Dish TV India Ltd., Noida V. DCIT (TDS), Noida

ITA 228/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 8357 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 13-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAGDISH SINGH
• Keywords: Period of limitation; Retrospective amendment; Time period of passing order; TDS
• Section: 194C; 201(1); 195; 201; 194J; 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B: NEW DELHI (THROUGH VIDEO CONFERENCING) BEFORE, SHRI G. S. PANNU, VICE PRESIDENT AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER I.T.A NO.227/DEL/2017 (ASSESSMENT YEAR 2012-13) I.T.A NO.228/DEL/2017 (ASSESSMENT YEAR 2013-14) M/S DISH TV INDIA LTD. FC-19, SECTOR-16A, FILM CITY, NOIDA-201 301 (U.P.) PAN-AAACA 5478M VS. DY. CIT (TDS) 2D, 1 ST FLOOR, ROOM NO.110, SEC.24, NOIDA-201 301 (U.P.) (APPELLANT) (RESPONDENT) APPELLANT BY SH. SANJIV SAPRA, CA RESPONDENT BY SH. JAGDISH SINGH, SR. DR DATE OF HEARING 03.11.2020 DATE OF PRONOUNCEMENT 15.01.2021 ORDER PER SUDHANSHU SRIVASTAVA, JM: BOTH THESE APPEALS ARE PREFERRED BY THE ASSESSEE. ITA 227/DEL/2017 IS AGAINST THE ORDER DATED 11.11.2016 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-I, NOI DA {CIT(A)} FOR ASSESSMENT YEAR 2012-13 WHEREAS ITA NO.228/DEL/2017 PERTAINS 2 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT TO ASSESSMENT YEAR 2013-14. BOTH THE APPEALS INVOLV E IDENTICAL ISSUES. THEREFORE, THESE APPEALS WERE HEARD TOGETHE R AND THEY ARE BEING DISPOSED OF THROUGH THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2.0 THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PUBLIC LIMITED COMPANY ENGAGED IN THE BUSINESS OF ESTABLIS HING, MAINTAINING AND OPERATING DIRECT-TO-HOME (DTH) PLAT FORM UNDER THE LICENSE GRANTED BY THE CENTRAL GOVERNMENT. FOR ASSE SSMENT YEAR 2012-13, A TDS VERIFICATION LETTER WAS ISSUED BY TH E ASSESSING OFFICER TO VERIFY THE COMPLIANCE TO TDS PROVISIONS. DURING THE COURSE OF VERIFICATION, IT WAS OBSERVED THAT THE ASS ESSEE HAD BEEN MAKING PAYMENTS, WHICH AS PER THE ASSESSING OFFICER (AO), ATTRACTED DEDUCTION OF TAX AT SOURCE (TDS). THE ASS ESSING OFFICER ALSO NOTED THAT THE ASSESSEE HAD DEDUCTED TAX AT SO URCE WHILE MAKING PAYMENTS TO TELEVISION CHANNELS IN INDIA AND ALSO ABROAD AND HAD DEDUCTED TDS U/S 194 AND 195 OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED THE ACT). THE ASSESSING OFFICER ALSO NOTED THAT THERE WERE SOME IRREGULARITIES WITH RESPECT TO SOME OF THE 3 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT DEDUCTEES VIS. M/S CONAX ACCESS SYSTEMS (PVT.) LTD. , TATA TELE SERVICES LTD., PROACTIVE DATA SYSTEMS (PVT.) LTD., TULIP TELECOM AND INTEGRATED SUBSCRIBER MANAGEMENT SERVICES LTD. THE ASSESSING OFFICER COMPUTED SHORT DEDUCTION OF TAX AT RS.4,30, 431/- AND COMPUTED INTEREST AT RS.53,48,144/- THEREBY CREATIN G A TOTAL DEMAND OF RS.57,78,575/- U/S 201(1)/201(1A) OF THE ACT FOR ASSESSMENT YEAR 2012-13. 2.1 IN ASSESSMENT YEAR 2013-14 ALSO A LETTER WAS IS SUED BY THE ASSESSING OFFICER TO VERIFY THE COMPLIANCE OF T HE TDS PROVISIONS AND DURING THE COURSE OF SUCH VERIFICATION, THE ASS ESSING OFFICER NOTED THAT THERE WAS IRREGULARITIES IN RESPECT OF DE DUCTION OF TAX AT SOURCE IN RESPECT OF M/S CONAX ACCESS SYSTEM (PVT.) LTD., TATA TELE SERVICES LTD., PROACTIVE DATA SYSTEMS (PVT.) LTD., TULIP TELECOM, INTEGRATED SUBSCRIBER MANAGEMENT SERVICES LTD. AND CYQUATOR MEDIA SERVICES (PVT.) LTD. THE ASSESSING OFFICER PR OCEEDED TO COMPUTE THE SHORT DEDUCTION OF TAX AT SOURCE AT RS. 75,183/- AND INTEREST AT RS.64,62,048/- THEREBY CREATING A TOTAL DEMAND OF RS.65,37,231/- U/S 201(1)/201(1A) OF THE ACT. 4 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT 2.2 THE ASSESSEES APPEALS FOR BOTH THE YEARS WERE DISMISSED BY THE LD. CIT (A) AND NOW THE ASSESSEE IS BEFORE TH IS TRIBUNAL CHALLENGING THE DISMISSAL OF ITS APPEALS. THE GROUN DS RAISED IN BOTH THE YEARS ARE AS UNDER: ITA NO.227/DEL/2017 FOR ASSESSMENT YEAR 2012-13: 1. THAT THE LD. AO HAD ERRED IN LAW AND ALSO ON T HE FACTS OF THE CASE BY PASSING THE IMPUGNED ORDER U/S 201 (1)/ 201 (1A) OF I.T. ACT BY CREATING A TOTAL DEMAND OF RS.57.78.575 1- AND THE LD. CIT (A) WAS NOT AT ALL JUSTIFIED IN CONFIRMING THE ACTION OF THE LD. AO BECAUSE THE PROVISIONS OF CHAPTER XVIIB OF T HE I.T. ACT WERE NOT APPLICABLE. 