The ACIT,Ahmedabad Circle-3, Ahmedabad V. ASE Capital Markets Ltd., Ahmedabad

ITA 373/AHD/2011

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9670 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2016
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 02-11-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 11-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Depreciation
• Section: 32

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD .., , !' BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER SL. NO. ITA NO(S) / CO NO. ASSESSMENT YEAR APPEAL(S) /CO BY APPELLANT VS. RESPONDENT APPELLANT RESPONDENT 1. 373/AHD/2011 2007-08 ACIT CIR-3 AHMEDABAD (REVENUE) ASE CAPITAL MARKETS LTD. KAMDHENU COMPLEX OPP. SAHAJANAND COLLEGE AMBAWADI, AHMEDABAD (ASSESSEE) PAN: AADCA 4692 D 2. 1480/AHD/2011 2008-09 ASSESSEE REVENUE 3. 546/AHD/2011 2007-08 ASSESSEE REVENUE 4. CO NO.60/AHD/2011 ( IN ITA NO.373/AHD/2011 ) 2007-08 ASSESSEE REVENUE REVENUE BY : MR. RAJESH MEENA, SR.DR ASSESSEE BY : MR. VIJAY RANJAN, AR #$ / DATE OF HEARING 02/11/2016 %&'$ / DATE OF PRONOUNCEMENT 23/12/2016 / O R D E R PER PRADIP KUMAR KEDIA, AM: THE REVENUE AND THE ASSESSEE HAVE FILED CROSS-APPE ALS IN ITA NO.373/AHD/2011 AND ITA NO.546/AHD/2011 FOR ASSESSM ENT YEAR (AY) ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 2 - 2007-08 RESPECTIVELY. THE ASSESSEE HAS ALSO FILED CROSS OBJECTION NO.60/AHD/2011 FOR AY 2007-08 WITH REFERENCE TO REV ENUES APPEAL IN ITA NO.373/AHD/2011. FOR THE SUBSEQUENT AY 2008-09 , THE ASSESSEE HAS FILED APPEAL BEARING ITA NO.1480/AHD/2011 AS CA PTIONED ABOVE. SINCE THE COMMON ISSUES ARE INVOLVED IN ASSESSEES OWN CASE IN BOTH THE YEARS, A CONSOLIDATED ORDER IS BEING PASSED FOR THE SAKE OF CONVENIENCE. 2. WE SHALL FIRST TAKE UP ASSESSEES APPEAL IN ITA NO.546/AHD/2011 RELEVANT TO AY 2007-08 AND CROSS-APPEAL OF THE REVE NUE FOR THE SAME YEAR IN ITA NO.373/AHD/2011 AS WELL AS CROSS OBJECT ION OF THE ASSESSEES ARISING THERE ON IN CO NO.60/AHD/2011 FOR ADJUDICAT ION PURPOSES. ITA NO.546/AHD/2011 (ASSESSEES APPEAL) AND ITA NO. 373/AHD/2011 (REVENUES APPEAL) 3. GROUNDS OF APPEAL RAISED BY THE ASSESSEE (IN ITA NO.546/AHD/2011) ASSAILING THE ORDER OF THE CIT(A) DATED 29/12/2010 READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) ERRED IN NOT DELETING THE WHOLE DISALLOWANCE OF RS. 5,94,844 WHICH IS MADE BY THE ASSESSING OFFICER IN TWO PARTS BEING RS.2,91,666 AND RS.3,03,178 FOR ALLEGEDLY BEING PRI OR PERIOD EXPENSES. 2. