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2018 (3) TMI 942 - ITAT DELHIPayment made to expatriate technicians in India - Non deduction of tds - revision u/s 263 - considering the residential status u/s 6 - DTAA between India and Japan - reference to Section 9(1)(ii) - assessee in default - revision u/s 263 - Held that:- It is not in dispute that in the original assessment order dated 3.5.2005, AO did not advert to the applicability of the provisions u/s 9(1)(ii) or the provisions of the DTAA between India and Japan but considered the case only u/s 6 of the Act in respect of the residential status of the employee. In view of the later decision of the Tribunal dated 21st October 2005 to the effect that the payment made to the expatriate technicians in India is taxable in India irrespective of their stay, CIT correctly held that the original assessment order passed by the AO is erroneous in so far as the provisions of Section 9(1)(ii) of the Act and the DTAA between India and Japan have not been taken into account is pre judicial to the interest of the revenue. AO did not consider the applicability of the provisions u/s 9(1)(ii) of the Act and the DTAA to the facts of this case, while respectfully following the decision of the Hon’ble Apex Court in the case of Malabar Industrial Co. Ltd. vs CIT (2000 (2) TMI 10 - SUPREME Court) - not open for the assessee to challenge the same on the ground that such an exercise amounts only to change of opinion. Coming to the merits of the case, as rightly held by the learned CIT in his order, the deduction of tax on the payments made to all the four employees requires consideration and for that purpose all the employees stand on the same footing. Since the case of two employees, namely, Mr. Masao Koga and Mr. Kiyonori Yana has already been decided by this Tribunal as being covered by the decision in the case of Pradeep J. Mehta vs CIT [2008 (4) TMI 6 - Supreme Court], we do not think it necessary to take a different view in respect of these two employees, viz. Mr. Takashi Suzuki and Mr.Tetsuo Mitera. Admittedly, the matter relating to the employees covered by the original assessment order is set aside to the file of the learned AO, we, therefore, set aside this matter also to the file of the AO for considering the case afresh in the light of the established principles after affording an opportunity to the assessee - Decided in favour of assessee for statistical purposes.
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