DCIT (TDS)1(1), MUMBAI V. BRIGHT OUTDOOR MEDIA P.LTD, MUMBAI

ITA 4008/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0660 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 17-04-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 26-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUPAMA SINGLA
• Assessee Lawyers: NEELAM C JADHAV
• Section: 194C; 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G MUMBAI BEFORE SHRI D.T. GARASIA (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 4008/MUM/2015 ASSESSMENT YEAR: 2012-13 DCIT (TDS) 1(1) VS. M/S. BRIGHT OUTDOOR MEDIA PVT . LTD. R. NO. 802, K.G. MITTAL AYURVEDIC 8 TH FLOOR, CRESCENT TOWER HOSPITAL BLDG. CHARNI ROAD LINK ROAD, ANDHERI (W) MUMBAI 400002 MUMBAI - 400053 PAN NO. AACCB9325Q (APPELLANT) (RESPONDENT) REVENUE BY : MS. ANUPAMA SINGLA, DR ASSESSEE BY: MS. NEELAM C. JADHAV, AR DATE OF HEARING : 17/04 /2017 DATE OF PRONOUNCEMENT: 12/05/2017 ORDER PER N.K. PRADHAN, AM THIS IS AN APPEAL FILED BY THE REVENUE. THE RELEVAN T ASSESSMENT YEAR IS 2012-13. THE APPEAL IS DIRECTED AGAINST THE ORDER AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)- 59, MUMBAI AND ARISES OUT OF ORDER U/S 201(1) AND 201(1A) OF T HE INCOME TAX ACT, 1961 (THE ACT). 2. THE GROUNDS OF APPEAL FILED BY THE REVENUE READ AS UNDER: I. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITIONS MADE U/S . 201(1) & 201(1A) BY HOLDING THAT THE PAYMENTS MADE BY THE AS SESSEE FOR HOARDING / DISPLAY RIGHTS FALL WITHIN THE PURVIEW O F SECTION 194C AND NOT SECTION 194I, WITHOUT CONSIDERING THE ENTIRE SE T OF FACTS IN TOTALITY READ WITH THE AMENDED DEFINITION OF RENT U/S 194I. ITA NO. 4008/MUM/2015 2 II. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS BY TRE ATING THAT THE PAYMENT MADE AS ADVERTISEMENT ON HOARDING FALL WITH IN THE PURVIEW OF SECTION 194C AND IS NOT IN THE NATURE OF RENT WI THIN THE MEANING OF SECTION 194I OF THE I.T. ACT, WITHOUT APPRECIATING THE FACT THAT THE DEFINITION OF RENT U/S. 194I HAS BEEN AMENDED W.E.F . 13.07.2006 AND AS APPLICABLE IN THE CASE OF THE ASSESSEE WHICH SAY S THAT ANY PERSON RESPONSIBLE FOR MAKING ANY PAYMENT UNDER ANY OTHER AGREEMENT OR ARRANGEMENT FOR THE USE TO (EITHER SEPARATELY OR TO GETHER ANY) A( LAND OR B) BUILDING ...... H) FITTINGS ..... WHETHER OR NOT ANY OR ALL OF THE ABOVE ARE OWNED BY THE PAYEE. 3. THE ASSESSING OFFICER (A.O.) OBSERVED THAT DURI NG THE FINANCIAL YEAR 2011-12, THE ASSESSEE HAD PAID RS. 61,97,64,11 1/- FOR ADVERTISEMENT ON HOARDING ON WHICH TAX WAS DEDUCTED AT SOURCE @ 2% U/S 194C OF THE ACT. THE A.O. WAS OF THE VIEW TH AT SINCE THE PAYEE CONCERNS WERE FOUND TO HAVE SUBLET THE HOARDING SIT ES TO THE ASSESSEE-COMPANY, IT WAS REQUIRED TO DEDUCT TAX AT SOURCE @ 10% U/S 194I OF THE ACT. THE A.O. THUS CONCLUDED THAT R S. 5,33,08,941/- HAD BEEN DEDUCTED SHORT FOR WHICH THE ASSESSEE WAS HELD TO BE IN DEFAULT U/S 201(1) OF THE ACT. FURTHER THE A.O. HEL D THE ASSESSEE TO BE LIABLE FOR INTEREST U/S 201(1A) FOR 36 MONTHS WHICH WORKED OUT TO RS. 1,91,91,218/-. THUS THE TOTAL TAX LIABILITY WOR KED OUT BY THE A.O. WAS RS. 7,25,00,159/-. 4. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEE FILED AN APPEAL BEFORE THE LEARNED CIT(A). WE FIND THAT THE LEARNED CIT(A) FOLLOWED THE ORDER OF HER PREDECESSOR-IN-OFFICE AND ALSO THE ORDER OF THE TRIBUNAL IN THE CASE OF M/S. MADISONS COMMUNICATIONS PVT. LTD ., ITA NO. 4991 & 4992/MUM/2013 DATED 29/10/2014 AND HELD THAT THE ASSESSEE WAS LIABLE TO DEDUCT TAX ON PAYMENT MADE F OR ADVERTISING AND HOARDING U/S 194C OF THE ACT. THUS THE LEARNED CIT(A) DELETED THE DEMAND SO RAISED U/S 201(1) AND INTEREST U/S 20 1(1A) OF THE ACT. ITA NO. 4008/MUM/2015 3 5. BEFORE US, THE LEARNED DR SUPPORTS ON THE ORDER OF THE A.O. ON THE OTHER HAND THE LEARNED COUNSEL OF THE ASSESSEE RELIES ON THE ORDER OF THE LEARNED CIT(A) AND ALSO THE ORDER OF T HE TRIBUNAL IN ASSESSEES OWN FOR THE A.Y. 2010-11 [7049/MUM/2012] AND A.Y. 2011-12 [7050/MUM/2012]. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT A SIMILAR ISSUE AR OSE BEFORE THE CO- ORDINATE BENCH AS MENTIONED ABOVE. THE TRIBUNAL REF ERRED TO THE CBDT CIRCULAR NO. 715 DATED 08.08.1995 AND HELD AS UNDER: FROM THE ABOVE CLARIFICATORY CIRCULAR ISSUED BY CB DT WHICH CLARIFIES THAT THE NATURE OF ADVERTISING CONTRACT IS FOR CONT RACTUAL PAYMENTS AND THE PROVISIONS OF SECTION 194C OF THE ACT WOULD BE APPLICABLE, IS ENOUGH TO EXPLAIN THAT THE ASSESSEES PAYMENTS MADE TO VAR IOUS PARTIES FOR THE PURPOSE OF DISPLAY OF THE ADVERTISEMENTS OF ASSESSE ES CLIENT DO NOT FALL IN THE CATEGORY OF RENT AND HENCE ASSESSEE WAS ONLY REQUIRED TO DEDUCT TDS U/S 194C OF THE ACT. THIS HAS ALSO SUPPORT OF O RDER OF ITAT CO- ORDINATE BENCH OF MUMBAI IN THE CASE OF ITO (TDS) V S. ROSHAN PUBLICITY (P) LTD. (2005) 4 SOT 105 (MUM) WHEREIN EXACTLY IDE NTICAL VIEW WAS TAKEN. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES , WE ARE OF THE VIEW THAT THE CIT(A) HAS RIGHTLY HELD THAT THE ASSESSEE IS LIABLE TO DEDUCT TDS U/S 194C OF THE ACT IN RESPECT OF THE PAYMENTS IN D ISPUTE. ACCORDINGLY THIS ISSUE OF REVENUES APPEALS OF BOTH THE YEARS I S DISMISSED. 6.1 FACTS BEING SIMILAR, WE FOLLOW THE ORDER OF THE CO-ORDINATE BENCH AND UPHOLD THE ORDER PASSED BY THE LEARNED CI T(A). 7. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 12/05/2017 SD/- SD/- (D.T. GARASIA) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBE R MUMBAI; DATED: 12/05/2017 BISWAJIT, SR. P.S. ITA NO. 4008/MUM/2015 4 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI