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2016 (12) TMI 181 - ITAT MUMBAITDS u/s 194D - TDS on expenditure incurred by the assessee on its insurance agents and SBI employees - assessee in default under section 201(1) & (1A) - Held that:- The foreign travel of its agents was organized for training purposes and to discuss market strategy and to understand the business at the ground level, from the details furnished in this regard. The amount incurred towards foreign travel expenditure in respect of an insurance agent does not accrue as ‘income’ in the hands of such insurance agent and thus the same would be outside the ambit of Chapter XVII. As assessee has already deducted tax at source under section 194C, by no stretch of imagination the said payment can be held to be liable for deduction of tax under section 194D, in so far as it was not a payment made to agent for procuring LIC business the expenses incurred cannot be said to be in the nature of incentive or reward to the insurance agents as they had no option to choose a place for the purpose of foreign travel. The said incentive does not in any manner has an object of benefiting the individual but has been incurred on the group as a whole and also the same is not a voluntary act on the part of insurance agents; therefore, the expenditure cannot be considered as income in the hands of the individual insurance agent. Thus we do not find any merit in the action of lower authority for treating the payment made to travel agent for getting the accommodation and ticket booking for the insurance agent causing for treating and holding them liable to deduction of tax at source under section 194D of the Act. The assesse has already deducted tax at source under section 194C, accordingly there is no justification in the order of lower authorities holding the assessee in default under section 201(1) & (1A). TDS in respect of service tax component on insurance commission paid to the insurance agent - Held that:- No tax is required to be deducted at source in respect of component of service tax so paid to the commission agent. TDS u/s 194C or 194J - payment made for annual maintenance contract / routine repair - Held that:- No infirmity in the order of Ld. CIT(A) holding that annual maintenance charges paid by assessee was liable for deduction of tax at source under section 194C and not under section 194J of the Income Tax Act.
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