TMI Blog2017 (3) TMI 1617X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer for considering afresh - I.T. Appeal No. 3177 (Mum.) of 2014 - - - Dated:- 8-3-2017 - SAKTIJIT DEY, JUDICIAL MEMBER AND N.K. Pradhan, ACCOUNTANT MEMBER For The Appellant : Ms. Aarati Vissanji For The Respondent : Arun Shenoy ORDER Saktijit Dey, Judicial Member - Captioned appeal by the assessee is directed against order dated 26th February 2014, passed by the learned Commissioner (Appeals)- 13, Mumbai, for the assessment year 2011-12. 2. The ground raised by the assessee are reproduced below:- 1.1 Tax was deductible under section 194J of the Act in respect of Market Research Expenses of ₹ 95,00,000/- and Media Monitoring Expenses of ₹ 19,00,000 (wrongly considered as ₹ 35,00,000/- by the Ld. A.O.) paid by the appellant instead and in place of Section 194C (the actual amount of expenses are ₹ 96,00,626/- for Market Research and are ₹ 18,52,135/- for Media Monitoring). 1.2 Without prejudice to the above and in alternate, the CIT(A) erred in not excluding the following while calculating short deduction of tax at source in respect of Market Research Expenses and Media Monitoring Expenses:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised in relation to payment made towards market research and media monitoring charges, over discussion is restricted to these two issues only. 4. As far as market research is concerned, it was submitted by the assessee that these payments, per-se, were not for advertising but for research activities carried out by certain parties on behalf of the assessee in relation to advertisement. It was submitted, in respect of payments made to foreign parties, tax was deducted at source under section 195 of the Act. As far as payment made to other parties in India is concerned, it was submitted by the assessee that since it is in the nature of work as envisaged under section 194C, assessee has deducted tax @ 2%. As far as media monitoring charges is concerned, assessee submitted that such payments are for monitoring display and advertisements in various media such as press, print, radio, TV channels, internet websites, etc., and the services are nothing but are in relation to the work of advertisement done by clients of the assessee. Therefore, assessee had deducted tax at source in terms of section 194C of the Act. The Assessing Officer, however, did not find merit in the submissions of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 lakh was created as a provision which was subsequently reversed during the statutory audit. She submitted, the major part of the payment amounting to ₹ 13,50,093, was made to TAM Media Research Pvt. Ltd. on which the assessee has deducted tax @ 2%, as such payment is covered under section 194C of the Act. She submitted, even otherwise also, TAM Media Research Pvt. Ltd. has offered such payment as income and paid tax. Therefore, no demand can be raised in case of the assessee for non-deduction of tax at source. In this context, she relied upon the decision of the Hon'ble Supreme Court in Hindustan Coca-Cola Beverage (P.) Ltd. V. CIT[2007] 293 ITR 226. Learned Authorised Representative submitted, though, the assessee had filed an application under section 154 of the Act before the Assessing Officer pointing out the mistake in figures, the Assessing Officer has not taken any action on the same. 8. Learned Departmental Representative on the other hand relied upon the observations of the Assessing Officer and the learned Commissioner (Appeals). 9. We have considered the submissions of the parties and perused the material available on record. As far as payment made tow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ideration whether the provision of section 201(1)/201(1A) are attracted to such payment. In this context, we need to observe that according to the learned Authorised Representative, this amount of ₹ 24,13,225, includes an amount of ₹ 5 lakh which was kept as a provision when the survey took place. However, such provision was reversed at the time of statutory audit. Therefore, since no payment was made there was no question of deducting tax at source. In our view, the aforesaid claim of the assessee requires consideration by the Departmental Authorities. As far as the balance payment is concerned, on a perusal of the orders of the Departmental Authorities, we have noticed that the assessee's claim that the nature of payment made comes within the ambit of section 194C has not been properly considered either by the Assessing Officer or by the learned Commissioner (Appeals) by carefully examining the agreement between the assessee and the payees and other relevant facts. Therefore, in our considered opinion, the liability of the assessee under section 201(1)/201(1A) in respect of payment made at ₹ 24,13,225 requires re-consideration. As far as the balance amount i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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