2016 (7) TMI 18

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....to the bank for using credit card facilities. Learned CIT(A) deleted the addition by following the decision rendered by the Coordinate Bench of the ITAT in the case of Jet Airways (India) Ltd. (ITA Nos. 7439, 7440 & 7441/Mum/2010 dated 17.7.2013). 3. Aggrieved, the Revenue filed this appeal before us. 4. We have heard the parties and perused the record. We have already noticed that learned CIT(A) has deleted the demand raised upon the assessee by following the decision rendered by the Tribunal. For the sake of convenience we extract below observations made by the learned CIT(A) :- 5.1 I have considered the averments made in the impugned order and also the written as well as oral submissions of the learned A.R. of the appellant and also t....

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....of Rs. 16,34,000 on the following reasoning- " "9.8 On going through the nature of transactions, I find considerable merit in the contention of the appellant that commission paid to the credit card companies cannot be considered as falling within the purview of S.194H. Even though the definition of the term "commission or brokerage" used in the said section is an inclusive definition, it is clear that the liability to make TDS under the said section arises only when a person acts on behalf of another person. In the case of commission retained by the credit card companies however, it cannot be said that the bank acts on behalf of the merchant establishment or e . A . 1 . 0 7 4 1 , F J a l r M A U I V 7 1 - 4 - 2 S . , L*11 that even the m....

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....no 7D5 is required to be deducted on the fees charged by the bank on credit card transactions." 5.3 Further, it is significant to mention here that similar issue as to applicability of TDS provisions on credit card collection charges arose for adjudication in the appellant's own case before the ld.CIT(A)-17, Mumbai (having jurisdiction over appeals against regular assessments of the appellant) wherein it is seen that the issue in dispute on similar set of facts has been decided in favour of the appellant, thereby holding that the provisions of Section 194H of the Act do not apply to credit card collection charges. For ease of reference, the concluding paragraph of the above referred order dated 01.10.2013 passed by the learned CIT(A)-....

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....that assessee. For ease of reference, the concluding paragraph of the above referred order of the learned CIT(A)-14, Mumbai is reproduced hereunder; 3.4 The facts remaining the same, respectfully following the decision of the Hon'ble ITAT, cited supra, it is held that no TDS is payable on credit card charges u/s.194H. Therefore, it is held that the assessee was not required to deduct TDS u/s.194H. Hence the assessee cannot be considered to be assessee in default u/s.201(1). Therefore, the addition made u/s 201(1)/201(1A) of Rs. 2,37,93,967/- stands deleted" 5.5 Having regard to all the above judicial pronouncements of different Benches of Hon'ble Tribunal, including that of the jurisdictional ITAT, and also decision of the Id.CIT(A....