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TMI Blog2021 (12) TMI 511X X X X Extracts X X X X X X X X Extracts X X X X ..... s are as follows: Sl. No. Assessment Year Order date of Assessing Officer Order of Commissioner of Income Tax (Appeals) Order of Income Tax Appellate Tribunal I.T.A. No. 1 2008-09 31/12/10 ITA No.78/Ktm/CIT(A)- IV/10-11 dt.04.06.2013 ITA No.510/Coch/2013 dt.25.10.2016 13/2017 2 2008-09 31/12/10 ITA No.79/Ktm/CIT(A)- IV/10-11 dt.04.06.2013 ITA No.512/Coch/2013 dt.25.10.2016 18/2017 3 2006-07 28/12/09 ITA No.37/Ktm/CIT(A)- IV/09-10 dt.05.06.2013 ITA No.511/Coch/2013 dt.25.10.2016 29/2017 3. Heard learned Senior Standing Counsel Mr.Christopher Abraham for Revenue and learned Counsel Mr.Anil Sivaraman for assessee. Both the counsel refer to and rely on the details covered by I.T.A. No.18/2017 and stated that advertance to the details in I.T.A. No.18/2017 would be sufficient for disposing of the other two appeals as well. 4. One T Murugan was the Proprietor of M/s.Meenakshy Lucky Centre/a proprietory concern doing business as a wholesale dealer of lottery tickets. The assessee was engaged in the said business as Stockist for the sale of lottery tickets of various government/quasi-government agencies and State governments. The assessee purchases lottery tickets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al dismissed the appeal. Hence the appeal. The appellant raises the following substantial questions of law in the instant appeal: "1. Whether, on the facts and in the circumstances of the casei) The payment made by the assessee to the Sub-agents fall within the clutches of Section 194G/194H of the Income Tax Act? ii) The provisions of section 40(a)(ia) are attracted to the above payments? 2. Did not the Tribunal err in deleting the disallowance made u/s 40(a)(ia) for non-deduction of tax at source u/s.194H/194G of the Income Tax Act from the payment of commission to subagents? 3. Should not the Tribunal have considered the issues raised (declined to be considered in paragraph 12 of the order on merits?" 6. The learned Counsel appearing for the parties have, in great detail, invited our attention to all the three orders of the authorities filed as Annexures A to C. The arguments now made in support of the respective cases by the learned counsel are similar to the arguments made before the CIT(Appeals) and the Tribunal. The Revenue contends that from the nature of admitted circumstances and the conduct of lottery business, the assessee, though a Stockist or wholesale dealer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and perused the record. Questions 1 to 4 9. The short and long of substantial questions framed centers around the premise on which deduction is rejected and added to the income of assessee and tax is levied, and, on the other hand, assessee contends: that the relationship between the assessee and the buyers of lottery tickets from the assessee is not an agent or purchaser. Stated simply, assessee claimed that lottery tickets were purchased at discount from the organising agency and, by retaining a margin of the discount so received, lottery tickets were sold to retail sellers. Hence, none of the incidences covered by Section 194 G or Section 194 H is attracted. At this juncture, to avoid reiteration of what has been held as a fact we deem it very useful to refer to the consideration of this aspect by the CIT (Appeals). In his order dated 04.06.2013, the learned CIT (Appeals) first had taken up for consideration the scope and applicability of Section 194H of the Act to the controversy in the subject assessment, and, thereafter, examined whether the sub-dealers purchasing lottery tickets from the assessee had rendered any service to the assessee in the course of buying or selling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transactions covered for the addition made by the Revenue.. 10.1 The alternative argument of the Revenue is that Section 194G of the Act is attracted and addition of amount covered by payments made to buyers of lottery from assessee is correct. Section 194G reads thus: Section 194G is attracted, which reads as under: "Any person who is responsible for paying, on or after the 1st day of October, 1991 to any person, who is or has been stocking, distributing, purchasing or selling lottery tickets, only income by way of commission, remuneration or prize (by whatever name called) on such tickets in an amount exceeding one thousand rupees shall, at the time of credit of such income to the account of the payee or at the time of payment of such income in cash or by the issue of a cheque or draft by any other mode, whichever is earlier, deduct income tax thereon at the rate of ten per cent" 10.2 The assessee acts as a post-office by receiving counterfoils of prize winning tickets sold by different retailers in the organisation of lottery business presented to the State government and the prize/incentive/bonus received from the government is transferred to retailers. In the circumstance ..... 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