2018 (8) TMI 1810 - HC - Income Tax

Court Upholds Income Tax Classification Decision on Cable Operator Payments

The High Court dismissed the appeal challenging the Income Tax Appellate Tribunal's order on the classification of payments to cable operators. The Court ... TDS u/s 194C OR 194J - placement fees / carriage fees paid to cable operators / MSO / DTH Operators - payments for work contract OR fees for technical service u/s 194J - Tribunal held the payments for work contract covered u/s 194C and not fees for technical service u/s 194J - HELD THAT:- The impugned order of the Tribunal relied upon the order of its coordinate bench in the case of Asst. Commissioner of Income Tax (TDS) Vs. UTV Entertainment Television Ltd., [2017 (11) TMI 915 - BOMBAY HIGH COURT] relating to AY 2008-09 to 2011-12, while dismissing the Revenue's appeal. The Revenue does not point out any distinguishing feature in fact or in law in this case from that in the UTV Entertainment Television Ltd. (supra), which would warrant a different view. For the reasons stated in our order dated in Commissioner of Income Tax Vs. UTV Entertainment Television Ltd. (supra) the question as proposed does not give rise to any substantial question of law. Thus, not entertained. Appeal is dismissed. Issues:Challenge to the order of the Income Tax Appellate Tribunal regarding the classification of payments made to cable operators as work contract under section 194C instead of fees for technical service under section 194J.Analysis:The High Court dealt with an appeal challenging the Tribunal's order related to Assessment Years 2008-09 and 2009-10. The specific issue raised was whether the payments made to cable operators, MSO, and DTH Operators should be classified as work contract under section 194C or fees for technical service under section 194J. The appellant argued that the services received were technical in nature, questioning the Tribunal's classification. The Revenue acknowledged that the Tribunal relied on a previous order related to a similar case, where the Revenue's appeals were dismissed by the High Court in 2017. The Revenue failed to present any distinguishing features in the current case that would warrant a different view from the previous judgment.The High Court, based on its previous order related to a similar case, concluded that the question raised did not give rise to any substantial question of law. Therefore, the appeal was dismissed, and no costs were awarded. The Court's decision was influenced by the lack of differentiation between the current case and the precedent set by the earlier judgment, where the classification of payments to cable operators was established as work contract under section 194C. The judgment highlighted the importance of consistency in legal interpretation and application, especially when dealing with similar factual and legal circumstances.