Income Tax Appellate Tribunal - Bangalore
Sands Advertising Communications Pvt. ... vs Assessee
IN THE INCOME TAX APPELLATE TRIBUNAL
"A" BENCH : BANGALORE
BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER
AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER
ITA Nos. Assessment Years
790/Bang/2009 2005-06
791/Bang/2009 2006-07
792/Bang/2009 2007-08
793/Bang/2009 2005-06
794/Bang/2009 2006-07
795/Bang/2009 2007-08
M/s. Sands Advertising
Communications Pvt. Ltd.,
No.29, Nanjappa Road,
(Behind Vijaya Bank),
K.H. Road,
Bangalore - 560 027. : APPELLANT
Vs.
The Dy. Commissioner of
Income-tax (TDS),
Circle 18(2),
Bangalore. : RESPONDENT
Appellant by : Shri Padamchand Khincha
Respondent by : Smt. Jacinta Zimik Vashai &
Shri Jason P. Boaz
ORDER
Per A. Mohan Alankamony, Accountant Member
These six appeals preferred by the assessee company are directed against the consolidated order of the Ld.CIT(A)-V, Bangalore for the ITA No.790-5/Bang/09 Page 2 of 31 assessment years 2005-06, 2006-07 and 2007-08 u/s 201(1) and u/s 201(1A) of the Act.
ITA Nos: 790, 791 & 792/09 - Ays 05-06, 06-07 & 07-08 u/s 201(1) of the Act:
2. In these appeals, the assessee company [the assessee - in short] has raised six identical grounds. Ground Nos: 1 and 6 are being general and no specific issues involved which, in our considered view, do not survive for adjudication. In the remaining grounds, the crux of the issue is that -
"The AO, without giving proper opportunity, has passed the orders u/s 201(1) of the Act which have been confirmed by the CIT(A) instead of quashing the said orders."
ITA Nos: 793, 794 & 795/09 - Ays 05-06, 06-07 & 07-08 u/s 201(1A) of the Act:
3. Likewise, in these appeals too, the assessee has raised four identical grounds. Ground Nos: 1 and 4 being general in nature, they are dismissed as non-consequential. In the remaining two grounds, the gist of the grievance of the assessee is largely confined to -
"The AO, without giving proper opportunity, has passed the orders and that he had erred in levying interest u/s 201(1A) of the Act which have been confirmed by the CIT (A) instead of quashing the said orders."
4. In these appeals, the issues raised are identical and inter-linked pertain to the same assessee, for the sake of convenience, they are considered together and disposed off in this common order.
ITA No.790-5/Bang/09 Page 3 of 31
5. The history of the case, in brief, is that the assessee is, an advertising agency, involved in advertising activity exclusively in the print media. Trishul Communications [Trishul - in short] also located in the same premises was doing similar line of business in which the managing director of the assessee holding 50% shares. The assessee's premise was subjected to action u/s 133A of the Act on 30.1.08 with a view to verify the details of TDS provisions under sections 192 to 194LA of the Act. On verification, it was found that there were a number of credit entries from the assessee to Trishul without effecting TDS provisions. On a query, it was stated that in respect of the clients of the assessee, advertisement for various purposes developed by the assessee were released to the print media through Trishul to avail the credit facility available with Trishul as it was an accredited agency. In the case of clients of Trishul, advertisements were created and released to print media directly. The assessee as well as Trishul bills their respective clients separately in their names and collect the advertisement charges in their respective names after deduction of TDS.
Trishul pays publications at 85%, but, collect from the assessee 3% extra for allowing the assessee to avail the credit facility. It was, further, stated that Trishul was only a routing agency and not a sub-contractor, and, thus, no TDS was effected with a presumption that the amounts have already been subjected to TDS in the hands of the clients of the assessee.
5.1. On a query from the Revenue as to why orders u/s 201(1) and u/s 201(1A) of the Act should not be passed treating the payments made by the assessee to Trishul as sub-contractual payment, it was contended by the assessee which is summarized that -
ITA No.790-5/Bang/09 Page 4 of 31
(i) The assessee was engaged in the business of advertising and public relations. It was not an accredited advertising agency recognized by the Indian Newspaper society [INS]. Therefore, the assessee cannot avail the credit facility offered by publications as such facility being available only to accredited advertising agencies. To overcome this, the assessee had an arrangement with Trishul, a duly accredited advertising agency - sister concern of the assessee. The customers of the assessee make payments after deducting tax at source. Since all receipts from INS member publications were routed by the assessee through Trishul, the receipts were paid/credited to Trishul without making TDS. The amounts so paid to Trishul would not be liable for deduction of tax at source u/s 194C of the Act because Trishul was only a routing agency. The amounts paid by the clients to the assessee have already been subjected to tax - TDS. Since Trishul was only a routing agency and not a publisher of the advertisements, it cannot be regarded as sub-contractor also. Thus, the provisions of s.194C (2) of the Act would not be applicable to the instant case.
(ii) Taking cue from the Board's Circular No.715 dated: 8.8.95, it was contended that the assessee was not a client, but, an advertising agency. Thus, the payment by the assessee to another agency would not fall within the scope of s.194C. Reliance was placed on the decisions of Hon'ble High Court of Gujarat [253 ITR 310] and Hon'ble Supreme Court [293 ITR 226]wherein referring to the Board's Circular, the Apex Court held that demand u/s 201(1) cannot be enforced from the deductee assessee once the taxes have been paid by the deductee-assessee.
5.2. After considering the forceful contentions of the assessee, the AO was of the view that the payment was not made by a client to the advertising agency but by a company to an advertising agency and applying the CBDT's Circular was not viable as the payment was made from a 'client company' to an advertising agency and not to a print media as mentioned in the Board's Circular. He had also brushed aside the assessee's assertion that the assessee company received from its clients after deduction of taxes and, hence, payment to Trishul does not attract ITA No.790-5/Bang/09 Page 5 of 31 TDS etc. Thus, the AO had worked out the TDS liability u/s 201(1) and interest u/s 201(1A) of the Act, for the assessment years as under:
Assessment year Total Demand 2005-06 Rs.416409 2006-07 Rs.352182 2007-08 Rs.360562
6. Aggrieved, the assessee took up the issues before the Ld. CIT(A) for relief. After due consideration of the lengthy and forceful submissions of the Ld. A.R and also the remand report of the AO into account, the Ld. CIT(A) had analyzed the issue at length and observed thus -
"8.1. The argument that Sands received from its clients after deduction of taxes and hence payment to Trishul does not attract TDS is not correct and without any evidence or basis. The fundamental rule of law that tax cannot be recovered twice of the same income is acceptable. Even if Trishul discharged its liability, Sands would claim expenses on these payments. Section 194C(1) mandates deduction of tax at source from the amounts paid or payable to any resident for carrying out any work (including supply of labour for carrying out any work). Explanation III to section 194C (2) enlists certain activities which are considered as 'work' for the purposes of section 194C. The said explanation reads as follows:
....................................