2. THAT WITHOUT PREJUDICE TO GROUND NO. 1 ABOVE, S ECTION 194J OF THE I.T. ACT WERE NOT APPLICABLE TO THE FAC TS OF APPELLANTS CASE AND THE APPELLANT HAD CORRECTLY DE DUCTED THE TAX AT SOURCE AS PER SECTION 194C OF THE I.T. ACT. 3. THAT THE SHORT DEDUCTION OF TDS WORKED OUT BY TH E LD. AO AND CONFIRMED BY THE LD. CIT (A) IS CONTRARY TO THE PROVISIONS OF THE ACT AND THEREFORE, THE ORDERS PASSED BY THE AUT HORITIES BELOW DESERVE TO BE ANNULLED/CANCELLED. 4. THAT THE AUTHORITIES BELOW HAD ALSO ERRED IN LAW AND ALSO ON THE FACTS OF THE CASE BY IGNORING THE DOCUMENTS FILED BY THE APPELLANT SHOWING THAT DEDUCTEES HAD ALREADY FILED THE RETURNS AND PAID TAX ON THEIR RESPECTIVE INCOME THEREBY IGN ORING CBDT CIRCULAR AND HONBLE SUPREME COURT JUDGMENT IN THE CASE OF HINDUSTAN COCO COLA BEVERAGES (P) LTD. WHICH WERE B INDING ON THE AUTHORITIES BELOW AND THEREFORE THE ORDERS PASS ED BY THE AUTHORITIES BELOW ARE LIABLE TO BE CANCELLED. 5 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT 5. THAT WITHOUT PREJUDICE TO THE ABOVE GROUNDS, TH E AUTHORITIES BELOW HAD ERRED IN LAW AS WELL AS ON FA CTS IN LEVYING /CHARGING INTEREST ON THE ALLEGED SHORT DEDUCTION O F TAX CONSIDERING THE PAYMENTS/CREDITS MADE TO CONAX ACCE SS SYSTEM PVT. LTD. (CONAX) TO BE LIABLE FOR DEDUCTI ON U/S 194J OF I.T. ACT AS AGAINST SECTION 194C AND CONSEQUENTLY, SUCH INTEREST OF RS.4,85,643/- ON THE ALLEGED SHORT DEDUCTION IS LIABLE TO BE CANCELLED. 6. THAT WITHOUT PREJUDICE TO THE ABOVE, THE AUTHOR ITIES BELOW HAD ERRED IN LAW AS WELL AS ON FACTS IN HOLDING THA T PAYMENTS MADE TO TATA TELESERVICES (TTL) WERE TECHNICAL IN THE NATURE AND WILL ATTRACT PROVISIONS OF SECTION 194J OF THE ACT FOR TAX DEDUCTION AT SOURCE THEREBY IGNORING THE FACT THAT THE APPELLANT HAD PURCHASED AIRTIME FROM TTL AND THE SAME DID NOT FALL WITHIN THE AMBIT OF TAX DEDUCTION AT SOURCE AND CON SEQUENTLY, THE ALLEGED SHORT DEDUCTION/NON DEDUCTION OF RS.4,0 3,616/- AND INTEREST U/S 201(1A) OF RS.1,85,474/- DESERVES TO B E DELETED. 7. THAT THE AUTHORITIES BELOW HAD ALSO ERRED IN HO LDING THAT VARIOUS PAYMENTS MADE TO CYQUATOR MEDIA SERVICES PR IVATE LIMITED (CMSPL) (FORMERLY KNOWN AS ESSEL BUSINESS P ROCESSES LIMITED/INTEGRATED SUBSCRIBER MANAGEMENT SERVICES L IMITED (EBPL/ISMSL), SUBSEQUENTLY MERGED WITH CMSPL) (CMS PL' OR 'ISMSL OR EBPL) WILL ATTRACT PROVISIONS OF SECTI ON 194J AND NOT SECTION 194C FOR DEDUCTION OF TAX AT SOURCE AND THEREFORE, INTEREST CHARGED OF RS.46,64,641/- U/S 201(1 A) ON ALLEGED SHORT DEDUCTION OF TAX AND INTEREST DESERVES TO BE DELETED. 8. THAT THE AUTHORITIES BELOW HAVE IGNORED THE FACT THAT EBPL HAS BEEN ISSUED LOWER DEDUCTION CERTIFICATE UNDER S ECTION 197 FOR PAYMENTS TO BE MADE BY THE APPELLANT TO EBPL UN DER SECTION 194C AND REVENUE HAS ACCEPTED SUCH CERTIFIC ATE FOR PAYMENTS BY THE APPELLANT LIABLE TO TAX DEDUCTION U NDER SECTION 194C. 9. THAT WITHOUT PREJUDICE TO ABOVE, THE LD . CIT(A) HAVE ERRED IN HOLDING THAT SINCE SERVICE TAX HAS BEEN LE VIED AND 6 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT RECOVERED ON THE SERVICES RENDERED TO THE APPELLANT , THE SAME ARE LIABLE TO THE PROVISIONS OF CHAPTER XVIIB OF TH E I T. ACT, IGNORING THAT SERVICE TAX IS LEVIED UNDER DIFFERENT STATUTE AND PROVISIONS OF CHAPTER XVIIB ARE RESTRICTED TO ONLY SUCH SERVICES MENTIONED IN THE I.T. ACT. 10. THAT WITHOUT PREJUDICE TO ABOVE, THE AUTH ORITIES BELOW HAS IGNORED THE ESSENCE OF AMENDMENT IN SECTION 201 (1 )/201 (1 A) OF THE ACT WHEREIN IT WAS BROUGHT INTO THE AC T THAT IF THE PAYEE HAS DISCHARGED ITS TAX LIABILITY, PAYER CANNO T BE HELD ASSESSEE IN DEFAULT FOR NON/SHORT DEDUCTION OF TAX. ACCORDINGLY, NO INTEREST COULD BE CHARGED ON THESE ALLEGED SHORT DEDUCTION/NON DEDUCTION AND THEREFORE, INTEREST WOR KED OUT U/S 201(1A) ON SHORT DEDUCTION DESERVES TO BE CANCELLED . 11. THAT THE LD. CIT (A) HAD IGNORES THE F ACT THAT THESE KIND OF CONTRACT FALL IN THE DEFINITION OF WORK AND ATTRACT SECTION 194C AND ARE NOT LIABLE TO TAX DEDUCTION U/S 194J. 12. THAT THE APPELLANT RESERVES ITS RIGHT TO ADD , AMEND/MODIFY THE GROUNDS OF APPEAL. ITA NO.228/DEL/2017 FOR ASSESSMENT YEAR 2013-14: 1. THAT THE LD. AO HAD ERRED IN LAW AND ALSO ON THE FACTS OF THE CASE BY PASSING THE IMPUGNED ORDER U/S 201 (1)/ 201 (1A) OF I.T. ACT BY CREATING A TOTAL DEMAND OF RS.65,37,231 /- AND THE LD. CIT (A) WAS NOT AT ALL JUSTIFIED IN CONFIRMING THE ACTION OF THE LD. AO BECAUSE THE PROVISIONS OF CHAPTER XVIIB OF T HE I.T. ACT WERE NOT APPLICABLE. 2. THAT WITHOUT PREJUDICE TO GROUND NO. 1 ABO VE, SECTION 194J OF THE I.T. ACT WERE NOT APPLICABLE TO THE FAC TS OF APPELLANTS CASE AND THE APPELLANT HAD CORRECTLY DE DUCTED THE TAX AT SOURCE AS PER SECTION 194C OF THE I.T. ACT. 3. THAT THE SHORT DEDUCTION OF TDS WORKED OU T BY THE LD. AO AND CONFIRMED BY THE LD. CIT (A) IS CONTRARY TO THE 7 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT PROVISIONS OF THE ACT AND THEREFORE, THE ORDERS PAS SED BY THE AUTHORITIES BELOW DESERVE TO BE ANNULLED/CANCELLED. 4. THAT THE AUTHORITIES BELOW HAD ALSO ERRED IN LAW AND ALSO ON THE FACTS OF THE CASE BY IGNORING THE DOCUMENTS FILED BY THE APPELLANT SHOWING THAT DEDUCTEES HAD ALREADY FILED THE RETURNS AND PAID TAX ON THEIR RESPECTIVE INCOME THEREBY IGN ORING CBDT CIRCULAR AND HONBLE SUPREME COURT JUDGMENT IN THE CASE OF HINDUSTAN COCO COLA BEVERAGES (P) LTD. WHICH WERE B INDING ON THE AUTHORITIES BELOW AND THEREFORE THE ORDERS PASS ED BY THE AUTHORITIES BELOW ARE LIABLE TO BE CANCELLED. 5. THAT WITHOUT PREJUDICE TO THE ABOVE, THE AUTHORITIES BELOW HAD ERRED IN LAW AS WELL AS ON FACTS IN HOLDI NG THAT PAYMENTS MADE TO TATA TELESERVICES (TTL) WERE TEC HNICAL IN THE NATURE AND WILL ATTRACT PROVISIONS OF SECTION 1 94J OF THE ACT FOR TAX DEDUCTION AT SOURCE THEREBY IGNORING THE FA CT THAT THE APPELLANT HAD PURCHASED AIRTIME FROM TTL AND THE SA ME DID NOT FALL WITHIN THE AMBIT OF TAX DEDUCTION AT SOURCE AN D CONSEQUENTLY, THE ALLEGED SHORT DEDUCTION/NON DEDUC TION OF RS.48,363/- AND INTEREST U/S 201(1 A) OF RS.13,299/ - DESERVES TO BE DELETED. 6. THAT THE AUTHORITIES BELOW HAD ALSO ERRE D IN HOLDING THAT VARIOUS PAYMENTS MADE TO CYQUATOR MEDIA SERVICES PR IVATE LIMITED (CMSPL) (FORMERLY KNOWN AS ESSEL BUSINESS P ROCESSES LIMITED/INTEGRATED SUBSCRIBER MANAGEMENT SERVICES L IMITED (EBPL/ISMSL), SUBSEQUENTLY MERGED WITH CMSPL) (CMS PL OR ISMSL OR EBPL) WILL ATTRACT PROVISIONS OF SECT ION 194J AND NOT SECTION 194C FOR DEDUCTION OF TAX AT SOURCE AND THEREFORE, INTEREST CHARGED OF RS.64,39,512/- U/S 201(1A) ON A LLEGED SHORT DEDUCTION OF TAX AND INTEREST DESERVES TO BE DELETE D. 7. THAT THE AUTHORITIES BELOW HAVE IGNORED T HE FACT THAT IN THE PREVIOUS YEAR, EBPL HAD BEEN ISSUED LOWER DEDUC TION CERTIFICATE UNDER SECTION 197 FOR PAYMENTS TO BE MA DE BY THE APPELLANT TO EBPL UNDER SECTION 194C AND REVENUE HA S 8 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT ACCEPTED SUCH CERTIFICATE FOR PAYMENTS BY THE