DCIT (TDS), Jaipur V. BHARTI HEXACOM LIMITED, Jaipur

ITA 952/JPR/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1991 (ITAT-JAIPUR)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 15-03-2017
• Assessment Year: 2014-2015
• Appeal Filed On: 04-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VARINDER MEHTA
• Assessee Lawyers: P C PARWAL CA DHK
• Section: 201(1)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH HKKXPUN] YS[KK LNL; ,OA JH DQY HKKJR] U;KF;D LNL; DS LE{K BEFORE: SHRI BHAGCHAND, AM AND SHRI KUL BHARAT, JM VK;DJ VIHY LA- @ ITA NO. 952/JP/2016 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2014-15. DY. COMMISSIONER OF INCOME - TAX, (TDS), JAIPUR. CUKE VS. M/S BHARTI HEXACOM LIMITED K-21 MALVIYA NAGAR, C-SCHEME, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. JPRH 00222 F VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI VARINDER MEHTA (CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (CA)) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 05.10.2017. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 06/10/2017. VKNS'K@ ORDER PER SHRI KUL BHARAT, J.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT (A)-III, JAIPUR DATED 19.08.2016 PERTAINING TO ASSESSMENT YE AR 2014-15. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, WHETHER THE ASSESSEE IS LIABLE TO DEDUCT TDS U/S 194H OF THE I. T. ACT, 1961 AS THE RELATION BETWEEN ASSESSEE AND DISTRIBUTOR IS THAT O F PRINCIPAL TO AGENT. 2. THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE DEMAND U/S 201(1) FOR NON DEDUCTION OF TDS U/S 194H OF THE I.T. ACT, 1961 ON COMMISSION PAYMENT TO VARIOUS DISTRIBUTORS. 2. BRIEFLY, STATED THE FACTS ARE THAT THE ASSESSING OFFICER FINDING THAT THE ASSESSEE HAS NOT DEDUCTED TAX U/S 194H OF THE ACT I N RESPECT OF COMMISSION PAID TO ITS DISTRIBUTORS, PASSED ORDER U/S 201(1)/201(1A) O F THE ACT. BEFORE THE ASSESSING 2 ITA NO. 952/JP/2016. M/S BHARTI HEXACOM LIMITED, JAIPUR. OFFICER, IT WAS CONTENDED THAT THE ISSUE HAS BEEN D ECIDED BY THE TRIBUNAL. HOWEVER, THE ASSESSING OFFICER WITHOUT FOLLOWING THE ORDER O F THE TRIBUNAL OBSERVED AS UNDER:- ONE OF THE OTHER CONTENTIONS OF THE ASSESSEE IS TH AT LD. ITAT, JAIPUR HAS ALSO PROVIDED RELIEF TO THE ASSESSEE IN ITS DECISION DAT ED 22.5.2015 (ITA NO. 656/JP/2010) AND HAS RULED THAT TDS IS NOT APPLICAB LE ON DISCOUNT ALLOWED TO PREPAID DISTRIBUTORS. THE ASSESSEE HAS ALSO CONTEND ED THAT LD CIT (A), JAIPUR HAS ALSO GIVEN RELIEF TO THE ASSESSEE FOR AY'S 2010 -11 TO 2013-14. IN THIS REGARD, IT IS STATED THAT THESE DECISIONS OF HIGHER COURTS HAVE NOT BEEN ACCEPTED BY THE DEPARTMENT AND HAVE BEEN CONTESTED BEFORE RAJASTHAN HIGH COURT AND ITAT JAIPUR RESPECTIVELY. HENCE, THIS ISS UE IS CURRENTLY SUB-JUDICE IN NATURE. AGGRIEVED BY THIS, THE ASSESSEE PREFERRED AN APPEAL BEFORE LD. CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS, HELD THAT THE ASSESSEE IS NOT LIABLE TO DEDUCT THE TAX U/S 194H OF THE ACT. 3. NOW, THE REVENUE IS IN FURTHER APPEAL BEFORE THI S TRIBUNAL. 4. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE ISSUE HAS BEEN DECIDED BY THE HONBLE JURISDICTIONAL HIGH COURT IN ASSESSEES OWN CASE IN DB INCOME-TAX APPEAL NOS. 96/2016, 97/2016 & 98/2016 I N FAVOUR OF THE ASSESSEE. HE DREW OUR ATTENTION TO PAGE NO.132 OF THE JUDGMENT O F THE HONBLE JURISDICTIONAL HIGH COURT. 5. ON THE CONTRARY, LD. DEPARTMENTAL REPRESENTATIVE S SUPPORTED THE ORDER OF THE AUTHORITIES BELOW. 3 ITA NO. 952/JP/2016. M/S BHARTI HEXACOM LIMITED, JAIPUR. 6. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. CIT(A) HAS DECIDED THIS ISSUE IN P ARA 4.4 OF THE IMPUGNED ORDER AS UNDER:- 4.4 RESPECTFULLY FOLLOWING THE ABOVE ORDERS OF HON 'BLE ITAT, JAIPUR, FROM A.Y. 2009-10 TO 2013-14. I HOLD THAT NO TAX IS REQU IRED TO BE DEDUCTED U/S 194H IN RESPECT OF DIFFERENCE BETWEEN THE PRICE AT WHICH THE PREPAID CARD IS SOLD TO THE DISTRIBUTOR AND THE PRICE AT WHICH THE END CUSTOMER BUYS AND CONSEQUENTLY THE DEMAND RAISED U/S 201(1) AND INTER EST U/S 201(1A) IS DELETED. IN THE RESULT, ALL THESE GROUNDS OF APPEAL ARE ALLOWED. FURTHER, THE HONBLE JURISDICTIONAL HIGH COURT IN A SSESSEES OWN CASE IN DB INCOME TAX APPEAL IN THE CASE OF COMMISSIONER OF INCOME TA X (TDS) JAIPUR VS. M/S BHARTI HEXACOM LIMITED K-21 MALVIYA MARG, C-SCH EME, JAIPUR AS UNDER:- M/S BHARTI HEXACOM LTD. 52. REGARDING THE OTHER APPEALS OF CELLULAR COMPANI ES THE QUESTIONS ARE REQUIRED TO BE ANSWERED AS DISCUSSED HEREINABOVE. T HE RELATIONSHIP IS NOT OF AGENT. IT IS PRINCIPAL TO PRINCIPAL BASIS. THE PAYM ENT IS RECEIVED BY THE COMPANY AND THE AMOUNT OF COMMISSION IS NEVER PAID TO THE AGENT OR THE DISTRIBUTOR. THEREFORE, NO TDS IS REQUIRED TO BE DE DUCTED. WE ALSO ACCEPT THE CONTENTION RAISED BY MR. JHANWAR THAT EVEN OTHERWIS E IN VIEW OF DIVERGENT JUDICIAL VIEWS, ONE IN FAVOUR OF THE ASSESSEE IS RE QUIRED TO BE ADOPTED AS PER SETTLED LAW. TAKING INTO CONSIDERATION THE ABOVE CO NCLUSION, THE FIRST ISSUE IS REQUIRED TO BE ANSWERED IN FAVOUR OF ASSESSEE. 4 ITA NO. 952/JP/2016. M/S BHARTI HEXACOM LIMITED, JAIPUR. RESPECTFULLY FOLLOWING THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT (SUPRA). WE DO NOT SEE ANY REASON TO INTERFERE INTO THE ORDE R OF LD. CIT(A), SAME IS HEREBY AFFIRMED. THUS, GROUND RAISED IN THIS APPEAL IS DI SMISSED. 7. IN THE RESULT, APPEAL OF THE REVENUE IN ITA NO. 952/JP/2016 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY, THE 6 TH DAY OF OCTOBER 2017. SD/- SD/- ( HKKXPUN] ( DQY HKKJR ) (BHAG CHAND ) ( KUL BHARAT ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 06/10/2017. POOJA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- DCIT (TDS), JAIPUR. 2. THE RESPONDENT BHARTI HEXACOM LTD. ,JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 952/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 5 ITA NO. 952/JP/2016. M/S BHARTI HEXACOM LIMITED, JAIPUR.