TaxTMI 
TaxTMI 
2019 (9) TMI 484
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....by A.O has raised before us the following effective grounds of appeal: "1. Whether on the facts, in the circumstances of the case and as per law, the ld. CIT(A) has erred in directing to delete the disallowance u/s 40(a)(ia) rws 194J in respect of Çarriage fees/Placement fees'and failing to appreciate that the payments made for use of 'process'are 'royalty'as per Explanation 6 to section 9(1)(vi) hence such payments are coverd u/s 194J of the Income-tax Act, 1961. 2. Whether on the facts, in the circumstances of the case and as per law, the ld. CIT(A) has erred in directing to delete the disallowance u/s 40(a)(ia) rws 194J of Çarriage fees/Channel Placement fees' whereas the jurisdictional ITAT Mumbai 'L' ben....
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....ed by the A.O that the distribution expenses mainly comprised of carriage expenses i.e expenses that were incurred by the assessee for placing the channel on prime band for the sole purpose of getting better viewership, better TRP and maximizing of its revenue. The A.O being of the view that the carriage expenses incurred by the assessee fell within the realm of the definition of "Royalty" as envisaged in Sec. 9(1)(vi) of the IT Act, therefore, the assessee which was obligated to deduct tax at source on the said amount under Sec. 194J had wrongly deducted the same under Sec. 194C of the IT Act. On the basis of his aforesaid deliberations the A.O disallowed the amount of Rs. 11,87,93,600/- under Sec. 40(a)(ia) of the I.T Act. 4. Aggrieved....
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....(for short 'D.R') relied on the order passed by the A.O. 6. We have heard the Ld. D.R, perused the orders of the lower authorities and the material available on record. Our indulgence in the present appeal has been sought by the revenue for adjudicating as to whether the CIT(A) was right in law and facts of the case in concluding that as the assessee was not liable for deduction of tax at source on the channel placement fees under Sec.194J of the Act and had rightly subjected the same for deduction under Sec.194C, therefore, no disallowance of the same was called for in its hands under Sec. 40(a)(ia) of the IT Act. 7. We have deliberated at length on the issue under consideration and are of the considered view that the issue involved ....
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.... retrospective effect from 1976, therefore, the assessee could not have contemplated the said retrospective amendment at the time he had made the payment after subjecting the same to deduction of tax at source under Sec. 194C. The Hon'ble High Court while upholding the view taken by the Tribunal that as the channel placement fees was rightly subjected to deduction of tax at source by the assessee under Sec.194C and not Sec. 194J of the IT Act, therefore, no disallowance of the said expenditure was called for under Sec. 40(a)(i) of the Act in the hands of the assessee, had observed as under: "(d) We find that view taken by the impugned order dated 9th July, 2014 of the Tribunal that a party cannot be called upon to perform an imposs....