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2018 (11) TMI 49 - AT - Income TaxTDS u/s 194H - discount allowed to the prepaid card distributors in respect of supply of SIM card/Recharge vouchers (SIM/RV) - treatment of the assessee as assessee in default - Held that:- In assessee’s own case having considered the contentions on either side and the orders of the learned AO, first and second appellate authorities, the Hon’ble jurisdictional High Court reached a conclusion that to the transaction between the assessee and the distributors in respect of sale of the SIM/RV cards, provisions of Section 194H are applicable. The authorities below rightly concluded that the provisions of Section 194H are applicable to the facts of the case and there should have been tax deducted at source in respect of the said transaction. The assessee said that the assessee cannot be branded as the assessee in default u/s 201(1) read with Section 194H in the absence of any evidence that the prepaid distributors have not offered for tax the discount availed by them from the appellant, we are of the considered opinion that it is a verifiable fact and learned AO has to verify whether the prepaid distributors have offered or not for tax the discount availed by them from the assessee. AO for verification of the fact whether or not the prepaid distributors offered for tax the discount availed by them from the assessee. Non deduction of the TDS u/s 194J on the payments of roaming charges - Held that:- The payments in question shall not be recorded as payment towards fee for technical services and only such payments as are for services which are specialized, exclusive and utmost to users/consumers qualified as fee for technical services in terms of Explanation 2 to Section 9(1)(vii) so as to attract TDS u/s 194J. On this premise, in assessee’s own case, a coordinate bench of this Tribunal held that in the absence of any human intervention during the actual roaming process, payment would not be fee for technical services and cannot be regarded as payments to Section 194J are applicable. While respectfully following assessee’s own case for the immediately preceding year, we are of the considered opinion that this demand cannot be sustained and has to be deleted. Interest levied u/s 201(1A) to the tune it is needless to say that interest is consequential in nature and on the amount to be found chargeable on the verification of the fact as directed in the preceding paragraphs.
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