APPEL LANT LIABLE TO TAX DEDUCTION UNDER SECTION 194C. 8. THAT WITHOUT PREJUDICE TO ABOVE, THE LD. C IT (A) HAVE ERRED IN HOLDING THAT SINCE SERVICE TAX HAS BEEN LE VIED AND RECOVERED ON THE SERVICES RENDERED TO THE APPELLANT , THE SAME ARE LIABLE TO THE PROVISIONS OF CHAPTER XVIIB OF TH E I.T. ACT, IGNORING THAT SERVICE TAX IS LEVIED UNDER DIFFERENT STATUTE AND PROVISIONS OF CHAPTER XVIIB ARE RESTRICTED TO ONLY SUCH SERVICES MENTIONED IN THE I.T. ACT. 9. THAT WITHOUT PREJUDICE TO ABOVE, THE AUTH ORITIES BELOW HAS IGNORED THE ESSENCE OF AMENDMENT IN SECTION 201(1)/201(1A) OF THE ACT WHEREIN IT WAS BROUGHT IN TO THE ACT THAT IF THE PAYEE HAS DISCHARGED ITS TAX LIABILITY, PAYER CANNOT BE HELD ASSESSEE IN DEFAULT FOR NON/SHORT DEDUCTION OF TAX. ACCORDINGLY, NO INTEREST COULD BE CHARGED ON THESE ALLEGED SHORT DEDUCTION/NON DEDUCTION AND THEREFORE, INTEREST WOR KED OUT U/S 201(1A) ON SHORT DEDUCTION DESERVES TO BE CANCELLED . 10. THAT THE LD.CIT (A) HAD IGNORES THE FACT THAT T HESE KIND OF CONTRACT FALL IN THE DEFINITION OF WORK AND ATTRACT SECTION 194C AND ARE NOT LIABLE TO TAX DEDUCTION U/S 194J. 11. THAT THE APPELLANT RESERVES ITS RIGHT TO ADD, AMEND/MODIFY THE GROUNDS OF APPEAL. 3.0 THE AUTHORIZED REPRESENTATIVE (AR) SU BMITTED THAT THE ASSESSEE WAS PLEADING TO RAISE ADDITIONAL GROUNDS IN ASSESSMENT YEAR 2012-13. HE DREW OUR ATTENTION TO THE ADDITION AL GROUNDS WHICH READ AS UNDER: 9 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT 1. THAT THE ORDER AS PASSED U/S 201(1)/201(1A) DAT ED 30/03/2015 FOR DETERMINING NON/SHORT DEDUCTION OF T DS FOR THE FIRST THREE QUARTERS OF FY 2011-12 WAS ILLEGAL AND VOID AB-INITIO SINCE THE SAME WAS PASSED AFTER THE EXPIRY OF LIMIT ATION PERIOD OF TWO YEARS FROM THE END OF THE FINANCIAL YEAR AS PRESCRIBED UNDER SUB-SECTION 3 OF SECTION 201 OF I.T. ACT. 2. THAT THE SHORT DEDUCTION OF TDS OF RS.4,03,618 A S DETERMINED VIDE ORDER U/S 201(1)/201(1A) DATED 30/0 3/2015 ON PAYMENTS TO TATA TELESERVICES LTD DESERVES TO BE DELETED AS SUCH ORDER WAS PASSED BEYOND THE PRESCRIBED LIMITAT ION PERIOD WHICH ENDED ON 31/03/2014. 3.1 THE LD. AUTHORIZED REPRESENTATIVE PLEADED THAT THESE ADDITIONAL GROUNDS WERE PURELY LEGAL GROUNDS AND TH AT THEY DESERVED TO BE ADMITTED AND ADJUDICATED UPON IN VIE W OF THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF NTPC LTD. VS. CIT AS REPORTED IN 229 ITR 383. 4.0 PER CONTRA, THE LD. SR. DEPARTMENTAL REPRE SENTATIVE (DR) OPPOSED THE ASSESSEES PRAYER FOR ADMITTING ADDITIO NAL GROUNDS. 10 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT 5.0 HAVING HEARD BOTH THE PARTIES AND AFTER HAVING GONE THROUGH THE ADDITIONAL GROUNDS SOUGHT TO BE RAISED BY THE ASSESSEE, WE ARE OF THE CONSIDERED OPINION THAT THESE GROUNDS ARE PURELY LEGAL GROUNDS GOING INTO THE VERY ROOT OF THE ISSUE AND, THEREFORE, IN THE INTEREST OF SUBSTANTIAL JUSTICE, THEY ARE ADMITTED. 6.0 THE LD. AUTHORIZED REPRESENTATIVE (AR) SUB MITTED THAT IN TERMS OF SECTION 201(3) OF THE ACT, WHICH WAS AMENDED BY FINANCE ACT, 2012 WITH RETROSPECTIVE EFFECT FROM 01. 04.2010 AND WHICH WAS APPLICABLE DURING THE ASSESSMENT YEAR 2012- 13 (FINANCIAL YEAR 2011-12), THE LIMITATION PERIOD FOR PASSING THE ORDER U/S 201(1) OF THE ACT WAS TWO YEARS FROM THE END OF T HE FINANCIAL YEAR IN WHICH THE STATEMENT WAS FILED. THE LD. AUTHOR IZED REPRESENTATIVE DREW OUR ATTENTION TO A CHART AND SUB MITTED THAT IN CASE OF ASSESSEE, THE ORDER U/S 201(1)/201(1A) FOR FINANCIAL YEAR 2011-12 WAS PASSED ON 30.03.2015 WHICH WAS BEYOND THE LIMITATION PERIOD AS SPECIFIED SECTION 201(3)(A) FO R THE FIRST QUARTER, THE SECOND QUARTER AND THE THIRD QUARTER SINCE THE STATEMENTS REFERRED TO IN SEC.200 FOR THESE THREE QUARTERS WER E FILED ON OR BEFORE THE END OF FINANCIAL YEAR ENDING 31ST MARCH, 2012. HE DREW 11 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT OUR ATTENTION TO THE CHART REFLECTING THESE DATES A S WELL AS COPIES OF THE TDS STATEMENTS ALONG WITH THEIR ACKNOWLEDGMENTS. