Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (2) TMI 599 - AT - Income TaxTDS u/s 194C or 194J or 194I - addition made on account of studio hire charges u/sec 40(a)(ia) - submissions of the Assessee in explanation to the payment on account of Studio Hire Charges that it is a practice of a Music Director to call musician at the hired studios for recording from different parties and sources as per his requirement and planning to play under his instruction - Held that:- A music director having no set up to record music at his home and he has to arrange everything required by hire on rent and no contractual agreement is required for hiring the studios and musical instruments. Further the assesse submitted that the studios would charge the hire charges for using the studios setup on hourly basis and provides their studios room with furniture and equipment on rent to the music directors and pleaded the question of TDS deduction under section 194C does not arise. We find force in the submissions of the Ld.AR in this regard. The impugned addition as made by the AO is admittedly below the prescribed monetary limit as required u/section 194I of the Act, therefore, we hold that the addition made for violation of Section 194C is not maintainable and as such it is deleted, accordingly, ground no-3 is allowed. TDS liability on Instrument Hire Charges - Held that:- The assessee was an individual and the AO made disallowance for not deducting tax in respect of payments made towards labour and advertisement charges and the Coordinate Bench held the said disallowance is not maintainable in view of the order dt:11-03-2011 of Tribunal in the case of Smt.Keya Seth. [2011 (3) TMI 1135 - ITAT KOLKATA]. We find that the said Coordinate Bench discussed the relevant provisions of Section 194C(1) and 2 as existed in A.Y’s.2006-07 and 2007-08 together with the Circular No-3/2008 dated 12-03-2008 in detail and held that the Assessee being an Individual is under no obligation to deduct tax and provisions under section 194C(1) is not applicable to A.Y’s.2006-07 and 2007-08 for an individual. In the present case, the year under consideration is 2006-07, therefore, we find that the facts and the law laid down by the Coordinate Bench supra is applicable to the issue on hand. Thus, we hold that the disallowance as made for violation of section 194C and the addition therein by invoking Section 40(a)(ia) of the Act is not maintainable - Decided in favour of assessee Payments to Artists - addition made thereon for violation U/Section 194C of the Act by invoking Section 40(a)(ia) - Held that:- If the concerned payee(s) has taken into account the relevant sum as received from Assessee for computing income in their returns of income furnished u/s. 139 of the Act and has paid tax due on the income declared in such return, We, therefore, set aside the impugned order of CIT(A) to the extent confirming the disallowance made by the AO u/s. 40(a)(ia) and restore the matter to the file of the AO for deciding the same afresh in the light of the submissions of the assessee. The assessee shall be at liberty to file requisite evidences, if any, to substantiate its claim. This ground of assessee’s appeal is allowed for statistical purpose. Assistant Fees - non deduction of TDS - Held that:- It is observed from the assessment order that the AO did not specify the charging section as required to be made any disallowance under the Act, but, however, mentioned the only the chapter VIIB of the Finance Act where the deduction at source commences to start from section 192. As rightly pointed by the Ld.AR in the absence of any charging section the disallowance thereon is not permissible. Ld.AR argued that the disallowance cannot be under sections 192, 194C and 194J of the Act as no such evidence brought on record to show that the said Assistant is an employee or carrying out any work under contract or rendered any professional or technical services to the Assessee as required under said charging sections. Therefore, we find force in the arguments of the Ld.AR and we hold that the addition made account of payment to Assistant to an extent of ₹ 29,700/- in the absence of any evidence is not maintainable - Decided in favour of assessee
|