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TMI Blog2016 (1) TMI 1213X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and in the circumstance of the case and in law, the Tribunal was justified in upholding the order of the Commissioner of Income Tax (Appeals) (CIT(A)) and holding that the PSF paid by the asssessee to the airport operators was not covered under the definition of rent given in the Explanation (i) to Section 194-I of the Act and the assessee was not liable to deduct tax at source under Section 194-I of the Act? (ii) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in holding the order of the CIT(A) and holding that the amount retained by a bank/credit card agency out of the sale consideration of the tickets booked through credit cards is not covered under the definition of "commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g aggrieved the respondent carried the issue in appeal to the Commissioner of Income Tax (Appeals) (CIT(A)). By an order dated 10th May, 2012, the CIT(A) held that the PSF collected from the passengers and paid over to the Airport Operator was not in the nature of rent as defined in Section 194-I of the Act. Consequently there was no obligation on the respondent to deduct tax at source under Section 194-I of the Act while handing over the amounts received from its passengers. (c) Being aggrieved with the order of the CIT(A) the Revenue carried the issue in appeal to the Tribunal. The impugned order of the Tribunal placed reliance upon Rule 88 of the Indian Aircraft Rules, 1937 which inter alia provides that licensee i.e. (Airport Operator) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... secure building and furniture. At this we are asked Mr. Chhotaray to identify the facts as reflected in the orders of the Revenue Authorities in support of the aforesaid submissions. Our attention was invited to page 17 of the order dated 10th May, 2012 of the CIT(A) where it is observed that PSF is consideration paid by the passengers for security, handling of baggage, toilets, etc. (e) We find in the present facts the respondent collects PSF from only its embarking passengers for and on behalf of the Airport Operator. In terms of Rule 88 of the Indian Aircraft Rules the Airport Operator is entitled to collect PSF which provides as under: " the licensee is entitled to collect fees to be called as Passengers Services Fees (PSF) from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent as provided under Section 194-I of the Act. The Apex Court while upholding the view of the Madras High Court held that when the airlines pay for landing and parking charges, "treating such charges as charges for "use of the land" would be adopting a totally naive and simplistic approach which is far away from reality. We have to keep in mind the substance behind such charges. When the matter is looked into from this angle, keeping in view the full and larger picture in mind, it becomes very clear that the charges are not for use of the land per se and therefore it cannot be treated as rent within the meaning of section 194-I of the Act." It may be observed that the Apex Court did further observe that in view of the explanation to Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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