Bill discounting charges whether commission
subject to TDS under section 194H - Alternatively whether interest subject to
TDS under section 194A
Facts:
Assessee had paid bill discounting charges for their
invoices to Hero Motocorp Ltd. and Hero Fin Corp Ltd. Plea of the revenue was
that these bill discounting charges were commission subject to TDS under
section 194-H and since assessee did not deduct TDS they were held default for
non-deduction of TDS under section 201(1) and interest was levied under
section 201(1A). On appeal CIT(A) upheld views of the AO. On further appeal -
Held in favour of the assessee that in bill discounting
there is no agent and principal relationship thus no TDS under section 194H was
triggered.
Such bill discounting/factoring charges was also not
interest under section 2(28A).
Applied:
Ahmedabad Stamp Vendors Association v. Union of India,
2002 TaxPub(DT) 1455 (Guj-HC)
CIT Delhi-I v. Cargil Global Trading IP. Ltd., [CC
19572/2011, dt. 10-5-2012]
Commissioner Of Income-Tax v. Cargill Global Trading
(P.) Ltd. [IT Appeal Nos. 204 and 331 of 2011, dt. 17-2-2011] : 2011 TaxPub(DT)
1422 (Del-HC)
Pr. CIT-06 v. M. Sons Gems N Jewell Ery Pvt. Ltd. (Formerly: M Sons
Enterprises Pvt. Ltd.) C/O Ssar & Associates, [ITA No. 9/2016, dt. 25-4-2016]
: 2016 TaxPub(DT) 2324 (Del-HC)
Case: ER Auto (P)
Ltd. v. ITO 2023 TaxPub(DT) 7271 (Del-Trib)