9911796707
TMI Blog2015 (10) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... the years are common except for variation in figures, hence, the said appeals and COs were clubbed together and are being disposed off by way of this consolidated order for the sake of brevity. The relevant ground as raised in AY 2010-11 reads as under (i) The Ld. CIT(A) has erred in law and on facts by ignoring the amended definition of rent w.e.f. 13.07.2006 as per section 194I and by holding that the payments made by the assessee for advertisement falls within the purview of section 194C and not section 194I. (ii) The Ld. CIT(A) has erred in law and on facts by deleting the additions made u/s 201(1) and section 201(1A) by relying upon CBDT circular No. 715 dated 08.08.1995 and Circular No. 714 dated 03.08.1995 and without considering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order u/s 201(1) & 201(1A) of the I. T. Act, 1961". 2. None appeared on behalf of the assessee nor any adjournment letter has been received despite service of notice, hence we proceed to decide the appeals and COs on its merits after hearing the Ld. DR. 3. The brief facts are that, assessee-company is engaged in the business of Media planning and other incidental activities in connection with the business of advertising and marketing. A survey u/s 133A was conducted in the case of the assessee on 08.07.2011, wherein it was noticed that assessee has shown expenditure on advertisement through outdoor display, which includes payments for advertisement on hoardings/billboards. During the relevant financial years 2009-10 and 2010-11, the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee and the owners of the hoardings or space, therefore, there is no question of deducting TDS u/s 194I. In support, the reliance was placed on the following two decisions (i) Ogivly & Matha in the ITA No. 5202/Del/2004, ITAT Delhi (ii) Roshan Publicity in ITA No. 1277/Mum/2011, ITAT, Mumbai However, the Assessing Officer after detailed discussion, rejected the assessee's contention and held that the assessee should have deducted TDS u/s 194I and thereby, treated 'the assessee in default' and also levied interest u/s 201(1A). While coming to this conclusion, the Assessing Officer relied upon catena of case laws, which are not being discussed here, as they are not very relevant for the facts and issues involved in the impugned case. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rties for display of advertisements of its clients and the transaction is purely in the nature of contract for the 'work' of advertising as defined in clause (iv)(a) of Explanation below section 194C. From the facts of the appellants case it is also evident that the appellant has not taken any space on hire or on subletting basis from these other parties. Even otherwise this could not have been so because these other parties namely Portland India Outdoor Advertising Pvt. Ltd, Poster Publicity (Division of Media edge: CIA India Private Limited) and others have also not taken any space on hire so as to be able to sublet the same to the appellant. 3.14 To elaborate this aspect further, there could be a situation where an assessee tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in this regard, cannot be categorized as 'rent'. There is, therefore no scope for the application of the provisions of section 194-1 in the case of the appellant. 3.15 Coming to the case taws cited by the AO and the appellant, it is seen that in the case of Mahalaxmi Sheela Premises CHS Ltd (supra) cited by the AO, the issue was the taxability of lease "rentals vi respect of a portion of the building in the hands of the owner of the building for fixing the hoarding of the advertiser. In that case it was held that the lease rentals shall be assessed as 'Income from house property'. Firstly there was no issue of tax deduction at source in that case and secondly the facts are different from the facts in the case of the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and Chattisgarh State Electricity Board (all supra), Hon'ble Madras High Court, ITAT, Delhi and ITAT, Mumbai respectively have held that for the payment to be categorized as rent, exclusive possession and control of the space/transmission lines/equipment etc is necessary and the agreement under which the payment is made should be akin to lease, sublease or tenancy to fall within the ambit of section 194-1 of the Act. None of these conditions prevail in the case of the appellant. Thus it is abundantly clear that the payments made by the appellant to other parties for display of advertisements of its clients are not in the nature of 'rent'. These payments are towards a work contract and hence the tax was liable to be deducted un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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