TMI Blog2018 (4) TMI 388X X X X Extracts X X X X X X X X Extracts X X X X ..... nect and access cost. Nothing has been brought before us by the assessee to demonstrate this fact. That being the case, the contention of the assessee that the re–assessment proceeding under section 147 has been initiated on a mere change of opinion cannot be accepted. Therefore, upholding the validity of initiation of proceedings, we dismiss this ground TDS u/s 194J - Disallowance u/s 40(a)(ia) - Held that:- Inter–connect usage charges are not in the nature of fees for technical services, hence, the provisions of section 194J would not be applicable. In view of the aforesaid decision of the Co–ordinate Bench in assessee’s own case there is no obligation / liability on the assessee to deduct tax at source on payment of inter–connect usag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round no.1, the assessee has challenged the validity of proceedings initiated under section 147 of the Act. 3. Brief facts are, the assessee a company is engaged in the business of providing telecom service. For the assessment year under dispute, the assessee filed its return of income on 30th September 2009, declaring business loss of ₹ 69,63,73,861. That besides, the assessee offered long term capital gain of ₹ 34,33,31,420 and long term capital gain of ₹ 3,09,071. The return of income filed by the assessee was selected for scrutiny and assessment in case of the assessee was originally completed under section 143(3) of the Act vide order dated 31st December 2011, determining the income at ₹ 11,47,96,590. Subsequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idity of proceedings initiated under section 147 of the Act. He also upheld the disallowance under section 40(a)(ia) for non deduction of tax at source. As regards the disallowance of depreciation, the learned Commissioner (Appeals) directed the Assessing Officer to verify whether such disallowance had already been made in rectification order date 20th March 2013, passed under section 154 of the Act and if it has already been made, not to make any further disallowance. 4. Learned Authorised Representative for the assessee appeared and filed written submission. The learned Authorised Representative submitted, re opening of assessment having been made in the absence of any tangible material and without application of mind and on a mere cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on a mere change of opinion cannot be accepted. Therefore, upholding the validity of initiation of proceedings, we dismiss this ground. 7. In ground no.2, the assessee has challenged disallowance of ₹ 7,28,19,366 under section 40(a)(ia) of the Act. 8. As discussed in the earlier part of this order, in the course of assessment proceeding, the Assessing Officer having found that the assessee has not deducted tax at source on inter connect and access cost of 7,28,19,366, called upon the assessee to explain why the payment so made should not be disallowed under section 40(a)(ia) of the Act. Though, the assessee objected to the proposed disallowance, however, the Assessing Officer while completing the assessment disallowed the said a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment year 2010 11, 2011 12 and 2012 13, the Assessing Officer passed orders raising demands under section 201(1) and 201(1A) against the assessee alleging non deduction of tax at source on payment of inter connect usage charges. The reasoning of the Assessing Officer while raising such demands in the aforesaid assessment years was, the payment made by the assessee towards inter connect usage charges are in the nature of fees for technical service, hence, will attract the provisions of section 194J of the Act. However, while deciding assessee s appeal on the disputed issue, the Tribunal in the order referred to above held that inter connect usage charges are not in the nature of fees for technical services, hence, the provisions of sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on 20th March 2013. The learned Commissioner (Appeals), after considering the aforesaid submissions of the assessee has directed the Assessing Officer to verify the claim of the assessee and delete the disallowance in case it is found that similar disallowance has been made in the rectification order. We do not find any infirmity in the order of the learned Commissioner (Appeals) on this issue. When the only relief claimed by the assessee before the learned Commissioner (Appeals) is on the ground of double disallowance of depreciation and the learned Commissioner (Appeals) has addressed the grievance of the assessee by issuing necessary directions to the Assessing Officer to delete the disallowance in case of double disallowance, there is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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