No.Addl.CIT/DDO Range-3(1)/Estb.

/2015-2016 Office of the

Addl.CIT,
DDO Range-3(1),
Room No: 25D, Aayakar
Bhavan,
Mumbai-400020.

Dated : 30.06.2015
SANCTION ORDER
Sanction is hereby granted for drawing of arrear payment of increment / Special
Pay for Sportsperson excelling in National / International sporting events
amounting to Rs.44030/- (Rupees Forty four thousand and thirty only) in the
case of Shri. Biju Thomas, Inspector, working in the office of Pr. Commissioner of
Income Tax – 15, Mumbai for the below mentioned period. These are the 1 st, 2 nd
and 3 rd increments / special pay granted to the official vide order No.
Addl.CIT(HQ)Pers./Sports/2013-14 dated 02.09.2014, the effect of which have
been given for the first time in the salary of June, 2015 and no arrears of Special
pay have been paid earlier to the official concerned.

Corresponding Arrear Special pay Calculation Amount (Rs.)

Designation and period amount against
Pay Scale at the the scale/grade
time increment pay
was given
01.03.2004 01.03.200 Rs.100/- Rs.100/- x114 Rs. 11400/-
1 Increment –TA
st
4 to (01.03.2004 to months
(4000-100- 31.05.201 31.08.2013
6000) 5
Rs.210/- Rs.210/- x 21 Rs. 4410/-
Revised scale: (01.09.2013 to months
5200-20200, 31.05.2015)
GP:Rs.2000/-

01.02.2005 01.02.200 Rs.100/- Rs.100/- x Rs. 10300/-

2 nd
Increment – 5 to (01.02.2005 to 103 months
TA 31.05.201 31.08.2013)
(4000-100- 5
6000) Rs.210/- Rs.210/- x 21 Rs. 4410/-
(01.09.2013 to months
Revised scale: 31.05.2015)
5200-20200,
GP:Rs.2000/-
01.02.2006 01.02.200 Rs.100/- Rs.100/- x 91 Rs. 9100/-
3rd Increment – 6 to (01.02.2006 to months
TA 31.05.201 31.08.2013)
(4000-100- 5
6000) Rs.210/- Rs.210/- x 21 Rs. 4410/-
(01.09.2013 to months
Revised scale: 31.05.2015)
5200-20200,
GP:Rs.2000/-

TOTAL Rs.44030/-
Total amount of Arrears (1 + 2 st nd
+ 3 rd
increments) = Rs. 44030/-
(Rupees Forty four thousand and thirty only)
The expenditure may be debited to the grant under the head ‘Salaries’ for the
F.Y: 2015-16.

(PANKAJ KUMAR)
Addl.CIT, DDO Range-3(1),
Mumbai.

No.Addl.CIT/DDO Range-3(1)/Estb./2015-2016 Office of the

Addl.CIT,
DDO Range-3(1),
Room No: 25D, Aayakar
Bhavan,
Mumbai-400020.

Dated : 30.06.2015

SANCTION ORDER

Sanction is hereby granted for drawing of arrear amount of Rs.2010/-

(Rupees Two thousand and ten only), being difference as per revised rate of
increment/Special Pay, for Sportsperson excelling in National / International
sporting events w.e.f 01.09.2013 as mentioned in OM No.6/1/2013/Estt(Pay-1)
dated 19.9.2013 and letter No. Addl.CIT(HQ)Pers./Sports/2013-14 dated
02.09.2014 in the case of Shri. Suryakant Y More, NS, who was working in the
office of Pr. Commissioner of Income Tax – 3, Mumbai for the below mentioned
period.

Corrsponding Revised Pay Special pay Amount Amoun Differenc

Designation Scale amount Due t drawn e
and Pay Scale against the (Arrear
at the time scale/grade due)
increment was pay and Period
given
01.05.1991 4440-7440 01.09.2013 to Rs.2520/ Rs.510 Rs.2010/
1 Increment
st
GP:1300 30.11.2013 @ - / -
(2550-55- Rs.210/- per
2660-60- increment for
3220) 3 months
01.02.1996 4440-7440
2 Increment
nd
GP:1300
(2550-55-
2660-60-
3220)
01.08.1999 4440-7440
3 rd
Increment GP:1300
(2550-55-
2660-60-
3220)
01.09.2013 5200-20200
4 th
increment GP:2000
(5200-20200)
GP:2000

Total amount of Arrear due = Rs.