...................................
8.2. I have perused the submission made by the appellant and do not agree with the view of the appellant that since all the receipts from INS member publications are routed by the company through Trishul, amounts paid/credited to Trishul would not be liable for TDS U/S 194C because Trishul is only a routing agency. Since Trishul is only a routing agency and not the publisher of the advertisements, it cannot be regarded as sub-contractors. The company is not a client as per CBDT Circular. It is an advertising agency. The payment made by the company to another agency would not fall within the scope of s.194C. in the present case, all the work in relation to the advertising contracts was undertaken by the appellant itself. No part of the said work was carried out by TC.
TC was only a router or conduit through which payment was made to the Media. TC was roped in with a view to availing the credit ITA No.790-5/Bang/09 Page 6 of 31 facility. TC had no role to play and had no interest in the advertising contracts except to the above and extent. There was no product or work achieved as a result of the arrangement between the appellant and TC. Had the payments not been made to the media through TC, the only effect was that the appellant would not have been eligible for the credit facility. It was not a situation where without making payment to TC, the advertisements could not have been placed in the media at all. The existence of TC in the whole transaction was only for a limited purpose. It did not alter the advertisement work carried out by the appellant. Thus, TC cannot be considered as a 'contractor' and the payments made to it for onward payment to media cannot be considered as 'work' or advertisement so as to fall within the scope of section 194C (1).
8.3. In view of all this, I am of the opinion that clarification of the Finance Minister on the floor of the House is not applicable in the present case because the payment made by the appellant is to its sister concern and not to media. In order to provide credit facility to its clients the appellant entered into an agreement with Trishul Communications (TC), a sister concern of the appellant for placing the advertisement in the newspaper, the accredited agency is be entitled for a commission of 15% from the newspaper publications. Thus, if the advertisement charges are Rs.100/-, after reducing a sum of Rs.15/- towards the commission, an amount of Rs.85/- would be paid by TC to the newspaper publications. TC in turn raises: (i) a debit note on the appellant for the entire sum of Rs.100/- and (ii) a credit note for Rs.12/- on the appellant. Thus, out of the total commission of Rs.15/-, a commission of Rs.3/- is retained by TC and the appellant would be entitled for a commission of Rs.12/-. When the appellant admitted that Rs.15/- is commission, then why should it paid Rs.85/- to Trishul as expenses on advertisement. This being the fact of the case, the appellant is liable to deduct tax at source on the payments made to Trishul as per law. The case law cited by the appellant also helps the Department as section 194C covers a person carrying out work for another person as a contractor in the ordinary sense. It does not cover a person carrying on activities of his own business in the ordinary course of charging fees, remuneration etc., [All Gujarat Federation v. CBDT - 214 ITR 276]. The appellant made payment to Trishul for the works done for the appellant and it cannot be said to be paid for carrying on his own business activities. I, therefore, consider the orders passed by the DCIT (TDS) u/s 201(1) and 201(1A) are justified and as per law. The orders need no interference and the same are hereby confirmed."
ITA No.790-5/Bang/09 Page 7 of 31
7. Not satisfied with the finding of the Ld. CIT (A), the assessee has come up with the present appeals before us. The Ld. AR's forceful arguments mostly revolved around what was contended before the first appellate authority. The submission of the Ld. Counsel, for the sake of clarity, is summarized as under:
(i) the assessee was engaged in the business of advertising and public relations. It was not an accredited advertising agency as recognized by INS. As the assessee cannot avail the credit facility offered by publications, the assessee had an arrangement with Trishul - a sister concern;
(ii) the assessee's customers make payment after deduction of tax at source. Since all the receipts from INS member publications were routed by the assessee through Trishul, amounts were paid/credited to Trishul without TDS;
- the amounts paid to Trishul would not be liable for TDS u/s 194C because Trishul was only a routing agency;
- the amounts paid by the clients to the assessee have already been subjected to TDS;
- since Trishul was only a routing agency and not the publisher of the advertisements, it cannot be regarded as sub-contractor [source:
CBDT Circular No.715 dt:8.8.95]
- as per Board's Circular, the assessee was not a client, but, an advertising agency. The payment made by the assessee to another agency would not fall within the scope of s.194C.
- Relies on -
(a) CIT v. Rishikesh Apartments Co-op. Housing Society Ltd. 253 ITR 310 (Guj)
(b) Hindustan Coca Cola Beverage (P) Ltd. 293 ITR 226 (SC)
(iii) Trishul had filed its ROI and paid the taxes. Thus, the assessee cannot be held as an assessee in default and tax cannot be recovered;
J.B.Boda and Co.(P) Ltd. 223 ITR 271 (SC) ITA No.790-5/Bang/09 Page 8 of 31
(iv) if an advertising agency was not accredited, payments have to be made immediately to the newspaper publications. The clients while placing advertisements with the assessee insist on credit facility being extended to them or discharging their dues. Since the assessee was not an accredited advertising agency, the assessee tied up with an arrangement with Trishul - a sister concern - according to which -
- the client places all the orders with the assessee for placing the advertisement in the media; all the work in connection with the said order would be performed by the assessee and no part of the work would be undertaken by Trishul;
- the advertisement would be placed by the assessee in the media not directly, but, through Trishul so as to avail the credit facility and to pass on similar benefit to the clients;
- the business apparatus or design or logo or trade mark of Trishul was used to secure the credit facility. This is a fairly prevalent practice in the advertising agency wherein the name of an accredited advertising agency was used for securing certain facilities;
(v) for placing the advertisement in the newspapers, the accredited agency was to be entitled for a commission of 15% from the newspaper publications. Thus, if the advertisement charges were Rs.100/-, after reducing a sum of Rs.15/- towards the commission, Rs.85/- would be paid by Trishul to the newspaper publications. Trishul in turn raises (i) a debit note on the assessee for Rs.100/-, and (ii) a credit note for Rs.12 on the assessee . Thus, out of commission of Rs.15/-, Rs.3/- is retained by the Trishul and the assessee is entitled Rs.12/- as commission;
(vi) The assessee doesn't fall within the ambit of s.194C and therefore no disallowance could be made u/s 40(a)(ia) for non deducting of TDS for the following reasons:
- S.194C(1) mandates deduction of tax at source from the amounts paid or payable to any resident (contractor) for carrying out any work (including supply of labour for carrying out any work). Explanation III below s.194C (2) enlists certain activities which are considered as 'work' for the purposes of s.194C.
