TaxTMI 
TaxTMI 
2013 (5) TMI 276
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....urces u/s 194H. 2. The appellant craves leave to add, amend alter or forgo any ground (s) of appeal raised above either before or at the time of hearing of the appeal. 2. The brief facts of the case are that the assessee is engaged in distribution of mutual funds of various companies and is earning commission for the same from various mutual funds. The return of income for assessment year under consideration was filed on 23.9.2009. The case of the assessee was selected for scrutiny under CASS. During assessment proceedings, the Assessing Officer observed that assessee had earned gross commission of Rs.77,01,033/- from various mutual fund companies and had paid Rs.69,28,562/- to various persons as sub broking commission, the detail of whic....
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....e of buying or selling of goods or in relation to any transaction relating to any asset, valuable article or thin, not being securities, it is evident that as per the above section 194H of the IT Act, 1961, no TDS is to be deducted from commission or brokerage paid for procuring the business of securities. As a result, neither the TDS of the assessee has been deducted by the different mutual funds nor the assessee has deducted TDS on the commission paid, for procuring the business of securities, to the sub brokers/agents involved. Further the assessee has stated vide its letter dated 4.11.2011 that tax is not deducted on sub brokerage paid by mutual fund distributor to its sub distributors/sub broker for distribution of units to the scheme....
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....tual funds. The Assessing Officer has not brought on record any facts to indicate that the sub brokerage has been paid for any other services other than that relating to mutual funds. The entire business of the appellant is relating to earning of brokerage from mutual funds and in the process payment is being made to sub brokers on account of brokerage. Section 2(H) of the Securities Contracts (Regulation) Act, 1956 which has been referred to in section 194H for the purpose of definition of securities specifically includes mutual funds under clause (id) which provides that securities includes units or any other instruments issued to the investors under any mutual funds scheme. In view of the findings above, and also keeping in view the judi....
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.... in I.T.A. No. 3663/Mum/2010. The Hon'ble Tribunal in the above noted case has held as under:- 5. Learned counsel for the assessee invites our attention to the fact that Section 2 (h) of the Securities Contracts (Regulations) Act, 1956, which has been referred to in Section 194 H for the purposes of definition of 'securities', specifically includes mutual funds under clause (id) which provides that "securities include - units or any other such instruments issued to the investors under any mutual fund scheme". When learned Departmental Representative was confronted with this fact, she did not have much to say - except placing her reliance on the order of the CIT(A). We are unable to see any merits in the stand taken by the CIT(A) and the ob....