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE CIT(A) SHOULD HAVE DELETED THE FIRST OF T HE AFORESAID ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 3 - TWO SUMS OF RS.2,91,666 EVEN ON MERITS AND IN REGAR D TO THE ORDER SUM OF RS.3,03,178 SHOULD HAVE NOT LEFT IT TO THE ASSESSING OFFICER PURPORTEDLY TO VERIFY THE ASSESSEES CLAIM OF DUPLICATION OF DISALLOWANCE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) ERRED IN NOT ACCEPTING THE ASSESSEES PLEA OF THE W HOLE SUM OF RS.59,70,900 PAID BY THE ASSESSEE-COMPANY TO ASE BE ING IN THE NATURE OF PROFESSIONAL FEES ON WHICH TDS WAS REQUIR ED TO BE EFFECT IN TERMS OF SECTION 194J AND HE FURTHER ERRE D IN TREATING A PART THEREOF AS RENT AND IN UPHOLDING DISALLOWANCE OF A PART OF THE SUM OF RS.59,70,990 IN PURSUANCE OF THE PROVISI ONS OF SECTION 40(A)(IA). 4. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE CIT(A) SHOULD HAVE OUTRIGHT DELETED THE D UAL DISALLOWANCE OF RS.2,58,877 MADE BY THE ASSESSING O FFICER BY INVOKING THE PROVISIONS OF SECTION 40(A0(IA) IN RES PECT OF RENTAL PAYMENTS FOR THE MONTHS OF JANUARY AND FEBRUARY, 20 07 AND SHOULD NOT HAVE MERELY LEFT TO THE ASSESSING OFFICE R FOR VERIFICATION WHEN ALL THE FACTS AND FIGURES WERE AL READY AVAILABLE ON RECORD AND HAD BEEN NOTICED ALSO IN PA RAS 8.1 & 8.2 ON PAGES 28 AND 29 OF THE IMPUGNED APPELLATE OR DER. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) ERRED IN NOT DELETING THE DISALLOWANCE OF RS.15,05, 533 WHICH WAS MADE BY THE ASSESSING OFFICER BY INVOKING THE P ROVISIONS OF SECTION 40(A0(IA) FOR THE ALLEGED FAILURE OF THE AS SESSEE TO DEDUCT TAX OF PURSUANCE OF SECTION 194-I. 6. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE CIT(A) SHOULD HAVE ACCEPTED THE ASSESSEE S CONTENTION THAT THE PAYMENTS FOR THE VSAT AND WAN S UPPORT AND LEASE LINE EXPENSES WERE NEITHER PROFESSIONAL F EES NOR RENT AND HENCE TAX WAS NOT REQUIRED TO BE DEDUCTED IN PU RSUANCE OF SECTION 194-J OR 194-I. 7. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE CIT(A) SHOULD HAVE RESTRICTED DISALLOWANC E ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 4 - U/S.40(A)(IA) ONLY ON EXPENDITURE PAYABLE AND NOT O N EXPENDITURE ACTUALLY PAID BY APPELLANT. 8. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) ERRED IN UPHOLDING DISALLOWANCE OF DEPRECIATION ON THE MEMBERSHIP OF THE STOCK EXCHANGE WHICH ENABLE THE A SSESSEE TO KEY-IN THE TRANSACTIONS ON THE SCREEN BASED PLAT FORM OF THE STOCK EXCHANGE. 4. LIKEWISE, THE REVENUE IN ITA NO.373/AHD/2011 H AS ALSO IMPUGNED THE ABOVEMENTIONED ORDER OF THE CIT(A) BY WAY OF GR OUNDS OF APPEAL REPRODUCED HEREUNDER:- 1. THE LD CIT(A) ERRED IN LAW AND ON FACTS IN DIR ECTING THE AO TO LIMIT THE DISALLOWANCE ON PROPORTIONATE BASIS TO TH E EXTENT THERE IS SHORTFALL OF TDS AS PER SEC.194I AND THE TDS DEDUCT ED BY THE ASSESSEE, OUT OF TOTAL DISALLOWANCE OF RS.59,70,900 /- FOR THE PERIOD FROM APRIL 2006 TO DECEMBE4R 2006 ON ACCOUNT OF INF RASTRUCTURE AND FACILITY USAGE CHARGES. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE R ESTORED. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. A COPY OF CIT(A)S ORDER WAS RECEIVED BY ME ON 05/01/2011. 