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The Income Tax Officer (TDS) Versus M/s. BKS Galaxy Realtors Pvt. Ltd.

2016 (12) TMI 1342 - ITAT MUMBAI

TDS u/s 194I - payment to CIDCO as lease premium - Held that:- Hon’ble Delhi High Court in the case of CIT Vs Indian News Paper Society (2015 (12) TMI 984 - DELHI HIGH COURT) wherein it has been held that lease premium paid to MMRDA is capital expenditure. Once that is so, then there is no requirement to deduct TDS. Thus, following the view taken by this Tribunal that such payment of lease premium does not fall within the meaning of “rent” as contemplated u/s 194-I, we hold that the assessee is .....

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i Amit Shukla, JM Appellant by : Shri Vaibhav Jain, DR Respondent by : Shri Prakash Pandit, AR ORDER Per Amit Shukla, JM The aforesaid appeal has been filed by the Revenue against the impugned order dated 25-02-2015 passed by the learned CIT (A)-59, Mumbai in relation to the order passed u/s 201 (1)/201(1A) of the Income Tax Act, 1961 for the assessment year 2010-11. The Revenue has taken the following grounds of appeal:- (i) On the facts and in the circumstances of the case and in law, the Ld. .....

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on of the plot of land on lease from CIDCO. (iii) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in not confirming the order of the Assessing Officer treating the assessee as an assessee in default u/s. 201(1) in respect of the amount of tax which has not been deducted under section 194 I from the payment made to CIDCO and levying interest under section 201(1A). (iv) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in .....

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ralal, 33 ITR 245, where it has been held that the persons who are responsible for deduction of tax at source are not concerned with the ultimate result of assessment. 2. At the outset, the learned Counsel for the assessee submitted that the issue of payment of lease premium to CIDCO, whether falls within the ambit of rent u/s 194-I or not has been the subject matter of dispute in various appeals before this Tribunal. Consistently, this Tribunal has been holding that such a lump sum payment of l .....

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to MMRDA was held to be capital expenditure. 3. On the other hand, the learned DR strongly relied upon the order of the Assessing Officer. 4. After considering the rival submissions and on perusal of the impugned order, we find that the assessee has made payment of ₹ 16,05,06,501/- to CIDCO as lease premium. The Assessing Officer held that the same is to be treated as rent and, therefore, the assessee should have deducted TDS u/s 194-I. Before the learned CIT (A), it was contended that thi .....

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is capital in nature and the same cannot be considered as rent for the purpose of deduction of TDS u/s 194-I. The relevant observation of the CIT (A) reads as under:- 3.3 At the time of appellate proceedings, the submission filed by the appellant was remanded to the AO by the CIT(A)-12, Mumbai vide letter no.CIT(A)-12/Misc. Comments of AO/2014-15 dated 15/05/2014 to the AO for report. The AO was also asked to place new arguments/points/evidences which are not referred to in the order appealed a .....

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ment has preferred further appeal with Hon ble Bombay High Court which is pending. 3.4 I have perused the facts of the case, submission of the appellant and the order u/s. 201(1)/201(1A) and the remand report submitted by the AO. Thus, from RR it is apparent that the AO has not brought any distinguishing facts but has simply stated that the decision of ITAT is not accepted by the Department. On perusal of submissions filed by the appellant, it is observed that the payment is for acquisition of l .....

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