Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2016 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (9) TMI 305 - HC - Income TaxTDS u/s 194H - non deduction of tds - genuineness of the transaction - Held that:- Although the entire MOU was placed before the AO there was no discussion of the MOU to support the conclusion that the agreement between the Assessee and VEEPL was a sham agreement. The second difficulty is that although the AO has raised questions regarding the genuineness of the transaction it does not appear to be based on any enquiry undertaken by the AO. The AO could have easily invoked the statutory power to undertake the enquiry if he had any doubt about the genuineness of the agreement between the Assessee and the VEEPL. Thirdly, the Court finds that a desperate attempt has been made by the AO to characterize the payments made by the Assessee to VEEPL as brokerage, although admittedly, the payment made amounted to ₹ 7,93,47,974. In particular, the Court finds that the plausible explanation offered by the Assessee in its letter dated 15th December 2009 bringing out the distinction between a consolidator and a broker has not been addressed by the AO. Court is satisfied that such payments could not be characterized as brokerage only for the purposes of bringing it within the ambit of Section 194H of the Act. In that sense, the basic background facts concerning the MOU entered into by the Assessee with the VEEPL is no different from the MOU entered into by the Assessees in the similar cases with VEEPL as aforementioned. - Decided in favour of assessee
|