TMI Blog2018 (12) TMI 460X X X X Extracts X X X X X X X X Extracts X X X X ..... sent case paid commission to bank not as an agent. Accordingly, we hold that there was no need to deduct TDS on the Bank Guarantee Commission paid by assessee to Bank. Difference in amount of TDS as per 26AS - Held that:- It reveals that assessee received ₹ 2,51,17,344/-, on which TDS of ₹ 25,11,900/- has been deducted. Ld. CIT(A) without verifying any details deleted addition, by holding that no income against advance accrued to assessee. Ld.CIT(A) also failed to note that advance has been received for services which are to be rendered in next year. It is the fact that assessee received money and did not offer to tax during the year under consideration, stating that, it is advance received. However, Ld.CIT(A) failed to observe that advance received, must have culminated in subsequent year as income of assessee. Therefore, in our considered opinion, it is required to be verified, in which year, the same income as been offered by assessee for income tax purposes. - ITA No. 4027/Del/2015 - - - Dated:- 6-12-2018 - Sri R.K. Panda, Accountant Member And Smt. Beena A Pillai, Judicial Member For the Assessee : Sh. Ashwani Kumar Garg, Adv. For the Revenue : Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred in holding that the amount of ₹ 2,51,17,344/- received by the assessee from M/s Formula One Management Limited was not liable to be treated as business income in the hands of the assessee for the year under assessment. 3) The appellant prays for leave to add, amend, modify or alter any grounds of appeal at the time or before the hearing of the appeal. 2. Brief facts of the case are as under: Assessee filed its return of income on 20/09/11, declaring nil income. The same was processed under section 143(1) of the Act, and case was selected for scrutiny. Accordingly, notice under section 143(2) of the Act was issued. Thereafter, notice under section 142(1) along with questionnaire was issued to assessee. In response to statutory notices, representative of assessee appeared before Ld. AO and filed necessary details which were placed on record. 2.1 Ld.AO observed that assessee is engaged in business to develop facilities of international standard for sports and recreation activities. Ld.AO called upon assessee to furnish information regarding the activities carried on by assessee. During course of TDS survey, it was found that assessee made payment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atute requires TDS to be deducted at the time of credit of such income to the account of payee or at the time of payment thereof whichever is earlier. 7.2 We are, therefore, of the considered opinion that TDS should have been deducted as the case may be. We, therefore, give following analysis regarding applicability of TDS provisions on each of the three items under consideration. (i) Lease rent paid by assessee to Yamuna Expressway Industrial Development Authority Ltd. (YEIDA) amounting to ₹ 23,05,98,619/- It is observed that lease rent paid by assessee has been considered by this Tribunal and is covered in favour of revenue by following decision of Hon ble Delhi High Court in case of Rajesh Projects (India) Pvt. Ltd vs. CIT reported in (2017) 78 Taxman 263, wherein Hon ble court observed as under: 20. In view of the above analysis, the court hereby concludes as follows: (1) Amounts paid as part of the lease premium in terms of the time-schedule(s) to the Lease Deeds executed between the petitioners and GNOIDA, or bi-annual or annual payments for a limited/specific period towards acquisition of lease hold rights are not subject to TDS, being capital paymen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdinate bench of this Tribunal in assessee s own case (supra), held TDS ought to be deducted on lease rent, by following decision of Hon ble Delhi High Court in case of Rajesh Projects (India) Pvt. Ltd vs. CIT (supra). 8.1 Accordingly, respectfully following Hon ble Delhi High Court in case of Rajesh Projects (India) Pvt. Ltd vs. CIT (supra), we hold that, TDS needs to be deducted on lease rent. (ii) Interest paid to Yamuna Expressway Development Authority, amounting to ₹ 51,08,02,728/-: 9. It is observed that coordinate bench of this Tribunal (supra) held that, payment of interest to YIEDA is covered by decision of Hon ble Allahabad High Court in case of CIT vs Canara Bank, reported in 386 ITR 504, wherein it has been held that, NOIDA is a Corporation established by Uttar Pradesh Industrial Area Development Act 1976(YIEDA), and therefore assessee was entitled to exemption of payment of tax at source under section 194A of the Act. This Tribunal held that YIEDA also constitute an Authority under State Act, and therefore, is covered by above referred decision of Hon ble Allahabad High Court. However, in our considered opinion recently Hon ble Supreme Court in case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iguous and if from the provision the legislative intent is clear, the Court need not call into aid the other rules of construction of statutes. The other rules of construction are called into aid only when the legislative intent is not clear vide Hiralal Ratanlal v. STO, AIR 1973 SC 1034;' 53. A Division Bench of the Delhi High Court also in Agricultural Produce Market Committee v. CIT [2006] 156 ITR 286/[2007] 294 ITR 549 had occasion to consider Section 10(20) as amended w.e.f. 01.04.2003 where the High court in paragraph 8 has stated the following: '8. The most striking feature of the Explanation is that the same provides an exhaustive meaning to the expression local authority . The word means used in the Explanation leaves no scope for addition of any other entity as a 'local authority' to those enlisted in the Explanation. In other words, even if an entity constitutes a 'local authority' for purposes of the General Clauses Act, 1897 or for purposes of any other enactment for that matter, it would not be so construed for purposes of section 10(20) of the Act unless it answers the description of one of those entities enumerated in the Explan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). 10. Considering present legal position, insofar as definition of, who would constitute an Authority , in our considered opinion decision of Hon ble Allahabad High Court cannot be applied, due to ratio laid down by Hon ble Supreme Court in case of New Okhla Industrial Development Authority vs CIT (supra). 11. Accordingly, respectfully following ratio laid down by Hon ble Supreme Court in case of New Okhla Industrial Development Authority vs CIT (supra), we hold that TDS needs to be deducted on interest paid to YEIDA. (iii) Bank guarantee commission amounting to ₹ 1,13,06,210/- 12. It is observed that Coordinate Bench of this Tribunal (supra) relying upon decision of Hon ble Delhi High Court in case of CIT vs. Living Media India Ltd., order dated 06/05/08, held that, bank guarantee commission cannot be subject to withholding of tax under section 194H of the Act, as it does not fall into clause (i) of Explanation to section 194H and further that assessee was not acting as an agent but on principle to principle basis. Further u/s 194A(2)(ii)(a) there is an exemption provided in respect of any payment made to any banking company to which any Banking regulation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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