5. BRIEFLY STATED, THE ASSESSEE IS ENGAGED IN SHARE BROKING AND DEPOSITORY ACTIVITIES WITH THE STOCK EXCHANGE. THE ASSESSEE FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS.90,78,720/- FOR THE AY 2007-08. WHILE FRAMING THE ASSESSMENT ORDER UNDER SECTION 1 43(3) OF THE ACT, THE AO OBSERVED CERTAIN DISCREPANCIES IN THE RETURN OF INCOME AND ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 5 - ACCORDINGLY RESORTED TO VARIOUS ADDITIONS AND DISAL LOWANCES AND RESULTANTLY ASSESSED THE INCOME AT RS.1,99,25,690/- . 6. THE CIT(A) GRANTED PARTIAL RELIEF WITH REFERENCE TO VARIOUS ISSUES RAISED BEFORE IT. BOTH THE ASSESSEE AS WELL AS REV ENUE ARE AGGRIEVED BY THE ORDER OF THE CIT(A) AND ACCORDINGLY CROSS-APPEA LS HAVE BEEN FILED BY THE PARTIES BEFORE THE TRIBUNAL. THE ASSESSEE HAS ALSO FILED CROSS OBJECTION WITH REFERENCE TO THE REVENUES APPEAL. ALL THE THREE APPEALS ARE THEREFORE DEALT WITH AS UNDER: 7. GROUND NOS.1 & 2 OF THE ASSESSEES APPEAL CONCER NS DISALLOWANCES OF RS.5,94,844/- ALLEGEDLY BEING PRIOR PERIOD EXPEN SES. IN THE COURSE OF HEARING, THE LD.AR FOR THE ASSESSEE FAIRLY SUBMITTE D THAT THE ISSUE HAS BEEN REMITTED BACK TO THE FILE OF AO FOR VERIFICATI ON IN TERMS OF DIRECTIONS NOTED IN THE ORDER OF THE CIT(A). HE ACCORDINGLY DOES NOT SEEK ANY FURTHER REMEDY FROM THE TRIBUNAL ON THE ISSUES INVO LVED. THE GROUND NOS.1 & 2 ARE ACCORDINGLY DISMISSED AS INFRUCTUOUS . 8. GROUND NOS.3 & 4 OF THE APPEAL CONCERNS DISALLOW ANCE UNDER SECTION 40(A)(IA) OF RS.59,70,990/- AND RS.2,58,877 /- RESPECTIVELY. THE LD.AR FOR THE ASSESSEE SUBMITTED THAT THESE TWO GRO UNDS CONCERN SHORT DEDUCTION OF TDS OR FAILURE TO DEPOSIT TDS BEFORE D UE DATE ETC. THE LD.AR FOR THE ASSESSEE REFERRED TO THE DECISION OF THE HONBLE DELHI HIGH ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 6 - COURT IN THE CASE OF CIT VS. ANSAL LAND MARK TOWNSH IP (P) LTD. REPORTED AT (2015) 377 ITR 635 (DELHI) AND SOUGHT R ETROSPECTIVE BENEFIT OF SECOND PROVISO TO SECTION 40(A)(IA) INSERTED BY FINANCE ACT, 2012. HE ACCORDINGLY PLEADED THAT THE MATTER MAY BE SET ASID E TO ASCERTAIN WHETHER THE DEDUCTEE HAS ALREADY INCLUDED THE IMPUGNED PAYM ENTS IN ITS ACCOUNTS AND OFFER THE SAME FOR TAXATION. 9. THE LD.DR DID NOT OBJECT TO THE REQUEST FOR VE RIFICATION BY THE AO IN TERMS OF JUDICIAL PRECEDENT NOTED ABOVE. 10. IN VIEW OF THE CONSISTENT VIEW TAKEN BY THE TRI BUNAL ON THE ISSUE, FOLLOWING VARIOUS JUDICIAL PRECEDENTS AND ALSO IN T HE LIGHT OF DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. ANSAL LAND MARK TOWNSHIP (P) LTD. (SUPRA), WE CONSIDER IT EXPEDIENT TO SET ASIDE THE ISSUE TO THE FILE OF AO FOR FRESH ADJUDICATION IN ACCORDA NCE WITH LAW IN THE LIGHT OF THE DECISION IN THE CASE OF ANSAL LAND MA RK TOWNSHIP (P) LTD.