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TMI Blog2015 (1) TMI 1422X X X X Extracts X X X X X X X X Extracts X X X X ..... in the meaning of section 194J of the Income-tax Act, 1961. (ii) The Ld. CIT(A) has erred on facts and in law in not correctly appreciating that for placing the channel of broadcaster in prime band, for which placement charges are paid, application of human mind by a technical person is essential and the same cannot be done merely by mechanical means. Therefore, the payment on account of placement charges is in nature of technical fee within the meaning of section 194J and section 194C has no application to the facts of the case (iii) Without prejudice to the first two grounds of appeals as above, since providing the services of preferred channel placement on account of which placement charges are paid requires use of industrial, commercial or scientific equipment within the meaning of sub clause (iva) to Explanation to sub clause (vi) of section 9(1) of the Income-tax Act, 1961, the said payment is payment on account of royalty and therefore, section 194J is clearly applicable. Accordingly, CIT(A) has erred in law and on facts in not appreciating this factual and legal position and in giving relief to the assessee. (iv) CIT(A) has further erred on facts and in law in not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acing their channels on a particular frequency or bandwidth. Thus these charges are paid to put the channel in prime frequency/band so that viewership as well as quality of channels can be increased. Placing a particular channel on a particular frequency is integral part of broadcasting process and, therefore, the fee/charges paid by assessee are in the nature of royalty or fee for technical services as per section 9(1)(vi) of the income tax Act. The fee is paid for placing the channel in a particular prime band or bandwidth involves the process of transmission and, therefore, the provisions of section 194J are applicable on such payment. He has relied upon the orders of authorities below. 5. On the other hand, the Ld. Counsel has submitted that the issue is covered in favour of the assessee by the decisions of this Tribunal in the case of ACIT Vs. UTV Entertainment Television Ltd. vide order dated 29.10.2014 and further in the case of ACIT Vs. M/s. NGC Networks (I) Pvt. Ltd. dated 09.07.2014, wherein the Tribunal has held that the fee for placement of channel does not fall u/s 194J but the same falls u/s 194C. Hence the CIT(A) has rightly held that the TDS in respect of the paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ute the services in India to various customers and users of the service'. Further, the agreement refers to the assessee subscriber as a party, which is desirous to subscribe for and receive the telecast signals of the service from the company in order to further distribute the same to the customers). 16. From the recital of the agreement "Itself, it is clear that the service that the assessee subscriber is availing is the receipt of 'telecasting signals' from the licensor or the company. The expression 'service' has also been referred to mean the TV channel which is dealt with by the licensor or the company. Therefore, what the assessee has transacted for with the licensor or company certainly includes within its ambit broadcasting and telecasting facility. The essence of the contract is to obtain broadcasting and telecasting of TV channels and thereafter its distribution amongst ultimate customers through the cable network of the assessee. 17. Another plea of the assessee/subscriber was that the licensor or the person to whom the assessee is making payment by itself does not do the work of broadcasting' and telecasting and is therefore outside the pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... troduced simultaneously with section 194J, is very specific in its application to not only broadcasting and telecasting but also include "production of programmes for such broadcasting and telecasting". If, on the same date, two provisions are introduced in the Act, one specific to the activity sought to be taxed and the other in more general terms, resort must be had to the specific provision which manifests the intention of the Legislature. It is not, therefore, possible to accept the contention of the Revenue that programmes produced for television, including "commissioned programmes", will fall outside the realm of section 194C, Explanation III of the Act. We find no infirmity in the view taken by the Income-tax Appellate Tribunal which we hereby affirm. 9. The Hon'ble Delhi High Court has made it clear that when two provisions are simultaneously introduced in the Act., one is specific and another is more general in terms then the resort must be to the specific provision. Therefore, when the work of broadcasting and telecasting of the programmes specifically falls under the ambit of provisions of section 194C, then in view of the decision of Hon'ble Delhi High Court (supra), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e deciding this issue has relied upon the decision of this Tribunal in the case of ACIT Vs. Manish Dutt (12 taxmann.com 50), wherein, the Tribunal held in para 8 to 12 as under:- "8. We have already seen that the assessee is engaged in the business of doing dubbing work. The assessee was having his own studio comprising of various dubbing equipments and professional artist to carryon the work of dubbing. Whenever the assessee's own studio could not be used the assessee used to give the job of carrying out dubbing work to other dubbing studios. In respect of one such work entrusted by the assessee to another studio by name Ninety Degrees the assessee had made a payment of Rs. 1,60,000. According to the assessee, the payment was made to a sub-contractor for execution of a contract and, therefore, in terms of section 194C the assessee deducted tax at source at 2 per cent. The Assessing Officer however, was of the view that the payment in question was rent paid by the assessee and, therefore, in terms of section 194-1 of the Act the assessee ought to have deducted tax at source at 20 per cent. Since the assessee did not deduct tax at source at the proper rate the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stances we are of the view that the provisions of section 194C were applicable and the assessee has rightly deducted tax at source at 2 per cent treating the payment as a payment to sub-contractor for carrying out a work. We do not find any ground to interfere with the order of CIT(A). Consequently ground No.2 raised by the revenue is dismissed. 13. No contrary decision has been referred or produced before us. Therefore, following the decision of this Tribunal, we do not find any error or illegality in the order of CIT(A) qua this issue." 10. Following the earlier orders of this Tribunal, this issue is decided against the revenue and in favour of the assessee. 11. Now we take up the Cross Objections filed by the assessee wherein the assessee has raised common grounds as under:- "1. On the facts and in the circumstances of the case, the learned Commissioner of Income- tax (Appeals) - 14, Mumbai, erred in not adjudicating on the following contentions raised by the Appellant: "(i) The learned TDS officer erred in holding that the Appellant is liable to pay principal amount of tax under section 201(1) of the Income tax Act, 1961 without verifying the payment of tax on such ..... X X X X Extracts X X X X X X X X Extracts X X X X
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