Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (9) TMI 41 - ITAT HYDERABADDisallowance u/s 40(a)(i) - withholding tax - taxability of commission income in India - Held that:- In the case of foreign agents who procure orders for exports to Indian Assessees, services are rendered by the agents outside India and the remuneration for such services will constitute business profits of the foreign agents. They are not rendering technical services for procuring orders and hence remuneration for procuring orders cannot be considered as fees for technical services. As the agent did not have any permanent establishment in India no part of the commission payable for procuring export orders is taxable in India - Following decision of CIT Vs EON Technology [2011 (11) TMI 20 - DELHI HIGH COURT] - Decided against Revenue. Weighted deduction u/s 35(2AB) - expenditure on research and development facility (R&D) - AO disallowed the claim u/s 35(2AB) made by the assessee on the ground that the requisite certificate from the prescribed authority had not been filed - Held that:- In view of the ratios laid down in CIT Vs. Sandan Vikas (India) ltd., [2011 (2) TMI 66 - DELHI HIGH COURT] and CIT Vs. Claris Lifesciences Ltd., [2008 (8) TMI 579 - Gujarat High Court] and in the light of certificate issued by DSIR, Government of India dated 16.06.2009, we set aside the issue to the file of the AO to grant weighted deduction u/s 35(2AB). The balance expenditure if any not approved by the DSIR will have to be considered for deduction under section 35(1) or under normal provisions of the Act. The expenditure has been incurred by the R & D facility of the assessee approved by the Government of India. Merely because part of the expenditure incurred by the approved R & D facilities is not considered for weighted deduction under Section 35(2AB) would not render expenditure is not towards R & D or not for the purposes of the business. Allowability of such expenditure u/s 35(1) or under other appropriate provisions of the Act will have to be considered - Decided partly in favour of Revenue.
|