2010/-

(Rupees Two thousand and ten only)

The expenditure may be debited to the grant under the head ‘Salaries’ for the
F.Y: 2015-16.

(PANKAJ KUMAR)
Addl.CIT, DDO Range-3(1),
Mumbai.
No.Addl.CIT/DDO Range-1(1)/Sports Inc. arr./2015-2016 Office of the
Addl.CIT,
DDO Range-1(1),
Room No: 207, Aayakar
Bhavan,
Mumbai-400020.
Dated : 12.08.2015.
SANCTION ORDER
Sanction is hereby granted for drawing of arrear payment of increment / Special
Pay for Sportsperson excelling in National / International sporting events
amounting to Rs.30200/- (Rupees Thirty thousand two hundred only) in the case
of Shri. Milind R. Purnapatre, Inspector, working in the office of Addl. CIT,
Range-16(2), Mumbai for the below mentioned period. These are the 1 st, 2 nd , 3 rd
and 4 th ncrements/special pay granted to the official vide orders No.
Addl.CIT(HQ)Pers./Sports/2003 dated 09.05.2003, No.
Addl.CIT(HQ)Pers./Sports/2005 dated 14.03.2006, No.
Addl.CIT(HQ)Pers./Sports/13-14 dated 15.09.2014 and No.
Addl.CIT(HQ)Pers./Sports/13-14 dated 15.09.2014 respectively. the effect of
which have been given in the salary of the official and no arrears of Special pay have
been paid earlier to the official concerned.
Corresponding Arrear Special pay Amount Amount Difference
Designation and period amount Due (Rs.) Drawn (Amount
Pay Scale at the against the (Rs.) due) (Rs.)
time increment scale/grad
was given e pay
01.02.2003 01.02.200 Rs.150/- 19050/- 19050/- 0
1 st
Increment – 3 to (150/-
Sr.TA 31.08.201 x127)
Pre-Revised 3
Scale (127
(5000-150- months)
8000) Rs.400/- 3200/- 1200/- 2000/-
Revised scale: 01.09.201 (400/- x 8)
(9300-34800), 3 to
GP:Rs.4200/- 30.04.201
4
(8 months)

01.03.2004 01.03.200 Rs.200/- 22800/- 22800/- 0

2 nd
Increment – 4 to (200/-
Inspector 31.08.201 x114)
Pre-Revised 3
Scale (114
(6500-200- months)
10500)
Rs.400/- 3200/- 1600/- 1600/-
Revised scale: (01.09.201 (400/- x 8)
(9300-34800), 3 to
GP:Rs.4200/- 30.04.201
4)
(8 months)

01.01.2006 01.01.200 Rs.200/- 18400/- 0 18400/-

3rd Increment – 6 to (200/-x
Inspector 31.08.201 92)
Pre-Revised 3
Scale (92
(6500-200- months)
10500)
3600/- 0 3600/-
Revised scale: Rs.450/-
(9300-34800), (01.09.201 (450/- x 8)
GP:Rs.4600/- 3 to
30.04.201
4) (8
months)

01.04.2013 01.04.201 Rs.200/- 1000/- 0 1000/-

4th Increment – 3 to (200/- x 5)
Inspector 31.08.201
Revised Scale 3
(9300-34800) (5 months)
GP:Rs.4600/-

Revised scale: Rs.450/- 3600/- 0 3600/-

(9300-34800), (01.09.201 (450/- x 8)
GP:Rs.4600/- 3 to
30.04.201
4)
(8 months)

TOTAL 74850/- 44650/- 30200/-

Total amount of Arrears (1 + 2st nd
+ 3 rd
+ 4 th
increments) = Rs. 30200/-
(Rupees Thirty thousand two hundred only)

The expenditure may be debited to the grant under the head ‘Salaries’ for the
F.Y: 2015-16.
 (VIVEK ANAND OJHA)
Addl.CIT, DDO Range-1(1),
Mumbai.