- Extensively quoting from the Hon'ble Finance Minister's Budget speech for the year 1995 and also Board's Circulars No.714 dt.3.8.95 and No.715 dt: 8.8.95, it was contended that it is manifest that s.194C would be applicable only when a client makes a payment to an ITA No.790-5/Bang/09 Page 9 of 31 advertising agency. It would not apply when the advertising agency makes payment to the media. The assessee is an advertising agency and not a client and, thus, the payment by one advertising agency to another advertising agency for onward remittance to the media cannot be considered as amounts paid 'for carrying out any work in relation to advertising'. Thus, the payment made to Trishul would not fall within the scope of s.194C as the payment was made in connection with the advertisements published in the media.
- The invoice for the advertising charges was raised by the media and in view of the arrangements, the assessee paid the sums to Trishul for the purpose of making payment to the media and the payment reached the media through Trishul.
- Thus, the payment made to the media through Trishul should be considered as a direct payment made to the media by the assessee, as a result, s.194C would have no application;
(vii) the assessee was engaged in the business of advertising and public relations and that all the work in connection with the advertisements placed in the media was performed by the assessee and no part of the said work was being undertaken by Trishul.
There was, in fact, no privity of contract between the clients and Trishul. Thus, the 'work' in relation to 'advertising' as envisaged in s.194C having been undertaken by the assessee, Trishul cannot be regarded as a 'contractor' in respect of the said advertising work.
- the AO had wrongly treated the assessee as a 'client' by not correctly appreciating the relationship between the assessee and Trishul. The assessee did not place any advertisement in the media on its own account, but, it undertook and executes the orders of persons who wished to place the advertisements in the media.
- Reliance was placed on the following case laws:
(a) Sethi Transport v. CBDT (1997) 226 ITR 274 (Ori)
(b) V.M.Salgaocar and Bros. Ltd. ITO (1999) 237 ITR 630 (Kar)
(c) All Gujarat Federation v. CBDT 214 ITR 276
(d) Calcutta Goods Transport Association v. Union o India (1996) 219 ITR 486 (Cal);
(e) Madras Bar Association v. CBDT (1995) 216 ITR 240 (Mad)
(f) SRF Finance Ltd. v. CBDT (1995) 211 ITR 861 (Del)
(viii) all the work in relation to the advertising contracts were undertaken by the assessee itself and no part of the work was carried out by the Trishul who was only a conduit through which payment was made to the media. Trishul had no role to play and ITA No.790-5/Bang/09 Page 10 of 31 had no interest in the advertising contracts except to the above extent;
- there was no product or work achieved as a result of this arrangement
- Had the payments not been made to the media through Trishul, the assessee would not have been eligible for the credit facility. It was not a situation where without making payment to Trishul, the advertisements could not have been placed in the media at all. The existence of Trishul in the whole transaction was for a limited purpose which did not alter the advertisement work carried on by the assessee. Thus, Trishul cannot be considered as a 'contractor' and the payments made to it for onward payment to media cannot be considered as 'work' or advertisement so as to fall within the scope of s.194C (1).
- The name and recognition of Trishul being an accredited agency was utilized in order to secure the credit facility. Out of the income earned from placing the advertisement contracts, 3% was retained by Trishul in consideration of utilizing its name and recognition. The said payment could at the best be described as 'royalty'.
(ix) for the said reasons, s.194C has no application and, thus, there was no liability to withhold tax at source under Ch.VIIB from the payments made to Trishul 7.1. To buttress his arguments; the Ld. A R had placed strong reliance on the various judicial pronouncements to drive home his point. During the course of hearing, he had furnished three paper books containing [1- 58 pages, 1 - 127 pages & 1 - 28 pages respectively ] which consist of, inter alia, copies of (i) show-cause notice, (ii) judgments of various Courts, (iii) Memorandum of understanding between Sands and Trishul etc., 7.2. On her part, the Ld. D R was very vehement in her resolves that the assessee and Trishul were sister concerns. The assessee had no access for releasing the advertisements in the media and Trishul was an accredited agency for releasing advertisements in the print media. As per the relevant provisions of the Act, deductions of TDS were to be effected ITA No.790-5/Bang/09 Page 11 of 31 on payments from one entity to another was a point for deduction of TDS.
The assessee had entrusted the work of releasing advertisements to media to Trishul. Thus, the TDS payments has to be seen 'only between the assessee and Trishul' and no other entity. As the assessee had failed in its obligation to deduct TDS on the payments made to Trishul, the assessee was in default and, thus, the provisions of s.201(1) and s.201(1A) of the Act were squarely applicable to the facts of the case on hand. Since, the AO had taken a stand in a judicious manner which has been upheld by the ld.
CIT(A) in toto, it was pleaded that the stand of the authorities below be sustained.
8. We have carefully considered the forceful submissions of either party. We have also duly perused the relevant records, voluminous paper books furnished and also strong reliance placed on the various judicial precedents by the ld. A.R. We have also gone through the documentary evidence produced by the Ld. D.R. 8.1. The vexed issue for consideration is, Whether the assessee was in default in not deducting the tax at source while making payments to print media through its sister concern?
8.1.1. The assessee being an advertising agency involved in advertising activity exclusively in the print media. Its sister concern - Trishul - also in the same line of business. Trishul was an accredited advertising agency as recognized by Indian Newspaper Society (INS). Since the assessee was not an accredited advertising agency, it had entered into a Memorandum of Understanding on 1-7-2002, according to which, all ITA No.790-5/Bang/09 Page 12 of 31 advertisements created/developed by the assessee for its clients will be released to the Print Media through Trishul by availing the credit facility being enjoyed by Trishul. The bone of contention of the assessee is that Trishul was only a routing agency and not a sub-contractor and as such s.194C of the Act is not applicable. To illustrate the arrangements between the assessee and Trishul, we would like to enlighten further that -
"For placing the advertisement in the print media (say newspapers), the accredited agency (Trishul Communications) is entitled for a commission of 15% from the newspaper publications. For example, if the advertisement charges were to be Rs.100/-, after reducing an amount of Rs.15/- being commission, Rs.85/- only will be paid by Trishul to the newspaper publishers. Trishul will in turn raise:
(i) a debit note on the assessee for the entire advertisement charge of Rs.100/-
(ii) a credit note for Rs.12/- on the assessee. Thus, out of total commission of Rs.15/-, thanks to accredited recognition, Rs.3/-
will be retained by Trishul and the assessee stands to gain Rs.12/-.