(SUPRA). THE AO SHALL DELETE THE DISALLOWANCE MADE UNDER SECTION 40(A)(IA) IF IT IS FOUND THAT THE DEDUCTEE HAS INCL UDED THE IMPUGNED RECEIPTS IN ITS RETURN OF INCOME FOR TAXATION PURPO SES. NEEDLESS TO SAY, THE ASSESSEE SHALL PROVIDE ALL REASONABLE ASSISTANC E TO THE AO FOR ADJUDICATING THE ISSUE. THE AFORESAID ISSUES ARE A CCORDINGLY RESTORED TO THE FILE OF AO IN TERMS OF DIRECTIONS NOTED AS AFOR ESAID. THE GROUND NOS. 3 AND 4 ARE ACCORDINGLY ALLOWED FOR STATISTICA L PURPOSES. ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 7 - 11. GROUND NOS.5 & 6 ALSO CONCERN DISALLOWANCE UNDE R SECTION 40(A)(IA) FOR DEFAULT IN NON-DEDUCTION, DEDUCTION O F TDS AT LOWER RANK ETC. WITH REFERENCE TO EXPENDITURE INCURRED FOR VAS T AND WAN SUPPORT AND LEASE LINE EXPENSES ETC. 12. OUR DIRECTION WITH REFERENCE TO GROUND NOS.3 & 4 IN THE LIGHT OF THE DECISION OF HONBLE DELHI HIGH COURT IN THE CAS E OF CIT VS. ANSAL LAND MARK TOWNSHIP (P) LTD. REPORTED AT (2015) 377 635 (DELHI) SHALL APPLY MUTATIS MUTANDIS TO GROUND NOS.5 & 6 OF THE ASSESSEES APPEAL ALSO. ACCORDINGLY, THE ISSUES RAISED IN GR OUND NOS.5 & 6 ARE ALSO SET ASIDE TO THE FILE OF THE AO FOR FRESH ADJU DICATION IN ACCORDANCE WITH LAW AFTER GIVING PROPER OPPORTUNITY TO THE ASSESSEE TO REPRESENT ITS CASE. GROUND NOS.5 & 6 ARE ACCORD INGLY ALLOWED FOR STATISTICAL PURPOSES. 13. GROUND NO.7 OF ASSESSEES APPEAL IS DISMISSED A S NOT PRESSED. 14. GROUND NO.8 OF ASSESSEES APPEAL CONCERNS DISAL LOWANCE OF DEPRECIATION ON STOCK EXCHANGE CARD AMOUNTING TO RS .8,96,848/-. 15. THE LD.AR FOR THE ASSESSEE SUBMITTED THAT THE A O HAS DISALLOWED DEPRECIATION OF RS.8,96,848/- ON BSE CARD HELD BY T HE ASSESSEE ON THE ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 8 - PREMISE THAT THE MEMBERSHIP CARD OF STOCK EXCHANGE IS NOT A DEPRECIABLE ASSET WITHIN THE MEANING OF SECTION 32(1) OF THE AC T. THE LD.AR FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE SATISFIES THE CONDITIONS OF PROVISION OF SECTION 32 OF THE ACT AND THE RIGHTS EMBEDDED IN THE STOCK EXCHANGE CARD TO CARRY ON THE STOCK BROKING BUSINESS FALLS U NDER THE BLOCK OF INTANGIBLE ASSETS AND THEREFORE THE DEPRECIATION HAS BEEN RIGHTLY CLAIMED BY THE ASSESSEE. THE LD.AR POINTED OUT THA T THE ISSUE IS NOW SETTLED IN FAVOUR OF ASSESSEE BY THE DECISION OF TH E HONBLE SUPREME COURT IN THE CASE OF M/S.TECHNO SHARES & STOCKS LT D. VS. CIT REPORTED IN 327 ITR 323 (SC). WE NOTE THAT THE ISSUE IS SQU ARELY COVERED IN FAVOUR OF ASSESSEE BY THE DECISION OF HONBLE APEX COURT IN THE CASE OF M/S.TECHNO SHARES & STOCKS LTD.