M/S GOOD MEDIA NEWS (P) LTD.,SHIMLA vs. PR. COMMISSIONER OF INCOME TAX, SHIMLA

PDF · subscribers
ITA 44/CHANDI/2016Status: DisposedITAT Chandigarh06 August 2019AY 2012-136 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the assessee's case facts were identical to the jurisdictional High Court's decision, which mandated TDS deduction. Therefore, the Assessing Officer's assessment was erroneous and prejudicial to revenue.

What were the facts?

The assessee debited a large sum for 'Pay Channel subscription'. The PCIT initiated revision proceedings, believing the assessee failed to deduct TDS on payments to TV channels as required by Section 194C. The Assessing Officer had accepted the assessee's plea based on a different ITAT ruling, ignoring a jurisdictional High Court decision.

What were the issues?

Whether the payments for 'Pay Channel subscription' were liable for TDS under Section 194C, and if the Assessing Officer's acceptance of the assessee's plea was erroneous and prejudicial to revenue.

Which sections of the Income-tax Act were involved?

Section 194C,Section 40A(3),Section 40A(ia)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

आदेश/Order

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee contesting the validity of the order dated 30.12.2015 of the Ld. Principal Commissioner of Income Tax, Shimla [hereinafter referred to as ‘PCIT’] exercising his revision jurisdiction u/s 263 of the Income Tax Act, 1961 (in short 'the Act').

2.

The brief facts of the case are that the Ld. CIT(A), from the record of the case, noticed that the assessee had debited a sum of Rs.

ITA No. 44-c-2016 M/s Good Media News (P) Ltd, Shimla. 2 6,36,19,146/- under the head ‘Pay Channel subscription’ in the profit &

loss Account. The Ld. PCIT was of the view that as per the provisions

of section 194C Explanation III of the Act, the assessee was required

to deduct tax at source on the payments made to various TV Channels

which was not done by the assessee. He observed that though the

Assessing Officer had raised a query in this respect to the assessee,

however, the Assessing Officer without proper application of mind

accepted the plea of the assessee that it was not liable to deduct tax at

source on the basis of the decision of the Agra Bench of the ITAT in

‘ITO vs Balkrishan Gupta’ 36 Taxman 518 (2013). The Ld. PCIT

observed that the Assessing Officer ignored the decision of the Hon'ble

jurisdictional High Court of Punjab & Haryana in the case of

‘Kurukshetra Darpans (P) Ltd vs CIT’ 217 CTR 326 dated 3.3.2008

which was applicable to the facts of the case of the assessee, wherein, it

had been held that the payments made to the licensor for obtaining TV

signals for cable TV Network was liable for TDS u/s 194C of the Act.

The Ld. PCIT further observed that the Assessing Officer had also

ignored the observations made by the Auditor in his report, wherein, it

was reported that the assessee had not given any certificate to the effect

that all the payments covered u/s 40A(3) had been made on account of

account payee cheques. The Ld. PCIT held that when the decision of

the Hon'ble jurisdictional High Court was available, the reliance of the

Assessing Officer on the Agra Bench of the Tribunal was wrong and,

ITA No. 44-c-2016 M/s Good Media News (P) Ltd, Shimla. 3 thus, an error had occurred in the assessment order passed by the

Assessing Officer and that the assessment order passed by the Assessing

Officer was also erroneous and prejudicial to the interest of Revenue.

He, accordingly, set aside the assessment order dated 26.11.2014

passed by the Assessing Officer and directed the Assessing Officer to

pass assessment order afresh.

3.

The Ld. Counsel for the assessee before us has submitted that the

Assessing Officer had duly applied his mind as he had raised query

regarding the non-deduction of TDS which was replied by the assessee.

That at the time of assessment, the Assessing Officer had verified the

bills and vouchers etc. and did not find any expenditure liable for

disallowance u/s 40A(3) of the Act. That even the decision of the

Hon'ble Punjab & Haryana High Court in the case of ‘Kurukshetra

Darpans (P) Ltd vs CIT’ (supra) was also discussed in the decision of

the Agra Bench of the Tribunal in the case of ‘ITO vs Balkrishan Gupta’

(supra), therefore, it cannot be said that the Assessing Officer had not

applied his mind. Further, that the view taken by the Assessing Officer

was one of the possible views, hence, the order cannot be said to be

erroneous.

4.

On the other hand, the Ld. DR has relied on the order of the Ld.

PCIT.

ITA No. 44-c-2016 M/s Good Media News (P) Ltd, Shimla. 4

5.

We have considered the rival submissions and have also gone

through the record. After going through the decision of the Agra Bench

of the Tribunal in ‘ITO vs Balkrishan Gupta’ (supra), we find that the

facts of the said case were different from the facts in the case of before

‘Kurukshetra Darpans (P) Ltd vs CIT’ (supra). That the issue before

the Hon’ble Punjab & Haryana High Court in the case of ‘Kurukeshtra

Darpans (P) Ltd vs CIT’ (supra) was a case of Cable Operator engaged

in procuring and giving signals to the customers, whereas, the issue in

the case of ‘ITO vs Balkrishan Gupta’ (supra) was giving packed signals

received from channels i.e. Star TV & others to the cable operators

without modification. We, therefore, raised a specific query to the Ld.

Counsel for the assessee as to the facts of the case of the assessee were

covered by the Agra Bench of the Tribunal in ‘ITO vs Balkrishan Gupta’

(supra) or facts of the case were identical to that of the case of

‘Kurukeshtra Darpans (P) Ltd vs CIT’ (supra), decided by the Hon'ble

Punjab & Haryana High Court.

The Ld. Counsel for the assessee has been fair enough to admit

that the assessee in this case is a cable operator and that the facts of the

case of the assessee were identical to that of the ‘Kurukshetra Darpans

(P) Ltd vs CIT’ (supra) decided by Hon'ble Punjab & Haryana High

Court . In view of this, the decision of the Hon’ble Punjab & Haryana

ITA No. 44-c-2016 M/s Good Media News (P) Ltd, Shimla. 5 High Court (supra) is applicable in the case of the assessee. There was

a wrong assumption of facts and law in this case by the Assessing

Officer because of which he did not make the disallowance u/s 40A(ia)

of the Act. It is also apparent that the Assessing Officer has also ignored

the observations made by the Auditor in his report that the assessee had

not given any certificate to the effect that all the payments covered u/s

40A(3) have been made by account payee cheques.

In view of this, we do not find any infirmity in the order of the Ld.

PCIT in holding that the order of the Assessing Officer was erroneous

and prejudicial to the interest of Revenue. We, therefore, do not find

any merit in this appeal of the assessee and the same is accordingly

dismissed.

In the result, the appeal filed by the assessee is dismissed.

Order pronounced in the Open Court on 06.08.2019.

Sd/- Sd/- (संजय गग� / SANJAY GARG) (एन. के. सैनी / N.K. SAINI) उपा�य� /Vice President �या�यकसद�य/ Judicial Member Dated : 06.08.2019 “आर.के.” आदेशक���त�ल�पअ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकरआयु�त/ CIT 4. आयकरआयु�त (अपील)/ The CIT(A) 5. �वभागीय��त�न�ध, आयकरअपील�यआ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड�फाईल/ Guard File

आदेशानुसार/ By order,

ITA No. 44-c-2016 M/s Good Media News (P) Ltd, Shimla.

6 सहायकपंजीकार/ Assistant Registrar

More judgments on Section 194C

All 2,696 judgments and leading authorities on Section 194C →

Recent GST High Court judgments

Search GST case law →