HANDIDNG OVER NOTE IN RESPECT OF TDS RANGE 1 (1),

MUMBAI

Prepared and Handed Over by: Kailash P. Gaikwad, IRS, JCIT, TDS Range
1(1), Mumbai
Taken Over by: Pankaj Kumar, IRS, Addl. CIT TDS Range 1(1), Mumbai.
*********

I took over the charge of TDS, Rasnge-1 , Mumbai, on 08/09/2014. During the
year, the pending actions have been pursued on the basis of registers/records maintained
in the Range office, details received from the officers of the charge and communication
received from various sources. In pursuance of the restructuring of the Department w.e.f.
15.11.2014, this Range replaced with TDS Range1 and TDS Range 1(2).
2. Profile of the charge and the central Action Plan , 2014-15: The TDS charge of
Mumbai contributes to around 10% of the Revenue collected annually at the National
Level. With more and more new areas of transactions being brought into the ambit of
TDS, this charge gains further importance as well as sensitivity.

Sr. No. Name of the Designation

officer Jurisdiction
(Alphabets)
1. Shri R K Madanlal DCIT (TDS), 1(1) A, B AND C (Rs.
lakh and above)
2. Shri Selva Gandhi ITO (TDS) 1(1)(1) AA TO AM
(below Rs. 50
lakhs)
3. Shri Rajeev N. Asher ITO (TDS) 1(1)(2) AN TO AZ
4. Shri Bhagawan Mahire ITO (TDS) 1(1)(3) B
5. Smt. Alice Edwin ITO (TDS) 1(1)(4) C
02. 1 The jurisdiction of TDS Range 1(1), Mumbai is over deductor whose name starts
with alphabets from A to C . There is one DCIT i.e DCIT (TDS) 1(1) and there are 4
posts for ITOs which are being manned by 4 ITOs. The details of Officers and their
jurisdictions are as below:

03. Budget Collection: The budget target, for F.Y. 2015-16 , in respect of TDS
Range 1(1), Mumbai has not been allocated. Ion order to evolve best strategies for
enhancing budget collection, it may be useful to refer to the strategy adopted last year.
The monthly DO letters and two way correspondence of this office and those of
CIT(TDS)-1, CCIT(TDS), CCIT(CCA) AND CBDT are user to understand the
experience of the last years and to formulate effective plans for this Year .
Budget Target and achievement:
FY Original Target (in Rs. crore) Revised Target (in Achievement (in Rs.
Rs. crore) crore)
2014- 14,360 13,230 13,231
15

04. Matters relating to issue of Certificates u/s 197 of the I.T. Act: Issuing
certificates u/s 197 is one of the key areas of work in TDS This area of work is highly
sensitive and calls for preventive vigilance.
04. 1 section 197Act provides that an assessee can make an application in Form No. 13
before the AO. In turn , is reprised to examine the application, look into the return and
financial statements for the past three years, check if there is any demand outstanding,
and if everything is found to be in order, he/she should forward the application to the
Range Head with his/ her comments stating therein if the case is fit for approval or
rejection. If the TDS /Tax forgone as a result of issue of the certificate would be more
than 50 lakhs, the Range Head is required to forward it to the CIT TDS for his approval
or rejection, as the case may be. For cases where the tax forgone is less than 50 lakhs, the
JCIT/Addl. CIT is required to approve or reject the case at his level.
04. 2 The Citizens Charter requires the application u/s 197 to be disposed of within 30
from the date when the application, completed in all respects, is submitted by the
assessee. In other words, after the assessee has submitted its application, the SO, if
needed, may issue a query letter to the assessee. The time limit of 30 days would start the
day assessee has submitted its reply and there is no further query by the AO in that case.
04. 3 An application u/s 197 can lead to finding of certain issues which may not be
directly relevant to TDS but which may be of relevance to the AO in the assessment wing
or in the othe4r wings of the department. In such cases, the AO is required to intimate tat
officer and proceed ahead towards issuance of the certificate as per the procedure. If
however, something of relevance to TDS is noted, a resort to section 201 should be taken.
04. 4 In order to handle and supervise this aspect of work properly and promptly, it
is suggested that the relevant legal provisions/ rules and instructions of CBDT may be
perused. All the officers maintain register for applications u/s 197 and a register in the
Range office is also maintained for this purpose along with an excel sheet also. Each case
is assigned a dest5inct number. This number should be marked on the assessee’s copy as
well.
04. 5 Lot of emphasis has been placed on this subject in almost all the meetings
with the officers. A number of measures have been suggested to facilitate proper and
prompt disposal of applications u/s 197 of the I.T. Act. Suitable procedure was suggested
and circulated among the officers vide various letters issued from this office. Again, the
instruction of CIT-TDS, Mumbai issued vide letter dated 3/4/2013 of this office. This
area of work requires close supervision. The CCUT (TDS) Mumbai has given the
directions regarding processing and disposal of applications u/s 197 vide the minutes
of meeting dated 11.06.2015. The same are contained in Para L of the said minutes.
Please go the same.
04. 6 Apart from this, a number of meetings have been conducted with the officers
and the staff at frequent intervals in order to sensitize them regarding the sensitivity of the
area. The online filing and processing of applications u/s 197 is fully functional now and
some applications are also processed online. The applicants may be encouraged to file the
applications online and such applications need to be given priority for processing for
encouraging the online filing of applications.
05. Current Action Plan 2015-16: The Central Action Plan has been received
and the same have been circulated amongst the Assessing Officers. The thrust areas
remain mostly the same in the current action plan. Before the Central Action Plan , the
Interim Action Plan was received. The targets allocated in the Interim Action Plan are
allocated to Assessing Officers and a review of such targets is also taken. In this respect,
the CCIT (TDS) , Mumbai has taken a review meeting on 11.06.2015 for reviewing the
Interim Action Plan. The minutes of meeting are received on 01.07.2015 The same are
circulated amongst officers and compliance-cum-action taken report is called for from
6the Assessing Officers by 15.07.2015. The directions of CCIT (TDS) contained in these
minutes of meeting may be kept in mind.
06. An in-house training of the officers and the staff has been initiated at the Range
level. This needs to be taken further. One such training workshop for all the incoming
officers was held on 22.6.2015. They have been apprised of all the technicalities of TDS
administration, TRACES, CPC-TDS, CPGRAMS and online filing and processing of
applications u/s 197. Though the officers have told that the training was useful for them,
one more such workshop is needed in the month of August after they have worded for
more than a month. They have been impressed upon that they need to log-in and
work on different applications like TRACES, ITD , CPGRAMS and www.
Cittdsmumbai. In themselves as a first thing in morning every working day.
07. Though the work in TDS has increased enormously in the last two F.Yrs. it
suffers from an acute shortage of manpower. Out of the manpower that is available, the
necessary skills are also lacking. Also, TDS is a very sensitive charge due to the
application u/s 197 and grievances relating to corrections on the system, refunds and
mismatch related demands . The scope of public contact is wide. Appropriate conduct
while dealing with assessee’s representatives and professional bodies is very necessary to
be impressed upon the officers who have come to TDS in this year.
08. Prosecution and Compounding: The Central Action Plan has laid a lot of
emphasis on Prosecution and compounding of offences. This aspect of word deserves a
priority attention. In F Y 2014-15, prosecution in 2 cases is launched and report on
compounding of offences. Is submitted in 18 cases. As this continues in the current year
as well, the pressure on this front of work will need to be maintained. The CCIT(TDS)
Mumbai has given the directions regarding processing and disposal of applications
u/s 197 vide the minutes of meeting dated 11.6.2015. The same are contained in Para
H and I if the said minutes. Please go through the same.
09. Educational Seminars: Educational Seminars are conducted to impart to the
assessee an insight into the statutory need to deduct TDS promptly and properly. The
session is addressed by a power point presentation and the officers of the Range answer
their queries. As this is an ongoing exercise this needs to be continued during the current
years as well. In the last Financial Year , such educational seminars are conducted into
Government/semi-Government and private organizations. Recently, M/s Bombay Goods
Transport Association gas requested for such an educational seminar for their
members who are Into the business of goods transport. The details are with DCIT
(TDS) 1(1), Mumbai. This may kindly be accorded a priority. One such seminar may also
be conducted in case of Air India Ltd. since there are large numbers of defaults in their
TDS returns resulting into huge demand by CPC-TDS. The CCIT (TDS) Mumbai has
given the directions regarding educational seminars vide the minutes of meeting
dated 11.06.2015. The same are contained in Para J of the said minutes. Please go
through the same.
10. Surveys u/s 133A and Inspections: TDS surveys are regularly conducted by
the TDS Charge. A list of cases in which surveys have been conducted and those in which
actions u/s 201has been initiated are a part of the Range office records maintained by the
Inspector posted in this office. Actions akin to surveys are conducted In respect of
Government Offices as well. These are called inspections as the Government Offices are
within the jurisdiction of ITO(TDS) 1(1)(1), Mumbai. The survey folders, in respect of
surveys conducted in F.Y. 2014-15 of the Range office are in the custody of the ITI. The
Assessing Officers may be asked to pursue actions arising out of surveys conducted
earlier, depending upon implications for latest assessment years/other years. In this F.Y ,
A survey action us 133/A (2A) is conducted in this case by ITO (TDS) 1(1)(4) , Mumbai.
The survey report is submitted. Notices u/s 201(1) have been issued for relevant
assessment years. The CIT (TDS)-1, Mumbai has asked for a compliance report in
respect of some issues form ITO (TDS) 1(1)(4), Mumbai. In case of Akshata
Mercantile Pvt. Ltd. and Champalal Steel Pvt. Ltd a complaint regarding non- deposit of
TDS is received. These cases can be taken for surveys on a priority basis.The file is with
DCIT (TDS)1(1), Mumbai. Some of the group cases are with DCIT (TDS) 2(1), Mumbai
which may require to be clubbed for survey actions.
11. Grievance Redressal/CPGRAMS/TAX Evasion Petitions: Quite a large
number of grievances are received by the TDS Charge . The grievances primarily relate
to less or no credit of TDS deducted by the deductor. The implication of such a in the
Government accounts. This clearly attracts prosecution. During the last year surveys have
been con ducted in some such cases and prosecution notices have been issued. This needs
to be followed up. In this F y. large numbers of grievances were received in case of
Chinar Shipping and Infrastructure (India) Pvt. Ltd. A survey action u/s 133A (2A)
is conducted in this case by ITO (TDS 1(1)(4) , Mumbai.
11. 1. Another such case is that of Andur Drugs and Phar5ma Ltd. and Amar
Remedies Ltd. The details of their grievances are with DCIT (TDS) 1(1), Mumbai.
These grievances may be taken up on priority by the Assessing Officer since the
complainant is following up with this office. Similarly, online complaints on CPGRAMS
are also received, a tab on which needs to be kept.
11 .2. Another such case is that of Arshia International Ltd. There are grievances in
this case on CPGRAMS, report in such grievances for settling them is submitted to CIT
(TDS)-1, Mumbai. M/S Arshia International Ltd and group companies are defaulting
habitually on TDS deposits. They were followed up constantly in last year , but with little
success. Such a follow up may be continued in this In this F Y also.
The CCIT (TDS) Mumbai has given the directions regarding processing and
disposal of grievances vide the minutes of meeting dated 11.06.2015. The same are
contained in Para G of the said minutes. Please go through the same for compliance.
12. Penalties: Fresh penalties have been initiated and disposed of in the last F. Y .
This area of work may be taken up on priority. The AOs may be asked to furnish the
proposals for initiating penalty proceedings at the earliest. Wherever proposals are
already received, notices may be issued, accordingly. A watch on the disposal of appeals
is required to be kept in order to pursue the penalty proceedings kept in abeyance, if any .
For a ready reference, the register for penalties maintained by the Range office can be
referred to.
13. Top Deductors: The details of top deductor are available in the Range
office. The list of top deductors, for F. Y. 2015-16, has to be revised on the basis of
collection for F.Y. 2014-15. It would be preferable to maintain the list of top 200 deductor
for the purpose of monitoring collections. The figures of collection as per TRACE are not
appearing correct. The list generated through TRACES may be verified before initiating
the monitoring exercise.
14. Dossier Reports: All the dossier reports, in respect of cases involving demand
of Rs 1 Core and above, are being sent regularly. The dossier reports, in respect of cases
involving arrear demand above Rs 10crores, have been sent for the quarter ended on
31/3/2015. The comments received from the higher authorities have been circulated
among the officers. Post restructuring there was a delay in submission of dossiers and
detailed reasons for such a delay are reported to h9igher authorities. Such a letter is
with Inspector/ Sr. TA of this office.
15. Statistical Reports : All the statistical reports, monthly and quarterly, have been
sent regularly. The same have been compiled on the bases of the reports/details received
from the officers. A number of instructions have been issued to the officers in order to
maintain accuracy in the reports sent. I have adequately cautioned the officers while
preparing the CAP-1 for the month of March, 2015 to maintain accuracy and
reasonableness. The Assessing Officers are not in the habit of furnishing D.O. Letters and
sometimes even the basic details required to compile the Range reports/ DO are not
forthcoming.
Post-restructuring, there was a problem with reconciliation of demand as per
original jurisdiction and later jurisdiction after restructuring. The detailed
explanation for justification of each of the column and figures therein in CAP-I is
given in CAP-I is given in CAP-I submitted for the month of April 2015.
The stenographer posted with this Range can take dictations only in Hindi. He is not
conversant with dictations in English and this creates problems in writing Dos each
month as typing the letters oneself becomes time consuming and in a scenario with a
heavy work load, this area of work bears the adverse impact.
16. Handing over note of Officers: The CIT (TDS), Mumbai had issued
instructions that all the officers going out on transfer should necessarily prepare and
furnish handing over notes to the respective successors. Accordingly, the outgoing
officers have furnished handing over notes and copies of the same are available in the
Range Office (with Office Superintendent).
RTI Appeal: One appeal under the RTI Act 20085 is received in this office; a notice of
hearing is issued to the appellant. The file is with Shri Umesh Raghotre, ITI in Range
office.
17. House Keeping activity/ pending actions: In the beginning of the new F. Y.
2015-16, this office has instructed all the officers and staff members in respect of
housekeeping activity, updating registers/ records and handing over notes. I had also
asked the official /staff members, working in the Range Office to update the
register/records and list out pending actions in the Range office.
The registers maintained in the range office relate to 197 applications, penalties,
grievances, audit objections, appeals RTI appeals TAX Evasion Petitions and SURVEYS.
These will need to be updated.
A meeting of the Officers may be taken, Immediately in order to ascertain the status of
housekeeping activity and drawing up all pending actions. According the register/ record
of the Range office need to be updated, wherever required. This is important ass primary
details and records are available with the Officers and unless they furnish relevant details
the range registers/records cannot be updated completely. It may noted that in TDS
charge , almost all of the first quarter of F. Y. goes in processing application u/s 197. The
Assessing Officers were asked to identify the almirahs and cupboards belonging to their
charge. Some of the officers have still not done the same. They may again kindly be
instructed to do so.
18. Computer/printer etc.: 1 newly purchased computer (desktop), 1 HP laser jet
printer, 1 steel almirah , 2 telephone instruments available in the chamber of Jt. /Add. CIT
(TDS) Range 1(1), Mumbai are handed over herewith .
19. Secret Service expenditure: One folder containing the details and documents
relating to Secret Service Expenditure for F.Y. 2013-14, is handed over herewith. The
folder contains all the related correspondence, receipts/ vouchers/ cash book and
contingent register. In terms of letter dated 22/2/2013 of the DIT (Expd./Budget), New
Delhi in F. No. DIT (EB) SSE\2012-13\2413, the expenditure under consideration is not
subject to scrutiny by any audit authority. However, the purpose for which the funds are
utilized is open to inspection by higher authorities. Therefore, the details/documents
handed over may be forwarded for inspec6tion by CIT (TDS), Mumbai. Folder. In one
Volume relating to Agreed List of Group ‘A’ and “B” officers for the year 2013 is handed
over herewith. Folder containing TAX Evasion Petition relating to telecom operators is
handed over herewith for perusal and action.
All the registers/ records/ reports/ correspondence, except the folders handed over
mentioned as above, are in the custody of officials/staff posted in the range office.
A gist of some important issues alive in TDS is attached separately for reference.
Date: 03 July 2015.

