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2016 (1) TMI 315 - ITAT MUMBAI

2016 (1) TMI 315 - ITAT MUMBAI - TMI - TDS u/s 194J - non deduction of TDS on the rebates and incenties - CIT(A) deleted the disallowance - Held that:- There should be an agency among the parties for the payment of commission and brokerage to bring the parties within the ambit of section 194H. There is no dispute that the law relied by the counsel of the parties but the crux of the said law is that in the case of incentives and rebates where there is no element of Agency the provision u/s. 194H .....

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Appellant : Shri Nitesh Joshi For the Respondent : Shri A K Srivastava ( CIT-DR ) ORDER Per Amarjit Singh, JM The revenue has filed the appeal against the order of learned Commissioner of Income Tax (Appeals)-II, Mumbai [hereinafter referred to as the "learned CIT(A)"] dated 26.03.2010 in connection with the A.Y. 2008-09. 2. The facts of the case are that the assessee is public limited company assessed at Thane / Mumbai. For the purpose of TDS pertaining to Thane Branch the above comp .....

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case of the assessee falls u/s 194H of the act therefore, the assessee was under obligation to deduct the T.D.S upon the rebates and incenties in accordance with law. Subsequently, assessee filed an appeal before learned CIT(A) who allowed the appeal on arriving at this conclusion that section 194H of the Act is not applicable to the present case. Feeling aggrieved the revenue has filed the present appeal before us. 3. We have heard the arguments advanced by the learned representative of the pa .....

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For ex-mill price upto ₹ 501/- the total quantity of net confirmation Excluding mini sale-notes will be taken actual. (b) For ex-mill price between ₹ 501 to ₹ 1000 the total quantity of nett Confirmation excluding mini sales notes will be increased 2 times. (c) For ex-mill price above ₹ 1000/- the total quantity of nett confirmation Excluding mini salenotes will be increased 3 times. 4.2. A dealer may qualify for a higher rate of bonus than as per provision in para 4.1 a .....

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ND/IR for the year. 4.4. The slabs of bonus will be as follows: 4.4.1 For all Retailers and Franchisees of Fabrics in Agra, Ahmedabad, Bangalore, Bhopal, Mumbai, Calcutta, Coimbatore, Delhi, Hyderabad, Indore, Jaipur, Kanpur, Ludhiana, Chennai, Nagpur, Patna, Pune, Secunderabad, Surat, Thane and Vadodara (hereinafter referred to as the 'SPECIAL CITIES') 1.0% - 3000 meters and 4000 meters 1.5% - 4001 meters and 5500 meters 2.0% - 5501 meters and 7500 meters 2.5% - 7501 meters and 10000 me .....

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- 5501 metres and 6500 metres 3.5% - 6501 metres and above 4.4.3 For all Retailers and Franchisees of Fabrics in all other cities not covered in para 4.4.1 and in para 4.4.2 above (hereinafter referred to as the 'REGULARCITIES') 1.0% - 2000 metres and 3000 metres 1.5% - 3001 metres and 4000 metres 2.0% - 4001 metres and 5500 metres 2.5% - 5501 metres and 7000 metres 3.0% - 7001 metres and 9000 metres 3.5% - 9001 metres and above 4.4.4 For all wholesalers of Fabrics in 'Special Citie .....

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wls will be treated as separate product group, having independent bonus slabs 4.5.1 The slabs of bonus for Rugs, Blankets & shawls will be determined by aggregating the total quantity of nett confirmation in pieces which will be arrived at on the following basis a) Exotic, wool mark & woolen (series 111, 178, 277, 195, 401 & 404) Rugs, Blankets & Shawls will be multiplied by a factor of 2. 5 b) All other Rugs, Blankets & shawls (other than Baby Blankets) will be taken actual .....

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ealers of seconds will, however, be based on actual meterage dispatched during the year 4.7 Bonus percentage as determined above will be payable on dispatches during the calendar year (January to December) against paid bills. For new dealers appointed during the mid year, slab will be determined on the net bookings received during the subsequent full calendar year and will be applied on the dispatches made during the first incomplete year of operation. 4.7.1 Nett value' of dispatches means i .....

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ase titled as Delhi Milk Scheme vs. CIT Delhi, [2015] 59 taxmann.com 176 (Calcutta) titled as Hutchison Telecom East Ltd. Vs. CIT, TDS, Kolkata & [2010] 42 SOT 125, Mumbai in the ITAT Mumbai 'B' bench in case titled as Mahesh Enterprises Vs. Income Tax Officer Ward 22(1)(1). However, on the other hand learned representative of the assessee refuted the said contentions and argued that there is no relation of principle and agent with the Franchisee holder and infact in view of the agre .....

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laws relied by the learned representative of the parties and going through the record. We are of the view that to pay the commission / brokerage there should be agency between the parties. In the instant case the copy of agreement is in the file wherein clause 4(1) speaks about the relationship and is hereby reproduced below for ready reference: "None of the terms of this agreement shall be construed as conferring the status of an agent on the Franchisee and all dealings between the Franch .....

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