DCIT (TDS) 3(1), MUMBAI V. ZEE ENTERTAINMENT ENTERPRISES LTD, MUMBAI

ITA 3933/MUM/2013

• Counselvise Citation: 393319914 RSA 2013
• Duration Of Justice: 1 year(s) 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 17-11-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 17-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHA KALA CHANDA
• Assessee Lawyers: VIJAY MEHTA
• Section: 133A; 194C; 201(1)

Judgement Text

G IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G, MUMBAI , BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER ITAS NO. : 3931 TO 3935/MUM /2013 (ASSESSMENT YEARS: 2006-07 TO 2010-11) DCIT (TDS)-3(1), 1012, 10 TH FLOOR, SMT K G MITTAL AYURVEDIC HOSPITAL BLDG., CHARNI ROAD (WEST), MUMBAI - 400 002 VS ZEE ENTERTAINMENT ENTERPRISES LTD., 135, CONTINENTAL BLDG., DR A B ROAD, WORLI, MUMBAI -400 018 .: PAN: AAACZ 0243 R (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. ABHA KALA CHANDA RESPONDENT BY : SHRI VIJAY MEHTA !' # $% /DATE OF HEARING : 17-11-2014 &'( # $% / DATE OF PRONOUNCEMENT : 20-02-2015 ORDER , , , , PER VIVEK VARMA, JM: THE FOLLOWING APPEALS HAVE BEEN FILED BY THE DEPARTMENT: SR. NO. ASST. YEAR ITA NO. CIT(A) DATE OF CIT(A) ORDER 1 2006 - 07 3931/MUM/2013 14. MUMBAI 26.04.2011 2 2007 - 08 3932/MUM/ 2013 14. MUMBAI 26.04.2011 3 2008 - 09 3933/MUM/2013 14, MUMBAI 26.04.2011 4 2009 - 10 3934/MUM/2013 14, MUMBAI 26.04.2011 5 2010 - 11 3935/MUM/2013 14. MUMBAI 26.04.2011 2. ALL THE APPEALS HAVE SOME COMMON GROUNDS. IN THIS EV ENT, WE, FOR THE SAKE OF CONVENIENCE AND BREVITY ARE DISPOSING OFF THE ABOVE APPEALS THROUGH THIS COMMON AND CONSOLIDATED ORDER. 3. FACTS, COMMON IN ALL THE YEARS UNDER CONSIDERATION ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF BROADCA ST AND DISTRIBUTION OF TV CHANNELS ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 2 PRODUCTION/COMMISSIONING/DISTRIBUTION/PURCHASE/EXPORT SALE OF TV PROGRAMMES, FILMS, NEWS AND ACTS AS A CANVASSING AGE NT FOR SPACE SELLING ON TV CHANNELS. ON 25.02.2009, THE DEPARTMENT UNDERTOOK SURVEY OPERATIONS U/S 133A OF TH E INCOME TAX ACT, 1961 ON THE ASSESSEE. IN THE COURSE O F SURVEY OPERATIONS, THE REVENUE AUTHORITIES SOUGHT VERIFICATION OF R ECORDS TO ASCERTAIN THE DEDUCTION OF TAS AS PER LAW. IN THE COU RSE OF VERIFICATION, THE REVENUE OFFICERS CAME TO THE VIEW THAT THE ASSESSEE WAS EITHER DEDUCTING TAS AT A LOWER RATE OR W AS NOT DEDUCTING ANY TAS AT ALL ON VARIOUS PAYMENTS BEING MADE BY THE ASSESSEE. THE AO CALLED FOR A DETAILED EXPLANATION FROM THE ASSESSEE IN THIS REGARD, WHICH DID NOT FIND FAVOUR WITH THE AO, WHO RAISED DEMANDS IN VARIOUS YEARS IN THE ORDER UNDER PROVISIONS SECTION(S) 201/201(1A) OF THE ACT. 4. SINCE SOME OF THE ISSUES RAISED ARE COMMON IN ALL THE YEARS, WE ARE TAKING UP ITA NO. 3931/MUM/2011 FOR THE ASSESSMENT YEAR 2006-07 AS THE LEAD YEAR. 5. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE DEPARTMENT: 1) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION U/ S 201(1) AND INTEREST U/S 201(1A) IN RESPECT OF CARRI AGE FEE /PLACEMENT FEE PAID BY THE ASSESSEE TO VARIOUS CABL E OPERATORS/MSO/DTH SERVICE PROVIDERS HOLDING THE SERVICE PROVIDED WAS WORK WITHIN THE MEANING OF SEC TION 1940 AND NOT TECHNICAL SERVICE U/S 194J. 2. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE CABLE OPER ATORS /MSO/DTH SERVICE PROVIDERS HAD NOT PROVIDED MERE STANDARD SERVICE OF TRANSMITTING THE SIGNALS OF ASSESSEE'S CHANNELS BUT THROUGH HUMAN INTERVENTION AND APPLICATION OF MIND PROVIDED SPECIFIED TECHNICAL SE RVICE OF PLACING ASSESSEE'S CHANNEL ON DESIRED PRIME BAND AND SUCH SERVICE ARE TECHNICAL SERVICE U/S 194J. 3. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE W AS IN FACT AUTHOR OF ALL THE PROGRAMME PURCHASED BY IT AN D WAS FULLY IN COMMAND OF MAKING SUCH PROGRAMME AND THEREFORE THE PAYMENTS MADE BY IT FOR PRODUCTION OF SUCH PROGRAMME WAS IN THE NATURE OF TECHNICAL FEE WITHIN THE ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 3 MEANING OF SECTION 194J AND THEREFORE ERRED IN DELE TING THE SHORT DEDUCTION AND INTEREST U/S 201(1A) DETERM INED ON THIS ACCOUNT AND HOLDING THE SAME WITHIN THE MEANING OF PROVISIONS OF SECTION 194C. 4. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE FACTS BROU GHT ON RECORDS BY THE ASSESSING OFFICER THAT THE ACQUISITI ON OF PROGRAMME SOFTWARE INVOLVES TRANSFER OF RIGHTS OF T HAT PROGRAMME TO THE ASSESSEE AND SUCH PAYMENTS MADE BY THE ASSESSEE ARE CLEARLY COVERED UNDER THE DEFINITI ON OF ROYALTY WITHIN THE MEANING OF ROYALTY IN EXPLANATIO N 2 TO CLAUSE (VII) TO SECTION 9. 5. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE ANY AGREEMENT WITH EVENT MANAGER TO JUSTIFY THAT THE PAYMENT WAS IN THE NATURE OF WORK CONTRACT AND ALSO FAILED TO APPRECIATE THAT THE ONUS WAS ON THE ASSESSEE TO ESTABLISH THE NATURE OF SERVICES WERE N OT IN THE NATURE OF PROFESSIONAL SERVICES. 6. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THAT THE EVENT MANAGEMENT SERVICE WAS IN THE NATURE OF WORK CONTRA CT U/S 194C AND THE SAME WAS NOT PROFESSIONAL SERVICE U/S 194J ESPECIALLY WHEN THE ASSESSEE DID NOT BRING ANY EVIDENCE TO JUSTIFY THE SERVICE WAS NOT IN THE NATURE OF PROFESSIONAL SERVICES WITHIN THE MEANING OF SECT ION 194J. 7. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE NOTIFICATI ON NO F NO. 275/43/2008-IT(B) DATED 21.08.2008 WAS CLARIFICATORY IN NATURE AND THE EVENT MANAGEMENT FE E WAS ALWAYS IN THE NATURE OF PROFESSIONAL SERVICES U /S 194J. 8. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED BY HOLDING THE EQUIPMENT HIRE CHAR GES U/S 194C AND FAILED TO APPRECIATE THAT THE EVIDENCE S AVAILABLE ON RECORDS CLEARLY SHOW THAT THE EQUIPMEN T HIRE CHARGES WERE PAID FOR SERVICES WHICH WERE TECH NICAL SERVICE WITHIN THE MEANING OF SECTION 194J. 9. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION AN D INTEREST U/S 201(1A) IN RESPECT OF EQUIPMENT HIRE C HARGES WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORDS B Y THE ASSESSING OFFICER. 10. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE PURPO RTED REIMBURSEMENT OF EXPENSES WAS IN FACT COMMISSION PA ID BY THE ASSESSEE TO ZEE TURNER LTD. AND THEREFORE TH E ASSESSEE WAS REQUIRED TO DEDUCT TDS AS PER THE PROVISION U/S 194J OF THE I.T. ACT ON SUCH PAYMENTS TO ZEE TURNER LTD. 11. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSES SEE DISGUISED THE PAYMENT OF COMMISSION TO ZEE TURNER L TD. IN THE FORM OF REIMBURSEMENT OF EXPENSES AND THEREF ORE ERRED IN DELETING THE SHORT DEDUCTION U/S 201(1) AN D INTEREST U/S 201(1A) SO DETERMINED BY THE ASSESSING OFFICER. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 4 12. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTI ON WHICH WAS DETERMINED ON THE BASIS OF INFORMATION AVAILABLE IN TAX AUDIT REPORT ESPECIALLY WHEN THE ASSESSEE DID NOT SUBMIT ANY EVIDENCE OF PAYMENT OF THE UNPAID TDS AS REPORTED IN TAX AUDIT REPORT. 13. ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSES SEE DID NOT PRODUCE THE EVIDENCE OF PAYMENT OF UNPAID TDS A S PER TAX AUDIT REPORT BEFORE THE ASSESSING OFFICER W HEREAS THE CIT(A) CLAIMED THAT THE ASSESSEE PAID THE UNPAI D TDS BEFORE THE COMPLETION OF PROCEEDINGS U/S 201(1)/201(1A). 14. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE DEMAN D OF RS.9,68,90,071/- WITHOUT PROPERLY APPRECIATING THE FACTUAL & LEGAL MATRIX OF THE CASE AS CLEARLY BROUG HT OUT BY THE A.O. IN ORDER U/S 201(1) OF THE IT ACT, 1961 . 15. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER AN Y GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY A T THE TIME OF THE HEARING OF THE CASE OR THEREAFTER. 16. THE ORDER OF THE CIT(A) BEING ERRONEOUS BE SET ASIDE AND THE A.O'S ORDER BE RESTORED. 6. THE FACTS PERTAINING TO THESE GROUNDS ARE THAT THE ASSESSEE PAYS CARRIAGE FEE TO CABLE OPERATOR/MSO FOR PU TTING THE CHANNEL ON A PARTICULAR FREQUENCY. THIS IS DONE, BECAUSE IN INDIA, BROADCASTERS FACE BANDWIDTH CONSTRAINTS. BY DOING T HIS, THE BROADCASTER GETS BETTER VIEWERSHIP AND REVENUES. F OR TAKING THIS SERVICE FROM CABLE OPERATOR, THE ASSESSEE PAYS CARR IAGE FEE, ON WHICH IT DEDUCTS TAS U/S 194C. ACCORDING TO THE AO, THE ASSESSEE SHOULD HAVE DEDUCTED TAS U/S 194J, BECAUSE A) ACCORDING TO THE A.O. PUTTING CHANNELS ON PARTICULAR BANDWIDTH REQUIRES HUMAN APPLICATION & TECHNICAL EXPERTISE B) FURTHER, SECTION 194C APPLIES ONLY WHEN STANDARD FEES IS PAID AND NOT WHEN CARRIAGE FEES ARE PAID FO R PUTTING A CHANNEL ON A PARTICULAR BANDWIDTH C) FURTHER, TRANSMISSION OF CHANNEL ON A DESIRED BAND FOR A FEE SHALL NOT AMOUNT TO 'WORK' AS DEFINED U/S 194C OF THE ACT. ACCORDINGLY, THE ASSESSEE COMMITTED A DEFAULT U/S 201(1) O F THE INCOME TAX ACT, 1961. 7. THE ASSESSEE RAISED THE ISSUE BEFORE THE CIT(A) AND REITERATED THE SUBMISSIONS. THE CIT(A), AFTER EXAMINING THE ENTIRE ISSUE, HELD, ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 5 I HAVE CONSIDERED THE FACTS OF THE CASE, THE SUBMI SSIONS AND THE ARGUMENTS OF THE LD. ARS AS WELL AS THE ORD ER PASSED BY THE AO. THE APPELLANT HAS MADE PAYMENT OF PLACEMENT CHARGES TO CABLE OPERATORS. IT IS EVIDENC ED FROM THE PLACEMENT AGREEMENT THAT THE CABLE OPERATO RS AGREE WITH THE APPELLANT TO PLACE THE CHANNELS ON C ERTAIN PREFERRED FREQUENCIES FOR A CONSIDERATION WHICH IS TERMED AS 'CARRIAGE OR PLACEMENT FEE'. IT S SEEN THAT THE CABLE OPERATORS ARE AS SUCH REQUIRED TO PLACE THE CHANNEL S ON SOME FREQUENCY. HENCE IN MY VIEW, BY AGREEING TO PL ACE THE CHANNEL ON ANY PREFERRED BAND, THE CABLE OPERAT OR DOES NOT RENDER ANY TECHNICAL SERVICE TO THE DISTRI BUTOR I TV CHANNEL. IN TERMS OF THE PROVISIONS OF SECTION 1 94C OF THE ACT, IT IS PROVIDED THAT EXPRESSION WORK' SHALL INCLUDE, INTER ALIA, BROADCASTING AND TELECASTING INCLUDING PRODUCTION OF PROGRAMMES FOR SUCH BROADCASTING AND TELECASTING. THEREFORE, IT IS EVIDENT THAT WHERE TH E PAYMENT IS FOR A WORK INVOLVING BROADCASTING AND TELECASTING, THE SAME SHALL BE SUBJECT TO DEDUCTION OF TAX AT SOURCE IN TERMS OF SECTION 194C OF THE ACT. 3.12 THUS, PAYMENT MADE TO CABLE OPERATORS FOR PLACEMENT CHARGES SHOULD BE REGARDED TO BE IN THE NATURE OF CARRYING OUT WORK OF BROADCASTING AND TELECASTING AND HENCE, SUBJECTED TO TDS UNDER SECTI ON 1940 OF THE ACT. SIMILAR VIEW HAS BEEN TAKEN BY THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF KURUKSHETRA DARPANS (F) LTD. V. CIT (2008) (169 TAX MAN 344). THEREFORE, I AM OF THE VIEW THAT PAYMENT OF PLACEMENT FEE BY THE APPELLANT TO THE CABLE OPERATO RS SHOULD BE SUBJECTED TO TDS @ 2% AS PER THE PROVISIO NS OF SECTION 194C OF THE ACT. 3.13 I DO NOT AGREE WITH THE STAND ADOPTED BY THE A O IN THE IMPUGNED ORDER THAT THE PLACEMENT FEE SHOULD BE TREATED AS FEES FOR TECHNICAL SERVICES FOR THE PURP OSE OF TDS UNDER SECTION 194J OF THE ACT. IT IS A SETTLED POSITION IN LAW THAT MERELY BECAUSE AS PART OF PROVIDING ANY SERVICE OR FACILITY, IF THE SERVICE PROVIDER REQUIR ES TECHNICAL EQUIPMENTS THAT DOES NOT MEAN THAT ANY TECHNOLOGY OR TECHNICAL SERVICE IS PROVIDED BY THE SERVICE PROVIDER. UNDER THE CURRENT ARRANGEMENT, WHAT THE C ABLE OPERATOR DOES IS TO ONLY GIVE PREFERENCE TO A PARTI CULAR CHANNEL OVER THE OTHER TO PLACE IT ON A PARTICULAR BAND FOR WHICH THEY CHARGE A CONSIDERATION. MERELY BECAUSE A S PART OF PROVIDING THIS PRIVILEGE/FACILITY, IT REQUI RES THE CABLE OPERATORS TO PUT THE CHANNEL ON A PARTICULAR BAND USING TECHNICAL EQUIPMENTS, DOES NOT MEAN THAT ANY TECHNOLOGY OR TECHNICAL SERVICE IS PROVIDED BY THE CABLE OPERATORS TO THE APPELLANT. HAVING REGARD TO THE DE CISION OF MADRAS HIGH COURT IN THE CASE OF SKYCELL COMMUNICATIONS LTD AND VARIOUS OTHER JUDICIAL PRECEDENTS RELIED UPON BY THE APPELLANT, PLACEMENT OF CHANNELS BEING A STANDARD FACILITY, THE CONSIDERATI ON IN RESPECT THEREOF WOULD NOT QUALIFY AS FEES FOR TECHN ICAL SERVICES FOR THE PURPOSE OF SECTION 194J OF THE ACT . 3.14 ALSO, I AGREE WITH THE APPELLANT THAT WHETHER THE PAYMENT IS TOWARDS A STANDARD FEE OR PLACEMENT FEE, THE ACTIVITIES INVOLVED ARE THE SAME IN BOTH CASES. FOR PLACEMENT OF A CHANNEL, BE IT ON A PRIME BAND OR AN Y ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 6 OTHER BAND THE CABLE OPERATOR PERFORMS THE SAME ACTIVITIES AND HE IS REQUIRED TO DO SO AS PART OF T HE BUSINESS HE IS CARRYING ON I.E. OF CARRYING CHANNEL S TO MAKE THEM AVAILABLE TO VIEWERS! SUBSCRIBERS. IF AS PER THE AO, THE PAYMENT OF STANDARD FEE FALLS UNDER SEC TION 194C OF THE ACT THEN THERE IS NO REASON AS TO WHY PLACEMENT FEE SHOULD NOT FALL UNDER SECTION 194C OF THE ACT SINCE ACTIVITIES INVOLVED IN BOTH THE CASES ARE SAME. THE PLACEMENT OF CHANNEL IS PART OF THE PROCESS OF BROADCASTING/TELECASTING THE CHANNEL AND HENCE, PAYMENT OF PLACEMENT FEE IS FOR DOING 'WORK' INVOLV ING BROADCASTING OF CHANNELS. THEREFORE, THE SAME IS LI ABLE FOR TDS UNDER SECTION 194C IN VIEW OF THE SPECIFIC DEFINITION OF 'WORK' CONTAINED THEREIN. 3.15 THE APPELLANT HAS CITED OTHER DECISIONS ALSO I N SUPPORT OF ITS CONTENTION AS TO WHY THE PAYMENTS CA NNOT BE TREATED AS FEES FOR TECHNICAL SERVICES UNDER SEC TION 194J. THE PLACEMENT FEE IS A CONSIDERATION FOR PROV IDING CHOICE OF THE DESIRED PLACEMENT OF THE CHANNELS AND IT IS NOT IN THE NATURE OF 'FEES FOR TECHNICAL SERVICES'. HENCE, I AM OF THE VIEW THAT PROVISIONS OF SECTION 194J CANN OT APPLY TO THE PAYMENT OF PLACEMENT CHARGES/ CARRIAGE FEES. IN VIEW OF THE FACTS OF THE INSTANT CASE, THE PAYMENTS OF PLACEMENT FEE MADE TO CABLE OPERATORS! MSOS ARE NOT IN THE NATURE OF 'FEES FOR TECHNICAL S ERVICES' BECAUSE ANY SERVICES OF MANAGERIAL, TECHNICAL OR CONSULTANCY NATURE WERE NOT RENDERED BY THE CABLE OPERATORS! MSOS AS DEFINED IN SECTION 194J READ WIT H EXPLANATION 2 TO SECTION 9(1)(VII) OF THE ACT. THIS IS SO BECAUSE IN THE PROCESS OF PLACEMENT OF CHANNELS, TH E CABLE OPERATORS! MSOS ARE AS SUCH REQUIRED TO PLACE THE CHANNELS ON SOME FREQUENCY. IN ANY CASE, I HAVE ALR EADY HELD ABOVE, THAT IN VIEW OF THE SPECIFIC PROVISIONS CONTAINED IN SECTION 194C WHICH DEAL WITH PAYMENTS FOR BROADCASTING AND TELECASTING WORK, OTHER GENERAL PROVISIONS CANNOT APPLY. 3.16 SINCE THE APPELLANT HAS ALREADY DEDUCTED TDS UNDER SECTION 194C OF THE ACT ON THE PLACEMENT FEE, THE AO IS DIRECTED NOT TO CONSIDER THE APPELLANT AS AN ASSESSEE IN DEFAULT UNDER SECTION 201(1) OF THE ACT , AS THERE IS NO SHORT DEDUCTION OF TAX BY THE APPELLANT . THE DEMAND OF TAX OF RS. 81,93,378/- UNDER SECTION 201( 1) AND CONSEQUENTIAL LEVY OF INTEREST AT RS. 48,56,174 /- UNDER SECTION 201(1A) IS HEREBY DELETED. 8. THE CIT(A) THEREFORE, DELETED THE ADDITION AS MADE BY T HE AO. 9. AGAINST THIS ORDER ON THE ISSUE, AS DECIDED BY THE C IT(A), THE DEPARTMENT IS IN APPEAL BEFORE THE ITAT. 10. BEFORE US, THE DR STRONGLY SUPPORTED THE ORDER OF THE AO, WHEREAS, THE AR SUPPORTED THE ORDER OF THE CIT(A). ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 7 11. WE HAVE HEARD THE ARGUMENTS AND HAVE PURSUED THE ORDERS OF BOTH THE REVENUE AUTHORITIES AND WE FIND THAT THE CIT(A) HAD CORRECTLY APPLIED THE PROVISIONS OF LAW, I.E. IN SEC TION 194C, WORK INCLUDES BROADCASTING AND TELECASTING INCLUDING PRODUCTION OF PROGRAMMES . WE ARE ALSO HELPED BY THE ORDER OF THE COORDINATE BENCH OF ITAT MUMBAI IN THE CASE OF ACIT( TDS) VS UTV ENTERTAINMENT TELEVISION LTD., ITA NO. 2699/MUM/2012, WHEREIN THE ITAT HELD THAT WHILE MAKING THE PAYMENT OF CAR RIAGE FEE TO CABLE OPERATORS, TDS HAS TO BE DEDUCTED U/S 194C. 12. IN SUCH A CIRCUMSTANCE, WE ENDORSE THE FINDING OF THE CIT(A) AND RESPECTFULLY FOLLOWING THE ORDER OF THE ITAT IN THE CASE OF UTV ENTERTAINMENT TELEVISION LTD. ( SUPRA ), WE SUSTAIN THE ORDER OF THE CIT(A) AND REJECT THE GROUNDS OF APPEAL RAIS ED BY THE DEPARTMENT. 13. GROUNDS NO. 1 & 2 ARE THEREFORE, REJECTED. 14. GROUNDS NO. 3 & 4 PERTAIN TO DEDUCTION OF TAS FOR PURCHASE OF PROGRAMMES. 15. THE FACTS ARE, THAT THE ASSESSEE BEING BROADCASTER REGULARLY PURCHASES COMMISSIONED PROGRAMS PRODUCED AS PER THE AGREEMENT WITH PRODUCTION HOUSE AS PER THE SCRIPT/ CONCEPT APPROVED BY IT. THE PRODUCTION HOUSE PRODUCES THE PROG RAM FOR THE ASSESSEE. THE PRODUCTION HOUSE DOES NOT HAVE OR R ETAIN ANY RIGHT ON THE PROGRAM BUT IT DELIVERS THE SOURCE MATERIAL OF THE PROGRAM TO ASSESSEE. THE ASSESSEE DEDUCTED TDS U/S 1 94C OF THE ACT ON THE SAID PAYMENT MADE TO PRODUCTION HOUSE FOR PURCHASE OF PROGRAMME. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 8 16. ON THE CONTRARY, THE AO WAS OF THE OPINION THAT THE PAYMENTS MADE BY ASSESSEE TO THE PRODUCTION HOUSE, FO R PURCHASE OF PROGRAMMES, ARE IN THE NATURE OF 'FEES FOR T ECHNICAL SERVICES' AND HENCE, TDS HAD TO BE DEDUCTED U/S 194J OF THE ACT. HE OBSERVED THAT THE PRODUCTION HOUSE USES THE S ERVICES OF PROFESSIONAL ARTIST I.E. ACTORS, SCRIP-WRITERS, DUBBING ARTISTS, TECHNICIANS ETC. SINCE THE PRODUCTION HOUSE AVAILS SERVICES OF SUCH PEOPLE, THEREFORE, THE PAYMENTS MADE TO PRODUCTION HOUSE WOULD FALL U/S 194J OF THE ACT. 17. THE AO THEREFORE, INVOKED THE PROVISIONS OF SECTION 20 1(1) OF THE INCOME TAX ACT, 1961. 18. AGAINST THIS ORDER OF THE AO, THE ASSESSEE APPROACH ED THE CIT(A), WHO, AFTER CONSIDERING THE DETAILED SUBMISSION, HELD, I HAVE CONSIDERED THE SUBMISSIONS AND THE ARGUMENT S OF THE LD. AR. THE APPELLANT HAS MADE PAYMENT FOR PRODUCTION OF PROGRAMMES TO VARIOUS PRODUCTION HOUSES. THE APPELLANT HIRES THE PRODUCERS FOR PRODUCING TV PROGRAMMES FOR IT, ON A COMMISSIONED WORK BASIS AND PAYS CONSIDERATION TO THE PRODUCERS FOR PRODUCING THE PROGRAMMES. IN TERMS OF THE PROVISION S OF SECTION 194C OF THE ACT, IT IS SPECIFICALLY PROV IDED THAT EXPRESSION WORK' SHALL INCLUDE, INTER ALIA, BROADCASTING AND TELECASTING INCLUDING PRODUCTION O F PROGRAMMES FOR SUCH BROADCASTING AND TELECASTING. THEREFORE, IT IS EVIDENT THAT WHERE THE PAYMENT IS FOR PRODUCTION OF TV PROGRAMMES, IT IS CLEARLY COVERED BY THE PROVISIONS OF SECTION 194C. A PERUSAL OF THE AGREEMENTS SHOWS THAT THE PRINCIPAL PURPOSE OF ENTERING INTO THE AGREEMENTS IS TO GET THE PROGRAMM ES PRODUCED BY THE PRODUCERS ON A COMMISSION WORK BASIS. THE PRODUCER IS CONTRACTED TO ORGANIZE, PLAN , SHOOT AND RECORD PROMOS/TEASER FOR THE TV PROGRAMMES AND THE APPELLANT HAS THE FULL CREATIVE AND TECHNICAL APPROVAL/AUTHORITY OVER THE PROGRAMME S, INCLUDING THE OUTLINE, SCRIPT, ETC. IN SUCH CASE, I AGREE WITH THE APPELLANT THAT THE PAYMENT FOR CARRYING OU T THE WORK OF PRODUCING PROGRAMMES ON BEHALF OF THE APPELLANT IS IN THE NATURE OF 'WORK' AS DEFINED IN SECTION 194C OF THE ACT AND THERE CAN BE NO QUESTIO N OF TREATING IT AS FEES FOR TECHNICAL SERVICES' UNDER S ECTION 194J OF THE ACT. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 9 4.6 IN VIEW OF THE ABOVE, I DO NOT AGREE WITH THE S TAND ADOPTED BY THE AO. HE HAS COMPLETELY IGNORED THE CR UX OF THE TRANSACTION. ALSO, THE DECISION RELIED UPON BY THE APPELLANT I.E. THAT OF HON'BLE DELHI HIGH COURT IN CASE OF PRASAR BHARTI [2006] (158 TAXMAN 470) IS ON IDENTIC AL FACTS I.E., PAYMENTS FOR PRODUCTION OF TV PROGRAMME S MADE ON COMMISSIONED WORK BASIS. THE HONBLE DELHI HIGH COURT HAS HELD AS UNDER: WE OBSERVE THAT EXPLANATION III, WHICH WAS INTRODUC ED SIMULTANEOUSLY WITH SECTION 194C, IS VERY SPECIFIC IN ITS APPLICATION TO NOT ONLY BROADCASTING AND TELECA STING BUT ALSO INCLUDE PRODUCTION OF PROGRAMMES FOR SUCH BROADCASTING AND TELECASTING'. IF, ON THE SAME DATE , TWO PROVISIONS ARE INTRODUCED IN THE ACT, ONE SPECIFIC TO THE ACTIVITY SOUGHT TO BE TAXED AND THE OTHER IN MORE GENERAL TERMS, RESORT MUST BE HAD TO THE SPECIFIC PROVISION WHICH MANIFESTS THE INTENTION OF THE LEGISLATURE. IT IS NOT, THEREFORE, POSSIBLE TO ACCE PT THE CONTENTION OF THE REVENUE THAT PROGRAMMES PRODUCED FOR TELEVISION, INCLUDING COMMISSIONED PROGRAMMES', WILL FALL OUTSIDE THE REALM OF SECTION 194C EXPLANA TION III OF THE ACT. WE FIND NO INFIRMITY IN. THE VIEW T AKEN BY THE ITAT WHICH WE HEREBY AFFIRM. 4.7 HENCE, IT IS EVIDENT THAT THE AO WAS NOT JUSTIF IED IN TREATING THE PAYMENT FOR PRODUCTION OF TV PROGRAMME S AS 'FEES FOR TECHNICAL SERVICES'. IN ANY CASE, AS A LSO HELD IN THE AFORESAID JUDGMENT, PROVISIONS OF SECTI ON 194C ARE MORE SPECIFIC AS COMPARED TO THOSE OF SECT ION 194J (SINCE PROVISIONS OF SECTION 194C DEAL WITH TH E VERY PAYMENT IN QUESTION - I.E. PRODUCTION OF PROGRAMMES, AND NOT WITH A GENERAL CATEGORY OF PAYMENT LIKE FEES FOR TECHNICAL SERVICES' AS IN SEC TION 194J), AND HENCE, SECTION 194J, CANNOT APPLY TO PAYMENTS FOR PRODUCTION OF PROGRAMMES. SECTION 194C CLEARLY STATES THAT PAYMENT FOR PRODUCTION OF PROGRAMMES CONSTITUTES PAYMENTS FOR 'WORK' UNDER SECTION 194C. ACCORDINGLY, APPLYING THE SAID JUDGME NT OF THE HON'BLE DELHI HIGH COURT AND ALSO RELYING ON THE CBDT'S CIRCULAR, IT IS CLEAR THAT THE PROVISIONS OF SECTION 194C WOULD PREVAIL OVER SECTION 194J OF THE ACT IN THIS CASE. 4.8 SINCE THE APPELLANT HAS ALREADY DEDUCTED TDS UNDER SECTION 194C OF THE ACT ON PRODUCTION PAYMENT S, THE AO IS DIRECTED NOT TO CONSIDER THE APPELLANT TO BE AN ASSESSEE IN DEFAULT UNDER SECTION 201(1) OF THE ACT, AS THERE IS NO SHORT DEDUCTION OF TAX BY THE APPELL ANT. THE DEMAND OF TAX OF RS. 6,68,97,644/- UNDER SECTIO N 201(1) AND CONSEQUENTIAL LEVY OF INTEREST AT RS. 4,44,86,904/- UNDER SECTION 201(1A) IS HEREBY DIREC TED TO BE DELETED. 19. THE CIT(A), THEREFORE, HELD THE ISSUE IN FAVOUR OF THE ASSESSEE. AGAINST THIS ORDER OF THE CIT(A) THE DEPARTMENT IS IN APPEAL BEFORE THE ITAT. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 10 20. BEFORE US, THE DR RELIED ON THE ORDER OF THE AO, WHER EAS, THE AR RELIED ON THE ORDER OF THE CIT(A). 21. ON HEARING BOTH THE SIDES IN DETAIL, WE FIND THAT THE C IT(A) HAS APPLIED THE PROVISIONS OF THE ACT, BEFORE COMING TO A CONCLUSION, THAT U/S 194C WORK INCLUDES PRODUCTION OF PROGRAMMES. WE FIND THAT SIMILAR ISSUE WAS CONTESTED BEFO RE THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS PRASAR BHARTI, REPORTED IN 292 ITR 580 (DELHI) AND FOLLOWED BY ACIT(TDS) VS SAHARA ONE MEDIA & ENTERTAINMENT LTD. IN ITA NO. 4548/MUM/2012, WHEREIN IT WAS HELD THAT PAYMENT TO ASSIG NED PRODUCER FOR PRODUCTION OF PROGRAMME SPECIFICALLY FALLS WITHIN THE AMBIT OF CLAUSE (B) TO EXPLANATION III TO SECTION 194C OF THE ACT, WHEREAS, THE PROVISIONS OF SECTION 194J OF THE ACT AR E GENERAL IN NATURE AND THEREFORE, PROVISIONS OF SECTION 194C WOULD PREVAIL OVER SECTION 194J. 22. IN THESE CIRCUMSTANCES, WE SUSTAIN THE ORDER OF THE CIT(A) AND REJECT THE GROUNDS OF APPEAL RAISED BY THE DEPARTM ENT ON THE ISSUE. 