JCIT (TDS)(OSD)-2(3), MUMBAI V. NIMBUS COMMUNICATIONS LTD, MUMBAI

ITA 3948/MUM/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 6105 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 04-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K JAIN
• Keywords: Tax effect; TDS
• Section: 201(1); 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B , MUMBAI BEFORE SHRI C.N. PRASAD , HONBLE JUDICIAL MEMBER AND SHRI RAJESH KUMAR, HONBLE ACCOUNTANT MEMBER ITA NO. 3948 /MUM/201 8 (A.Y: 2012 - 13) J CIT (TDS)(OSD) 2(3) 718, 7 TH FLOOR SMT K.G. MITTAL AYURVEDIC HOSPITAL BUILDING CHARNI ROAD (W) MUMBAI 400 002 V. M/S. NIMBUS COMMUNICATIONS LIMITED NIMBUS CENTRE, OBEROI COMPLEX ANDHERI (W), MUMBAI 400 053 PAN NO: AA ACN3947L (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI S.K. JAIN DATE OF HEARING : 19.09.2019 DATE OF PRONOUNCEMENT : 19 .09 .2019 O R D E R PER C.N. PRASAD (JM) THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 60 , MUMBAI [HEREINAFTER IN SHORT LD.CIT(A)] IN APPEAL NO. CIT(A) - 60/IT - 100/ITO(TDS) - 2(4)/2014 - 15 DATED 26.03.2018 FOR THE A.Y. 2012 - 13. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS IN ITS APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THE PAYMENT OF GUARANTEE 2 ITA NO. 3948/MUM/2018 (A.Y: 2012 - 13) M/S. NIMBUS COMMUNICATIONS LIMITED COMMISSION PAID BY THE ASSESSEE TO THE BANKS IS NOT COVERED UNDER 'COMMISSION OR BROKERAGE' AS DEFINED U/S 194H OF THE ACT AND THE ASSES SEE WAS NOT LIABLE TO DEDUCT TAX AT SOURCE UNDER SECTION 194H IN RESPECT OF THIS AMOUNT? 2. ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) ERRED IN NOT CONFIRMING THE ORDER OF THE ASSESSING OFFICER TREATING THE ASSESSEE IN DEFAULT U/S 201(1) IN RESPECT OF AMOUNT OF TAX WHICH HAS NOT BEEN DEDUCTED U/S 194H AND LEVYING INTEREST U/S 201 (1A) OF THE ACT? 3. ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) ERRED IN HOLDING THAT THERE DOES NOT EXIST PRINCIPAL - AGENT RELATI ONSHIP BETWEEN THE ASSESSEE AND THE BANKS AND THEREBY CLEARLY IGNORING THE FACT THAT IN THE ENTIRE PROCESS OF FACILITATION OF GUARANTEE BANKS ARE NOTHING BUT A CONSTRUCTIVE AGENT FOR THE ASSESSEE COMPANY? 4. ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT(A) ERRED IN IGNORING THAT THE SECTION 194H GIVES AN INCLUSIVE DEFINITION OF 'COMMISSION OR BROKERAGE' AND HAS WIDE COVERAGE TO CLEARLY INCLUDE THE PAYMENT OF GUARANTEE COMMISSION PAID BY THE ASSESSEE TO THE BANKS? 3. AT THE TIME OF HEARING LD. DR HAS STATED THAT THE TAX EFFECT ON THE ISSUE IN THE PRESENT APPEAL IS BELOW . 5 0 LAC S AND IN VIEW OF THE CBDT CIRCULAR NO. 17 /201 9 DATED 08.08.2019 IN F.NO.279/MISC.142/2007 - ITJ (PT) , THE APPEAL OF THE REVE NUE IS NOT MAINTAINABLE. I N VIEW OF THE ABOVE SUBMISSIONS , WE DISMISS THE APPEAL OF THE REVENUE ON ACCOUNT OF LOW TAX EFFECT. 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 19 TH SEPTEMBER, 2019 SD/ - SD/ - ( RAJESH KUMAR ) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI / DATED 19/09/2019 GIRIDHAR, SR.PS 3 ITA NO. 3948/MUM/2018 (A.Y: 2012 - 13) M/S. NIMBUS COMMUNICATIONS LIMITED COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// BY ORDER, (ASSTT. REGISTRAR) ITAT, MUM