(SUPRA) WHICH HAS BE EN FOLLOWED BY THE COORDINATE BENCH OF ITAT AHMEDABAD IN THE CASE OF A CIT ANAGRAM CAPITAL LTD. & ORS. IN ITA NO.1531/AHD/2011 FOR AY 2008-09, ORDER DATED 06/11/2015 RELIED UPON BY THE ASSESSEE. THE RELEVANT PORTION OF THE AFORESAID ORDER OF THE ITAT AHMEDABAD DEALING WITH THE ISSUE IS EXTRACTED HEREUNDER FOR READY REFERENCE:- 13. THE ASSESSEE'S NEXT GROUND RAISED IN THE INSTA NT APPEAL CHALLENGES DISALLOWANCE OF DEPRECIATION ON AHMEDABAD STOCK EXC HANGE CARD OF RS.141/- MADE IN THE COURSE OF ASSESSMENT AND AFFIR MED IN THE LOWER APPELLATE PROCEEDINGS. BOTH THE LOWER AUTHORITIES H OLD THAT STOCK EXCHANGE MEMBERSHIP CARD IS NOT AN ELIGIBLE ASSET U /S 32 OF THE ACT AS HELD BY HON'BLE BOMBAY HIGH COURT IN M/S. TECHNOSHA RES AND STOCKS LTD. VS. CIT 193 TAXMAN 248. THE CIT(A) OBSERVES TH AT THE HON'BLE APEX COURT HAS REVERSED THE ABOVE STATED DECISION A S REPORTED IN 327 ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 9 - ITR 323 WITH A RIDER THAT THE SAME RELATES TO BOMBA Y STOCK EXCHANGE CARD ONLY. HE REPRODUCES RELEVANT PORTION OF THIS J UDGMENT AS WELL. HOWEVER, THE REVENUE FAILS TO POINT OUT ANY DISTINC TION BETWEEN THE ASSESSEE'S AHMEDABAD STOCK EXCHANGE CARD AND RELEVA NT FEATURES OF BOMBAY STOCK EXCHANGE CARD. NOR SUCH A DISTINCTION IS FORTHCOMING FROM HON'BLE APEX COURT DECISION. WE FIND THAT A CO -ORDINATE BENCH OF THE TRIBUNAL IN CASE OF ASSESSEE'S SISTER CONCERN'S CASE M/S. EDELWEISS STOCK BROKING LTD. VS. CIT, ITA NO. 1168/AHD/2011 D ECIDED ON 11.07.2014 FOR AY 2006-07 GRANTS IDENTICAL DEPRECIA TION RELIEF. WE ALSO DRAW SUPPORT THEREFROM FOR ALLOWING THE IMPUGNED DE PRECIATION CLAIMED. THIS GROUND IS ACCEPTED. 16. FOLLOWING THE PARTY OF REASONING, WE FIND MERIT IN THE AFORESAID GROUND OF THE ASSESSEE. GROUND NO.8 OF ASSESSEES APPEAL IS ACCORDINGLY ALLOWED. 17. ASSESSEES CROSS OBJECTION NO.60/AHD/2011 (IN I TA NO.373/AHD/2011) FOR AY 2007-08 IS DISMISSED AS NOT PRESSED. 18. THE REVENUE HAS ALSO OBJECTED TO THE ORDER OF T HE CIT(A) IN RESTRICTING THE DISALLOWANCE ON PROPORTIONATE BASIS TO THE EXTENT OF SHORTFALL IN TDS DEDUCTED BY THE ASSESSEE CONCERNIN G PAYMENT MADE TOWARDS INFRASTRUCTURE AND OTHER FACILITIES USAGE C HARGES FOR WHICH DISALLOWANCE OF RS.59,70,900/- WAS MADE BY THE AO. THE ISSUE HAS ALREADY BEEN ADJUDICATED IN GROUND NOS.3 & 4 OF THE ASSESSEES APPEAL AND THEREFORE THE DIRECTIONS GIVEN IN RESPECT OF TH OSE GROUNDS SHALL APPLY ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 10 - MUTATIS MUTANDIS TO THE REVENUES APPEAL. THE REVENUES APPEAL IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. ASSESSEES APPEAL IN ITA NO.1480/AHD/2011 FOR AY 20 08-09 19. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF AP PEAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE AP PELLANTS CASE, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ER RED IN NOT DELETING THE DISALLOWANCE OF RS.4,98,000 WHICH WAS MADE BY THE ASSESSING OFFICER BY INVOKING THE PROVISIONS OF SEC TION 40(A0(IA) FOR THE ALLEGED FAILURE ON THE PART OF THE APPELLAN T TO DEDUCT TAX IN PURSUANCE OF SECTION 194-I OF THE ACT. 2. WITHOUT PREJUDICE, ON THE FACTS AND IN THE CIRC UMSTANCES OF THE CASE, THE COMMISSIONER OF INCOME TAX (APPEALS) SHOU LD HAVE ACCEPTED THE APPELLANTS CONTENTIONS THAT THE PAYME NTS FOR THE VSAT WAN SUPPORT AND LEASE LINE EXPENSES WERE NEITH ER PROFESSIONS FEES NOR RENT AND HENCE TAX WAS NOT REQ UIRED TO BE DEDUCED IN PURSUANCE TO SECTION 194-J OR 194-I OF T HE ACT. 20. THE LD.AR FOR THE ASSESSEE SUBMITTED THAT THE A O HAS HELD THAT THE PAYMENTS MADE TOWARDS FOR VSAT CHARGES IS IN THE NA TURE FOR THE USE OF SUCH EQUIPMENT. ACCORDINGLY, HE CONCLUDED THAT SUC H PAYMENTS ARE SQUARELY COVERED UNDER THE DEFINITION OF RENT FOR T HE PURPOSE OF TDS UNDER SECTION 194-I OF THE ACT. 21. WE NOTE THAT SIMILAR ISSUE HAS ARISEN IN AY 200 7-08 AS PER GROUNDS OF APPEAL NOS.5 & 6 RAISED BY THE ASSESSEE. ISSUE RAISED BY THE ASSESSEE IS ACCORDINGLY SET ASIDE TO THE FILE OF TH E AO FOR FRESH ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 11 - ADJUDICATION IN ACCORDANCE WITH LAW IN THE LIGHT OF THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. ANS AL LAND MARK TOWNSHIP (P) LTD. REPORTED AT (2015) 377 ITR 635 (D ELHI). THE ASSESSEE SHALL BE ENTITLED TO RELIEF FROM RIGORS OF SECTION 40(A)(IA) OF THE ACT IF IT IS FOUND BY THE AO THAT THE DEDUCTEE HAS INCLUDED THE AFORESAID PAYMENT RECEIVED FROM THE ASSESSEE FOR THE PURPOSES OF COMP UTATION OF ITS TOTAL INCOME. ACCORDINGLY, ASSESSEES APPEAL FOR AY 2008 -09 IS ALLOWED FOR STATISTICAL PURPOSES. 22. IN THE RESULT, THE POSITION IS SUMMARIZED AS U NDER:- (1) REVENUES APPEAL IN ITA NO.373/AHD/2011 FOR AY 2007-08 IS ALLOWED FOR STATISTICAL PURPOSES. (2) ASSESSEES APPEAL IN ITA NO.546/AHD/2011 FOR A Y 2007-08 IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. (3) ASSESSEES CO NO.60/AHD/2011 IS DISMISSED AS NOT PRESSED. (4) ASSESSEES APPEAL IN ITA NO.1480/AHD/2011 FOR AY 2008- 09 IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 23/12/2016 SD/- SD/- ( ..) ( ) ( R.P. TOLANI ) ( PR ADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 23/ 12 /2016 ,..,.../ T.C. NAIR, SR. PS ITA NO.373/AHD/2011 (BY REVENUE) AND ITA NOS.1480, 546 AND CO NO.60/AHD/2011 (BY AS SESSEE) ACIT VS. ASE CAPITAL MARKETS LTD. - 12 - ! ' / COPY OF THE ORDER FORWARDED TO : 1. -./ / THE APPELLANT 2. 0./ / THE RESPONDENT. 3. 123 4 / CONCERNED CIT 4. 4 ( - ) / THE CIT(A)- 5. 56723 , --23' , -1 / DR, ITAT, AHMEDABAD 6. 79# / GUARD FILE. / BY ORDER, 05 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 19.12.16 (DICTATION-PAD 22- PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 19.12.16 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 23.12.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 23.12.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER