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Income Tax Appellate Tribunal, “SMC”, BENCH MUMBAI
Before: SHRI R.C.SHARMA
O R D E R These are the appeals filed by the assessee against the order of CIT(A)-Mumbai, for the assessment year 2010-2011& 2011-2012, in the matter of order passed u/s.201(1)/201(1A) of the I.T.Act.
There is a marginal delay of 14 days in filing both the appeals. After going through the reasons for the delay, we found the same are satisfactorily explained, therefore, in the interest of substantial justice, we condone the delay and appeals were heard on merits.
Rival contentions have been heard and record perused. Facts in brief are that the assessee company is a member of Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). The assessee company is dealing in the business of share broking and is also a 2 Depository Participant with NSDL. During the year under reference, the assessee company has paid the tax deducted at source on Transaction charges @2% (i.e. 194C). During the course of assessment the assessee company had filed the TDS Certificate of Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) along with NSE Bill and BSE Vallan Ledger. However, the assessing officer has taxed TDS on transaction charges @10% (i.e. 194J).
By the impugned order the CIT(A) confirmed the action of AO following the decision of Hon’ble Bombay High Court in the case of Kotak Securities Ltd. 340 ITR 333.
At the outset, ld. AR placed the order of Hon’ble Supreme Court wherein decision of Hon’ble Bombay High Court in the case of Kotak Securities Ltd. was reversed and it was held that transaction tax are not liable for deduction of tax u/s.115J.
We have considered rival contentions and found that the issue is squarely covered by the decision of Hon’ble Supreme Court in the case of Kotak Securities Ltd. 383 ITR 1, wherein the Hon’ble Supreme Court held that transaction charges paid to stock exchange for facility is not a fee for technical services, therefore, not liable to deduction of tax on such payments u/s.194J. Respectfully following the decision of Hon’ble Supreme Court in the case of Kotak Securities Ltd. (supra), we do not find any merit in the action of lower authorities for holding assessee in default for non-deduction of tax at source u/s.194J of the I.T.Act.