Handed over Taken

Over
[KAILASH GAIDWAD]
[PANKAJ KUMAR]
Joint Commissioner of Income Tax Addl. Commissioner of Income
Tax
TDS, Range-1(1), Mumbai TDS, Range-1(1),
Mumbai
 IMPORTYANT ISSUES:

1. Lease Premium paid to Mumbai Metropolitan Regional Development

Authority

Survey conducted in the premises of Mumbai Metropolitan Regional Development

Authority (MMRDA) revealed that several entities are not deducting TDS on payments
of lease premium to MMRDA.

The definition of rent given in clause (i) of the explanation to section 194-I is very
comprehensive and includes any payment, by whatever name called, under any lease,
sub-lease, tenancy or other agreement or arrangement for the use of land. This definition
would include lease premium paid to MMRDA/CIDCO as well.

The remuneration for the lease is bifurcated into rent and lease premium. The amount of
5rent is so nominal and insignificant that it is clear that the lease premium is in the nature
of advance rent

The restrictive covenants in the lease agreement clearly show that the agreement is not
one of sale but is in the nature of lease

On the basis of survey, notices were sent to lessees who had not deducted tax at source
u/s. 194-I on the payments of lease premium exceeding Rs. 5700 crore to MMRDA for
the period F.Y. 2008-09 to 2010-11 and orders u/s 201 were passed.

The ITAT Chennai has upheld the department’s attend on this issue However, the ITAT
Mumbai has ruled against the Department and we are in appeal before the High Court.

2. Telecom sector-Non –deduction of TDS On commission payments made to

dealers for sale of pre- paid SIM cards and recharge coupons.

Survey conducted in the case of Telecom companies such as Vodafone, Maharashtra Tele
services etc revealed that they are providing prepaid and postpaid mobile services
through a network of dealers/distributors.

In the case of post paid services, dealers were being paid a commission for their services
on which TDS was being deducted, but in the case of prepaid SIM cards and recharge
coupons, the dealers remit the payments to the telecom companies after deduction a
certain fee/discount.
Since the nature of services performed by the dealers in both prepaid and postpaid
services was the same, the payment made for prepaid services was also in the nature of
commission liable to TDS u/s 194H of the Act.

The High Courts of Kerala , Calcutta have upheld the stand of the department in view of
the principal-agent relationship between the telecom companies and dealers and the fact
all risks and pricing of the products continued to be with the telecom companies.

3. HDFC bank-commission paid by retailers on account of credit card

payments

HDFC bank installs its swiping machine at the premises of the merchant establishment
where the customers’ credit card is swiped. The bank then makes payment to the
merchant but retains a certain amount as commission for the services rendered.

The amounts retained by the banks is clearly in the nature of commission for the services
rendered as defined in section 194H of the Act liable to TDS @10%. Hence action is
being taken against the major retailers for non deduction of TDS on such commission
payment. Similar issues may be checked with other bands as well.
4. LTC matters in Government Banks:

It was observed that in certain Banks, especially, SBI the employees were allowed to
travel to foreign destinations on the grant of LTC can be availed of only for travels within
the political boundaries of India, the Bank has been asked to withdraw the grant of LTC
and deduct TDS on the amounts paid to the employees on this account. This issue may
also be taken up in respect of other Government Banks.

5. Payments made to Doctors by a Hospital:

The hospitals, while paying to the doctors, as a general rule, deduct TDS on payments
treating them as Professional charges. However, a Probe into the matter traveled that
some of the doctors have been hired in terms of employer-employee relationship. The
TDS on payments made to them should have, therefore, been deducted as salary ay 20%
and not at 10% render the head Professional charge. This issue may be looked into in the
cases of hospitals lying under the jurisdiction of Range 1(1).

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