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2021 (7) TMI 1197 - AT - Income TaxShort deduction of TDS - Addition u/s 194J or 194C - assessee has made payments for purchase of bulk bandwidth data from M/s. Bharti Airtel Ltd., and M/s. Reliance Communications Ltd. - default u/s.201(1) and 201(1A) - HELD THAT:- Payments made by the assessee for bulk purchase of bandwidth from service providers like M/s. Bharti Airtel Ltd., and M/s. Reliance Communications Ltd., cannot be considered as fees for technical services because such services have been provided through optical fiber cable without any human intervention - as per terms of agreement and nature of services between parties, it is clearly in the nature of works contract which comes u/s.194C f the Act. AO as well as the ld.CIT(A) has erred in holding the assessee as an assessee in default u/s.201(1) / 201(1A) of the Act to compute short deduction of TDS and interest thereon. Accordingly, we set aside the order of the ld.CIT(A) and direct the AO to delete additions made towards short deduction of TDS and interest u/s.201(1) / 201(1A) - Appeal filed by the assessee is allowed.
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