THE COMMISSIONER OF INCOME TAX vs. M/S. ADISHWAR INDIA LTD

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 3RD DAY OF AUGUST, 2015

PRESENT

THE HON'BLE MR. JUSTICE VINEET SARAN

AND

THE HON’BLE MR. JUSTICE B. MANOHAR

ITA NO.96/2015

BETWEEN

NRUPATHUNGA ROAD, BANGALORE-560 001. ….APPELLANTS

(BY SRI K.V.ARAVIND, ADV.,)

AND

M/S.ADISHWAR INDIA LTD. NO.140, 11TH CROSS, I MAIN, 2ND STAGE, WEST OF CHORD ROAD BANGALORE-560 086 PAN:AABCA 4663P …RESPONDENT

THIS ITA IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED:21.11.2014 PASSED IN

ITA NO.1506/BANG/2013, FOR THE ASSESSMENT YEAR 2010-2011 PRAYING TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE; II. ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME-TAX APPELLATE TRIBUNAL, BANGALORE, IN ITA NO.1506/BANG/2013 DATED 21.11.2014 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-11(1), BANGALORE.

THIS ITA COMING ON FOR ADMISSION THIS DAY, VINEET SARAN J. DELIVERED THE FOLLOWING:

JUDGMENT

This is an appeal filed by the revenue challenging the order of the ITAT whereby the fee charged by the Bank for use of credit cards has been treated as a commission paid by the assessee on which TDS was not deducted by the assessee and hence the disallowance of expenditure under Section 40(a)(ia) of the Income Tax Act, 1961 (for short ‘the Act’) was made.

The Division Bench of Delhi High Court also in the case of Commissioner of Income Tax –vs- JDS Apparels Private Limited (2015) 370 ITR 454 held that the amount retained by the bank is a fee charged by them for having rendered the banking services and cannot be treated as a commission or brokerage paid in course of use of any services by a person acting on behalf of another for buying or selling of goods.

As such, we are of the opinion that no substantial question of law arises for determination by this Court. The appeal is accordingly dismissed.

Sd/-

JUDGE

Sd/-

JUDGE