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Facts
The assessee deducted TDS at 2% under Section 194C for payments made for composing and DTP work. The AO treated these payments as technical services and demanded TDS under Section 194J at 10%, also levying interest for short deduction.
Held
The Tribunal held that the composing and DTP services are not technical services as defined under Section 194J of the Act. Therefore, the assessee was correct in deducting TDS at 2% under Section 194C.
Key Issues
Whether the payments for composing and DTP work fall under Section 194C (contractual payments) or Section 194J (technical services) of the Income Tax Act for TDS purposes.
Sections Cited
194C, 194J, 133A, 201(1A)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “A” BENCH, KOLKATA
Before: SHRI RAJESH KUMAR, AM & SHRIPRADIP KUMAR CHOUBEY, JM
These are the appeals preferred by the assessee against the order of the Commissioner of Income-tax (Appeals)(hereinafter referred to as the “Ld. CIT(A)”]even dated 31.01.2025 for the AY 2013-14., 2015-16 to 2018-19.
The issue involved in all the appeals is similar, therefore, these are clubbed together and disposed of by this consolidate order for the sake of brevity and convenience. First of all, we will take as lead case and facts are discussed in the following paras.
The only issue raised by the assessee in the ground of appeal is against the order of ld. CIT (A) confirming the action of the ld. AO in
The facts in brief are that a survey action u/s 133A of the Act was conducted in the office premises of the assessee at CG-84/80, Sector- II, Salt Lake, Kolkata-700091. During the course of survey proceedings, the ld. AO noticed that M/s Publishing Services Pvt. Ltd. has been paid an amount of ₹39,42,543/- as composing charges and assessee has accordingly, deducted TDS at the rate of 2% u/s 194C of the Act. The ld. AO during the course of survey confronted the assessee as to why the composing charges should not be treated as technical service and as to why the TDS at the rate of 10% u/s 194J should not be invoked. The assessee submitted that the payments were made to Publishing Services Pvt. ltd. under an agreement with the assessee towards composing services rendered to the assessee by the said publishing agency and are purely in the nature of contract and therefore TDS has been rightly deducted by the assessee u/s 194C of the Act, at the rate of 2%. The contentions of the assessee did not find favour with the AO , and he treated the assessee in default by holding that the Provisions of Section 194J of the Act, are applicable as the assessee is receiving technical services from said agency thereby raising total demand of ₹5,61,419/- including interest u/s 201 (1A) of the Act of ₹2,46,015/-.
In the appellate proceedings, the ld. CIT (A) simply affirmed the order of the ld. AO by dismissing the appeal of the assessee.
After hearing the rival contentions and perusing the materials available on record, we find that the assessee is engaged in the business of publishing of books mainly education books and sale thereof. For the purpose of composing and DTP work of the assessee
The issue raised in other appeals in to 583/KOL/2025 are similar to one as decided by us in ITA No. 579/KOL/2025. Accordingly, our decision would, mutatis mutandis, apply to these appeals of assessee in to 583/KOL/2025. Hence, the appeals of assessee are allowed.
In the result, the all the appeals of the assessee are allowed.
Order pronounced in the open court on 04.11.2025.