TaxTMI 
TaxTMI 
2010 (10) TMI 904
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....Act') vide his order dated 09-02-2007 for assessment year 2006-07. 2. The only issue in this appeal of assessee is against the order of CIT(A) confirming the action of Assessing Officer in considering the assessee in default on account of non-deduction of TDS on payment made to Ahmedabad Urban Development Authority (AUDA for short) for the right to advertise by exhibiting hoardings & kiosks on its land. The following are the grounds raised by assessee :- "1. The ld. CIT(A)X, Ahmedabad erred in law and on facts in invoking the provisions of section 194-I of the IT Act with respect to payments .made to AUDA without considering the facts that the licence agreement entered with the said authority is not for the use of any land, building a....
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....said payment under section 194-I of the Act and declared by the assessee in default under section 201(1) of the Act for the sum of Rs. 19,09,894 and interest of Rs. 3,67,336 under section 201(1A) aggregating to Rs. 22,77,230 by Assessing Officer vide order dated 9-2-2007. Aggrieved, assessee preferred appeal before CIT(A). The CIT(A) confirmed the action of the Assessing Officer by giving following findings in para 5.7 of his appellate order :- "5. I have carefully considered the submissions made and I have also gone through the order of the Assessing Officer. The basic objection of the assessee is that the appellant had not used any land and there is no agreement or lease etc. so that provisions of section 194-I could be attracted. They....
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....ts to AUDA and other authorities for the purpose of using their place for putting up advertisement boards and as such there was liability to deduct and pay tax. As the same has not been done and as discussed detailed by he Assessing Officer, the assessee is liable to pay the tax as well as interest and the order of Assessing Officer does not call for any interference." Aggrieved, assessee preferred second appeal before Tribunal. 4. Before us, the assessee stated that the provisions of section 194-I were not attracted because the contract with AUDA was for putting up sign boards on Unipole which were to be at least 2.7 mt. above the ground level as stated in clause-10 of the acceptance letter dated 8-4-2005 of AUDA and structures were ....
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....ly the acquisition of right to display by the assessee from AUDA which is not an advertisement agreement under section 194C. In any view of the matter, both the lower authorities have given a clear finding that AUDA is assessed to tax and filing its return of income and therefore, no demand under section 201(1) could be raised upon the assessee. Reliance is place on the decision of Hon'ble Supreme Court in the case of Hindustan Coca Cola Beverage (P.) Ltd. v. CIT [2007] 293 ITR 226 wherein the Hon'ble Apex Court following CBDT's Circular dated 29-1-1997 has held that when payee has already paid the taxes due on the payments received by the assessee, no tax could be recovered once again from the deductor assessee. The Assessing Officer....
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....r, below mentioned order is passed to affix total 60 (sixty) boards in favour of Het Graphics from Shyama Prasad Mukherjee Overbridge to Naranpura AEC Junction (Sola Road) on the 132 ft Ring Road, Such boards have to affix with below mentioned Terms. TERMS :- (1)The time limit of this permission is five years from the date of allotment then after 45 days it will be started and continue for five years. Permission Holder cannot cancelled the permission between such time limit. (2)From the Shyama Prasad Mukharjee Overbridge to Naranpura, A.E. Junction (Sola Road Junction) upto this 132 ft Ring road with the prior permission from Authority maximum 60 (Sixty) Boards of advertisement have to affix. (3)...... (4)As per granted by th....
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....s belonging to others and it is therefore, clear that what is being used by the assessee in the case before Tribunal is only the right of displaying the advertisement. In other words, the use of hoarding site is to facilitate display of advertisement. The Tribunal further held that the amount is paid for commercial exploitation of display rights and not for using hoarding sites under any lease, sub-lease, tenancy, etc and section 194-I is more appropriately applicable to a case where rent is paid in consideration for the use of any land or building, etc. under any lease, sub-lease, tenancy, etc. In other words, there should be a live link between payment of compensation known as rent and the use of land or building and this live link is by ....