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT, THEREFORE , FOR THESE THREE QUARTERS, THE LIMITATION PERIOD HAD EXPIRED ON 30.0 3.2014, AND, THEREFORE, THE IMPUGNED ORDER U/S 201(1), 201(1A), PASSED ON 30.03.2015 WAS BEYOND THE PERIOD OF LIMITATION AND WA S, THEREFORE, VOID AB INITIO . RELIANCE WAS PLACED ON THE JUDGMENT OF THE HONBL E GUJARAT HIGH COURT IN THE CASE OF TATA TELESERVICES LIMITED VS. UNION OF INDIA REPORTED IN 385 ITR 497 (GUJ.). RELIANCE WAS ALSO PLACED ON THE ORDER OF ITAT DELHI BENCH IN THE CASE OF HCL TECHNOLOGIES LTD. VS. ACIT (TDS) IN ITA NO.1723/DEL /2017 VIDE ORDER DATED 20.07.2020 . 6.1 WITH RESPECT TO THE MERITS OF THE CAS E, THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT GROUND NO.5 CHALLENGE S THE CHARGING OF INTEREST OF RS.4,85,643/- U/S 201(1A) ON ALLEGED SHORT DEDUCTION OF TAX ON PAYMENTS/CREDIT TO M/S CONAX ACCESS SYSTE MS (PVT.) LTD. BY HOLDING THAT TAX WAS TO BE DEDUCTED @ 10% U/S 194 J AS AGAINST THE RATE OF 2% U/S 194C AS MADE BY THE ASSESSEE. IT WAS FURTHER 12 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT SUBMITTED THAT IF THE ASSESSEES PLEA FOR THE QUASH ING OF THE IMPUGNED ORDER FOR THE FIRST THREE QUARTERS BASED O N THE ADDITIONAL GROUNDS OF APPEAL IS ALLOWED THEN THE DISPUTED INTE REST WILL BE LIMITED OF RS.1,15,293/- ONLY. THE LD. AUTHORIZED R EPRESENTATIVE SUBMITTED THAT CONAX ACCESS SYSTEMS (PVT.) LTD. WAS A CONTRACTOR PROVIDING OPERATIONS/SUPPORTS SERVICES FOR THE SMAR T CARD/VIEWING CARD WHICH WERE USED BY THE ASSESSEE FOR PROVIDING T HE DTH SERVICES TO ITS CUSTOMERS. OUR ATTENTION WAS DRAWN TO COPIES OF SAMPLE INVOICES ISSUED BY THE CONAX ACCESS SYSTEMS (PVT.) LTD. AND IT WAS SUBMITTED THAT FROM THE PERUSAL OF SUCH THE I NVOICES AS WELL AS OF THE COPY OF THE AGREEMENT WITH THE SERVICE PRO VIDER (PLACED IN THE PAPER BOOK) IT WOULD BE EVIDENT THAT THE SERVICE S PROVIDER WAS OWNING THE CONDITIONAL ACCESS SYSTEM PLATFORM AND WAS PROVIDING SUCH SYSTEM BASED SERVICES OF ACTIVATING AND MAINTA INING THE USE OF SMART CARDS BY THE ASSESSEE WHICH WAS STANDARD SERVI CE IN NATURE AND NOT EXCLUSIVE. IT WAS ALSO SUBMITTED THAT NO TE CHNICAL KNOWLEDGE WAS BEING PROVIDED TO OR BEING MADE AVAILAB LE TO THE ASSESSEE. THE LD. AUTHORIZED REPRESENTATIVE SUBMITT ED THAT SINCE THE SERVICES WERE PURELY PERTAINING TO MAINTENANCE, PROVISIONS OF 13 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT SECTION 194C OF THE ACT WERE APPLICABLE. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAD DEDU CTED TDS CORRECTLY @ 2%. OUR ATTENTION WAS ALSO DRAWN TO CBDT CIRCULAR NO.715 DATED 08.08.1995 WHEREIN IT HAD BEEN CLARIFIE D THAT ROUTINE, NORMAL MAINTENANCE CONTRACTS WHICH INCLUDES SUPPLY OF SPARES WILL BE COVERED UNDER SECTION 194C OF THE ACT. 6.2 WITH RESPECT TO GROUND NO. 6, THE LD. AUTHOR IZED REPRESENTATIVE SUBMITTED THAT THE AUTHORITIES BELOW HAD ERRED IN HOLDING THAT PAYMENTS MADE TO TATA TELESERVICES LIM ITED WERE TECHNICAL IN NATURE AND WOULD ATTRACT THE PROVISIONS OF SECTION 194J IGNORING THE FACT THAT THE ASSESSEE HAD PURCHASED A IRTIME FROM TATA TELESERVICES LTD AND THE SAME DID NOT FALL WITHIN TH E PURVIEW SECTION 194J OF THE ACT. IT WAS SUBMITTED THAT TATA TELESERVICES LTD. PROVIDED THE PLATFORM TO THE ASSESSEE FOR SENDING S YSTEM GENERATED BULK SMS MESSAGES REQUIRING NO HUMAN INTERVENTION A ND, THEREFORE, THE PURCHASE OF AIRTIME FROM THE TELECOM MUNICATION SERVICES PROVIDER COULD NOT BE CONSIDERED AS TECHNI CAL SERVICES AND, THEREFORE, SECTION 194J WAS NOT APPLICABLE IN THE