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TMI Blog2018 (7) TMI 1165X X X X Extracts X X X X X X X X Extracts X X X X ..... to tax in the hands of the payee. Hence, there was no liability on the part of payer to deduct tax at source. In the present case, we find that except for the assessee’s submission that the recipient being non-resident is not chargeable to tax on the sum paid, there is no decision of honourable High Court backing the scheme. Furthermore, we are not sitting in judgement on the chargeability in hands of the recipient as the facts and the necessary background material are not available on record before us. - decided against assessee - I.T.A. Nos.667 to 674/Mum/2016 - - - Dated:- 9-7-2018 - SHRI SHAMIM YAHYA, AM AND SHRI RAVISH SOOD, JM For The Appellant : Shri Abhishek Tilak For The Respondent : Shri M. V. Rajguru ORDER Per Bench: These are appeals by the assessee against the respective orders of the ld. Commissioner of Income Tax (Appeals) for the concerned assessment years. Since the issues are common and the appeals were heard together these have been disposed of by this common order. 2. The common grounds of appeal read as under: 1. On the facts, and in the circumstances of the case, and in law, the learned Commissioner of Income-tax (Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 141 ITR 626 (Bom.) 5. Since the facts are identical, we are referring to the facts and figures from ITA No. 667/Mum/2016. Accordingly, we adjudicate the issues arising out of all the above grounds including the additional grounds as under: 6. The assessee in this case has filed an appeal under section 248 of the income Tax Act, 1961 (the Act) contesting its liability to deduct TDS under section 195 the Act. The assessee has made certain remittances (being transponder lease rentals) to Measat Satellite Systems Snd. Bhd. Malaysia (Measat). Although denying its liability to pay TDS on this amount, the assessee has deducted TDS on its remittances to Measat. It has filed an appeal before the ld. Commissioner of Income Tax (Appeals) claiming that the amounts paid to the non resident are not liable to tax in India and hence it does not have a liability to deduct TDS on these remittances. 7. Brief facts of the case are that the assessee is a company registered in India and is primarily engaged in broadcasting television channels from India. It is also engaged in marketing of advertising airtime on these channels, distribution of the channels, marketing and distribution of films an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to Intelsat, USA to be in the nature of royalty, thus upholding the order of the A.O. under section 195(2). The ITAT held that: 17. Thus it is clear that in the case of Siemens Aktiengesellschaft (supra) it was found that the payment was not royalty as defined in the clauses of agreement and, therefore, it could not be taxed as royalty as per the provisions of the Act. The Hon'ble High Court though was of the view that if any term Is not at all defined in the treaty then considering the express language of Article 1(2) of the Indo- German DTAA, the term defined in the act even by subsequent to the date of agreement would be applicable as set out in the Article 1(2) of the treaty Therefore the said decision will not help the case of the assessee before us because the Explanation 6 defines the term process and not royalty and further there is no change in the definition of royalty by virtue of Explanation 6. The other decisions relied upon by the assessee are based on the decision of Hon'ble Delhi High Court in the case Asia Satellite Communication Co Ltd (supra) which was prior to the amendment and without considering the Explanation 6 as well as Explanation below sub-s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the transponder fee paid by the ass to MEASAT Malaysia was in the nature of royalty under the treaty as well as under the Income Tax Act. Ground no. 2 of the appeal is decided accordingly against the ass and in favour of the Revenue. 5.4 The facts of the present appeal are entirely same. Respectfully following the above judgment of the Hon'ble ITAT in respect of the same assessee on same issues, the claim made by the appellant in its appeal that it is not liable to deduct tax from the transponder fees payable to Measat is liable to be dismissed. 6. In the result, it is held that the remittances made by the appellant to Measat represent income in the nature of royalty both under the Income Tax Act as well as the DTAA between India and Malaysia Hence, the amounts are held to be liable to tax in India. The appellant is held liable to deduct suitable tax from the transponder fees payable by the appellant to MEASAT 10. Against the above order, the assessee is in appeal before us. 11. We have heard both the counsel and perused the records. It transpires that this tribunal in assessee s own case has considered the same issue as raised in the main grounds of appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal s finding in assessee s own case supra in paragraph 12 above wherein the Tribunal observed that Hon ble Madras High Court in the case of Verizon Communication (supra) while considering identical issue has observed in paragraph 33 as under . 7.5 Hence in the present situation, we have a Tribunal decision in assessee s own case wherein ratio from decision of Hon ble Madras High Court has been followed. Hence the learned Counsel of the assessee s pleading to take a different stand on the basis of a Delhi High Court decision which has not followed the Hon ble Madras High Court decision is not sustainable. This is more so in absence of any jurisdictional High Court decision and after noting the fact that assessee is in appeal before the Hon ble jurisdictional High Court against the Tribunal s decision in assessee s own case wherein decision of a High Court has been specifically followed. Hence following the aforesaid consistent decisions of the ITAT in assessee s own case, for successive four years, which has been appealed against but not yet reversed by Hon ble jurisdictional High Court, we do not find any infirmity in the order of the learned CIT(A). Accordingly, we uphold the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon the assessee to deduct tax at source. Hence, the present issue in the appeal as to whether the assessee was liable for deducting the TDS on transponder fee payable to MEASAT Malaysia has to be decided against the assessee by following the decision of the ITAT in assessee s own case hereinabove, since the reasoning submitted by the ld. Counsel of the assessee to deviate from the earlier order of the tribunal in assessee s own case had already been dealt with hereinabove. 16. It will further be not out of place to mention that in judicial hierarchy decisions of honourable High Court are ranked higher than that of the tribunal. Furthermore, in some of the decisions of the tribunal referred by the learned counsel of the assessee, the decision in favour of assessee was also rendered by taking into account the fact that it had been conclusively held by honourable High Court that the income was not chargeable to tax in the hands of the payee. Hence, there was no liability on the part of payer to deduct tax at source. In the present case, we find that except for the assessee s submission that the recipient being non-resident is not chargeable to tax on the sum paid, there is no de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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