2017 (2) TMI 1003

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....allowance of Rs. 65,00,000/- made on account of non-deduction of tax (TDS), by holding that the said payment is not towards rental expenses and the provisions of Section 194 I of the Act, which provides for TDS on payment of rent, are not applicable? (ii) Whether on the facts and circumstances of the case, the finding of the Tribunal is perverse, contrary to the record and untenable in the eye of law? 2. Brief facts of the case are that the assessee firm is engaged in this business of purchase and sales of shares and is also engaged in films business. The assessee has filed the return of income on 31/7/2007 declaring NIL income. However, subsequently the case was selected for compulsory scrutiny and notice under Section 143(2) w....

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....s. Show Time Entertainment Pvt. Ltd. nor any payment was made by the assessee to the first party. It will be useful to mention here that even the AO at page 4 of his order acknowledges this aspect in the following manner:- "Gross collection of Rs. 80,59,051/- was made by the Cinema Hall i.e. Space-1,2,3 for the period from 01.04.2006 to 31.05.2006 and after keeping a sum of Rs. 65,00,000/- towards the provisions of para 2 and 5 of the agreement, a sum of Rs. 15,59,051/- paid to the assessee by the Cinema Hall, which the assessee has shown as income from film business under the head of the income from other sources. Thus, in the computation of the income also, assessee has treated this income from the business of films." 14....

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....ct to the sharing of proceedings of film between film distributors and film exhibitor owning a cinema theatre, are not attracted to such payment. We find that the above said circular squarely applicable to the facts and circumstances of the case. In fact, in the present case assured and guaranteed return by the assessee was given to the cinema owner is case of exhibiting of films by the cinema owner. There is no letting out of the cinema hall, plant and machinery, furniture and fixture for exhibition of films. We feel that the dominant and prime intention of the parties entered into agreement to conduct business and to give comfort level by the assessee to the cinema owner. The day to day maintenance and running of commercial activities rem....