SAMURAI SECURITIES P. LTD, MUMBAI V. ITO (OSD) TDS 3(2), MUMBAI

ITA 2850/MUM/2014

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8841 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 12-09-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 25-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

ITA NO.2850/M/2014 SAMURAI SECURITIES PVT LTD 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH E, MU MBAI BEFORE SHRI R. C. SHARMA, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.2850/MUM/2014 (ASSESSMENT YEAR- 2010-11) SAMURAI SECURITIES PVT LTD, 303/306, RAHEJA CHEMBERS FREE PRESS JOURNAL MARG, NARIMAN POINT, MUMBAI-400021 PAN:AAGCS7809C VS. ITO (OSD) -3(2), CHARNI ROAD MUMBAI (APPELLANT) (RESPONDENT) ASSESSEE REPRESENTED BY NONE REVENUE REPRESENTED BY -- SH. V. JUSTINE DR DATE OF HEARING: 18.10.2017 DATE OF ORDER: 18.10.2017 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER: 1. THIS APPEAL BY ASSESSEE UNDER SECTION 253 OF INCOM E TAX ACT IS DIRECTED AGAINST THE ORDER OF COMMISSIONER (APPEALS) - 14, M UMBAI DATED 06.02.2014 FOR ASSESSMENT YEAR 2010-11. THE ASSESSE E HAS RAISED FOLLOWING GROUNDS OF APPEAL; (I) THE ASSESSING OFFICER ERRED IN RAISING THE DEMAND O F RS. 5,79,196/-(INCLUDING INTEREST OF RS. 1,53,317/-) FOR NON-DEPOSIT OF TDSS ON TRANSACTION CHARGES AND THE LEARNED COMMISSIONER OF INCOME TAX (APPLEAS) ER RED IN CONFIRMING THE DEMAND RAISED BY ASSESSING OFFICER UNDER SECTION 20 1(1)/(201)(1A). 2. BRIEF FACTS OF THE CASE ARE THAT INFORMATION RECEIV ED FROM NATIONAL STOCK EXCHANGE THAT DURING THE FINANCIAL YEAR 2009-10 THE ASSESSEE HAS PAID TRANSACTION CHARGES, HOWEVER THE ASSESSEE HAS NOT D EDUCTED TAX THEREON AS ITA NO.2850/M/2014 SAMURAI SECURITIES PVT LTD 2 PER THE PROVISIONS OF SECTION 194J OF THE INCOME TA X ACT 1961. THE ITO (TDS) ON THE BASIS OF DECISION OF BOMBAY HIGH COURT IN CASE OF KOTAK SECURITIES LTD HELD THAT TAX IS DEDUCTIBLE UNDER SE CTION 194J ON THE PAYMENT OF TRANSACTION CHARGES TO EXCHANGE. THE A SSESSEE WAS ASKED TO FURNISH DETAIL OF TRANSACTION CHARGES AND THE TAX D EDUCTED THEREON. NO RESPONSE WAS RECEIVED FROM THE ASSESSEE. THE ITO (T DS) CONSIDERING THE TRANSACTION CHARGES BEING FEE FOR TECHNICAL SERVICE S TO NATIONAL STOCK EXCHANGE OF INDIA AND FURTHER INTEREST IS ALSO PAYA BLE UNDER SECTION 201(1)/201(1A) PASSED THE ORDER AGAINST THE ASSESSE E. THE ASSESSING OFFICER /ITO(TDS) WORKED OUT THE LIABILITY OF RS. 4 ,25,880/- AND RS.1,53,317/- ON ACCOUNT OF INTEREST FROM 1 APRIL 2 009 TO 31 MARCH 2012 @ 1% PER MONTH VIDE ORDER DATED 31 MARCH 2012. ON APPEAL BEFORE COMMISSIONER (APPEALS) THE ACTION OF ASSESSING OFFI CER /ITO (TDS) WAS CONFIRMED. THUS, FURTHER AGGRIEVED BY THE ORDER OF CIT(A) THE ASSESSING HAS FILED PRESENT APPEAL BEFORE US. 3. NONE APPEARED ON