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2016 (1) TMI 679 - ITAT MUMBAI

2016 (1) TMI 679 - ITAT MUMBAI - TMI - TDS U/S 194J and 194I - tds not deducted on dock fees and airport terminal charges and cargo handling charges - Held that:- The stand of the Assessing Officer is that since the total reserves exceeds the investment in securities, income from which is exempt, therefore, it can be presumed that investment were out of borrowed funds. However, the investments were made by the assessee over the years and the total reserves in the respective years were more than .....

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we note that in para 4.1 of the impugned order, the brake up of the disallowance made by the Assessing Officer has been discussed. Since, we have held that the assessee is not covered u/s 194I/194J and the assessee cannot be treated in default, therefore, we affirm the stand of the ld. Commissioner of Income Tax (Appeals). Resultantly, this appeal of the Revenue is also having no merit. - Decided in favour of assessee. - ITA NO.4950/Mum/2013, ITA NOs.4856 to 4858/Mum/2013 - Dated:- 6-11-2015 - .....

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01(1)/201(1A) of the Act and further deleting the interest levied u/s 201(1A) by holding that the payment of cargo handling charges does not fall within the ambit of section 194J of the Act. 2. In ITA No.4950/Mum/2013 (Assessment Year 2009-10), the ground raised pertains to holding that no disallowance u/s 14A r.w.r. 8D (2)(ii) is called for overlooking that the Assessing Officer correctly made the disallowance as the assessee could not establish the nexus between its own funds and investment ma .....

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arrived at in the impugned orders. M/s Manilal Patel Clearing Forwarding Pvt. Ltd. 2.2. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee is custom house agents filed TDS returns. Survey u/s 133A of the Act was carried out on 24/02/2011. The assessee disclosed the material facts/documents during survey and also during subsequent submission dated 18/03/2011 and 23/03/2011 made before the Assessing Officer. The Assessi .....

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eturn of income by including the impugned amounts in the return by claiming that tax has already been paid by the payees, which cannot be recovered again from the assessee, thereby no default has been committed, as has been alleged by the ld. Assessing Officer. We note that the ld. Commissioner of Income Tax (Appeals) duly considered the submissions of the assessee, various case laws as mentioned in various paras of the impugned orders and the charges separately. The submissions of the assessee .....

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hat the assessee was acting only as an intermediatery between the importers/exporters and the port authorities. The assessee merely collected payments from its customers and disbursed the same to them. The ground rent, terminal handling and demurrage were also the sole liability of the clients. Thus, in the absence of any privity of contract between the port authorities and the assessee, it can be said that the assessee is not a person responsible for deducting tax u/s 194 I of the Act, conseque .....

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ions sets out various conditions which an applicant is required to fulfill to get recognition from the authorities/custom authorities to function as CCSPs. The stand of the Revenue/Assessing Officer is that the term rent defined in explanation (1) to section 194 I is very wide in its ambit and includes every kind of payment by whatever name they called, which is paid pursuant to any agreement or arrangement. M/s Manilal Patel Clearing Forwarding Pvt. Ltd. Admittedly, such CCSPs are providing var .....

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responsibilities of custom house agents. As per the custom regulations, the obligation to make the payments of such charges is upon the importer/exporter, whose goods are handled by them. The assessee is merely providing services to the exporters/importers. Viewed from this angle, we find merit in the conclusion drawn by the ld. Commissioner of Income Tax (Appeals) that the assessee is not a person responsible as defined u/s 194 I, therefore, regarded in default for non-deduction of tax. Therefo .....

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ee for technical services, requiring deduction of tax u/s 194J of the Act. The assessee further find support from M/s Manilal Patel Clearing Forwarding Pvt. Ltd. the decision in Skycell Communications Ltd. vs DCIT and HCL Infotel Ltd. vs ITO (supra), thus, no default was committed by the assessee u/s 194J of the Act. We affirm the stand of the ld. Commissioner of Income Tax (Appeals). 3. Now, we shall take up appeal in ITA No.4950/Mum/2013, wherein, first ground pertains to disallowance u/s 14A .....

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