8.1.2. Let us have a glimpse of s.194C (1):
"(1) Any person responsible for paying any sum to any resident (hereinafter in this section referred to as the contractor) for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and --.
(2)Any person ..........................................................
Explanation III-For the purposes of this section, the expression "work" shall also include-
(a) advertising
(b) ........................
[Explanation was brought on the Statute Book by the Finance Act 1995 w.e.f. 1.7.1995] 8.1.3. The argument of the assessee was that the spadework with regard to advertisements such as sketch, material, getting approval of the clients of "advertisement substance devised and designed" were being precisely ITA No.790-5/Bang/09 Page 13 of 31 done by the assessee and that the finished materials (the contents of advertisements) were routed through Trishul to the media to avail accredited facility being enjoyed by Trishul. In fact, Trishul role was confined only to forward the advertisement materials devised by the assessee to the media. To put it in a nutshell, the assessee had made use of Trishul only for routing through its advertisements to the media. The collection of payments from the clients (the advertisers) was the job of the assessee. While making the payment to the assessee being the advertisement charges, the client (the advertiser) shall effect the TDS.
Thus, the advertisement charges have since been suffered TDS when the clients made payments to the assessee. Trishul had indeed acted as a liaison between the assessee and the media for which it had retained 3% discount extended by the media because it was accredited advertising agency.
8.1.4. It may not be out of context to mention here that the Ld.CIT(A) had observed that the assessee received payments from its clients after TDS and, hence, payment to Trishul does not attract TDS was not correct and without any evidence and basis. However, the assessee had asserted that its clients have already effected TDS while making the payments and the same reflected in its accounts has been conveniently overlooked by the CIT(A), but, at the same breath, he conceded that "the fundamental rule of law that tax cannot be recovered twice of the same income is acceptable...."[Source: Para 8.1 of the impugned order]. On the one hand the CIT(A) disagrees with the assessee's claim, but, on the other hand he vouches that taxes cannot be imposed twice on the same income which, in ITA No.790-5/Bang/09 Page 14 of 31 our view, is lacking conviction. This observation of the CIT(A) drives us to safely conclude that the complexity of the issue has neither been properly understood nor dealt with in the perspective manner it was deserved to.
8.1.5. Let us now analyze the legal pronouncements of the various Hon'ble Courts:
(i) S.R. Finance Limited v. C.B.D.T. reported in 211 ITR 861 (Del):
The Hon'ble Court had, after deliberating the issue whether the Circular explain provisions for deduction of TDS from the payments to contractors and sub-contractors, in its wisdom proclaimed that the Board has no power to enlarge the scope of statutory provisions. Its powers are confined to issue administrative instructions. The impugned circulars travel beyond the provisions of s.194C and have no legal force and are liable to be quashed. The authorities functioned under the Income-tax Act are not bound by them.
(ii) Calcutta Goods Transport Association & Another v. UOI (Ors) - 219 ITR 486 (CAL):
The Hon'ble Court had observed that "The word "work" does not have the widest possible connotation is also clear from the fact that Parliament had sought to bring professional services and other such "works" in the wider sense within the net of tax deduction at source. If such "work" were already covered by section 194C, it was wholly unnecessary to introduce separate statutory provisions in this regard. The only conclusion that follows from this is that the word "work" is to be understood in the limited sense as product or result. The carrying out of work indicates doing something to conduct the work to completion or an operation which produces such result. The petitioners have correctly submitted that the word "work" as used in section 194C has been used in this sense. That is also why the specific extension to supply of labour was necessary. That being so the mere transportation of goods by a common carrier does not affect or result in the ITA No.790-5/Bang/09 Page 15 of 31 goods carried or are the goods affected thereby and as such cannot be brought within the scope of section 194C........."
(iii) Sethi Transport & Others v. C.B.D.T. - 226 ITR 274 (Ori):
The Hon'ble Court while deliberating the case, has observed that -
In Associated Cement Co. Ltd. v. CIT [1993] 201 ITR 435, the Supreme Court ruled that no ambiguity is found in the language employed in the sub- section. What is contained in the sub-section, as appears from its plain reading and analysis, admits of the following formulations:
(1) A contract may be entered into between the contractor and any of the organizations specified in the sub-section.
(2) Contract in Formulation-1 could not only be for carrying out any work but also for supply of labour for carrying out any work.
(3) Any person responsible for paying any sum to contractor in pursuance of the contract in Formulations-1 and 2 could credit that sum to his account or make its payment to him in any other manner.
(4) But, when the person referred to in Formulation-3 either credits the sum referred to therein to the account of or pays it to the contractor, he shall deduct out of that sum an amount equal to two per cent., as income-tax on income comprised therein.
The court held that there is nothing in the sub-section from which the Board held that the contract to carry out a work or the contract to supply labour to carry out a work should be confined to "works contract "as was argued on behalf of the appellant. The court saw no reason to curtail or to cut down the meaning of the plain words used in the section. "Any work "means any work and not a "works contract ", which has a special connotation in the tax law. The court further observed that in the sub-section the term " work "
expressly includes supply of labour to carry out a work which is a clear indication of the Legislature that " work " in the sub-section is not intended to be confined to or restricted to " works contract ". The court laid down the principle in the following words:
" ' Work ' envisaged in the sub-section therefore, has a wide import and covers ' any work ' which one or the other of the organizations specified in the sub-section can get carried out through a contractor under a contract and further it includes obtaining by any of such organizations supply of labour under a contract with a contractor for carrying out its work which ITA No.790-5/Bang/09 Page 16 of 31 would have fallen outside the ' work ', but for its specific inclusion in the sub-section.
In the said decision, the Supreme Court also decided the controversy relating to the exact amount to be deducted from the dues of the contractor. That question, however, is not relevant for the purpose of the present case.
