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2020 (10) TMI 81 - ITAT HYDERABADTDS u/s 194H - “payment to Gateways” - Non deduction of tds - As per assessee terms and conditions under which the Gateway has rendered services to the customers were invariably recorded in the agreements between the company and the respective Gateways, which establish that the company, on the one hand, and Gateways on the other hand, were independent parties in their respective fields and, therefore, there was no necessity of deducting any TDS - CIT-A deleted the disallowance - HELD THAT:- CIT(A) has followed the decisions of the coordinate benches of this Tribunal in own case wherein it has been held that the “sale made on the basis of a credit card” is the transaction of the merchant establishment and that the credit company only facilitates the electronic payment for a certain charge and the commission retained by the credit card company is therefore in the nature of normal banking charges and not in the nature of commission/brokerage for acting on behalf of the merchant establishment. DR has not been able to rebut the decisions of the Tribunal with any decision of the appellate forums to the contrary - No reason to interfere with the order of CIT(A) in deleting the disallowance made by the AO u/s 40(a)(ia) - also noticed that the Gateways have offered the income to tax in their hands in their respective returns of income. Therefore, the proviso to section 40(a)(ia) is applicable and for this reason also, the disallowance cannot be sustained. - Decided in favour of assessee.
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