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2016 (6) TMI 1087 - AT - Income TaxDisallowance u/s. 40(a)(ia) - non TDS on SMS charges - Held that:- We find that the nature of services rendered by the two parties are just to provide an Internet platform wherein the software of stock broker gets automatically interfaced with Internet platform without any human intervention and SMS gets automatically generated and sent to customers of assessee. It can at best be considered only as these two parties selling SMS credits to the assessee. It is nobody’s case that the transactions fall under the ambit of section 194J of the Act. In order to apply the provisions of section 194C of the Act, there should be two main ingredients – (i) the existence of contract (whether oral or written) and (ii) such contract should be for carrying out any work requiring the human intervention. In the instant case, there is no contract entered into by and between the assessee with two parties as we find that SMS credits sold by two parties were just consumed by the assessee on need basis. We find that the activity carried on in the instant case does not fall under the definition of ‘work’ in terms of section 194C of the Act as it does not involve any human intervention - Decided in favour of assessee Eligibility for getting rebate u/s. 88E - Held that:- We direct the Ld. AO to disallow the rebate u/s. 88E of the Act at 10% on the claim of the assessee and grant relief for the remaining amount. See Destiny Securities Ltd. Versus Deputy Commissioner of Income Tax [2016 (6) TMI 880 - ITAT KOLKATA]
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