The Bombay High Court in the case of Bombay Goods Transport Association v. CBDT [1994] 210 ITR 136, specifically considered the question of validity of the circular of the Board bearing No. 681, dated March 8, 1994, requiring deduction of tax at source under section 194C in the case of contracts for carriage of goods. The court held that such circular is illegal and without jurisdiction in so far as it requires deduction of tax at source under the section in the case of contracts for mere carriage of goods which do not include any other services like loading and unloading and are not connected with any work to be performed by the carrier. Referring to the decision of the Supreme Court in Associated Cement Co. Ltd. v. CIT [1993] 201 ITR 435, it was observed:
".... the controversy before the Supreme Court was limited to the applicability of section 194C to labour contracts. The various circulars of the Central Board of Direct Taxes were not before the Supreme Court. The Supreme Court interpreted section 194C de hors those circulars. It did not approve the narrow construction of the expression ' any work ' to include only ' works contracts '.
The Bench took the view that the expression "any work" used in section 194C does not include transport contracts.
In the case of Advertising Agency Association of India v. CBDT [1994] 210 ITR 152, the Bombay High Court also considered the effect of the decision of the Supreme Court in Associated Cement Co.'s case [1993] 201 ITR 435 and held that the Supreme Court has in no way extended or amplified the scope of section 194C of the Income-tax Act, 1961. It merely held that the said section is not confined to works contracts but also applies to labour contracts. The Supreme Court in that case was required to consider the question of applicability of section 194C to labour contracts because the contention of the assessee was that the said section was applicable only to works contracts. It was this contention that was repelled by the Supreme Court. The court held that Circular No. 681 is illegal and without jurisdiction in so far as it requires deduction of tax at source from payments to advertising agencies for professional services rendered by them.
The Madhya Pradesh High Court in the case of M. P. State Bar Council v. Union of India (Writ Petition No. 2259 of 1994, disposed of on August 24, 1995), referring to the decisions of the Supreme Court in the case of Associated Cement Co. [1993] 201 ITR 435 the Bombay High Court in ITA No.790-5/Bang/09 Page 17 of 31 Chamber of Income-tax Consultants v. CBDT [1994] 209 ITR 660 ; the Delhi High Court in S. R. F. Finance Ltd. v. CBDT [1995] 211 ITR 861 and the Gujarat High Court in All Gujarat Federation of Tax Consultants v.
CBDT [1994] 76 Taxman 307, held that section 194C does not cover the professionals.
We have carefully perused the judgments in the aforementioned decided cases. We are in respectful agreement with the decision of the Bombay High Court that in Associated Cement Co.'s case [1993] 201 ITR 435, the Supreme Court only considered the point whether the expression " any work " used in section 194C is confined to " works contracts " or not. The court did not specifically consider the question whether any other type of contract likes carriage contract, advertisement contract, etc., comes within the purview of section 194C. We are also in agreement with the view taken by the Bombay High Court that section 194C does not extend to contracts for mere carriage of goods. Therefore, the circular of the Board extending section 194C to contracts for mere carriage of goods is based on a misreading and misconstruction of the judgment of the Supreme Court. Further, while purporting to clarify the legal position, as lay down by the Supreme Court, the Board has introduced a definition of the term "transport contracts "which was not considered by the Supreme Court. The Board has also not given any other reason for reversing its previous circulars. We may add here that whether a particular case would come within the purview of section 194C of the Income-tax Act or not depends upon the facts and circumstances of the case, the stipulations in the agreement between the parties, and other relevant factors. The Board's circular to the effect that transport contracts in general come within the purview of section 194C is erroneous and illegal.
(iv) V.M.Salgaocar & Bros Ltd. v. ITO - 237 ITR 630 (Kar):
The jurisdictional Hon'ble High Court, while deciding the above case has analyzed the issue in a comprehensive manner and ruled that -
"Another circular dated March 8, 1994, in dispute is on the basis of the judgment given in the case of Associated Cement Co. Ltd. [1993] 201 ITR 435 (SC), was issued by the CBDT where it was pointed out that "any work"
is not restricted to "works contract" and is wide enough to cover any work which is carried out through a contractor in a contract. The circular dated March 8, 1994, provided that the term "transport contracts" would, in addition to contracts for transportation and loading/unloading of goods, also cover contracts for plying of buses, ferries, etc., along with staff (e. g., driver, conductor, cleaner, etc.), Circular No. 86 dated May 29, 1972 was withdrawn beside the Circulars Nos. 93 and 108 which were issued on September 26, 1972, and March 20, 1973. In the circular dated March 8, 1994, it was clarified that the provisions of section 194C will apply from ITA No.790-5/Bang/09 Page 18 of 31 April 1, 1994. Thus the dispute now remains only for the period from April 1, 1994, to June 30, 1995.
The Bombay High Court in the case of Bombay Goods Transport Association v. CBDT [1994] 210 ITR 136 has held that in the judgment of Associated Cement Co. Ltd.'s case [1993] 201 ITR 435 (SC), the provisions of section 194C were not interpreted in the manner as interpreted by the Central Board of Direct Taxes so as to apply the said judgment to all types of contract including transport contracts, service contracts, etc. It was also pointed out that various circulars issued by the Central Board of Direct Taxes were not before the Supreme Court and the words "any work" could not be restricted to include works contract only and the observations made were that the word "works contract" and labour contracts would be included in "any work". It was further made clear that labour contract would have fallen outside the "work" envisaged by section 194C but for its specific inclusion in sub-section (1). The Bombay High Court held that the provisions of section 194C are not applicable to contracts for mere carriage of goods which do not include any other services like loading or unloading.
The circular was accordingly quashed.
The Orissa High Court in the case of Sethi Transport v. CBDT [1997] 226 ITR 274, had also the occasion to consider the circular dated March 8, 1994, and agreeing with the decision given by the Bombay High Court observed that section 194C does not extend to the contract for mere carriage of goods, to that extent, the circular issued was held illegal.
The Calcutta High Court in the case of Calcutta Goods Transport Association v. Union of India [1996] 219 ITR 486 has taken into consideration the definition of the word "work" as defined in New Shorter Oxford English Dictionary, and Stroud's Judicial Dictionary and came to the conclusion that the word "work" is to be understood in the limited sense as product or result. The carrying out of work indicates doing something to conduct the work to completion or an operation which produces the result. That being so the mere transportation of goods by a common carrier does not affect or result in the goods being carried nor are the goods affected thereby and as such cannot be brought within the scope of section 194C of the Act. It was declared that common carriers of goods by road are not liable to deduction of tax at source under section 194C of the Act.
