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TMI Blog2011 (5) TMI 1140X X X X Extracts X X X X X X X X Extracts X X X X ..... Stock Exchange were for technical services and come within the purview of Sec. 194J and 194C of the I.T. Act and therefore liable for deduction of tax. 3. Before the Ld. CIT(A) the assessee submitted that the VSAT and Lease line charges, transaction charges and other charges are reimbursement charges paid by the members of the Stock Exchange in lieu of infrastructure and trading facilities provided by the stock exchange. The VSAT and Leasline, transaction charges etc. paid to stock exchange are not payments which come within the domain of fee for technical services and they are also not for any work done by Stock Exchange for the member broker. The Ld. CIT(A) relying on the decision of ITAT Mumbai Bench in ITA No. 1955/M/08 for A.Y. 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Exchanges do not provide any technical services by installing VSAT network. It is the facility provided to its members, such payment cannot be said to be nature of fees for any technical services rendered. Stock Exchanges merely provide facilities for its members to purchase and sell shares within frame work of its bye-laws. It also provides for a mechanism for settlement of dispute between the brokers and its customers. Stock Exchanges do not involve them in providing any technical services to any of its members. We are of the view that this ratio of Hon'ble Madras High court will apply to the facts of the present case. The Assessing Officer in coming to the conclusion that the payment was for fee for technical services has relied on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... distinguishing feature brought on record by the revenue we respectfully following the order of the Tribunal supra, hold that the payment of V-SAT charges and leaseline charges cannot be considered as fees for technical services rendered and accordingly we are inclined to uphold the order of the ld. CIT(A) in deleting the disallowance made by the AO. The grounds taken by the revenue are therefore rejected. 5. We also find that the transaction charges are covered in favour of the assessee by the decision of the Mumbai Tribunal in the case of Kotak Securities Ltd. vs Addl. CIT in 25 SOT 440, wherein it has been held as under: To call a payment as fees for technical services it should have been said in consideration for rendering by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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