23. GROUNDS NO. 3 & 4 ARE THEREFORE, REJECTED. 24. GROUNDS NO. 5, 6 AND 7 PERTAIN TO DEDUCTION OF TAS ON EVENT MANAGEMENT CHARGES. 25. THE ASSESSEE ORGANIZES EVENTS, FOR WHICH IT APPOINTS EVENT MANAGEMENT COMPANIES. ON THE PAYMENT MADE TO THE EVEN T MANAGER, THE ASSESSEE DEDUCTED TAS U/S 194C, BUT ACCO RDING TO THE AO, THE ASSESSEE SHOULD HAVE DEDUCTED TAS U/S 194J. HE, THEREFORE, HELD THE ASSESSEE TO BE IN DEFAULT OF SHORT DED UCTION U/S 201(1) OF THE ACT. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 11 26. AGAINST THE ORDER ON THE ISSUE, THE ASSESSEE SUPPOR TED THE CIT(A), BEFORE WHOM THE SUBMISSIONS WERE REITERATED. THE CI T(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, HELD, I HAVE CONSIDERED THE SUBMISSIONS AND THE ARGUMENT S OF THE AR. IN MY OPINION, THE EVENT MANAGEMENT SERV ICES ARE IN THE NATURE OF SIMPLE 'WORK CONTRACTS'. IN TH E CASE OF THE APPELLANT, THE EVENT MANAGERS HAVE PROVIDED TO THE APPELLANT THE SECURITY PERSONNEL, LABOUR PERSONNEL, CONTRACTORS, MEN AND WOMEN REQUIRED FOR THE EVENTS IN VARIOUS CAPACITIES. IN CARRYING OUT SUCH EVENTS, TH E EVENT MANAGERS HAVE NOT IMPARTED ANY TECHNICAL KNOWLEDGE OR TRAINING TO THE APPELLANT OR ITS PERSONNEL. HENCE, IN MY OPINION, THE SERVICES RENDERED BY THE EVENT MANAGER S ARE SIMPLY IN THE NATURE OF WORKS CONTRACT'. THE AG HAS HELD THE EVENT MANAGEMENT FEES TO BE IN THE NATURE OF 'FEES FOR TECHNICAL SERVICES' ONLY BECAUSE OF THE O BDT NOTIFICATION NO. 88/2008 ISSUED VIDE FNO. 275/43/2008-IT(B), DATED 21-08-2008. SINCE IT HAS B EEN ISSUED LATER, ON 21I'/2008, IT CANNOT BE APPLIED TO THE CURRENT YEAR. EARLIER TO THIS NOTIFICATION, NONE OF THE CIRCULARS OF THE BOARD COVERED THE 'EVENT MANAGEMEN T FEES' SPECIFICALLY AND HENCE SUCH CONTRACTS FOR EVE NT MANAGEMENT COULD NOT HAVE BEEN CLASSIFIED UNDER ANY CATEGORY OTHER THAN THE 'WORKS CONTRACT'. THE LATER NOTIFICATION DATED 21-08-2008, IN MY OPINION, CANNO T BE APPLIED RETROSPECTIVELY. EVEN THE SAID NOTIFICATION ITSELF STATES THAT 'THIS NOTIFICATION SHALL COME INTO FORC E WITH EFFECT FROM THE DATE OF ITS PUBLICATION IN THE OFFI CIAL GAZETTE'. 5.6 IN VIEW OF ABOVE DISCUSSION THEREFORE, IT IS EVIDENT THAT THE 'EVENT MANAGEMENT FEES' PAID BY TH E APPELLANT TO ITS EVENT MANAGERS CANNOT BE HELD TO B E IN THE NATURE OF .FOR TECHNICAL SERVICES' IN THE CURR ENT YEAR. I HOLD ACCORDINGLY. SINCE THE APPELLANT HAS ALREADY DEDUCTED TDS UNDER SECTION 194C OF THE ACT, THE AC IS DIRECTED NOT TO CONSIDER THE APPELLANT TO BE AN ASSESSEE IN DEFAULT UNDER SECTION 201(1) OF THE ACT AS THERE IS NO SHORT DEDUCTION BY THE APPELLANT. TH E DEMAND OF TAX OF RS. 8,45,747/- UNDER SECTION 201(1 ) AND CONSEQUENTIAL LEVY OF INTEREST AT RS. 5,61,792/ - UNDER SECTION 201(1A) IS HEREBY DIRECTED TO BE DELE TE. 23. THE CIT(A), THEREFORE, DELETED THE DEMAND AS RAISED BY THE AO. 24. AGAINST THIS ORDER OF THE CIT(A), THE DEPARTMENT IS IN APPEAL BEFORE THE ITAT ON THIS ISSUE. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 12 25. THE DR VEHEMENTLY ARGUED THE ISSUE ON BEHALF OF THE AO, WHEREAS, THE AR ARGUED THE CORRECTNESS OF THE ORDER OF CIT(A). 26. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE DEPA RTMENT IS HEAVILY RELYING ON THE NOTIFICATION ISSUED BY THE BOARD NO. 88/2008/F. NO. 275/43/2008 DATED 21.08.2008, ACCORDING T O WHICH IT PRESCRIBES THAT TDS ON FEE FOR EVENT MANAGEMENT IS TO BE U/S 194J. BUT THIS NOTIFICATION IN OUR OPINION SHALL BE PROSPECTIVE AND SHALL NOT COVER THE PAYMENTS MADE PRIOR TO THE ISSUE OF NOTIFICATION, AS IT DOES NOT BEAR ANY RETROSPECTIVE CHARACTER. 27. WE, THEREFORE, SUSTAIN THE ORDER OF THE CIT(A) AND RE JECT THE GROUNDS TAKEN BY THE DEPARTMENT. 28. GROUNDS NO. 5, 6 & 7 ARE THEREFORE, REJECTED. 29. GROUNDS NO. 8 AND 9 PERTAIN TO TDS ON EQUIPMENT HIR E CHARGES. 30. THE FACTS ARE THAT COMPANIES, INCLUDING THE ASSESSEE HIRE EQUIPMENTS, LABOURS AND OPERATORS FOR THEIR PRODUCTION UN ITS. ON THESE PAYMENTS, THE ASSESSEE PAYS HIRE CHARGES AN D DEDUCTS TAS UNDER THE PROVISIONS OF SECTION 194C. HOWEVER, THE AO HELD IT TO THE FTS AND THEREFORE THE TDS SHOULD HAVE BEEN U /S 194J AND THEREFORE INVOKED SECTION 201(1). 31. AGAINST THIS, THE ASSESSEE APPROACHED THE CIT(A) AND REITERATED THE FACTS. THE CIT(A), AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE HELD, I HAVE CONSIDERED THE ABOVE SUBMISSIONS OF THE APPELLANT AND THE ARGUMENTS OF THE LD. ARS. FIRST O F ALL, IN MY OPINION THE 'EQUIPMENT HIRE CHARGES' PAID BY THE APPELLANT CANNOT IN ANY CASE FALL IN THE CATEGORY O F 'FEES FOR TECHNICAL SERVICES'. THE AO HAS NOT MADE OUT A CASE ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 13 AGAINST THE APPELLANT THAT SUCH 'EQUIPMENT HIRE CHA RGES' ARE IN THE NATURE OF RENT AND HENCE TAX WAS LIABLE TO BE DEDUCTED UNDER SECTION 194J OF THE ACT. HOWEVER, EV EN FOR THE SAID 'EQUIPMENT HIRE CHARGES' TO BE TERMED AS RENT, IT WAS NECESSARY THAT THE EQUIPMENT IS TAKEN ON HIRE BY THE APPELLANT AND USED BY THE APPELLANT ITS ELF. THE FACTS IN THE CASE OF THE APPELLANT ARE NOT SO. IT IS SEEN THAT THE EQUIPMENTS HAVE BEEN TAKEN ON HIRE ON WET LEASE BASIS, WHICH INCLUDES EQUIPMENTS ALONG-WITH OPERATING STAFF. FURTHER, OTHER SERVICES ARE ALSO P ROVIDED BY THE VENDOR. THEREFORE, IN MY OPINION THE 'EQUIPM ENT HIRE CHARGES' ARE SQUARELY COVERED UNDER THE PROVIS IONS OF SECTION 194C OF THE ACT. AS RIGHTLY POINTED OUT BY THE APPELLANT, CBDT CIRCULAR NO. 681 DATED 08.03.1994 CLARIFIES THAT 'THE PROVISIONS OF SECTION 194C SHAL L APPLY TO ALL TYPES OF CONTRACTS FOR CARRYING OUT ANY WORK INCLUDING TRANSPORT CONTRACT, SERVICE CONTRACTS, ADVERTISEMENT CONTRACTS, BROADCASTING CONTRACTS, TELECASTING CONTRACTS, LABOUR CONTRACTS, MATERIALS CONTRACTS AND WORKS CONTRACT.' IN THIS REGARD, IT M AY BE NOTED THAT CIRCULAR NO. 715 DATED 08/08/1995 ALSO SUPPORTS THE CONTENTION OF THE APPELLANT IN THIS RE GARD THAT SECTION 194C SHALL APPLY TO ALL TYPES OF 'WORK CONTRACTS'. THERE IS NO SEPARATE OR SPECIFIC PROVIS ION OR CLARIFICATION BY CBDT IN REGARD TO EQUIPMENT HIRE CHARGES. 6.9 IT IS THUS BEYOND DOUBT THAT EQUIPMENT HIRE CHA RGES ARE COVERED UNDER THE PROVISIONS OF SECTION 1940 AN D I HOLD ACCORDINGLY. SINCE, THE APPELLANT HAS ALREADY DEDUCTED TDS UNDER SECTION 1940 OF THE ACT, THE AC IS DIRECTED NOT TO CONSIDER THE APPELLANT TO BE AN ASS ESSEE IN DEFAULT UNDER SECTION 201(1) OF THE ACT AS THERE IS NO SHORT DEDUCTION BY THE APPELLANT. THE DEMAND OF TAX OF RS. 23,68,523/- UNDER SECTION 201(1) AND CONSEQUENT IAL LEVY OF INTEREST AT RS. 15,41,694/- UNDER SECTION 2 01(1A) IS HEREBY DELETED. 32. THE CIT(A), THEREFORE DELETED THE ADDITIONAL TAX LIABILITY COMPUTED BY THE AO. 33. AGAINST ORDER OF THE CIT(A), THE DEPARTMENT IS BEFORE THE ITAT ON THE ISSUE OF TDS ON HIRE CHARGES OF EQUIPMENT. 34. BEFORE US, THE DR ARGUED THE CASE OF THE AO, WHILE TH E AR SUPPORTED THE ORDER OF THE CIT(A). 35. WE HAVE HEARD THE ARGUMENTS AND HAVE PERUSED TH E MATERIAL ON RECORD AND ALSO PURSUED THE ORDERS OF THE R EVENUE AUTHORITIES. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 14 36. IN OUR OPINION THE CIT(A) HAS APPLIED THE PROVISIONS OF THE ACT AND HAVE DELVED ON THE SAME. WE ALSO FIND THAT THE A O TERMED THE PAYMENT MADE FOR HIRE CHARGES AS FTS, WHICH THE CIT(A) HAS CATEGORICALLY DEMOLISHED. WE FIND THAT SIMILAR ISSUE WAS DEALT WITH BY THE COORDINATE BENCH AT MUMBAI IN THE CASE OF ACIT (TDS) VS SAHARA ONE MEDIA & ENTERTAINMENT LTD., ITA NO. 4548-4550/MUM/2012, WHEREIN IT WAS HELD THAT PAYMENT MA DE BY ASSESSEE UNDER A CONTRACT, WHICH IS A PART OF PRODUC TION OF PROGRAMME, TDS IS REQUIRED TO BE DEDUCTED U/S 194C. 37. KEEPING THE RELEVANT PROVISION IN MIND AS WELL AS GAINFULL Y FOLLOWING THE ORDER OF THE ITAT IN THE CASE OF SAHARA ONE MEDIA & ENTERTAINMENT LTD. ( SUPRA ), WE ARE OF THE CONSIDERED OPINION THAT THERE WAS NO MISTAKE IN THE ORDER OF THE CIT(A), WHIC H WE SUSTAIN ON THE ISSUE, THEREBY REJECTING THE GROUND AS R AISED BY THE DEPARTMENT. 38. GROUNDS NO. 8 & 9 ARE THEREFORE, REJECTED. 39. GROUNDS 10 & 11 PERTAIN TO TDS ON REIMBURSEMENT O F COMMISSION EXPENSES. 40. THE FACTS ARE THAT THE ASSESSEE PAID COMMISSION TO ZEE TURNER LTD., WHICH INCLUDED REIMBURSEMENT OF DEALER COMMISSION. ON REIMBURSEMENT OF DEALER COMMISSION, THE ASSESSEE DID NOT DEDUCT TAS. THIS PAYMENT AGGREGATED RS. 17.56 CRORES, WHICH INCLUDED RELIEF BY WAY OF CERTIFICATE ISSUED BY T HE DEPARTMENT U/S 197 CERTIFICATE AT RS. 13.84 CRORES AND T HE BALANCE RS. 3.72 CRORES WAS REIMBURSEMENT. 41. THE AO WAS OF THE VIEW THAT THE PAYMENT FELL WITHIN TH E AMBIT OF SECTION 194H AND SINCE THE ASSESSEE DID NOT DED UCTED ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 15 TAS, THE ASSESSEE COMMITTED A DEFAULT AND INVOKED SECTIO N 201(1). 42. THE ASSESSEE TOOK THE ISSUE BEFORE THE CIT(A) AND REITERATED ITS SUBMISSIONS BEFORE HIM AND SUBMITTED THAT 194H CONTEMPLATED INCOME BY WAY OF COMMISSION AND NOT ANY PAYMENT. IN THE CASE OF THE ASSESSEE, THE PAYMENT WAS MADE AS A REIMBURSEMENT OF COMMISSION, WHEREIN NO INCOME WAS GENERATED TO THE PAYEE. THE CIT(A), HELD, I HAVE CONSIDERED THE ABOVE SUBMISSIONS OF THE APPELLANT AS WELL AS THE FACTS OF THE CASE. I AGREE WITH THE APPELLANT THAT NO TAX IS REQUIRED TO BE DEDUCTE D IN RESPECT OF REIMBURSEMENT OF COMMISSION WHICH HAS BE EN PAID BY ZEE TURNER LTD TO ITS DEALERS AND DISTRIBUT ORS. THE PROVISIONS OF SECTION 194H ARE QUITE CLEAR AND THE WORDS USED THEREIN ARE 'ANY INCOME BY WAY OF COMMISSION'. THEREFORE, SINCE THE REIMBURSEMENTS AR E NOT IN THE NATURE OF ANY INCOME IN THE HANDS OF ZEE TUR NER LTD, NO TAX WAS REQUIRED TO BE DEDUCTED IN RESPECT OF THE SAID REIMBURSEMENT OF RS. 3.72 CRORES. FURTHERMORE, IT IS ALSO SEEN THAT WHILE PAYING THE COMMISSION TO ITS D EALERS AND DISTRIBUTORS, ZEE TURNER LTD. HAS DEDUCTED TAX AT SOURCE ON THE SAID COMMISSION PAID WHICH WAS IN TUR N REIMBURSED BY THE APPELLANT. ACCORDINGLY NO TAX WAS REQUIRED TO BE DEDUCTED AGAIN ON THE COMMISSION REIMBURSED TO ZEE TURNER. 7.7 IN VIEW OF THE ABOVE, I DO NOT AGREE WITH THE S TAND ADOPTED BY THE AO AND THE AO IS DIRECTED NOT TO CON SIDER THE APPELLANT TO BE AN ASSESSEE IN DEFAULT UNDER SE CTION 201(1) OF THE ACT AS THERE IS NO SHORT DEDUCTION BY THE APPELLANT. THE DEMAND OF TAX OF RS. 20,87,475/- UND ER SECTION 201(1) AND CONSEQUENTIAL LEVY OF INTEREST A T RS. 15,02,982/- UNDER SECTION 201(1A) IS HEREBY DELETED . 43. THE CIT(A), THUS DELETED THE TAX CHARGED ON THE ASSESSEE. 44. AGAINST THIS ORDER OF THE CIT(A), THE DEPARTMENT IS IN APPEAL BEFORE THE ITAT. 45. BEFORE US, THE DR SUPPORTED THE ORDER OF THE AO, WH EREAS, THE AR SUPPORTED THE ORDER OF THE CIT(A). 46. AFTER HEARING BOTH THE PARTIES, WE DO NOT FIND ANY INFIR MITY IN THE VIEW TAKEN BY THE CIT(A). ON THE FACTS THAT PAYEE, M/S ZEE TURNER LTD. PAID COMMISSION TO ITS CONSTITUENTS, THEY DEDU CTED ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 16 TAX WHERE EVER APPLICABLE. IN THE INSTANT CASE, THE ASSES SEE HAD ONLY MADE GOOD THE PAYMENTS MADE BY ZEE TURNER LTD., WHICH IT HAD PAID ON BEHALF OF THE ASSESSEE. HENCE THERE WAS NO P ROFIT ELEMENT INVOLVED IN THOSE PAYMENTS, BEING REIMBURSEMENTS MADE BY THE ASSESSEE TO ZEE TURNER LIMITED. IN THE PR OCEEDINGS BEFORE THE REVENUE AUTHORITIES, THE ASSESSEE WAS ABLE TO DEMONSTRATE THE DIFFERENT CHARACTERS OF PAYMENTS MADE B Y IT. THE PAYMENTS, WHERE ZEE TURNER LIMITED PAID ITS TAXES, THE ASSESSEE WAS UNDER NO OBLIGATION AND/OR BECAME DEFAULTER U/S 201(1). ON THE GIVEN FACTS, WE FIND OURSELVES BENEFITTED BY T HE DECISION OF HONBLE SUPREME COURT IN THE CASE OF HINDUSTAN COCA COLA BEVERAGES REPORTED IN 293 ITR 226, WHEREIN IT WAS HELD THAT WHERE THE DEDUCTEE/RECIPIENT HAS ALREADY PAID TAXES ON AMOUNT RECEIVED FROM DEDUCTOR, THE DEPARTMENT CANNO T RECOVER THE TAX ON THE SAME AMOUNT, AS THAT WOULD RES ULT IN DOUBLE TAXATION. 47. WE ARE ALSO AWARE OF THE DECISION OF THE COORDINATE B ENCH AT KOLKATA IN THE CASE OF RAMAKRISHNA VEDENTA MATH VS I TO, REPORTED IN 55 SOT 417 (KOL), WHEREIN IT WAS HELD THAT THE ONUS IS ON THE REVENUE TO DEMONSTRATE THAT THE TAXES HAVE NOT BEEN RECOVERED FROM THE PERSON WHO HAD THE PRIMARY LIABILITY TO PAY THE TAX IN ACCORDANCE WITH THE INCOME. 48. SINCE IN THE INSTANT CASE, THE ASSESSEE HAD PROVIDED COMPLETE DETAILS OF EXPENSES AND TAXES PAID BY THE PAYEE , THE ADDITION BECAME UNTENABLE. 49. ON THESE FACTS AND SEEKING BENEFIT OF THE CITED CASE LAWS, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF TH E CIT(A), WHICH WE SUSTAIN AND AS A CONSEQUENCE REJECT THE GROU NDS TAKEN BY THE DEPARTMENT ON THE IMPUGNED ISSUE. 50. GROUND NO. 10 & 11 ARE THEREFORE REJECTED. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 17 51. GROUNDS NO. 12 & 13 PERTAIN TO SHORT DEDUCTION OF TAS. 52. ACCORDING TO THE AO, THE ASSESSEE HAD COMMITTED A BREACH BY SHORT DEDUCTION OF TAS AS PER TAX AUDIT REPORT, WHER EAS THE CIT(A) NOTED THAT THE DETAILS HAD BEEN PROVIDED BY WAY OF THE CHALLANS OF PAYMENT OF TAX DEDUCTED AT SOURCE, HENCE THE PROVISIONS OF SECTION 201(1)/201(A) CANNOT BE ATTRACTED. BEFO RE THE CIT(A), THE ASSESSEE SUBMITTED THAT THE AO DID NOT C ONSIDER THE DETAILS COMPLETELY, THEREFORE HE CONCLUDED THAT THE A SSESSEE WAS IN DEFAULT. IN ANY CASE, THE ASSESSEE SUBMITTED THE D ETAILS AND PROOFS OF PAYMENT OF TAX AND INTEREST. 53. ON CONSIDERATION OF THE DETAILS AND PROOFS OF PAYMENT , THE CIT(A) DELETED THE DEMAND AS RAISED BY THE AO. 54. AGAINST THIS ORDER, THE DEPARTMENT IS IN APPEAL BEFOR E THE ITAT. 55. BEFORE US, THE DR RELIED ON THE ORDER OF THE AO ON T HE ISSUE, WHEREAS, THE AR RELIED ON THE ORDER OF THE CIT(A). 56. ON HEARING AND GOING THROUGH THE ORDERS OF THE REV ENUE AUTHORITIES, WE DO NOT FIND ANY INFIRMITY IN THE IMPUGNED ORDE R, WHICH WE SUSTAIN AND AS A CONSEQUENCE, THE GROUNDS OF A PPEAL ON THE IMPUGNED ISSUE ARE REJECTED. 57. GROUNDS NO. 12 & 13 ARE THEREFORE, REJECTED. 58. GROUND NO. 14 IS CONSEQUENTIAL TO THE ABOVE GROUNDS , WHEREIN WE HAVE DELETED THE DEMANDS AS CREATED BY TH E AO. IN SUCH A CIRCUMSTANCES, GROUND NO. 14 BECOME INCONSEQUENT IAL, HENCE IT IS REJECTED. 59. GROUNDS NO. 15 & 16 ARE GENERAL. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 18 60 IN THE RESULT, THE APPEAL AS FILED BY THE DEPARTMENT IS DISMISSED. ITA NO. 3932/MUM/2013 : ASST. YEAR 2007-08 : 61. