9911796707
TMI Blog2023 (12) TMI 933X X X X Extracts X X X X X X X X Extracts X X X X ..... for the petitioner states that the discretion to stay the demand during the pendency of an appeal has to be exercised judiciously and reasonably, based on relevant grounds, with due application of mind, and must not be exercised arbitrarily or capriciously or based on irrelevant considerations. He states that in complete violation of this mandate, the impugned orders are arbitrary in nature, have been passed mechanically, and suffer from complete non-application of mind. 3. He states that the impugned order fails to consider that the petitioner has a strong prima facie case on merits as the petitioner's Service Agreement with Justice and Education Fund Inc. (hereinafter referred to as 'JEF'), contents supplied, receipts through proper banking channels were duly disclosed in the ITR and legitimacy of business activity, or expenditure of the petitioner were undisputed. He emphasises that the prices of deliverables were mentioned item wise and the proprietary rights in the articles, videos and short scripts were to belong exclusively to JEF under the Service Agreement executed between the parties. The relevant portion of the Service Agreement referred to and relied upon by learned s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not binding and do not act as a fetter on the discretionary powers vested under Section 220(6) as held by the Supreme Court in CIT V. LG Electronics India (P) Ltd., (2018) 18 SCC 447. 6. Learned senior counsel for the petitioner states that the respondents erred in rejecting the petitioner's application for stay by holding that the petitioner had not demonstrated its financial stringency, which is entirely untenable and contrary to the financial statements like balance sheet placed on record by the petitioner. He further states that in a case as the present one, where the assessee demonstrates a strong prima facie case, that in itself is sufficient ground for necessitating a stay on demand. 7. Undoubtedly, the power vested under Section 220(6) of the Act, 1961 is discretionary and it is not mandatory to pre-deposit 20% of the assessed amount to obtain stay of deposit at the stage of filing the appeal before the Commissioner of Income Tax (Appeals). In the present case, the Assessing Officer in the assessment order has given a number of cogent findings against the petitioner. In fact, the Assessing Officer after analyzing a number of relevant facts has virtually held that the tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d clause 1A, The Justices and Education Fund may give directions to Newsclick for managing the content of portal and such other services will also be provided as may be required by the company. Assessee was show caused to prove/establish whether any such directions were ever received by Newsclick.......However, on perusal of same, it is seen that Assessee has only submitted some communication to show how joint content development is being done. The proofs submitted falls short of even basic level of direction. It may be noted that as per his own submission, Assessee has billed the foreign entity for 1469 stories, 763 videos and 396 scripts for getting revenue of over Rs 15.53 crores. From submissions, it is not clear how and when direction for desired content were ever received by Assessee from foreign entity....... 5.5.1 .....it is noticed that Assessee has not received any biding/substantive directions/guidelines which otherwise would have been given by The Justices and Education Fund regarding the topic, content and the relevance of issues for delivery of the services. This abnormality is when seen in context of receiving more than Rs. 15.53 crore casts strong aspersions on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s PPK Newsclick Studio LLP. As per the details filed in Income Tax Returns of M/s PP Newsclick Studio LLP, it was incorporated on 28.04.20215 and was not carrying out any operations. Further, on analysis of the digital evidences gathered in the survey proceedings, it is revealed that the LLP was converted into Private Limited company only for the purpose of receiving foreign funding..... Hence on perusal of these emails it can be clearly seen that the said conversion of LLP into company was done only for the purpose of receiving foreign funds from WWM in form of share premium in other years. The finding related to infusion of fund in form of share premium further strengthens the fact that the assessee has been undertaking activities to receive foreign remittance in one form or another.... 6.4 ....It was also found that there was no exclusivity factor with respect to the services provided. It would not be out of place to mention that the same videos and the article that were provided in lieu of revenue received/recognized were also posted by the assessee on his own portal/online space. It is beyond comprehension that why would anybody make such major payments (running in cror ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kraborty are genuine business expenses of the assessee in lieu of services rendered by Sh. Amit Chakraborty. 7.3 The facts have been perused and it is found that the argument by Assessee is devoid of merits and is nothing more than a make-believe concocted story. The assessee has not objected to the categorical finding that Sh. Anup Chakraborty has been paid an amount of Rs. 13,90,275/- without any provision of services. Then to explain the incongruency, Assessee has made this story that his brother gave services. It is not understandable that how come, payments need to be made to a completely different person. Further, it is pertinent to mention here that the assessee has even deducted Taxes at Source in the name of Sh. Anup Chakraborty and not in the name of Sh. Amit Chakraborty who has (according to the argument of the Assessee) provided services to them. Further, the circumstantial evidences also do not corroborate the argument of the assessee. The person in question is living in a metro and it is not the case of a migrant labor/poor person where the payment may be made to his family living in a remote area or inaccessible area with the perspective of access to Banking servi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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