SANAT M DALAL SECURITIES P.LTD,MUMBAI vs. CIT(A)-14, MUMBAI
In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal held that transaction charges paid to the stock exchange are for providing facilities and not fees for technical services. Therefore, no tax deduction at source was required under Section 194J.
What were the facts?
The assessee paid transaction charges to the stock exchange and did not deduct tax at source. The Assessing Officer treated the assessee as in default for non-deduction of TDS under Section 194J.
What were the issues?
Whether transaction charges paid to the stock exchange are liable for TDS under Section 194J as fees for technical services.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
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- VLS Finance Limited & Another v. Commissioner of Income Tax & Another77 citing384 ITR 1 · 2016 · SC · Read judgment
Income Tax Appellate Tribunal, “E” Bench, Mumbai
Before: Shri B.R. Baskaran (AM)& Ramlal Negi (JM)
O R D E R Per B.R. Baskaran (AM) :-
The assessee has filed this appeal challenging the order dated 24.6.2016 passed by learned CIT(A)-14, Mumbai for A.Y. 2008-09 confirming the order passed by the Assessing Officer u/s. 201(1) and 201(1A) of the Income Tax Act.
We have heard the parties and perused the record. The Assessing Officer treated the assessee as assessee in default since the assessee did not deduct tax at source on the transaction charges paid to the stock exchange. The Assessing Officer took the view that the assessee should have deducted tax at source u/s. 194J of the Act on the amount of ` 4,37,645/- paid by the assessee to the stock exchange. Accordingly the Assessing Officer raised the demand u/s. 201(1) of the Act and levied interest u/s. 201(1A) of the Act. Learned CIT(A) also confirmed the same.
2 Sanat M. Dalal Securities P. Ltd.
We have noticed that the above said issue has since been decided by Hon'ble Supreme Court in favour of the assessee in the case of CIT Vs. Kotak Securities Ltd. (2016) 384 ITR 1, wherein it was held that the transaction charges paid to the stock exchange is for providing facility and it is not fees for technical services and hence no tax is required to be deducted u/s. 194J of the Act. Accordingly, following the decision rendered by Hon'ble Supreme Court(supra), we set aside the order passed by learned CIT(A) and direct the Assessing Officer to delete the impugned demand raised upon the assessee u/s. 201(1) & 201(1A) of the Act.
In the result, appeal filed by the assessee is allowed.
Order has been pronounced in the Court on 3.10.2016
More judgments on Section 201(1)
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- Tmw Fintech Private Limited, Mumbai vs Circle 14(1)(2), MumbaiITA 30/MUM/2026[2019-20]Status: Disposed14 Oct 2026AY 2019-20
- State Bank of India, Guna vs Income Tax Officer, TDS, GwaliorITA 432/AGR/2026[2017-18]Status: Disposed7 Oct 2026AY 2017-18
- State Bank of India Regional Business… vs Income Tax Officer, TDS Gwalior, GwaliorITA 420/AGR/2026[2016-17]Status: Disposed7 Oct 2026AY 2016-17
- State Bank of India, Tikamgarh vs Income Tax Officer, TDS ITO (TDS) Gwalior…ITA 411/AGR/2026[2017-18]Status: Disposed7 Oct 2026AY 2017-18
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