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE DEPARTMENT: A) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION U/ S 201(1) AND INTEREST U/S 201(1A) IN RESPECT OF CARRI AGE FEE /PLACEMENT FEE PAID BY THE ASSESSEE TO VARIOUS CABL E OPERATORS/MSO/DTH SERVICE PROVIDERS HOLDING THE SERVICE PROVIDED WAS WORK WITHIN THE MEANING OF SEC TION 1940 AND NOT TECHNICAL SERVICE U/S 194J. B) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE CABLE OPER ATORS /MSO/DTH SERVICE PROVIDERS HAD NOT PROVIDED MERE STANDARD SERVICE OF TRANSMITTING THE SIGNALS OF ASSESSEE'S CHANNELS BUT THROUGH HUMAN INTERVENTION AND APPLICATION OF MIND PROVIDED SPECIFIED TECHNICAL SE RVICE OF PLACING ASSESSEE'S CHANNEL ON DESIRED PRIME BAND AND SUCH SERVICE ARE TECHNICAL SERVICE U/S 194J. C) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE W AS IN FACT AUTHOR OF ALL THE PROGRAMME PURCHASED BY IT AN D WAS FULLY IN COMMAND OF MAKING SUCH PROGRAMME AND THEREFORE THE PAYMENTS MADE BY IT FOR PRODUCTION OF SUCH PROGRAMME WAS IN THE NATURE OF TECHNICAL FEE WITHIN THE MEANING OF SECTION 194J AND THEREFORE ERRED IN DELE TING THE SHORT DEDUCTION AND INTEREST U/S 201(1A) DETERM INED ON THIS ACCOUNT AND HOLDING THE SAME WITHIN THE MEANING OF PROVISIONS OF SECTION 194C. D) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE FACTS BROU GHT ON RECORDS BY THE ASSESSING OFFICER THAT THE ACQUISITI ON OF PROGRAMME SOFTWARE INVOLVES TRANSFER OF RIGHTS OF T HAT PROGRAMME TO THE ASSESSEE AND SUCH PAYMENTS MADE BY THE ASSESSEE ARE CLEARLY COVERED UNDER THE DEFINITI ON OF ROYALTY WITHIN THE MEANING OF ROYALTY IN EXPLANATIO N 2 TO CLAUSE (VII) TO SECTION 9. E) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE ANY AGREEMENT WITH EVENT MANAGER TO JUSTIFY THAT THE PAYMENT WAS IN THE NATURE OF WORK CONTRACT AND ALSO FAILED TO APPRECIATE THAT THE ONUS WAS ON THE ASSESSEE TO ESTABLISH THE NATURE OF SERVICES WERE N OT IN THE NATURE OF PROFESSIONAL SERVICES. F) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THAT THE EVENT MANAGEMENT SERVICE WAS IN THE NATURE OF WORK CONTRA CT U/S. 194C AND THE SAME WAS NOT PROFESSIONAL SERVICE U/S 194J ESPECIALLY WHEN THE ASSESSEE DID NOT BRING ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 19 ANY EVIDENCE TO JUSTIFY THE SERVICE WAS NOT IN THE NATURE OF PROFESSIONAL SERVICES WITHIN THE MEANING OF SECT ION 194J. G) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE NOTIFICATI ON NO. F NO. 275/43/2008-IT(B) DATED 21.08.2008 WAS CLARIFICATORY IN NATURE AND THE EVENT MANAGEMENT FE E WAS ALWAYS IN THE NATURE OF PROFESSIONAL SERVICES U /S 194J. H) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED BY HOLDING THE EQUIPMENT HIRE CHAR GES U/S. 194C AND FAILED TO APPRECIATE THAT THE EVIDENC ES AVAILABLE ON RECORDS CLEARLY SHOW THAT THE EQUIPMEN T HIRE CHARGES WERE PAID FOR SERVICES WHICH WERE TECH NICAL SERVICE WITHIN THE MEANING OF SECTION 194J. I) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION AN D INTEREST U/S 201(1A) IN RESPECT OF EQUIPMENT HIRE C HARGES WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORDS B Y THE ASSESSING OFFICER. J) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE COMMISSION PAID TO DIRECTORS WAS SALARY CONSIDERING DAY TO DAY INVOLVEMENT OF THESES DIRECTORS TO CARRY OUT THE FU NCTIONS OF VARIOUS COMMITTEE OF WHICH THEY WERE MEMBERS AND THE COMMISSION WAS RIGHTLY TREATED AS SALARY. K) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT RELATIONSHIP B ETWEEN THE DIRECTORS AND THE ASSESSEE WAS OF EMPLOYER AND EMPLOYEE AS EVIDENT FROM THE NATURE OF WORK DONE BY THESE DIRECTORS AS BROUGHT OUT IN THE ORDER BY THE ASSESSING OFFICER. L) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION WH ICH WAS DETERMINED ON THE BASIS OF INFORMATION AVAILABL E IN TAX AUDIT REPORT ESPECIALLY WHEN THE ASSESSEE DID N OT SUBMIT ANY EVIDENCE OF PAYMENT OF THE UNPAID TDS AS REPORTED IN TAX AUDIT REPORT. M) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE THE EVIDENCE OF PAYMENT OF UNPAID TDS AS PE R TAX AUDIT REPORT BEFORE THE ASSESSING OFFICER WHERE AS THE CIT(A) CLAIMED THAT THE ASSESSEE PAID THE UNPAID TD S BEFORE THE COMPLETION OF PROCEEDINGS U/S. 201(1)/201(1A). N) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE DEMAN D OF RS.9,68,90,071/- WITHOUT PROPERLY APPRECIATING THE FACTUAL & LEGAL MATRIX OF THE CASE AS CLEARLY BROUG HT OUT BY THE A.O. IN ORDER U/S. 201(1) OF THE IT. ACT, 19 61. 2. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY A T THE TIME OF THE HEARING OF THE CASE OR THEREAFTER. 16. THE ORDER OF THE CIT(A) BEING ERRONEOUS BE SET ASIDE AND THE A.O'S ORDER BE RESTORED. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 20 62. WE FIND THAT GROUNDS 1(A) TO (I) ARE SIMILAR AND IDENTICAL TO GROUNDS NO. 1 TO 9 IN ITA NO. 3931/MUM/2013, WHEREIN WE HAVE REJECTED THE GROUNDS AS RAISED BY THE DEPARTMEN T. SIMILARLY WE REJECT GROUNDS NO. 1(A) TO 1(I) IN THIS APPEAL AS WELL. 63. SIMILARLY GROUNDS NO. 1(L) AND 1(M) ARE SIMILAR TO GROUND S NO. 12 & 13 IN ITA NO. 3931/MUM/2013, WHEREIN WE HAVE REJECTED THE GROUNDS AS RAISED BY THE DEPARTMENT. SINC E THE GROUNDS ARE SIMILAR AND IDENTICAL, WE REJECT THE GROUNDS IN THIS APPEAL AS WELL. 64. GROUNDS NO. 1(J) & 1(1K) PERTAIN TO PAYMENT OF COMMISSION TO NON-EXECUTIVE/INDEPENDENT DIRECTORS. THE FACTS ARE T HAT IN THE YEAR UNDER CONSIDERATION, THE ASSESSEE PAID COMMISSION OF RS. 55.17 LACS TO ITS NON EXECUTIVE DIRECTORS/INDEPENDENT DIR ECTORS, WHICH WAS DULY APPROVED BY THE BOARD OF DIRECTORS. THE AO CAME TO THE CONCLUSION THAT THESE DIRECTORS WERE ACTUA LLY EMPLOYEES OF THE COMPANY AND WERE PAID SALARY, WHICH WAS SHOWN AS COMMISSION TO AVOID WITHHOLDING TAX. 65. ON THE OTHER HAND, IN APPEAL BEFORE THE CIT(A) ON TH IS ISSUE, IT WAS HELD THAT THESE DIRECTORS DID NOT HAVE ANY EMPLOYER EMPLOYEE RELATIONSHIP AND NOR DID THEY RECEIVE ANY PECU NIARY BENEFITS. PAYMENT OF COMMISSION TO THEM, ITSELF, COULD NOT BE CATEGORISED AS SALARY. 66. AGAINST THIS ORDER, THE DEPARTMENT IS IN APPEAL BEFORE THE ITAT. 67. BEFORE US THE AR SUBMITTED THAT THESE DIRECTORS WE RE NEVER INVOLVED IN THE DAY TO DAY ACTIVITIES OF THE ASSESSE E COMPANY, NOR WERE THEY EMPLOYED AND DRAWING SALARY. THES E DIRECTORS, ACCORDING TO THE AR, PROVIDED SERVICES OF/ON SPECILISED, WHICH THEY HONED. THE AR SUBMITTED, AS PER SYNO PSIS THAT THE AMENDMENT TO IMPORT SECTION 194J SPECIFIED MANA GING ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 21 DIRECTOR/WHOLE TIME DIRECTOR. SINCE THESE PERSONS/DIRECTOR S WERE NEITHER MANAGING DIRECTOR NOR WHOLE TIME DIRECTOR, TH E PROVISIONS OF SECTION 194J COULD NOT BE APPLIED. 68. THE DR RELIED ON THE ORDER OF THE AO. 69. WE HAVE HEARD THE ARGUMENTS AND HAVE PERUSED TH E ORDERS OF THE REVENUE AUTHORITIES AND ARE OF THE VIEW TH AT THE AO WENT ON WRONG TRACK AND DID NOT CONSIDER THE PROVISIONS/EXPRESSIONS USED IN THE RELEVANT SECTION, I.E. 194 J. SINCE THE CIT(A) HAS APPLIED THE RIGHT LAW, WE ARE INCLINED TO SUSTAIN THE ORDER OF THE CIT(A), CONSEQUENTIALLY REJECT TH E GROUND AS RAISED BY THE DEPARTMENT. 70. GROUNDS NO. 1(J) AND (K) ARE THEREFORE, REJECTED. 71. AS A RESULT, THE APPEAL, AS FILED BY THE DEPARTMENT IS REJECTED. ITA NO. 3933/MUM/2013 : ASST. YEAR 2008-09 : 72. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE DEPARTMENT: A) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION U/ S 201(1) AND INTEREST U/S 201(1A) IN RESPECT OF CARRI AGE FEE /PLACEMENT FEE PAID BY THE ASSESSEE TO VARIOUS CABL E OPERATORS/MSO/DTH SERVICE PROVIDERS HOLDING THE SERVICE PROVIDED WAS WORK WITHIN THE MEANING OF SEC TION 1940 AND NOT TECHNICAL SERVICE U/S 194J. B) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE CABLE OPER ATORS /MSO/DTH SERVICE PROVIDERS HAD NOT PROVIDED MERE STANDARD SERVICE OF TRANSMITTING THE SIGNALS OF ASSESSEE'S CHANNELS BUT THROUGH HUMAN INTERVENTION AND APPLICATION OF MIND PROVIDED SPECIFIED TECHNICAL SE RVICE OF PLACING ASSESSEE'S CHANNEL ON DESIRED PRIME BAND AND SUCH SERVICE ARE TECHNICAL SERVICE U/S 194J. C) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE W AS IN FACT AUTHOR OF ALL THE PROGRAMME PURCHASED BY IT AN D WAS FULLY IN COMMAND OF MAKING SUCH PROGRAMME AND THEREFORE THE PAYMENTS MADE BY IT FOR PRODUCTION OF SUCH ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 22 PROGRAMME WAS IN THE NATURE OF TECHNICAL FEE WITHIN THE MEANING OF SECTION 194J AND THEREFORE ERRED IN DELE TING THE SHORT DEDUCTION AND INTEREST U/S 201(1A) DETERM INED ON THIS ACCOUNT AND HOLDING THE SAME WITHIN THE MEANING OF PROVISIONS OF SECTION 194C. D) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE FACTS BROU GHT ON RECORDS BY THE ASSESSING OFFICER THAT THE ACQUISITI ON OF PROGRAMME SOFTWARE INVOLVES TRANSFER OF RIGHTS OF T HAT PROGRAMME TO THE ASSESSEE AND SUCH PAYMENTS MADE BY THE ASSESSEE ARE CLEARLY COVERED UNDER THE DEFINITI ON OF ROYALTY WITHIN THE MEANING OF ROYALTY IN EXPLANATIO N 2 TO CLAUSE (VII) TO SECTION 9. E) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE ANY AGREEMENT WITH EVENT MANAGER TO JUSTIFY THAT THE PAYMENT WAS IN THE NATURE OF WORK CONTRACT AND ALSO FAILED TO APPRECIATE THAT THE ONUS WAS ON THE ASSESSEE TO ESTABLISH THE NATURE OF SERVICES WERE N OT IN THE NATURE OF PROFESSIONAL SERVICES. F) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THAT THE EVENT MANAGEMENT SERVICE WAS IN THE NATURE OF WORK CONTRA CT U/S. 194C AND THE SAME WAS NOT PROFESSIONAL SERVICE U/S 194J ESPECIALLY WHEN THE ASSESSEE DID NOT BRING ANY EVIDENCE TO JUSTIFY THE SERVICE WAS NOT IN THE NATURE OF PROFESSIONAL SERVICES WITHIN THE MEANING OF SECT ION 194J. G) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE NOTIFICATI ON NO. F NO. 275/43/2008-IT(B) DATED 21.08.2008 WAS CLARIFICATORY IN NATURE AND THE EVENT MANAGEMENT FE E WAS ALWAYS IN THE NATURE OF PROFESSIONAL SERVICES U /S 194J. H) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED BY HOLDING THE EQUIPMENT HIRE CHAR GES U/S. 194C AND FAILED TO APPRECIATE THAT THE EVIDENC ES AVAILABLE ON RECORDS CLEARLY SHOW THAT THE EQUIPMEN T HIRE CHARGES WERE PAID FOR SERVICES WHICH WERE TECH NICAL SERVICE WITHIN THE MEANING OF SECTION 194J. I) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION AN D INTEREST U/S 201(1A) IN RESPECT OF EQUIPMENT HIRE C HARGES WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORDS B Y THE ASSESSING OFFICER. J) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE COMMISSION PAID TO DIRECTORS WAS SALARY CONSIDERING DAY TO DAY INVOLVEMENT OF THESES DIRECTORS TO CARRY OUT THE FU NCTIONS OF VARIOUS COMMITTEE OF WHICH THEY WERE MEMBERS AND THE COMMISSION WAS RIGHTLY TREATED AS SALARY. K) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT RELATIONSHIP B ETWEEN THE DIRECTORS AND THE ASSESSEE WAS OF EMPLOYER AND EMPLOYEE AS EVIDENT FROM THE NATURE OF WORK DONE BY THESE DIRECTORS AS BROUGHT OUT IN THE ORDER BY THE ASSESSING OFFICER. ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 23 L) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION WH ICH WAS DETERMINED ON THE BASIS OF INFORMATION AVAILABL E IN TAX AUDIT REPORT ESPECIALLY WHEN THE ASSESSEE DID N OT SUBMIT ANY EVIDENCE OF PAYMENT OF THE UNPAID TDS AS REPORTED IN TAX AUDIT REPORT. M) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE THE EVIDENCE OF PAYMENT OF UNPAID TDS AS PE R TAX AUDIT REPORT BEFORE THE ASSESSING OFFICER WHERE AS THE CIT(A) CLAIMED THAT THE ASSESSEE PAID THE UNPAID TD S BEFORE THE COMPLETION OF PROCEEDINGS U/S. 201(1)/201(1A). N) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE DEMAN D OF RS.24,59,12,548/- WITHOUT PROPERLY APPRECIATING THE FACTUAL & LEGAL MATRIX OF THE CASE AS CLEARLY BROUG HT OUT BY THE A.O. IN ORDER U/S. 201(1) OF THE IT. ACT, 19 61. 2. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY A T THE TIME OF THE HEARING OF THE CASE OR THEREAFTER. 3. THE ORDER OF THE CIT(A) BEING ERRONEOUS BE SET A SIDE AND THE A.O'S ORDER BE RESTORED. 73. WE FIND THAT GROUNDS 1(A) TO (N) ARE SIMILAR AND IDENTICAL TO GROUNDS NO. 1 TO 14 IN ITA NO. 3931/MUM/2013, WHEREIN WE HAVE REJECTED THE GROUNDS AS RAISED BY THE DEPARTMEN T. SIMILAR VIEW IS TAKEN IN THIS APPEAL AS WELL. 74. WE, THEREFORE, REJECT THE GROUNDS AS RAISED BY THE DEPARTMENT. 75. IN THE RESULT, APPEAL AS FILED BY THE DEPARTMENT IS DISMISSED. ITA NO. 3934/MUM/2013 : ASST. YEAR 2009-10 : 76. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE DEPARTMENT: A) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION U/ S 201(1) AND INTEREST U/S 201(1A) IN RESPECT OF CARRI AGE FEE /PLACEMENT FEE PAID BY THE ASSESSEE TO VARIOUS CABL E OPERATORS/MSO/DTH SERVICE PROVIDERS HOLDING THE SERVICE PROVIDED WAS WORK WITHIN THE MEANING OF SEC TION 1940 AND NOT TECHNICAL SERVICE U/S 194J. B) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE CABLE OPER ATORS /MSO/DTH SERVICE PROVIDERS HAD NOT PROVIDED MERE ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 24 STANDARD SERVICE OF TRANSMITTING THE SIGNALS OF ASSESSEE'S CHANNELS BUT THROUGH HUMAN INTERVENTION AND APPLICATION OF MIND PROVIDED SPECIFIED TECHNICAL SE RVICE OF PLACING ASSESSEE'S CHANNEL ON DESIRED PRIME BAND AND SUCH SERVICE ARE TECHNICAL SERVICE U/S 194J. C) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE W AS IN FACT AUTHOR OF ALL THE PROGRAMME PURCHASED BY IT AN D WAS FULLY IN COMMAND OF MAKING SUCH PROGRAMME AND THEREFORE THE PAYMENTS MADE BY IT FOR PRODUCTION OF SUCH PROGRAMME WAS IN THE NATURE OF TECHNICAL FEE WITHIN THE MEANING OF SECTION 194J AND THEREFORE ERRED IN DELE TING THE SHORT DEDUCTION AND INTEREST U/S 201(1A) DETERM INED ON THIS ACCOUNT AND HOLDING THE SAME WITHIN THE MEANING OF PROVISIONS OF SECTION 194C. D) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE FACTS BROU GHT ON RECORDS BY THE ASSESSING OFFICER THAT THE ACQUISITI ON OF PROGRAMME SOFTWARE INVOLVES TRANSFER OF RIGHTS OF T HAT PROGRAMME TO THE ASSESSEE AND SUCH PAYMENTS MADE BY THE ASSESSEE ARE CLEARLY COVERED UNDER THE DEFINITI ON OF ROYALTY WITHIN THE MEANING OF ROYALTY IN EXPLANATIO N 2 TO CLAUSE (VII) TO SECTION 9. E) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE ANY AGREEMENT WITH EVENT MANAGER TO JUSTIFY THAT THE PAYMENT WAS IN THE NATURE OF WORK CONTRACT AND ALSO FAILED TO APPRECIATE THAT THE ONUS WAS ON THE ASSESSEE TO ESTABLISH THE NATURE OF SERVICES WERE N OT IN THE NATURE OF PROFESSIONAL SERVICES. F) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THAT THE EVENT MANAGEMENT SERVICE WAS IN THE NATURE OF WORK CONTRA CT U/S. 194C AND THE SAME WAS NOT PROFESSIONAL SERVICE U/S 194J ESPECIALLY WHEN THE ASSESSEE DID NOT BRING ANY EVIDENCE TO JUSTIFY THE SERVICE WAS NOT IN THE NATURE OF PROFESSIONAL SERVICES WITHIN THE