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2017 (6) TMI 544 - AT - Income TaxTds u/s. 194H - whether payments made to the doctors were in the nature of commission ? - nature of payment - Held that:- In the instant case, it is admitted by the assessee that the payments are made to the doctors as reference fees. These are admittedly cash payments and not through banking channels. The assessee does not have a case that the doctors have disclosed these payments made by the assessee in their returns of income and paid due taxes to Government. Admittedly, the payments made by the assessee to the doctors are taxable in the hands of the doctors. The payments are actually in the form of secret commission and the assessee as well as the doctors who received it never wanted this information to be revealed to the Income Tax Department or to the general public. Had the assessee effected TDS on these payments, the doctors would have been compelled to disclose this income in their returns of income. The assessee by not deducting tax at source, had aided the doctors to evade income tax which was due to the Central Government. The explanation given for ‘Commission or Brokerage’ in Section 194H of the Act being an inclusive definition, does not exclude the ordinary meaning of ‘Commission’ or ‘Brokerage’. The payment made by the assessee as referral fees is directly proportionate or percentage of an amount received by the assessee for providing CT scan and MRI scan and such payment comes within the term ‘Commission or Brokerage’. In the light of the above said reasoning and ordinary dictionary meaning of ‘Commission’, the order passed by the Assessing Officer u/s. 201(1) and 201(1A) of the Act and which was sustained by the CIT(A) is correct and in accordance with law. - Decided against assessee.
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