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2018 (11) TMI 695 - ITAT MUMBAIShort deduction of TDS - TDS u/s 194C OR 194J - Carriage Fees/ Channel Placement Fees - whether these payments are made for use/ right to use of process and are royalty as per explanation 6 under section 9(1)(vi) of the Act and therefore covered under section 194J? - Held that:- There is no dispute that the payment in question was made by the assessee to the cable operators/ MSOs for placing the TV channels in the prime band in order to enhance the viewership and better advertisement revenue. what the assessee has transacted for with the licensor or company certainly includes within its ambit broadcasting and telecasting facility. The essence of the contract is to obtain broadcasting and telecasting of TV channels and thereafter its distribution amongst ultimate customers through the cable network of the assessee. What the assessee subscriber is looking for is to obtain the telecast signals from the licensor, which is enough, to deduce that the impugned contract involves broadcasting and telecasting of TV signals. Moreover, the licensor or the company, as is evident from the specimen agreement on record, in the business of distribution of satellite based TV channels and has exclusive rights to market and distribute said services in India, the service that is referred to in the agreement is the broadcasting and telecasting of TV signals. Tribunal was correct in holding that the assessee was required to deduct tax at source in terms of s. 194C As decided in assessee's own case [2016 (1) TMI 213 - ITAT MUMBAI] provisions of section 194J of the Act are not applied on payment of carriage fees to cable operations hence, the disallowance carriage/ channel placement fees u/s 40(a)(ia) is deleted. - Decided in favour of assessee.
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