Case Law Details
It was held that the payment of National roaming charges is not rent for the use of telecom equipments in accordance with Section 194-I of the Income-tax Act, 1961 (the Act) and accordingly not liable for deduction of tax at source.
Facts of the case
• The taxpayer is a Public Limited Company engaged in the business of providing mobile telephone services. The taxpayer entered into an agreement with IDEA Cellular Ltd. (IDEA) whereby a subscriber of a cellular network can also gain access to the services of any other network operators in their respective licensed area for a specific charge called as national roaming charge.
• The Assessing Officer (AO) noticed that the taxpayer had failed to deduct tax at source on payments made to other mobile service providers towards national roaming charge.
• The AO was of the view that payment of national roaming charge made to other cellular service providers for allowing use of their network would amount to payment made for technical services within the meaning of section 1 94J of the Act and the taxpayer should have deducted tax from such payments.
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how will it be a relief to the assess..if not 194 I, TDS will be required to be deducted in 194 J…..