ACTION FINANCIAL SERVICES INDIA LTD, MUMBAI V. ITO (TDS)1(1), MUMBAI

ITA 7075/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2748 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 21-11-2014
• Court: TRIBUNAL
• Assessee Lawyers: RAHUL K HAKANI

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER ./ ITA NO. 7075&7076 / MUM/20 1 4 ( / ASSESSMENT YEAR : 20 10 - 20 1 1 & 2011 - 2012 ) M/S ACTION FINANCIAL SERVICES INDIA LTD., 31, 4 TH FLOOR, RAJGIR CHAMBERS, 12/14, SHAHID BHAGAT SINGH ROAD, FORT, MUMBAI - 400001 VS. ITO(TDS) - 1(1), MUMBAI ./ ./ PAN/GIR NO. : A AACA 4423 G ( / APPELLANT ) .. ( / RESP ONDENT ) /ASSESSEE BY : SHRI RAHUL K. HAKANI /REVENUE BY : SHRI ARVIND KUMAR / DATE OF HEARING : 0 5 / 0 7 /201 6 / DATE OF PRONOUNCEMENT 08/07 /201 6 / O R D E R TH ESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - MUMBAI, FOR THE ASSESSMENT YEAR 20 1 0 - 201 1 & 2011 - 2012 , IN THE MATTER OF ORDER PASSED U/S.201(1)/201(1A) OF THE I.T.ACT . 2. THERE IS A MARGINAL DELAY OF 14 DAYS IN FILING BOTH THE APP EALS. AFTER GOING THROUGH THE REASONS FOR THE DELAY, WE FOUND THE SAME ARE SATISFACTORILY EXPLAINED, THEREFORE, IN THE INTEREST OF SUBSTANTIAL JUSTICE, WE CONDONE THE DELAY AND APPEALS WERE HEARD ON MERITS. 3 . RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY IS A MEMBER OF BOMBAY STOCK EXCHANGE (BSE) AND NATIONAL STOCK EXCHANGE (NSE). THE ASSESSEE COMPANY IS DEALING IN THE BUSINESS OF SHARE BROKING AND IS ALSO A ITA NO. 7075&7076 / 1 4 2 DEPOSITORY PARTICIPANT WITH NSDL. DURING THE YEAR UNDER REFERENCE, THE ASSESSEE COMPANY HAS PAID THE TAX DEDUCTED AT SOURCE ON TRANSACTION CHARGES @2% (I.E. 194C). DURING THE COURSE OF ASSESSMENT THE ASSESSEE COMPANY HAD FILED THE TDS CERTIFICATE OF BOMBAY STOCK EXCHANGE (BSE) AND NATIONAL STOCK EXCH ANGE (NSE) ALONG WITH NSE BILL AND BSE VALLAN LEDGER. HOWEVER, THE ASSESSING OFFICER HAS TAXED TDS ON TRANSACTION CHARGES @10% (I.E. 194J). 4 . BY THE IMPUGNED ORDER THE CIT(A) CONFIRMED THE ACTION OF AO FOLLOWING THE DECISION OF HONBLE BOMBAY HIGH COURT I N THE CASE OF KOTAK SECURITIES LTD. 340 ITR 333 . 5 . AT THE OUTSET, LD. AR PLACED THE ORDER OF HONBLE SUPREME COURT WHEREIN DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF KOTAK SECURITIES LTD. WAS REVERSED AND IT WAS HELD THAT TRANSACTION TAX ARE NO T LIABLE FOR DEDUCTION OF TAX U/S.115J. 6 . WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF KOTAK SECURITIES LTD. 383 ITR 1, WHEREIN THE HONBLE SUPREME COURT HELD TH AT TRANSACTION CHARGES PAID TO STOCK EXCHANGE FOR FACILITY IS NOT A FEE FOR TECHNICAL SERVICES, THEREFORE, NOT LIABLE TO DEDUCTION OF TAX ON SUCH PAYMENTS U/S.194J. RESPECTFULLY FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF KOTAK SECURITIE S LTD. (SUPRA), WE DO NOT FIND ANY MERIT IN THE ACTION OF LOWER AUTHORITIES FOR HOLDING ASSESSEE IN DEFAULT FOR NON - DEDUCTION OF TAX AT SOURCE U/S.194J OF THE I.T.ACT. ITA NO. 7075&7076 / 1 4 3 7 . IN THE RESULT, APPEALS OF ASSESSEE FOR BOTH THE YEAR UNDER CONSIDERATION ARE ALLOWED. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 08/07 / 201 6 . SD/ - ( R.C.SHARMA ) / ACCOUNTANT MEMBER MUMBAI ; DATED 08/07 /201 6 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//