AS SESSEES CASES. IT WAS ALSO SUBMITTED THAT THE ASSESSING OFFICER HAS NO T BROUGHT ON 14 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT RECORD ANY EVIDENCE TO SHOW THAT SUCH SERVICES AS RE NDERED BY TATA TELESERVICES WERE NOT STANDARD IN NATURE AND WERE S PECIAL, EXCLUSIVE OR CUSTOMIZED SERVICES FOR THE ASSESSEE. RELIANCE WAS PLACED ON THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF CIT VS. KOTAK SECURITIES LTD. REPORTED IN 383 ITR 1 (SC ). THE LD. AUTHORIZED REPRESENTATIVE ALSO SUBMITTED THAT IF AS SESSEES ADDITIONAL GROUNDS WERE ACCEPTED, THIS GROUND WILL B ECAME ACADEMIC IN NATURE. 6.3 WITH RESPECT TO GROUND NOS. 7 AND 8, THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT THESE GROU NDS CHALLENGED THE CHARGING OF INTEREST OF RS.46,64,641/- U/S 201( 1A) ON ALLEGED SHORT DEDUCTION OF TAX ON CONTRACTUAL PAYMENTS/CRED ITS MADE TO CYQUATOR MEDIA SERVICES PVT. LTD. BY ALLEGING THAT TDS WAS TO BE DEDUCTED AT THE RATE OF 10% IN TERMS OF SECTION 194 J AS AGAINST THE RATE OF 2%, AS APPLIED BY THE ASSESSEE U/S 194C OF THE ACT. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT THIS COMPA NY WAS PROVIDING CONDITIONAL ACCESS SERVICES (CAS), SUBSCR IBER MANAGEMENT SERVICE (SMS) AND CALL CENTER SERVICES ( CCS) TO THE ASSESSEE ON WHICH TAX HAD BEEN DEDUCTED AT THE RATE OF 2% IN TERMS 15 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT OF SECTION 194C OF THE ACT. IT WAS FURTHER SUBMITTED THAT THE ASSESSING OFFICER, HOWEVER, REFERRED TO AND RELIED UPON HIS PREVIOUS ORDER DATED 21.03.2014 PASSED U/S 201(1) AND 201(1A ) IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2011-12 (FIN ANCIAL YEAR 2010-11) FOR HOLDING THAT THE PROVISIONS OF SECTION 194J WERE APPLICABLE ON CONTRACTUAL PAYMENTS IN THE CASE OF C ONAX ACCESS SYSTEM PVT. LTD. IT WAS SUBMITTED THAT THE LD. CIT (A) HAD UPHELD THE ACTION OF THE ASSESSING OFFICER THEN BUT THE IT AT HAD RESTORED THE ISSUE TO THE FILE OF THE LD. CIT (A) VIDE ORDER DATED 31.01.2018 AND, THEREAFTER, THE LD. CIT (A) VIDE HIS ORDER DAT ED 29.06.2018 HAD FULLY ALLOWED THE APPEAL OF THE ASSESSEE. THE LD. A UTHORIZED REPRESENTATIVE ALSO SUBMITTED THAT IF ASSESSEES AD DITIONAL GROUNDS ARE ACCEPTED THEN THE INTEREST UNDER CHALLENGE WILL BE LIMITED ONLY TO THE LAST QUARTER. 6.4 ALTERNATIVELY, WITHOUT PREJUDICE, THE LD. AUTHORIZED REPRESENTATIVE ALSO SUBMITTED THAT THE ASSESSING OF FICER HAS NOT GIVEN ANY REASONS FOR CONSIDERING THE CONTRACTUAL P AYMENTS TO BE LIABLE FOR DEDUCTION OF TAX AT SOURCE IN TERMS OF S ECTION 194J AS AGAINST 194C AND FURTHER THAT THE LD. CIT (A) ALSO HAD MADE ONLY 16 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT GENERAL OBSERVATIONS WITHOUT BRINGING ON RECORD OR P INPOINTING ANY ADVERSE MATERIAL TO HOLD THAT THE VENDORS WERE REND ERING TECHNICAL SERVICES. IT WAS ALSO SUBMITTED THAT THE TAX LIABILI TY WAS FULLY DISCHARGED BY THE PAYEE CONAX ACCESS SYSTEM PVT. LT D. AS WAS EVIDENT FROM THE CERTIFICATE ISSUED BY THE CHARTERE D ACCOUNTANT AND, THEREFORE, THE PAYER CANNOT BE DEEMED TO BE AS SESSEE IN DEFAULT FOR NON/SHORT DEDUCTION OF TAX AT SOURCE AS HELD BY HONBLE APEX COURT IN THE CASE HINDUSTAN COCO COLA BEVERAGE (PVT.) LTD. VS. CIT REPORTED IN 293 ITR 296 (SC). 6.5 THE LD. AUTHORIZED REPRESENTATIVE AL SO SUBMITTED THAT WITH EFFECT FROM 01. 04.2020, THE RATE OF TAX FOR THE PURPOSES OF DEDUCTION WITH RESPECT TO FEE FOR TECHNICAL SERVI CES HAD BEEN REDUCED FROM 10% TO 2% WITH A VIEW TO REDUCE TAXES LI TIGATION. IT WAS SUBMITTED THAT, THEREFORE, IN THE LIGHT OF THIS AMENDMENT, THE BENEFICIAL RATE SHOULD BE APPLIED IN THE CASE OF AS SESSEE ALSO. 7.0 WITH RESPECT TO ASSESSEES APPEAL B EARING ITA NO.228/DEL/2013, THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT THE GROUNDS WERE IDENTICAL AND SO WERE THE ARG UMENTS AS IN 17 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT THE ITA NO.227/DEL/2017 AND, THEREFORE, THE SAME WE RE NOT BEING REPEATED FOR THE SAKE OF BREVITY. 