TMI Blog2015 (2) TMI 532X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 35,69,715/-, if it is found to have been paid within the relevant financial year - Decided in favour of assessee by way of remand. - ITA No.478/Hyd/2013 - - - Dated:- 28-1-2015 - Shri P.M. Jagtap and Shri Saktijit Dey, JJ. For The Assessee : Shri A.V. Raghuram, Advocate For The Department : Smt. Esther Nianghauvung Hangal, (DR) ORDER Per Saktijit Dey, J.M. This appeal of the assessee is directed against the order of ld CIT (A) Guntur, dated 28.11.2012 pertaining to the A.Y 2009-10. The solitary issue in this appeal is with regard to disallowance of ₹ 35,69,715/- by invoking the provisions of section 40(a)(ia) of the Act. 2. Brief facts of the case relating to the issue in dispute are, the assessee, a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax at source u/s 194C of the Act on the payments made to the pay channels. As the assessee had not deducted any tax, he issued a show cause notice to the assessee requiring him to explain why payments of ₹ 36,15,907/-should not be disallowed u/s 40(a)(ia) of the Act. In response to the show cause notice the assessee submitted that there is no contract for work with the concerned TV channels. It was submitted that the nature of transactions between the assessee and the pay channels cannot be considered as works contract as envisaged u/s 194C. AO however, rejecting the explanation of the assessee disallowed an amount of ₹ 35,69,715/- by invoking section 40(a)(ia) of the Act. 3. Being aggrieved of such disallowance, assessee pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich deal with broadcaster or telecasting but not a person who distributes right to view such broad casting or telecasting and thereby erred in holding that the assessee is liable to deduct tax when he is purchasing the activation card from TV Channel. 4. The ld CIT (A) failed to appreciate the fact that purchase of activation card by assessee is as a user, is as good as purchasing a sim card for cellphone which does not attract provisions of tDS and thereby erred in holding that there is service as held in the case of Idea Cellular holding sale of sim cards includes commission and TDS is required to be made failing to appreciate the difference between sale of sim cards to dealers of SIM cards and sale of same to user and thereby erred i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowing the aforesaid view expressed by the Hon'ble High Court, the ITAT in case of Ushodaya Enterprises vs. DCIT in ITA No.676/Hyd/09 dated 7.1.15 has also directed the AO to follow the ratio laid down in the case of Merillin Shipping Transport vs. Add.CIT (Supra)by the ITAT Special Bench. 5. The ld DR has not controverted the submissions made by the ld AR. 6. We have heard the parties and perused the orders of the revenue authorities and other materials on record. On a perusal of the assessment order, it is seen that in Para 3 of the assessment order, the AO has noted that the assessee has paid an amount of ₹ 36.15 lakhs to various TV channels. If that is the case, then nothing remains payable by the assessee by the end o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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