9911796707
TMI Blog2019 (4) TMI 1317X X X X Extracts X X X X X X X X Extracts X X X X ..... td. ] 2014 (11) TMI 732 - DELHI HIGH COURT] The bank in question is not concerned with buying or selling of goods or even with the reason and cause as to why the card was swiped. It is not bothered or concerned with the quality, price, nature, quantum etc., of goods bought/ sold. The bank merely provides banking services in the form of payment and, subsequently, collects the payment. The amount punched in the swiping machine is credited to the account of the retailer by the acquiring bank, after retaining a small portion of the same as their charges. The banking services cannot be covered and treated as services rendered by an agent for the principal during the course of buying or selling of goods as the banker does not render any servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion is, whether the Respondent, while making payment to the bank of credit card charges, was required to deduct tax at source. It is true that this question has been admitted by the High Court in Department's Appeal. However, recently on 18th December, 2018 while hearing Income Tax Appeal No.847 of 2016 and connected Appeal filed by the Department, this Court considered the following question : Whether on the facts and in the circumstances of the case and in law, the Hon ble ITAT is justified in holding the deletion of disallowance ₹ 1,96,68,165/ under section 40a(ia) by the Tribunal without appreciating that the assessee had failed to deduct tax at source from commission paid to Banks for providing credit car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, therefore, the charge collected by the Bank for such service, does not amount to commission within the meaning of Section 194H of the Act. 3 The decision of the Delhi High Court in the case of JDS Apparels P. Ltd., (supra) was also rendered in the background of the Revenue's contention of breach of Section 194H of the Act in connection with the credit card charges. The Court, after analyzing the provisions contained in Section 194H of the Act, held and observed as under: 15: Applying the above cited case law to the factual matrix of the present case, we feel that section 194H of the Act would not be attracted. HDFC was not acting as an agent of the respondent assessee. Once the payment was (Delhi) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e charged by them for having rendered the banking services and cannot be treated as a commission or brokerage paid in course of use of any services by a person acting on behalf of another for buying or selling of goods. The intention of the Legislature is to include and treat commission or brokerage paid when a third person interacts between the seller and the buyer as an agent and thereby renders services in the course of buying and/or selling of goods. This happens when there is a middleman or an agent who interacts on behalf of one of the parties, helps the buyer/seller to meet, or participates in the negotiations or transactions resulting in the contract for buying and selling of goods. Thus, the requirement of an agent and principal re ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