The Delhi High Court in the case of Delhi Goods Transport Association v. CBDT [1995] 80 Taxman 525 has held that on the basis of the circular dated March 8, 1994 tax on carriage of goods cannot be levied.
I have considered over the matter.
ITA No.790-5/Bang/09 Page 19 of 31 The judgment given by the apex court in the case of Associated Cement Co. Ltd. [1993] 201 ITR 435 was in respect of loading of cement bags into wagons/trucks. It was in this context that the word "any work" was held not restricted to payment in relation to works contract. Even the circular dated May 29, 1972, interpreted the provisions of the section 194C and clarified that the tax is not to be deducted under section 194C by transport contractors. It was only because of the judgment given in the case of Associated Cement Co. Ltd. [1993] 201 ITR 435 (SC) another circular dated March 8, 1994 was issued by the Central Board of Direct Taxes and section 194C was held applicable only from April 1, 1994, and for such a long time, i.e., more than twenty years, the interpretation which was taken by the Department and acted upon was that the transport contractors are not liable for deduction of tax under section 194C. In the judgment of Associated Cement Co. Ltd.'s case [1993] 201 ITR 435 (SC), the controversy was not of the transport contractors but was related to loading and unloading of goods. In Associated Cement Co. Ltd.'s case [1993] 201 ITR 435 (SC) it was observed:
"... there is nothing in the sub-section which could make us to hold that the contract to carry out a work or the contract to supply 'labour to carry out a work should be confined to 'works contract' as was argued on behalf of the appellant. We see no reason to curtail or to cut down the meaning of the plain words used in the section. 'Any work' means any work and not a 'works contract', which has a special connotation in the tax law. Indeed, in the sub- section, the 'work' referred to therein expressly includes supply of labour to carry out a work. It is a clear indication of the Legislature that the 'work' in the sub-section is not intended to be confined to or restricted to 'works contract'. 'Work' envisaged in the sub-section, therefore, has a wide import and covers 'any work' which one or the other of the organizations specified in the sub-section can get carried out through a contractor under a contract and further it includes obtaining by any of such organizations supply of labour under a contract with a contractor for carrying out its work which ITA No.790-5/Bang/09 Page 20 of 31 would have fallen outside the 'work' but for its specific inclusion in the sub- section."
According to the interpretation of the Department which was prevalent till April 1, 1994, the transport contractors were not considered to be falling within the ambit of section 194C. Mere transportation of goods by a common carrier does not affect or result in the goods neither carried nor are the goods affected. The legislative intent could also be seen from the subsequent amendments.
Explanation III was inserted by the Finance Act, 1995, by which advertising and travelling agencies, etc., were included thereunder. Whether the Explanation could be considered to be explanatory so as to apply for the transaction between April 1, 1994, to June 30, 1995? An interpretation which had continued and acted upon for more than a decade is not to be easily deviated. Circular No. 108 dated March 20, 1973, has dealt with the service contracts not involving carrying out of any work and has specifically said that the transport contract would not be included in the purview of section 194C as transport contract cannot be regarded as contract for carrying out any "work".
However, the Punjab and Haryana High Court in the case of Ekonkar Dashmesh Transport Co. v. CBDT [1996] 219 ITR 511 has dissented with the judgment given by the Bombay High Court and the Calcutta High Court referred to above and taking into consideration the judgment in the case of Associated Cement Co. Ltd. [1993] 201 ITR 435 (SC), held that the end-
product may be the work but the income derived by the contractor for "carrying out the work" is certainly covered by the provisions of section ITA No.790-5/Bang/09 Page 21 of 31 194C. In the case of Associated Cement Co. Ltd. [1993] 201 ITR 435 (SC), the contract was for loading/unloading of goods and nothing was done to the goods. It was a pure and simple hire of labour for loading and unloading of goods which was the subject-matter of the decision in Associated Cement Co. Ltd.'s case [1993] 201 ITR 435 (SC).
The definition of the word "work" in various dictionaries is as under :
"In Webster's New Dictionary, 'work' has been defined as 'work', work, n. (O>E> weore =D. and G. work = Ice]. verk, work; akin to Goth. Waurkian to work, also to Gr. ergon, work, organon., instrument, E. organ] Exertion directed to produce or accomplish something ; labor toil ; productive or operative activity; as, to make a machine do work activity undertaken in return for payment, as in wages ; that on which exertion or labor is expended a product of activity or labor ; as, a literary work ; needlework or embroidery ; an engineering structure, as a bridge or dock; workmanship :
as, to do good work; a task or undertaking ; as, one's life's work ; a deed or act.
In Encyclopedia Britannica the word 'work' has been defined as work, in physics, measure of energy transfer that occurs when an object is moved over a distance by an external force at least part of which applied in the direction of the displacement. If the force is constant, work may be computed by multiplying the length of the path by the component of the force acting along the path. Work done on a body is accomplished not only by a displacement of the body as a whole from one place to another, but also, for example, by compressing a gas, by rotating a shaft, and even by causing invisible motions of the particles within a body by an external magnetic force.
In Oxford English Dictionary the word 'work' has been defined as something to be done, or something to do ; what a person (or thing) has or had to do ; occupation, employment, business, task function."
From a perusal of the above definition it is evident that the word "work" has relation with the word "labour" which has to be put by a person for occupation, employment, business, task or function.
ITA No.790-5/Bang/09 Page 22 of 31 The word "work" refers and comprehends the activities of the workmen and not the operation in the factory or on machines. It is the physical force which has been comprehended in the word "work". Section 194C(1) refers to carrying out of any work. If the sub-section (1) is read as a whole then it could be interpreted that it is the work of labour which is done by the contractor or he may supply the labour to do the work as a sub-contractor.
Sub-section (2) of section 194C also refers to the contract for carrying out the work undertaken by the contractor or for supplying wholly or partly any labour which the contractor has undertaken to supply."
8.1.6. We have a glimpse of Board's Circular No.715 dated:
8.8.1995 and the relevant portions of which, for ready reference, are extracted hereunder:
"The Finance Act, 1995, has enlarged the scope of income-tax deduction at source by making various amendments. In regard to the changes introduced through the Finance Act, 1995, a number of queries have been received from the various associations and professional bodies on the scope of tax deduction at source. It would be desirable to clarify the doubts by issuing a public circular in the form of question answer as under:--
Q 1 : What would be the scope of an advertising contract for the purpose of section 194C of the Act ?
