TaxTMI 
TaxTMI 
2025 (9) TMI 1681
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....17-18 in filing of these appeals before the tribunal. In its affidavit the assessee has pleaded that in this case the Ld.CIT(A) had passed a common order for assessment years 2015-16 to 2017-18 confirming, the orders of the Ld.AO passed u/s u/s 201 and 201(1A) of the Act and accordingly the assessee had contested the impugned order by filing a common appeal through Form-36 for all the three years vide ITA No.7830/Del/18 dated 07.12.2018. It was contended that there was no challenge to the impugned filing by the registry. However, during the course of hearing, the fact of joint filing was noticed and appellant was advised to file separate appeals. Consequently, appeals for AY-2016-17 and 2017-18 were delinked and appeals vide ITA nos.273/Del/2025 and 274/Del/2025 for AY-2016-17 & 2017-18 respectively were filed. All these activities contributed to the delay which was neither willful nor wanton. It is the case of the assessee that its act of joint filing is well recognized practice in filing of appeals before the tribunals and which has the support from Hon'ble High Courts as well as ITAT. Reference was invited to the decision of Hon'ble Bombay High Court in the case of BDA Limited a....
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....ses the transaction that a customer undertakes through its installed App with the assistance of payment Gateways (PG) companies. In continuance of its business, the assessee uses two payment gateways company namely CC Avenues and Zaaki payment services pvt ltd. During the course of survey, it was noted that payments made to CC Avenues and Zaaki payment services pvt ltd were not exposed to TDS. The Ld.AO held that the payments made by the assessee fell within the mischief of section 194H as commission payment and hence liable for deduction of TDS. Rejecting arguments of the assessee that RBI regulations, CBDT notification no.47 / 2016 dated 17.06.2016 support its case, the Ld.AO held the assessee to be in default. It was contended that a relationship of principal to agent existed between the assessee and CC Avenues and Zaaki payment services pvt ltd. Consequently, for AY-2015-16 the Ld.AO vide his order dated 19.03.2018 raised a demand u/s 201 and 201(1A) of Rs. 19,82,522/-. On identical analogy the Ld.AO raised demand for AY-2016-17 and 2017-18. Aggrieved, the assessee filed appeal before the Ld.CIT(A) who concurred with the findings of the Ld.AO and confirmed the demand raised by ....
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....mer is received by the assessee which subsequently gets transmitted to the PGs for processing. It is not a case where the PGs are directly dealing with any clients / customers of the assessee. The Ld.Counsel invited our attention to the RBI circular issued in March 2020 stipulating that PG companies are outsourcing partners and the ultimate responsibility for transaction always rests upon the main service provider or the e-wallet company. The Ld.Counsel argued that existence of a principal agency relationship is sina qua non for invocation of provisions of section 194H r.w.s. 201 / 201(1A). Reliance was placed upon the decision of Hon'ble Gujarat High Court in its decision in the case of Ahmadabad Stamp Vender Association 257 ITR 202. 8.0 In support of its contentions, the Ld.Counsel placed reliance upon a plethora of judicial pronouncements as supporting its case. It was argued that Hon'ble Apex Court in the case of Bharti Cellular Limited has also held that principal agency relationship is sina qua non for invocation of provisions of section 194H r.w.s. 201 / 201(1A). Thus, reference was invited to para 6 of the order. "....6. It is settled by a series of judgments of....
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....e work he performs for the principal. 9. At this stage, three other relevant aspects/considerations should be noted. First is the difference between 'power' and 'authority'. The two terms though connected, are not synonymous. Authority refers to a factual position, that is, the terms of contract between the two parties. The power of the agent however, is not, strictly speaking, conferred by the contract or by the principal but by the law of agency. When a person gives authority to another person to do the acts which bring the law of agency into play, then, the law vests power with the agent to affect the principal's legal relationship with the third parties. The extent and existence of the power with the agent is determined by public policy. The authority, as observed above, refers to the factual situation. The second consideration is that the primary task of an agent is to enter into contracts on behalf of his principal, or to dispose of his principal's property. The factors mentioned in clauses (b) to (d) in paragraph8 above flow, and are indicia of this primary task. Clauses (b) to (d) of paragraph 8 are useful as tests or standards to examine the true....
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....concerned with buying or selling of goods or even with the reason and cause as to why the card was swiped. It is not bothered or concerned with the quality, price, nature, quantum etc. of the goods bought/sold. The bank merely provides banking services in the form of payment and subsequently collects the payment. The amount punched in the swiping machine is credited to the account of the retailer by the acquiring bank, i.e. HDFC in this case, after retaining a small portion of the same as their charges. The banking services cannot be covered and treated as services rendered by an agent for the principal during the course of buying or selling of goods as the banker does not render any service in the nature of agency.... " 10.0 In the case of Corporation Bank, Hon'ble Karnataka High Court relying upon JDS apparels held that "....7. Now we may advert to the facts of the case in hand. In case the credit card issued by the assessee was used on the swiping machine of another bank, the customer whose credit card was used got access to internet gateway of acquiring bank resulting in realization of the payment. Subsequently, the acquiring bank realize and recover the payme....
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....e legislature is to include and treat commission or brokerage paid when a third person interacts between the seller and the buyer as an agent and thereby renders services in the course of buying and/or selling of goods. This happens when there is a middleman or an agent who interacts on behalf of one of the parties, helps the buyer/seller to meet, or participates in the negotiations or transactions resulting in the contract for buying and selling of goods. Thus, the requirement of an agent and principal relationship. This is the exact purport and the rationale behind the provision. The bank in question is not concerned with buying or selling of goods or even with the reason and cause as to why the card was swiped. It is not bothered or concerned with the quality, price, nature, quantum etc. of the goods bought/sold. The bank merely provides banking services in the form of payment and subsequently collects the payment. The amount punched in the swiping machine is credited to the account of the retailer by the acquiring bank, i.e. HDFC in this case, after retaining a small portion of the same as their charges. The banking services cannot be covered and treated as services rendered by....