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Issues Involved:
1. Validity of the orders under section 163(2) of the I.T. Act treating the assessee as an agent of Tsvetmetpromexport, Moscow, U.S.S.R. 2. Timeliness of the appeals and payment of the appeal fee. 3. Existence of a business connection between the assessee and the foreign company. 4. Applicability of sections 9(1)(vii)(b), 163(1)(c), 115A, and 44D of the I.T. Act. 5. Timeliness of the order passed under section 163(2) of the I.T. Act. Detailed Analysis: 1. Validity of the Orders Under Section 163(2) of the I.T. Act: The primary issue in these appeals was the validity of the orders passed by the Assessing Officer under section 163(2) of the I.T. Act, which treated the assessee as an agent of Tsvetmetpromexport, Moscow, U.S.S.R. The assessee argued that there was no business connection with the foreign company, and thus, it could not be treated as an agent. However, the Assessing Officer observed that the payments made to the foreign company for technical services were chargeable to tax under section 9(1)(vii)(b) of the I.T. Act. The officer noted that even without a business connection, the assessee could be treated as an agent under section 163(1)(c) since the foreign company received income indirectly through the assessee. 2. Timeliness of the Appeals and Payment of the Appeal Fee: The assessee initially paid an appeal fee of Rs. 250, which was later supplemented with an additional Rs. 1250 to meet the total required fee of Rs. 1500. The assessee contended that the appeals were filed in time, and the short payment was due to a mistaken belief. The tribunal accepted this explanation and treated the appeals as in order. 3. Existence of a Business Connection: The assessee argued that there was no business connection with the foreign company, which is a prerequisite for being treated as an agent under section 163(1)(b). However, the Assessing Officer and the tribunal noted that the payments made to the foreign company were for technical services, which fall under section 9(1)(vii)(b) and do not require a business connection. The tribunal emphasized that section 163(1) includes four categories of persons who can be treated as agents, and the assessee fell under section 163(1)(c). 4. Applicability of Sections 9(1)(vii)(b), 163(1)(c), 115A, and 44D of the I.T. Act: The tribunal examined the applicability of various sections of the I.T. Act. It was determined that the payments made by the assessee to the foreign company were fees for technical services under section 9(1)(vii)(b). Section 163(1)(c) was applicable as it includes any person in India from or through whom the non-resident receives any income. The tribunal rejected the assessee's argument that there was no income arising to the non-resident from the assessee. Sections 44D and 115A were also considered, which provide for the computation of income from royalties and fees for technical services and the applicable tax rates. 5. Timeliness of the Order Passed Under Section 163(2) of the I.T. Act: The assessee argued that the orders under section 163(2) were time-barred as they were passed after a reasonable period. However, the tribunal held that there is no time limit specified for passing an order under section 163(2), and thus, the orders were not time-barred. Conclusion: The tribunal upheld the orders of the Assessing Officer for all four years in question, concluding that the orders were proper, legal, and valid. The appeals filed by the assessee were dismissed. The tribunal found that the payments made to the foreign company were fees for technical services and fell under section 9(1)(vii)(b) of the I.T. Act, and the assessee was rightly treated as an agent under section 163(1)(c). The tribunal also confirmed that the orders were not time-barred as there was no specified time limit for passing such orders.
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