A : The term "advertising" has not been defined in the Act. During the course of the consideration of the Finance Bill, 1995, the Finance Minister clarified on the floor of the House that the amended provisions of tax deduction at source would apply when a client makes payment to an advertising agency and not when an advertising agency makes payment to the media, which includes both print and electronic media. The deduction is required to be made at the rate of 1 per cent.
Q 2 : Whether the advertising agency would deduct tax at source out of payments made to the media ?
A : No. The position has been clarified in the answer to question No. 1 above.
ITA No.790-5/Bang/09 Page 23 of 31 Q 4: Whether tax is required to be deducted at source on payments made directly to the print media for release of advertisements?
A : The payments made directly to print and electronic media would be covered under section 194C as these are in the nature of payments for purposes of advertising. Deduction will have to be made at the rate of 1 per cent.
Q 6: Whether payment under a contract for carriage of goods or passengers by any mode of transport would include payment made to a travel agent for purchase of a ticket or payment made to a clearing and forwarding agent for carriage of goods?
A : The payments made to a travel agent or an airline for purchase of a ticket for travel would not be subjected to tax deduction at source as the privity of the contract is between the individual passenger and the airline/travel agent, notwithstanding the fact that the payment is made by an entity mentioned in section 194C(1). The provisions of section 194C shall, however, apply when a plane or a bus or any other mode of transport is chartered by one of the entities mentioned in section 194C of the Act. As regards payments made to clearing and forwarding agents for carriage of goods, the same shall be subjected to tax deduction at source under section 194C of the Act.
Q 16: Whether tax is required to be deducted at source under section 194C or 194J on payment of commission to external parties for procuring orders for the company's product?
A : Rendering of services for procurement of orders is not covered under the provisions of section 194C. However, rendering of such services may involve payment of fees for professional or technical services, in which case tax may be deductible under the provisions of section 194J.
Q 30: Whether the deduction of tax at source under section 194C and 194J has to be made out of the gross amount of the bill including reimbursements or excluding reimbursement for actual expenses?
A : Sections 194C and 194J refer to any sum paid. Obviously, reimbursements cannot be deducted out of the bill amount for the purpose of tax deduction at source.
8.1.7. Even on a close reading of the Circular makes it very clear that the term "advertising" has not been defined in the Act.
During the course of the consideration of the Finance Bill, 1995, the ITA No.790-5/Bang/09 Page 24 of 31 Finance Minister clarified on the floor of the House that the amended provisions of tax deduction at source would apply when a client makes payment to an advertising agency and NOT when an advertising agency makes payment to the media, which includes both print and electronic media. The present assessee was not a client, but, an advertising agency. Considering Trishul as a media, for an argument-sake, whatever payments made by the assessee to Trishul, no tax need to be deducted at source according to the said Circular since neither the assessee (Sands) was a client nor Trishul a media. The word "work" has not been defined in the Act. The Board in its Circulars had repeatedly stressed that when a client makes payment to an advertisement agency, the client was obliged to effect the TDS. In the case on hand, when a client (the advertiser) made the payment to the advertising agency (the assessee), it had effected the TDS, whereas the assessee - being an advertising agency - reimbursed the advertising charges to Trishul which were neither a client nor a media and, thus, the provisions of s.194C have no role to play.
8.1.8. With due respects, we have carefully perused the ruling of the highest judiciary of the land in the case of Associated Cement Company Limited v. CIT and Another reported in (1993) 201 ITR 435 on which rival parties have placed their faith. In consonance with ITA No.790-5/Bang/09 Page 25 of 31 the finding of the Hon'ble Apex Court, the Board in its circular No.681 dated 8.3.1994 had indicated that -
"5. The Supreme Court has held that ....there is nothing in the sub- section which could make us hold that the contract to carry out a work or the contract to supply labour to carry out a work should be confined to 'works contract'......." their Lordships have further held that 'Any work' means any work and not a 'work contract', which has a special connotation in the tax law....'Work' envisaged in the sub-section, therefore, has a wide import and covers 'any work' which one or the other of the organizations specified in the sub- section can get carried out through a contractor under a contract and further it includes obtaining by any of such organizations supply of labour under a contract with a contractor for carrying out its work which would have fallen outside the 'work' but for its specific inclusion in the sub-section'.
...........................
...........................
7..................the following guidelines in regard to the applicability of the provisions of section 194C:
(i) The provisions of section 194C shall apply to all types of contracts for carrying out any work including transport contracts, service contract, advertisement contracts, broadcasting contracts, telecasting contracts, labour contracts, material contracts and works contracts.
...............
................
(v) Service contracts would be covered by the provisions of this section since service means doing any work as explained above.
.................................................................................... .....................
(viii) the provisions are wide enough to cover not only written contracts but also oral contracts.
............................................................................................. ........."
ITA No.790-5/Bang/09 Page 26 of 31 8.1.9. Even the Board vide its subsequent Circular No.715 dated: 8.8.1995 had made it amply clear that when an advertising agency makes payment to the media, the amended provisions of tax deduction at source would NOT apply. In the present case, the assessee being an 'advertising agency' had NOT made the payments to the media directly, but, the advertisement materials were routed through Trishul for the publication of its advertisements in the newspapers since Trishul was an accredited agency through which the advertisements of the assessee were being released to the media. The role of Trishul was only confined to channelizing the advertisement materials devised and designed by the assessee to the media.
8.1.10. To counter the stand of the Ld. CIT (A) that "8.3.......I am of the opinion that clarification of the Finance Minister on the floor of the House is not applicable in the present case because the payment made by the appellant is to its concern and not to media", the Ld. Counsel came up with a question, Whether reliance on Finance Minister's speech can be placed differently while interpreting a statutory provision? and answered that at the introduction of the Finance Bill, known as placing the Budget on the floor of the Parliament, the Hon'ble Finance Minister's budget speech among others contains a broader outline of the proposed amendments in direct tax regime. In other words, the Finance Minister outlines the underlying object or intent of the proposed amendment. This was the reason due to which the judiciary in India had recognized the budgetary speech of the Finance Minister as an external aid to interpretation of taxing statute.