8.0 PER CONTRA, THE LD. SR. DEPARTM ENTAL REPRESENTATIVE (DR) PLACED RELIANCE ON THE ORDERS OF THE ASSESSING OFFICER FOR BOTH THE YEARS UNDER CONSIDERATION. THE LD. SR. DR SUBMI TTED THAT THE ASSESSING OFFICER HAD COMPUTED THE SHORT DEDUCTION OF TAX AT SOURCE AS WELL AS INTEREST THEREON IN TERMS OF THE PROVISIONS OF INCOME TAX ACT AND, THEREFORE, THE LD. CIT (A) HAD UPHELD THE SAME. IT WAS SUBMITTED THAT THE APPEALS OF THE ASSESSEE D ESERVED TO BE DISMISSED. 9.0 WE HAVE HEARD THE RIVAL SUBMISSI ONS AND HAVE ALSO PERUSED THE MATERIAL ON RECORD. WE TAKE UP ITA NO.2 27/DEL/2017 FIRST FOR ADJUDICATION. 9.1 THE ASSESSEE HAS RAISED ADDITIONAL GROUNDS IN FINANCIAL YEAR 2011-12. IT IS THE SUBMISSION OF THE LD. AUTHORIZED REPRESENTATIVE THAT THE ORDER PASSED U/S 201(1)/201 (1A) DATED 30.03.2015 FOR THE FIRST THREE QUARTERS WAS ILLEGAL SINCE THE SAME WAS PASSED AFTER THE EXPIRY OF THE LIMITATION PERIOD OF 2 YEARS FROM THE END OF FINANCIAL YEAR AS PRESCRIBED UNDER SUB-S ECTION 3 OF 18 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT SECTION 201 OF THE ACT. THE LD. AUTHORIZED REPRESEN TATIVE HAS DEMONSTRATED BEFORE US THROUGH A CHART, TDS STATEME NTS AS WELL AS THEIR ACKNOWLEDGEMENTS FOR THE FIRST THREE QUARTERS OF FINANCIAL YEAR 2011-12 THAT THESE STATEMENTS HAD BEEN FILED O N OR BEFORE 31.03.2012. THEREFORE, THE TIME LIMIT FOR PASSING T HE ORDER U/S 201(3) OF THE ACT WOULD TWO YEARS FROM THE END OF THE YEAR IN WHICH SUCH TDS STATEMENTS WERE FILED I.E. 31.03.2014. HO WEVER, THE IMPUGNED ORDER WAS PASSED ON 30.03.2015 I.E., BEYON D THE PERIOD OF LIMITATION. THE LD. SR. DR HAS ALSO NOT CHALLENG ED THIS CLAIM OF THE ASSESSEE. AN IDENTICAL ISSUE HAS BEEN CONSIDERE D BY THE HONBLE GUJARAT HIGH COURT IN TATA TELESERVICES VS. UNION O F INDIA [2016] 385 ITR 497 (GUJARAT) WHEREIN IT HAS BEEN HELD THAT PRIOR TO SECTION 201 WAS AMENDED BY FINANCE ACT NO.2 OF 2009, NO TIME LIMIT WAS PROVIDED FOR PASSING AN ORDER U/S 201(1). BUT W.E.F . 01.04.2010, A TIME LIMIT HAS BEEN PROVIDED SPECIFYING THAT SUCH O RDER WAS TO BE PASSED WITHIN TWO YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH STATEMENTS OF TDS ARE FILED. IF NO STATEMENT IS FIL ED, THE ORDER COULD BE PASSED UP TO FOUR YEARS FROM THE END OF THE FINA NCIAL YEAR IN WHICH THE AMOUNT IS CREDITED OR PAID. THIS JUDGMENT OF THE HONBLE 19 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT GUJARAT HIGH COURT HAS BEEN FOLLOWED BY THE CO-ORDI NATE BENCHES OF THIS TRIBUNAL IN DELHI AND MUMBAI. THEREFORE, RE SPECTFULLY APPLYING THE RATIO OF THE JUDGMENT IN THE CASE OF T ATA TELESERVICES LTD. (SUPRA) WE HOLD THAT THE ORDER U/S 201 (1)/201 (1A) FOR THE FIRST THREE QUARTERS FOR FINANCIAL YEAR 2011-12 WAS PASSED BEYOND THE LIMITATION PERIOD AND, THEREFORE, THE SAME IS NOT A VALID ORDER IN THE EYES OF LAW. ACCORDINGLY, THE SAME IS QUASHED. 9.2 THE ONLY ISSUE REMAINING IN FI NANCIAL YEAR 2011- 12 IS THE ISSUE OF SHORT DEDUCTION OF TAX AT SOURCE AND INTEREST THEREON FOR QUARTER FOUR. THE ASSESSING OFFICER HAS COMPUTED SHORT DEDUCTION OF TAX AT SOURCE AND INTEREST THEREON IN RESPECT OF CONAX ACCESS SYSTEMS PVT. LTD. AND TATA TELESERVICES IN T HE 4 TH QUARTER. WITH RESPECT TO BOTH THESE PARTIES, IT IS THE ASSES SEES CONTENTION THAT PAYMENTS TO THIS COMPANY WERE MADE UNDER NORMA L CONTRACTUAL OBLIGATIONS AND THAT THE SERVICES BEING PROVIDED BY THESE TWO COMPANIES WERE GENERAL IN NATURE AND DID N OT REQUIRE ANY TRANSFER OF SKILL NOR DID MAKE AVAILABLE ANY SKILL TO THE ASSESSEE. THE ASSESSEE HAD DEDUCTED TAX AT SOURCE IN TERMS OF SECTION 194C OF THE ACT @ 2% WHEREAS THE ASSESSING OFFICER HAS HE LD THAT THE 20 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT PAYMENT WOULD FALL WITHIN THE TERMS OF SECTION 194J O F THE ACT ATTRACTING THE RATE OF 10%. THE LD. AUTHORIZED REPR ESENTATIVE HAS REFERRED TO INVOICES AND AGREEMENTS ENTERED INTO WIT H BOTH THE PARTIES TO BUTTRESS HIS ARGUMENTS THAT THE SERVICES RENDERED WERE NOT IN THE NATURE OF TECHNICAL SERVICES REQUIRING A NY SHARING/TRANSFERRING OF TECHNICAL SKILL OR KNOWLEDGE . THESE EVIDENCES AND EXPLANATIONS WERE SUBMITTED BEFORE TH E ASSESSING OFFICER AS WELL AS LD. CIT (A). HOWEVER, THE LD. CI T (A), NOTWITHSTANDING THE FACT THAT IN FINANCIAL YEAR 2010 -11 HE HAD HELD THAT THE PAYMENTS WERE NOT IN THE NATURE OF SERVICE S FALLING UNDER SECTION 194J, NOT ONLY IGNORED HIS APPELLATE ORDER IN FINANCIAL YEAR 2010-11 BUT ALSO CHOSE TO BRUSH ASIDE THE EXPLANATI ONS AND EVIDENCES SUPPLIED BY THE ASSESSEE WITHOUT EXAMINING THE SAME IN DETAIL. WE ARE INFORMED THAT THE DEPARTMENTS APPEA L AGAINST THE ORDER OF THE LD. CIT (A) IN FINANCIAL YEAR 2010-11 IS PENDING BEFORE THE TRIBUNAL. IN SUCH CIRCUMSTANCES, IN THE INTERES T OF SUBSTANTIAL JUSTICE, WE DEEM IT FIT TO RESTORE THE ISSUE OF SHO RT DEDUCTION OF TAX AT SOURCE AND INTEREST THEREON IN THE FOURTH QUARTE R OF FINANCIAL YEAR 2011-12 TO THE FILE OF THE LD. CIT (A) WITH A D IRECTION TO PASS A 21 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT SPEAKING ORDER AFTER DULY CONSIDERING THE EVIDENCES AND EXPLANATIONS BEING OFFERED BY THE ASSESSEE IN THIS REGARD AFTER GIVING PROPER OPPORTUNITY TO THE ASSESSEE TO PRESENT ITS C ASE. 10.0 IN THE RESULT, ITA NO.227/DEL/2017 STANDS ALLOWED FOR STATISTICAL PURPOSES. 11.0 IN ITA NO.228/DEL/2017, THE ISSUES ARE IDENTICAL IN AS MUCH AS THE ASSESSING OFFICER HAS HELD THE ASSESSEE TO HAVE MADE SHORT DEDUCTION OF TAX AT SOURCE IN RESPECT OF M/S CONAX ACCESS SYSTEM (PVT.) LTD., TATA TELE SERVICES LTD., PROACT IVE DATA SYSTEMS (PVT.) LTD., TULIP TELECOM, INTEGRATED SUBSCRIBER M ANAGEMENT SERVICES LTD. AND CYQUATOR MEDIA SERVICES (PVT.) LT D. THE ASSESSEE HAS ALSO BEEN CHARGED WITH INTEREST ON THE ALLEGED S HORT DEDUCTION OF TAX. IN ALL THE CASES, IT IS THE ALLEGATION OF T HE ASSESSING OFFICER THAT THE TAX SHOULD HAVE BEEN DEDUCTED @ 10% IN TER MS OF SECTION 194J INSTEAD OF 2%, AS DONE BY THE ASSESSEE U/S 194 C OF THE ACT. IT IS SEEN THAT THE ASSESSEE HAD DULY SUBMITTED COPIES OF AGREEMENTS, INVOICES AND OTHER RELATED EVIDENCES TO DEMONSTRATE , BOTH BEFORE THE ASSESSING OFFICER AS WELL AS THE LD. CIT (A), THAT THE PAYMENTS IN QUESTION WERE LIABLE FOR DEDUCTION OF TAX AT SOURCE @ 2% ONLY. 22 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT HOWEVER, BOTH THE LOWER AUTHORITIES HAVE IGNORED TH E EVIDENCES AND EXPLANATIONS SUBMITTED BY THE ASSESSEE IN THIS REGARD. SINCE, WE HAVE DEEMED IT APPROPRIATE TO RESTORE THE IDENTIC AL ISSUES IN FINANCIAL YEAR 2011-12 TO THE FILE OF THE LD. CIT ( A) FOR PASSING A SPEAKING ORDER IN LIGHT OF THE EVIDENCES AND EXPLAN ATIONS OF THE ASSESSEE IN THIS REGARD, LIKEWISE, ON SIMILAR REASON ING AND IN THE INTEREST OF SUBSTANTIAL JUSTICE, WE RESTORE THE APPE AL TO THE LD. CIT (A) TO BE DECIDED AFRESH AFTER GIVING DUE OPPORTUNI TY TO THE ASSESSEE TO PRESENT ITS CASE. 12.0 IN THE RESULT, ITA NO.228/DEL/2017 STAN DS ALLOWED FOR STATISTICAL PURPOSES. 13.0 IN THE FINAL RESULT, BOTH THE APPEAL S STAND ALLOWED FOR STATISTICAL PURPOSES. SD/- SD/- (G.S.PANNU) (SUDHANSHU SRIVASTAVA) VICE PRESIDENT JUDICIAL MEMBER DATED:15/01/2021 PK/PS COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 23 ITA NOS.227 & 228 /DEL/2017 M/S DISH TV INDIA L IMITED VS. DCIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI