Viacom 18 Media Pvt. Ltd. Vs Asst. Director of Income Tax (ITAT Mumbai)
Assessee is liable to deduct TDS on the transponder fees paid to non-resident
Facts –
Assessee has leased transponder on satellites owned by Measat, Malaysia and rentals were paid to Measat on monthly basis. As per transponder lease agreement, taxes, if any, payable on transponder lease rentals are to be borne by the assessee. An appeal is filed by the assessee contesting its liability of deducting TDS u/s 195.
In assessee’s own case, ITAT had decided the matter against the assessee.
Held –
The identical issue was decided by the ITAT in assessee’s own case on a number of successive preceding years by a series of orders against the assessee. Further, except for the assessee’s submission that the recipient being non-resident was not chargeable to tax on the sum paid, there was no decision of High Court backing the scheme. Therefore, following the decision of ITAT in assessee’s own case, assessee was liable to deduct TDS on transponder fee payable to MEASAT Malaysia.
FULL TEXT OF THE ITAT JUDGEMENT
These are appeals by the assessee against the respective orders of the ld. Commissioner of Income Tax (Appeals) for the concerned assessment years. Since the issues are common and the appeals were heard together these have been disposed of by this common order.
2. The common grounds of appeal read as under:
1. On the facts, and in the circumstances of the case, and in law, the learned Commissioner of Income-tax (Appeals) – 58, Mumbai [‘CIT(A)’] has erred in holding that the payments of transponder fees by the Appellant to MEASAT Satellite Systems Snd. Bhd, Malaysia (‘MEASAT’), are taxable under the Income-tax Act, 1961 (‘the Act’), and under the India-Malaysia Tax Treaty (‘the Treaty’), and hence, are subject to tax withholding under Section 195 of the Act.
2. On the facts, and in the circumstances of the case, and in law, the learned CIT(A) ought to have held that the transponder fees payable by the Appellant to MEASAT are not taxable in India and consequently, not subject to tax withholding under Section 195 of the Act.
3. The assessee has also raised the common additional grounds which read as under:
3. On the facts and in the circumstances of the case, and in law, the transponder fees payable by the Appellant to Measat Satellite Systems Snd. Bhd. ought not to be taxable in India and consequently, not subject to withholding of tax under Section 195 of the Act, in light of the following decision of the Hon’ble Mumbai Tribunal on identical facts and issues:
