TaxTMI 
TaxTMI 
2005 (11) TMI 366
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....to the association and association in turn pays the same to the artists. The Assessing Officer held that tax has not deducted at the time of making the payment in accordance with section 194J. As the tax was not deducted assessee is liable to pay interest at the rate of 18 per cent per annum on the amount of such tax from the date on which tax deducted on the date of the order. Since the assessee has not submitted the dates of the payments, the period of default was calculated, by considering that the payment have been made throughout the financial year, the period of default took as commenced from the middle of the financial year, i.e., 1-10-1999. The default period was taken as 16 months and the interest under section 201(1A) was calculated at Rs. 2,07,967 and the penalty proceedings under section 221 were also initiated separately. 4. There was a survey action under section 133A at the premises of the association on 15-11-2000. During this survey action, it was noticed that tax has not been deducted out of the payments made to the artists, as required under section 194J; he held that the services rendered by the artists are covered by the definition of "professional services"....
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....be also not levied. In this regard, also submit the dates of payment to these persons so that the interest be calculated correctly. Please also submit the details of all the payment made to various persons during financial year 1999-2000, wherein the total payment credit exceed Rs. 20,000 to a particular person, so that necessary action for not deducting the taxes as required by section 194J. Please also state whether, the producers, other than individual HUF while making payment to the association are deducting tax, if yes, please submit the name and address of such producers. If, the association is getting payments without deduction of tax, then the names and address of such producers be submitted, for the period 1-4-2000 to till date. Please submit the copy of latest return of income filed, along with profit and loss account and balance sheet. Attention is also drawn to letter dated 16-1-2001 issued by this office for which, a reply is still awaited. The reply to this letter should reach this office on or before 19-2-2001, otherwise necessary action as per the provisions of Income-tax Act, 1961 will be taken". 6. There was no response. The Assessing Officer held a....
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.... Representative supported the order of the Assessing Officer and submitted that the services rendered by stunt artists are covered by professional services as contemplated under Rule 4F as notified for the purpose of section 44AA. An artist means any person engaged in his professional capacity in the production of a cinematograph film whether produced by him or by any other person. There is no doubt, assessee is a person engaged in his professional capacity in the production of cinematograph film as an actor. An actor is an artist. Actor included stunt actor. It is the assessee who made the payment to the artist or to its members. Hence, the DR submitted assessee is a defaulter under section 201(1). Hence, he submitted the order of the Assessing Officer may be restored. 10. On the other hand, the learned Counsel for the assessee submitted that assessee is a voluntary organization, which came into existence for ameliorating the exploitation of the stunt artists. The assessee is not making any payment to the artists/stunt actor. There is no agreement between the assessee and the recipient. The assessee is not responsible for making payments. The artist has not rendered any service....
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....rvices rendered by stunt artist is undoubtedly a professional service. 14. But the question is whether the assessee as the name itself indicates a voluntary organization formed to protect the interest of its members. The Association safeguards the rights of the members and the payments received from producers/film makers routed through the association to the artists who are its members. There is no agreement between the artists and the assessee. The agreement if any is between the producer/film makers and the services by the artists are rendered to them directly but the payment is made through the assessee to safeguard the interest of the recipient i.e., its members/stunt artists. Written submission of the assessee which is reproduced vide page 2 of the para 5 of the order of CIT(A) mentions that the association had been in existence since 1959 and it was formed primarily because of producers/film makers never used to make full payments to the stunt artists or never used to make the payments in-time. With the formation of the association, not only the payments made on time and the rate at which the payment is fixed by the association (in consultation with the producers guild). H....