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2021 (11) TMI 36 - AT - Income TaxProportionate disallowance of deduction claimed u/s. 80IA - services provided pursuant to ILD/NLD license constitute a new and independent undertaking - assessee claimed deduction u/s 80IA of the Act on profits derived from telecommunication services including the services rendered pursuant to these licenses for the assessment years under consideration - Since the assessee did not provide any segmental income expenditure for NLD and ILD services, proportionate disallowance is made on the basis of revenue - HELD THAT:- Since the factual matrix and the arguments are identical. Facts consider in A.Y. 2011-12, respectfully following the decision of the coordinate bench we direct the AO to delete the proportionate disallowances. TDS U/S 195 - Addition u/s. 40(a)(i) for non-withholding of taxes - Disallowance of telecommunications expenses paid to Foreign Telecom Operators - assessee contracts with its customers for providing data transmission services in India and overseas in a safe and secure manner - HELD THAT:- On finding parity of facts with the facts of A.Y. 2011-12 respectfully following the findings of this Tribunal (supra) we direct the AO to delete the disallowance. TDS u/s 194J - Disallowances of telecommunication expense paid to Domestic Telecom Operators - AO disallowed the payments made for these telecom connectivity services - HELD THAT:- It is true that the agreement between the assessee, Bharti Airtel and Reliance clearly show that each party was responsible for its network and for the provisions of services related to it. We are of the considered view that the telecom operators provided connecting, transit and termination services to each other on a reciprocal basis and neither of the parties had any rights in the equipments or in the network of the other parties. The FTOs do not grant any possession or control of any equipment or in the network deployed by them to the assessee. As relying on case of Bharti Airtel [2016 (3) TMI 680 - ITAT DELHI] payment cannot be termed as covered by Explanation 2 read with Section 9(vi) - Decided in favour of assessee. Short grant of credit for TDS - HELD THAT:- We find that on short grant of TDS given by the AO, the assessee has moved a rectification application which has not been disposed of till date. We direct the AO to consider the claim of the credit of TDS as per the provisions of the law and decide the rectification application expeditiously.
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