TMI Blog2022 (9) TMI 1519X X X X Extracts X X X X X X X X Extracts X X X X ..... n deduct TDS thereon. CIT (A) was right in relying on CBDT Circular No.06.2016 - Undisputedly the AO never made any disallowance or addition on this issue of payment commissioner/ discount to the advertising agencies neither from earlier other nor from subsequent assessment year and only made disallowance in A.Y.2009-10. Principal of consistency always followed by the tax authorities, in the identical and similar facts and circumstances. AO has not mentioned any reason as to why he proceeded to take a deviated view from preceding assessment years contrary to rule of consistency, in this particular A.Y.2009-10 under identical facts and circumstances. Decided in favour of assessee. Disallowance u/s 14A r.w.r. 8D - CIT(A) restricted addition - HELD THAT:- AO has invoked provisions of section 14A of the Act r.w.r 8D (iii) of the Rules by taking 0.5% of average of investments of assessee in the opening and closing of the year which has been reduced by the CIT(A) to the extent of average of investment out of which the assessee has earned exempt income during the relevant financial period. This conclusion of Ld. First appellate authority is in accordance with the order of ACI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder the law the same can be held to be in the nature of commission. 1.3 That without prejudice to the above and in the alternative the disallowance made by the learned Assessing Officer was erroneous and had to be restricted to 30% of the amount of expenditure claimed in view of the amendment made in Finance No. (2) Act, 2014 reported in 366 ITR 21 (St.) 2. That the learned prejudice to the above and in the alternative the disallowance made by the learned Assessing Officer was erroneous and had to be restricted to 30% of the amount of expenditure claimed in view of the amendment made in Finance No. (2) Act, 2014 reported in 366 ITR 21 (St.) 2.1 That the learned Additional Commissioner of Income Tax has failed to appreciate that in absence of satisfaction of statutory precondition provided in section 14A (1) of the Act, no disallowance could be validly made by mechanically applying Rule 8 D of the Income Tax Rules, 1962. 4 That the appellant craves, leaves or reserving the right to amend modify, alter, add or forego any ground(s) of cross objection at any time before or during the hearing of this appeal. 5. That the learned Additional Commissioner of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the same without any disallowance but only for A.Y.2009-10 the AO made disallowance without any positive or adverse material against the assessee, only on the basis of his own surmises and conjectures, which was rightly deleted by the Ld. CIT(A) by properly appreciating the facts and circumstances and by considering rule of consistency as respect by the tax authorities under the well accepted principals of tax jurisprudence. 8. The Ld. Counsel also submitted that the order of the Hon ble High Court of Delhi in the case of CIT Vs. Living Media India Pvt. Ltd. (supra) has been confirmed by Hon ble Supreme Court India by dismissing SLP of department by order dated 11.12.2009 and the same was rightly applied by the CBDT Circular No.5/2016 while granting relief to the assessee, therefore, grounds of revenue may kindly be dismissed. 9. On careful consideration of our rival submissions first of all we observed that the AO made impugned disallowance u/s. 40 (a) (ia) of the Act with the following observations and findings :- 10. Further from the first appellate order we observed that the Ld. CIT(A) has granted relief to the assessee by relying on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that commission was not paid by the Assessee to the advertising agency and, therefore, the provisions of Section 194H of the Act could not be invoked by the Revenue. 12. Reliance also been placed by the assessee on the judgment of Hon ble Jagran Prakashan Vs. DCIT (TDS) reported in 345 ITR 288 (SC) wherein by considering the judgment of the Hon ble Jurisdictional High Court in the case of CIT Vs Living Media India Ltd. (supra) and board circular which has been held thus ; 13. From the grounds as well as contents of the Ld. CIT (DR) we note that it is not the case of the department that the judgment of the Jurisdictional High Court in the case of Living Media India and CBDT Circular No.05/2016 (supra) do not support the claim of assessee but the bone of main contention of the revenue is that since the assessee is not a newspaper publisher or publishing house, therefore, said judgment of jurisdictional High Court (supra) and CBDT circular (supra) cannot be applied to the case of assessee for granting relief from rigour of section 40 (a) (ia) of the Act at 15% discount / commission paid to the advertising agencies by the assessee. 14. In our conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee by the judgment of Hon ble Jurisdictional High Court of Delhi in the case of CIT Vs. Living Medial India Pvt. Ltd. (supra) and CBDT circular No.5/2016 (supra). 18. Further, in our considered opinion the principal of consistency always followed by the tax authorities, in the identical and similar facts and circumstances. The AO has not mentioned any reason as to why he proceeded to take a deviated view from preceding assessment years contrary to rule of consistency, in this particular A.Y.2009-10 under identical facts and circumstances. Therefore, in view of foregoing, we are unable to see any ambiguity perversity or any other valid reason to interfere with the findings arrived by the Ld. CIT(A) and, therefore, we uphold the same. Accordingly ground No.1 and 2 of revenue are dismissed. 19. Ground No.3 and 4 of revenue The Ld. CIT (DR) submitted that the Ld. CIT(A) has erred in restricting the disallowance u/s. 14A of the r.w.r 8D on the basis of calculation submitted by the assessee and without confirming the same to the AO in violation of rule 46 A of IT Rule. Therefore, the impugned order on this count may kindly be set aside by restoring that of the AO. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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