ITA No.790-5/Bang/09 Page 27 of 31 8.1.11. The judiciary had occasions to deliberate the issue at length, notably:
(i) The Hon'ble Apex Court in the case of Lok Shikshana Trust v. CIT reported in (1975) 101 ITR 234 had held that the speech made by the Minister or the mover of a Bill can be taken into consideration for ascertaining the object or purpose underlying the Legislation;
(ii) Yet another ruling, the highest judiciary of the land had reiterated the above view in K.P.Vergese v. ITO (1981) 131 ITR 597 stressing the Finance Minister's speech as compared to the wording in the Statute. It was held that, if the plain and literal construction of a provision leads to manifestly unreasonable and absurd consequences then the object forthcoming from the speech of the Finance Minster has to be resorted to and applied to ascertain the true import of the provision..."
(iii) In the case of R & B Falcon (A) PTY Ltd v. CIT (2008) 301 ITR 309, the Hon'ble Supreme Court was very emphatic in its wisdom that -
"22. The interpretation of the CBDT, being in the realm of executive construction, should ordinarily be held to be binding, save and except where it violates any provisions of law or is contrary to any judgment rendered by the Courts. The reason for giving effect to such executive construction is not only same as contemporaneous which would come within the purview of the maxim temporania caste pesto, even in certain situation, a representation made by an authority like Minister presenting the Bill before the Parliament may also be found bound thereby.
23. Where a representation is made by the maker of Legislation at the time of introduction of the Bill or construction thereupon is ITA No.790-5/Bang/09 Page 28 of 31 put by the Executive upon its coming into force, the same carries a great weight.
(iv) The Hon'ble Bombay High Court, in its ruling in the case of CIT v. Ajanta Pharma Ltd. (2009) 318 ITR 252 relying the Apex Court's verdict in K.P.Vergese v. ITO referred supra, had observed thus -
"Whether speeches made on the floor of the house were admissible in interpreting the provisions. Speeches made by the Members of the Legislature on the floor of the House when a Bill for enacting a statutory provision is being debated are inadmissible for the purpose of interpreting the statutory provision but the speech made by the mover of the Bill explaining the reason for the introduction of the Bill can certainly be referred to for the purpose of ascertaining the mischief sought to be remedied by the Legislation and the object and purpose for which the legislation was enacted. The Supreme Court in K.P.Varghese's case (supra) said that this is in accord with the recent trend in juristic thought not only in Western countries but also in India that interpretation of a Statute being an exercise in the ascertainment of meaning everything which is logically relevant should be admissible. The Finance Minister's speech, therefore, can be relied upon by the Court for the purpose of ascertaining what was the reason for introducing that clause...."
8.1.12. In view of the various judicial pronouncements referred supra, we are of the firm view that the clarifications made by the Hon'ble Finance Minister on the floor of the Parliament cannot brushed aside on the plea that the payment made by the present assessee was to its sister concern and not to media.
8.1.13. The advertisement materials devised and defined by the assessee were being channelled through Trishul - thanks to its accredited agency status - to the media and that no specific "work"
ITA No.790-5/Bang/09 Page 29 of 31 was assigned to Trishul to carry out on behalf of the assessee and, thus, in our considered view, the issue doesn't fall within the ambit of s.194C of the Act.
8.1.14. In an overall consideration of the facts and circumstances of the issue as deliberated in the foregoing paragraphs, we are of the unanimous view that the assessee's case doesn't fall within the ambit of s. 194C (1) of the Act and that the authorities bellow were NOT justified in invoking the provisions of the s.201 (1) and s.201 (1A) of the Act for the assessment years under dispute for the reasons that -
(i) By virtue of not an Accredited Advertising Agency (AAA), the assessee was deprived of availing the credit facility being offered by the Publications (print media);
- Trishul being an AAA; the assessee had tied up with Trishul to channelize its advertising materials through it to the print media;
- No specific work was assigned to Trishul on behalf of the assessee.
Trishul had merely routed the 'advertising materials' devised and designed by the assessee on behalf of its clients;
(ii) Trishul was neither a client nor a media, but a routing agency and, moreover, the payment(s) made by the client(s) to the advertising agency (the assessee), tax has already been deducted at source by the client(s), as conceded by the first appellate authority - "the fundamental rule of law that tax cannot be deducted twice of the same income.''
(iii) Presumably Trishul was roped in by the assessee with a sole purpose of availing the credit facility being enjoyed by Trishul and nothing else;
(iv) The role of Trishul in the transaction was confined only to transit the advertisement materials devised by the assessee to the media which does not visualize any product or result. Mere routing ITA No.790-5/Bang/09 Page 30 of 31 through the advertising materials invented by the assessee doesn't produce any result and as such it cannot be brought within the ambit of s.194C of the Act as ruled by the Hon'ble High Court of Calcutta referred supra (219 ITR 486);
(v) In fact, 15% of discount, royalty, commission as the case may be -
AAA status enjoyed by Trishul - received from the media was being shared in the ratio of 12: 3 by the assessee and Trishul which in effect, the assessee was not paying even a penny from its coffer to Trishul. Even 85% of amounts paid by the assessee to Trishul were reimbursement of the advertising charges paid by Trishul to media;
(vi) The advertising charges paid by the assessee to the media thro' Trishul had, in fact, landed in the hands of the print media and in the process Trishul stands to gain a paltry discount of 3% being AAA and nothing-else;
- In effect, the Board's Circular No.715 referred supra comes to the rescue of the assessee. At the cost of repetition, the relevant portion of which are reproduced as under:
Q 1: What would be the scope of an advertising contract for the purpose of section 194C of the Act?
A: The term "advertising" has not been defined in the Act. During the course of the consideration of the Finance Bill, 1995, the Finance Minister clarified on the floor of the House that the amended provisions of tax deduction at source would apply when a client makes payment to an advertising agency and not when an advertising agency makes payment to the media, which includes both print and electronic media. The deduction is required to be made at the rate of 1 per cent.
Q 2: Whether the advertising agency would deduct tax at source out of payments made to the media?
A : No. The position has been clarified in the answer to question No. 1 above.
9. In the result, the assessee's appeals for the assessment years 2005-06, 2006-07 and 2007-08 [in ITA Nos: 790 to 795/09] are ALLOWED.
ITA No.790-5/Bang/09 Page 31 of 31 Pronounced in the open court on this 22nd day of January, 2010.
Sd/- Sd/-
(GEORGE GEORGE K. ) (A. MOHAN ALANKAMONY )
Judicial Member Accountant Member
Bangalore,
Dated, the 22nd January, 2010.
Ds/-
Copy to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)
5. DR, ITAT, Bangalore.
6. Guard file (1+1)
By order
Assistant Registrar
ITAT, Bangalore.