whereas appeal of the Assessee is allowed. - ITA No.5589/Mum/2014, ITA No.5158/Mum/2014 - - - Dated:- 2-12-2016 - SHRI R.C.SHARMA, AM and SHRI RAVISH SOOD, JM For The Assessee : Shri Vijay Mehta For The Revenue : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 'fee for technical services' and hence, covered under section 194J of the Act. The aforesaid stand of the Assessing Officer was not approved by the CIT(Appeals) following the ratio of the judgment of the Hon'ble Madras High Court in the case of Skycell Communications Ltd. vs. DCIT, 251 ITR 53(Mad). For the said reason, Revenue is in appeal before us. 4. Before us, the Ld. Representative for the respondent assessee, at the outset, pointed out that in the assessee's own case for the same ITA No. 4884/MUM/2014 (Assessment Year : 2009-10) year with another TAN particulars, similar decision of the CIT(Appeals) has been accepted by the Revenue as no appeal was filed before the Tribunal. The Ld. Representative for the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITA No. 4884/MUM/2014 (Assessment Year : 2009-10) the Act, as it is a payment for obtaining a standard facility and not for technical services. Thus, on this aspect Revenue has to fail. 6. In Grounds of appeal No.3, the case set up by the Revenue is that the CIT(Appeals) has erred in holding that bank guarantee charges paid to the bank are not liable for deduction of tax at source under section 194H of the Act. 6.1 On this aspect of the controversy, it was a common point between the parties, that the Mumbai Bench of Tribunal in the case of Kotak Securities Ltd. vs. DCIT, 147 TTJ 443(Mum) has held that bank guarantee charges are not liable for deduction of tax under section 194H on the ground that such transactions are on princip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not find any infirmity in the order of CIT(A) holding that assessee is not in default for non-deduction of TDS on such payments. Accordingly, appeal of the revenue is dismissed. 6. The assessee in its appeals i.e. ITA No.5974 5973/Mum/14(AY:2011-12 2012-13), has taken common grounds, which pertain to deduction of tax at source in respect of expenditure by way of amount paid for maintenance of computer service u/s.194J. 7. We have considered rival contentions and found that so far as the expenditure on AMC is concerned, the assessee had deducted tax at source as per the provisions of S.194C of the Act and this is also the law laid down by the Tribunal in the case of Facets Polishing Works (P) Ltd. Vs. ITO(TDS) [69 SOT 361(Ahd) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch, as discussed above, we do not find any merit in the action of the lower authorities for holding that assessee is liable for deducting tax u/s.194J, in respect of internet charges and computer maintenance charges paid by the assessee. 11. In the result, both appeals of the assessee are allowed, whereas appeal of the revenue is dismissed. 7. We also found that issue is covered by the decision of Hon ble Supreme Court in case of Kotak Securities Ltd., 383 ITR 1. 8. The facts and circumstances during the year under consideration are same, respectfully following the order of the Tribunal, we do not find any merit in the order of the AO for holding the assessee in default in respect of payment of internet charges and bank guaran ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