MEANING OF SECT ION 194J. G) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE NOTIFICATI ON NO. F NO. 275/43/2008-IT(B) DATED 21.08.2008 WAS CLARIFICATORY IN NATURE AND THE EVENT MANAGEMENT FE E WAS ALWAYS IN THE NATURE OF PROFESSIONAL SERVICES U /S 194J. H) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED BY HOLDING THE EQUIPMENT HIRE CHAR GES U/S. 194C AND FAILED TO APPRECIATE THAT THE EVIDENC ES AVAILABLE ON RECORDS CLEARLY SHOW THAT THE EQUIPMEN T HIRE CHARGES WERE PAID FOR SERVICES WHICH WERE TECH NICAL SERVICE WITHIN THE MEANING OF SECTION 194J. I) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION AN D INTEREST U/S 201(1A) IN RESPECT OF EQUIPMENT HIRE C HARGES WITHOUT APPRECIATING THE FACTS BROUGHT ON RECORDS B Y THE ASSESSING OFFICER. J) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE COMMISSION PAID TO DIRECTORS WAS SALARY CONSIDERING DAY TO DAY ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 25 INVOLVEMENT OF THESES DIRECTORS TO CARRY OUT THE FU NCTIONS OF VARIOUS COMMITTEE OF WHICH THEY WERE MEMBERS AND THE COMMISSION WAS RIGHTLY TREATED AS SALARY. K) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT RELATIONSHIP B ETWEEN THE DIRECTORS AND THE ASSESSEE WAS OF EMPLOYER AND EMPLOYEE AS EVIDENT FROM THE NATURE OF WORK DONE BY THESE DIRECTORS AS BROUGHT OUT IN THE ORDER BY THE ASSESSING OFFICER. L) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD CIT(A) ERRED IN DELETING THE DEMAND OF RS. 25,50,21,804/- WITHOUT PROPERLY APPRECIATING THE FA CTUAL & LEGAL MATRIX OF THE CASE AS CLEARLY BROUGHT OUT B Y THE AO IN ORDER U/S 201(1) OF THE I.T. ACT, 1961. 2. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY A T THE TIME OF THE HEARING OF THE CASE OR THEREAFTER. 3. THE ORDER OF THE CIT(A) BEING ERRONEOUS BE SET A SIDE AND THE A.O'S ORDER BE RESTORED. 77. WE FIND THAT GROUNDS 1(A) TO (E) ARE SIMILAR AND IDENTICAL TO GROUNDS NO. 1 TO 12 IN ITA NO. 3931/MUM/2013, WHEREIN WE HAVE REJECTED THE GROUNDS. SINCE THE GROUNDS AS RAISED BY THE DEPARTMENT ARE SIMILAR IN NATURE AND ISSUE, WE REJECT TH E GROUNDS IN THIS APPEAL AS WELL. 78. GROUNDS NO. 1(A) TO 1(E) ARE, THEREFORE, REJECTED. 79. WE, THEREFORE, REJECT THE GROUNDS AS RAISED BY THE DEPARTMENT. 80. IN THE RESULT, THE APPEAL AS FILED BY THE DEPARTMENT IS DISMISSED. ITA NO. 3935/MUM/2013 : ASST. YEAR 2010-11 : 81. THE FOLLOWING GROUNDS HAVE BEEN RAISED BY THE DEPARTMENT: A) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND I N LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION U/ S 201(1) AND INTEREST U/S 201(1A) IN RESPECT OF CARRI AGE FEE /PLACEMENT FEE PAID BY THE ASSESSEE TO VARIOUS CABL E OPERATORS/MSO/DTH SERVICE PROVIDERS HOLDING THE SERVICE PROVIDED WAS WORK WITHIN THE MEANING OF SEC TION 1940 AND NOT TECHNICAL SERVICE U/S 194J. B) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE CABLE OPER ATORS ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 26 /MSO/DTH SERVICE PROVIDERS HAD NOT PROVIDED MERE STANDARD SERVICE OF TRANSMITTING THE SIGNALS OF ASSESSEE'S CHANNELS BUT THROUGH HUMAN INTERVENTION AND APPLICATION OF MIND PROVIDED SPECIFIED TECHNICAL SE RVICE OF PLACING ASSESSEE'S CHANNEL ON DESIRED PRIME BAND AND SUCH SERVICE ARE TECHNICAL SERVICE U/S 194J. C) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE W AS IN FACT AUTHOR OF ALL THE PROGRAMME PURCHASED BY IT AN D WAS FULLY IN COMMAND OF MAKING SUCH PROGRAMME AND THEREFORE THE PAYMENTS MADE BY IT FOR PRODUCTION OF SUCH PROGRAMME WAS IN THE NATURE OF TECHNICAL FEE WITHIN THE MEANING OF SECTION 194J AND THEREFORE ERRED IN DELE TING THE SHORT DEDUCTION AND INTEREST U/S 201(1A) DETERM INED ON THIS ACCOUNT AND HOLDING THE SAME WITHIN THE MEANING OF PROVISIONS OF SECTION 194C. D) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE FACTS BROU GHT ON RECORDS BY THE ASSESSING OFFICER THAT THE ACQUISITI ON OF PROGRAMME SOFTWARE INVOLVES TRANSFER OF RIGHTS OF T HAT PROGRAMME TO THE ASSESSEE AND SUCH PAYMENTS MADE BY THE ASSESSEE ARE CLEARLY COVERED UNDER THE DEFINITI ON OF ROYALTY WITHIN THE MEANING OF ROYALTY IN EXPLANATIO N 2 TO CLAUSE (VII) TO SECTION 9. E) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THE EQUIPMENT HIRE CHARGES U/S 194C AND FAILED TO APPRECIATE THAT THE EVIDENCE S AVAILABLE ON RECORDS CLEARLY SHOW THAT THE EQUIPMEN T HIRE CHARGES WERE PAID FOR SERVICES WHICH WERE TECH NICAL SERVICE WITHIN THE MEANING OF SECTION 194J. F) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION AND INTEREST U/S 201(1A) IN RESPECT OF EQUIPMENT HIRE C HARGES WITHOUT APPRECIATING THE FACT BROUGHT ON RECORDS BY THE ASSESSING OFFICER. G) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE COMMISSION PAID TO DIRECTORS WAS SALARY CONSIDERING DAY TO DAY INVOLVEMENT OF THESES DIRECTORS TO CARRY OUT THE FU NCTIONS OF VARIOUS COMMITTEE OF WHICH THEY WERE MEMBERS AND THE COMMISSION WAS RIGHTLY TREATED AS SALARY. H) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT RELATIONSHIP B ETWEEN THE DIRECTORS AND THE ASSESSEE WAS OF EMPLOYER AND EMPLOYEE AS EVIDENT FROM THE NATURE OF WORK DONE BY THESE DIRECTORS AS BROUGHT OUT IN THE ORDER BY THE ASSESSING OFFICER. I) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE SHORT DEDUCTION WH ICH WAS DETERMINED ON THE BASIS OF INFORMATION AVAILABL E IN TAX AUDIT REPORT ESPECIALLY WHEN THE ASSESSEE DID N OT SUBMIT ANY EVIDENCE OF PAYMENT OF THE UNPAID TDS AS REPORTED IN TAX AUDIT REPORT. J) ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE D ID NOT PRODUCE THE EVIDENCE OF PAYMENT OF UNPAID TDS AS PE R TAX AUDIT REPORT BEFORE THE ASSESSING OFFICER WHERE AS THE CIT(A) CLAIMED THAT THE ASSESSEE PAID THE UNPAID TD S ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 27 BEFORE THE COMPLETION OF PROCEEDINGS U/S. 201(1)/201(1A). K) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE DEMAN D OF RS.25,20,73,318/- WITHOUT PROPERLY APPRECIATING THE FACTUAL & LEGAL MATRIX OF THE CASE AS CLEARLY BROUG HT OUT BY THE A.O. IN ORDER U/S. 201(1) OF THE IT. ACT, 19 61. 2. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY A T THE TIME OF THE HEARING OF THE CASE OR THEREAFTER. 3. THE ORDER OF THE CIT(A) BEING ERRONEOUS BE SET A SIDE AND THE A.O'S ORDER BE RESTORED. 82. SIMILAR TO GROUNDS NO. 1 TO 11 IN ITA NO. 3931/MUM/2013. 83. WE FIND THAT GROUNDS 1(A) TO (K) ARE SIMILAR AND IDENTICA L TO GROUNDS NO. 1 TO 12 IN ITA NO. 3931/MUM/2013, WHEREIN WE HAVE REJECTED THE GROUNDS. SINCE THE GROUNDS AS RAISED BY THE DEPARTMENT ARE SIMILAR IN NATURE AND ISSUE, WE REJECT TH E GROUNDS IN THIS APPEAL AS WELL. 84. GROUNDS NO. 1(A) TO 1(K) ARE, THEREFORE, REJECTED AND GROUNDS 2 & 3 ARE GENERAL. 85. IN THE RESULT, APPEAL AS FILED BY THE REVENUE STANDS DISMISSED. SUM-UP: ALL THE FIVE APPEALS I.E. ITAS 3931 TO 3935 OF 2013 FILED BY TH E DEPARTMENT STAND DISMISSED. ORDER PRONOUNCED TODAY, I.E. 20.02.2015 SD/- SD/- ( ) ( ) (R C SHARMA) ( VIVEK VARMA ) ACCOUNTANT MEMBER J UDICIAL MEMBER MUMBAI, DATE: 20 TH FEBRUARY, 2015 ZEE ENTERTAINMENT ENTERPRISES LTD. ITA 3931 TO 3935/MUM/2013 28 $/ COPY TO:- 1) / THE APPELLANT. 2) / THE RESPONDENT. 3) THE CIT(A) -14, MUMBAI. 4) THE CIT-(TDS), MUMBAI. 5) ,'-. $! / , , THE D.R. G BENCH, MUMBAI. 6) .01 2 COPY TO GUARD FILE. 34! / BY ORDER / / TRUE COPY / / 5 / 6 / , DY. / ASSTT. REGISTRAR I.T.A.T., MUMBAI *CHAVAN, SR.PS