BEHALF OF ASSESSEE WHEN THE CASE W AS CALLED FOR HEARING. DESPITE WAITING FOR SUFFICIENT TIME AND PA SSOVER. NONE IS APPEARING ON BEHALF OF ASSESSEE FROM LAST SEVERAL D ATES DESPITE SERVICE OF NOTICE THROUGH REGISTERED POST. WHEN NONE APPEARED ON BEHALF OF ASSESSEE WE LEFT NO OPTION EXCEPT TO HEAR THE LD. DR FOR REV ENUE AND TO PROCEED ON THE BASIS OF MATERIAL AVAILABLE ON RECORD TO DECIDE THE APPEAL ACCORDINGLY. THE LEARNED DR FOR THE REVENUE SUPPORTED THE ORDER OF AUTHORITIES BELOW ITA NO.2850/M/2014 SAMURAI SECURITIES PVT LTD 3 AND ARGUED THAT THE ASSESSEE HAS NOT COOPERATED EIT HER BEFORE THE ASSESSING OFFICER/ ITO (TDS) OR BEFORE COMMISSIONER (APPEALS). THE ASSESSEE HAS NOT COME FORWARD TO SUBSTANTIATE HIS C LAIM RAISED IN THE PRESENT APPEAL. THE LEARNED DR ARGUED THAT THE APPE AL OF THE ASSESSEE BE DISMISSED. 4. WE HAVE CONSIDERED THE SUBMISSION OF LEARNED DR FOR THE REVENUE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ITO ( TDS) PASSED THE ORDER UNDER SECTION 201(1)/ 201(1A) ON THE BASIS OF THE D ECISION OF MUMBAI HIGH COURT IN CIT VS KOTAK SECURITIES [15 TAXMAN 77 ] WHEREIN IT WAS HELD THAT TAX AT SOURCE IS DEDUCTABLE AT SOURCE UND ER SECTION 194J, ON THE PAYMENT OF TRANSACTION CHARGES TO EXCHANGES. WE HAV E NOTED THAT SUBSEQUENT TO THE ORDER OF BOMBAY HIGH COURT, TH E HONBLE APEX COURT IN CASE OF CIT VS KOTAK SECURITIES LTD [ 2016] 67 TAXMANN.COM 356 (SC) HELD THAT THE SERVICES MADE AVAILABLE BY BOMB AY STOCK EXCHANGE [BSE ONLINE TRADING (BOLT) SYSTEM] FOR WHICH TRANSA CTION CHARGES ARE PAID BY MEMBERS OF BSE ARE COMMON SERVICES AND THAT EVERY MEMBER OF STOCK EXCHANGE IS NECESSARILY REQUIRED TO AVAIL OF SUCH SERVICES TO CARRY OUT TRADING IN SECURITIES IN STOCK EXCHANGE; SUCH S ERVICES DO NOT AMOUNT TO 'TECHNICAL SERVICES' PROVIDED BY STOCK EXCHANGE, NOT BEING SERVICES SPECIFICALLY SOUGHT FOR BY USER OR CONSUMER AND, TH EREFORE, NO TDS IS LIABLE TO BE DEDUCT UNDER SECTION 194J ON PAYMENTS MADE FOR SUCH SERVICES. CONSIDERING THE FACTS THAT THE LD CIT(A) WAS NOT HAVING THE ITA NO.2850/M/2014 SAMURAI SECURITIES PVT LTD 4 BENEFIT OF DECISION OF THE HONBLE APEX COURT, WHI LE PASSING THE IMPUGNED ORDER, THE APPEAL IS RESTORED TO THE FILE OF LD CIT(A) TO VERIFY THE FACT AND PASS THE ORDER IN ACCORDANCE WITH LAW. NEEDLESS TO SAY THAT THE ASSESSEE BE GIVEN OPPORTUNITY BEFORE PASSING TH E ORDER. HENCE, THE GROUND OF APPEAL RAISED BY ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN C OURT ON 18.10.2017 SD/- SD/- R.C.SHARMA PAWAN SIN GH ACCOUNTANT MEMBER JUD ICIAL MEMBER MUMBAI, DATED: 18.10.2017 COPY OF THE ORDER FORWARDED TO : 1. THE ASSESSEE; 2. THE REVENUE; 3. THE CIT(A); 4. THE CIT, MUMBAI CITY CONCERNED; 5. THE DR, ITAT, MUMBAI; 6. GUARD FILE. BY ORDER SK PRIVATE SECRETARY (DY./ASSTT.REGISTRAR) ITAT, MUMBAI