TMI Blog2016 (9) TMI 305X X X X Extracts X X X X X X X X Extracts X X X X ..... at a desperate attempt has been made by the AO to characterize the payments made by the Assessee to VEEPL as brokerage, although admittedly, the payment made amounted to ₹ 7,93,47,974. In particular, the Court finds that the plausible explanation offered by the Assessee in its letter dated 15th December 2009 bringing out the distinction between a consolidator and a broker has not been addressed by the AO. Court is satisfied that such payments could not be characterized as brokerage only for the purposes of bringing it within the ambit of Section 194H of the Act. In that sense, the basic background facts concerning the MOU entered into by the Assessee with the VEEPL is no different from the MOU entered into by the Assessees in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by the Assessee in the present case to VEEPL were on similar terms and conditions as obtaining in Finian Estate Developers (supra). Accordingly, the ITAT held that the case was covered squarely by its decision in Finian Estate Developers (supra). It held that the expenses incurred by the Assessee towards consolidation of land was not liable to deduction of tax at source under Section 194 H of the Act and disallowance under Section 40(a) (ia) of the Act. 4. At the outset, it was pointed by Ms. Kavita Jha, learned counsel for the Assessee, that there is a series of orders passed by the ITAT in relation to the similarly placed Assessees and the orders of the ITAT in those cases have been affirmed by this Court by dismissing the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h VEEPL in the present case, pursuant to an identical agreement between the Assessee and the DLF Commercial Project Corporation, is no different from the MOUs entered into by the aforementioned Assessees with VEEPL. 6. The Court in its order dated 5th November 2015 noticed that although the ITAT had decided the question that has been urged in the case of Finian Estate Developers (supra) in favour of the Assessee and against the Revenue when an appeal was filed by the Revenue against the said decision of the ITAT in the case of Finian Estate Developers (supra), the Revenue did not raise a challenge to the decision of the ITAT on the above question. Accordingly, the Court noted in its order dated 15th November 2015 that the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court finds that although the entire MOU was placed before the AO there was no discussion of the MOU to support the conclusion that the agreement between the Assessee and VEEPL was a sham agreement. The second difficulty is that although the AO has raised questions regarding the genuineness of the transaction it does not appear to be based on any enquiry undertaken by the AO. The AO could have easily invoked the statutory power to undertake the enquiry if he had any doubt about the genuineness of the agreement between the Assessee and the VEEPL. Thirdly, the Court finds that a desperate attempt has been made by the AO to characterize the payments made by the Assessee to VEEPL as brokerage, although admittedly, the payment made amounted to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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