2014 (10) TMI 1003 - AT - Income Tax

Admission od additional evidence -non deduction of tds u/s 195 - HELD THAT - Application has been made for admission of additional evidence and it is submitted that these evidences would be material and would help in deciding the issue. Considering the fact that the additional evidences would help in deciding the issue the same are admitted. However since these evidences were not available before lower authorities and also the case laws which were relied upon by the Assessee were not considered by the lower authorities we are of the view that in the interest of justice and fair play the issues raised in the appeal needs to be considered afresh in the light of additional evidence submitted by the Assessee and the other decisions on which it would like to rely upon - remit the issue to the file of A.O to decide the issue afresh after considering the submissions of the Assessee the decisions relied upon by Assessee and in accordance with law. - Appeal of Assessee are allowed for statistical purposes.

Summary

Issues:
Appeal against CIT(A) order for A.Ys. 2008-09 & 2009-10 - Disallowance u/s.40(a)(i) and Transfer Pricing adjustment.

Issue 1: Disallowance u/s.40(a)(i)
The Assessee appealed against the CIT(A) order upholding the AO's disallowance under section 40(a)(i) of Rs. 1,26,63,364 for failure to deduct tax u/s.195 for payments to Non-Residents. The Assessee contended that the CIT(A) erred in not considering their submissions positively. The Assessee argued that the disallowance should be deleted. The Tribunal admitted additional evidence submitted by the Assessee, including case laws and agreements, as crucial for the case. The Tribunal remitted the issue back to the AO for fresh consideration in light of the new evidence and case laws. Both parties agreed that the issue for A.Y. 09-10 was similar, leading the Tribunal to remit that appeal as well for fresh assessment. Ultimately, the appeal was allowed for statistical purposes.

Issue 2: Transfer Pricing Adjustment
The Assessee contested the CIT(A) order upholding the AO's addition of Rs. 8,52,070 on account of Transfer Pricing adjustment. The Assessee argued that the CIT(A) should not have confirmed the addition and failed to appreciate the detailed submissions made. The Tribunal admitted additional evidence submitted by the Assessee, which was deemed crucial for the case. The Tribunal remitted the issue back to the AO for fresh consideration in light of the new evidence and relevant case laws. Both parties agreed that the issue for A.Y. 09-10 was similar, leading the Tribunal to remit that appeal as well for fresh assessment. Ultimately, the appeal was allowed for statistical purposes.

In summary, the Appellate Tribunal ITAT Ahmedabad heard appeals by the Assessee against the CIT(A) orders for A.Ys. 2008-09 & 2009-10 regarding disallowance u/s.40(a)(i) and Transfer Pricing adjustment. The Assessee challenged the disallowance under section 40(a)(i) for non-deduction of tax on payments to Non-Residents and the Transfer Pricing adjustment. The Tribunal admitted additional evidence crucial for the case and remitted both issues back to the AO for fresh consideration in light of the new evidence and case laws. Both appeals were allowed for statistical purposes, emphasizing the need for fair play and justice in the assessment process.