S.C. DHARMADHIKARI, J.

1. By these appeals, the Revenue has proposed common questions and stated to be substantial questions of law.

2. These questions are set out at pages 14 and 15 of the paper-book in Income Tax Appeal No.1315 of 2015.

3. These questions and the additional question stated to be of law are common to both these appeals.

4. It would be convenient to take the facts from Income Tax Appeal No.1315 of 2015. Therein the Revenue challenges the order passed on 10-12-2014 by the Income Tax Appellate Tribunal, Mumbai for the Assessment Year 2008-09. The Tribunal has dismissed the Revenue's appeal.

5. This Court's jurisdiction under Section 260A of the Income Tax Act, 1961 ("the I.T. Act" for short) is invoked in the following facts and circumstances.

6. The assessee before this Court is a Private Limited Company. It is carrying on business as a Third Party Administrator ("TPA" for short). The assessee is holding a licence from the Insurance Regulatory and Development Authority ("IRDA" for short). The Revenue claims that the assessee is appointed by various insurance companies to disburse amounts under what is styled as Mediclaim Insurance Policy. The insurance companies issue these policies which are serviced by TPAs like the assessee. The Revenue's case is that these TPAs act as facilitators and charge a fee. They provide services, inter alia, like hospitalisation, cashless access, billing and call centre services. All claims payable by the insurance companies for these services are routed through the TPA. The amounts are paid from an account styled as Claim Float Account ("CFA" for short) provided by the insurance companies. Under the cashless scheme, the amounts received from the insurance companies are disbursed directly to the recognized hospitals/clinics towards payments to various individuals receiving medical treatment. In the case of reimbursement, the payments are made by the TPA to the insured.

7. In para 3.2 of the memo of this appeal the Revenue says that, the arrangement is that the initial amount is paid by the insurance company to the assessee. This amount is deposited in the FA (Float Account). The payment for insurance claim is made from this account. Once the FA is utilised by the assessee, it presents the detailed information on disbursement to the insurance company and which is verified by the insurance company. Thereupon, the assessee is reimbursed the sums/amounts disbursed. This is a continuous process and throughout the assessment year. As stated above, the receipts and disbursements are routed through the bank account of the assessee for which the assessee passes certain book entries. It is stated that on receipt of the amount, the bank account is debited and the account of the insurance company is credited. On payment of claims to the hospitals/insured, the account of the insurance company is debited and the bank account is credited. It is in these circumstances that the Revenue alleges that the assessee prepares the Profit and Loss Account by taking only the service charges received as receipt, and administrative and operating charges as expenses. The claims receivable from the insurance companies and payable to hospitals are not routed through the Profit and Loss Account and are directly taken to the Balance Sheet and are reflected as assets and liabilities in the Balance Sheet.

8. In the instant case, the assessee filed a return of income on 28-9-2008 declaring total income of Rs.68,85,850/-. The return was processed under Section 143(1) of the I.T. Act. Later, a survey under Section 133A of the I.T. Act was conducted by the TDS Wing of the Department on 17-9-2009. It was noticed that the assessee had made payments to various hospitals during the year totalling to Rs.11,89,18,600/-, without deducting tax at source. It was claimed that this was required under Section 194J of the I.T. Act and that invited a disallowance under Section 40(a)(ia) of the I.T. Act. The Assessing Officer, therefore