Kodak India P. Ltd. v. Deputy Commissioner of IncomeTax

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The Tax PublishersI. T. A. No. 9080/Mum/2010 2013 TaxPub(DT) 0830 (Mum-Trib) : (2013) 051 (II) ITCL 0590 : (2013) 058 SOT 0251 : (2013) 022 ITR (Trib) 0721 Income Tax Act, 1961 --Tax deduction at source--Under section 194JPayments for services of modelling--Assessee-subsidiary of USA company was engaged in the manufacturing cameras trading in cameras and dealing in photographic films in and out of India. Assessing officer found that there was a short-deduction of TDS in respect of payments made to K. He noted that assessee had entered into an agreement with K to act as model for all promotional materials created by assessee including posing for photographs or promotion of product of it. Therefore, he held that the payments made by assessee were towards fees for a model and it covered within the purview of Explanation (a) to section 194J. Assessee however made deduction of tax at source under section 194C in respect of payments for services of modelling. *Held:* Payments were payable for the services of modelling and it was unconnected with the production of cinematographic film. While 'modelling' was aimed at display of merchandise, the 'acting' was defined as 'to act in play or film', i.e., to portray a role authored by a story-writer with different purposes and objects and certainly not to displace merchandise to boost the sales of a manufacturer or a trader of the product or services. Therefore, the impugned payments made by assessee to M on behalf of K did not attract the provisions of section 194J. The provisions of Explanation (a) to section 194J and Notifications issued by the Board in this regard suggest that the services rendered by a person in the course of carrying on legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or advertising or notified sports professionals or other notified professions for the purpose of section 44AA which includes the film artist as listed in the rules, who are engaged in production of cinematographic film, constitute 'fees for professional service' (FPS) for the purposes of section 194J. The expressions 'services rendered' used in the said Explanation assume significance and therefore, the taxable receipts under section 194J are services-specific and not person specific. Income Tax Act, 1961 Section 194J IN THE ITAT, Mumbai 'A' Bench Dinesh Kumar Agarwal, j. m. & D. Karunakara Rao, A.M. Kodak India P. Ltd. v. Dy. CIT I. T. A. No. 9080/Mum/2010 A.Y. 2009-10 20 February, 2013 Appellant by : M. M. Golvala & Sandeep Chetiwal Respondent by : Manoj Kumar, Departmental representative ORDER *D. Karunakara Rao, A.M.* This appeal filed by the assessee on 28-12-2010 is against, the order of the Commissioner (Appeals)-14, Mumbai, dated 29-10-2010 for the assessment year 2009-10. SUBSCRIBE FOR FULL CONTENT

The Tax PublishersI. T. A. No. 9080/Mum/2010
2013 TaxPub(DT) 0830 (Mum-Trib) : (2013) 051 (II) ITCL 0590 : (2013) 058 SOT 0251 : (2013) 022 ITR (Trib) 0721

Income Tax Act, 1961

--Tax deduction at source--Under section 194JPayments for services of modelling--Assessee-subsidiary of USA company was engaged in the manufacturing cameras trading in cameras and dealing in photographic films in and out of India. Assessing officer found that there was a short-deduction of TDS in respect of payments made to K. He noted that assessee had entered into an agreement with K to act as model for all promotional materials created by assessee including posing for photographs or promotion of product of it. Therefore, he held that the payments made by assessee were towards fees for a model and it covered within the purview of Explanation (a) to section 194J. Assessee however made deduction of tax at source under section 194C in respect of payments for services of modelling. Held: Payments were payable for the services of modelling and it was unconnected with the production of cinematographic film. While 'modelling' was aimed at display of merchandise, the 'acting' was defined as 'to act in play or film', i.e., to portray a role authored by a story-writer with different purposes and objects and certainly not to displace merchandise to boost the sales of a manufacturer or a trader of the product or services. Therefore, the impugned payments made by assessee to M on behalf of K did not attract the provisions of section 194J.

The provisions of Explanation (a) to section 194J and Notifications issued by the Board in this regard suggest that the services rendered by a person in the course of carrying on legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or advertising or notified sports professionals or other notified professions for the purpose of section 44AA which includes the film artist as listed in the rules, who are engaged in production of cinematographic film, constitute 'fees for professional service' (FPS) for the purposes of section 194J. The expressions 'services rendered' used in the said Explanation assume significance and therefore, the taxable receipts under section 194J are services-specific and not person specific.

Income Tax Act, 1961 Section 194J

IN THE ITAT, Mumbai 'A' Bench

Dinesh Kumar Agarwal, j. m. & D. Karunakara Rao, A.M.

Kodak India P. Ltd. v. Dy. CIT

I. T. A. No. 9080/Mum/2010

A.Y. 2009-10

20 February, 2013

Appellant by : M. M. Golvala & Sandeep Chetiwal

Respondent by : Manoj Kumar, Departmental representative

ORDER

D. Karunakara Rao, A.M.

This appeal filed by the assessee on 28-12-2010 is against, the order of the Commissioner (Appeals)-14, Mumbai, dated 29-10-2010 for the assessment year 2009-10.