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2013 (6) TMI 352 - AT - Income TaxTechnical services provided by the NSDL and CDSL - whether will fall under the head of "Settlement and Custody Fees" as professional/technical services u/s. 194J - Disallowance u/s. 40(a)(ia) for failure to deduct TDS as confirmed by AO - Held that:- The judgement of Kotak Securities Ltd. (2011 (10) TMI 24 - Bombay High Court) squarely applies to the facts of the assessee's case and the assessee is availing managerial services from NSDL/CDSL for which the assessee paid the fees. Being so, the assessee is liable to deduct TDS on the payment made to the NSDL/CDSL as the assessee not deducted TDS on the impugned payment. The disallowance made by the Assessing Officer u/s 40(a)(ia) is justified. As assessee submitted that in para 32 of the Bombay High Court judgement cited supra, it was held that since both Revenue and assessee are in bona-fide belief for merely a decade that tax is not deductible at source on payments on transaction charges, no fault can be found with the assessee in not deduction tax at source in the assessment year under consideration and consequently disallowance made by the AO u/s. 40(a)(ia) in respect of transaction charges cannot be sustained. This finding of the Hon’ble High Court in that case is on the basis of peculiar facts of that case. In the case at hand, those peculiar facts are missing. Being Revenue appeal allowed.
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