9911796707
TMI Blog2018 (4) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... that where the assessee has paid commission to its foreign agents outside India for services rendered outside India and claimed deduction of the same as business expenditure, the case of foreign agent is not covered by the provisions of section 9 and income of the foreign agent will not be taxed in India. The responsibility of deducting tax at source from the remittances of the commission to the foreign agent would arise only when such commission is taxable in India in the hands of the recipient. The income of the recipient in the form of commission received from assessee was not chargeable to tax in India. Therefore in the present case also the lower authorities have wrongly interpreted the provisions of section 40(a)(i) of the Act and al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company through agents for non-deduction of TDS by invoking the provisions of section 40(a)(i) of the Act. For this assessee has raised the following ground No. 1 and 2: - 1. On the facts and in the circumstances of the case and in Law the Hon'ble CIT(A) erred in upholding the addition made by the Ld AO by invoking provision of section 40(a)(ia) on commission payment made to Non Resident agent of ₹ 6,96,077/- and the reason assigned for doing so are wrong and contrary to the provision of Income Tax Act and rules made there under. 2. On the facts and in the circumstances of the case and in law the Hon'ble erred in confirming the addition made by the Ld AO by invoking provisions of section 40(a)(ia) on outward freigh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowance can be made by invoking the provisions of section 40(a)(i) of the Act. Aggrieved, assessee preferred the appeal before CIT(A) on both the issues i.e. disallowance of commission paid to foreign parties as well as outward freight charges paid to foreign shipping companies without deduction of TDS. The CIT(A) also confirmed the action of the AO. Aggrieved assessee is in second appeal before Tribunal 4. We have heard the rival contentions and gone through the facts and circumstances of the case. We find that the facts are admitted and there is no dispute about it. Admittedly, these payments are on account of commission made to foreign parties and similarly, the outward freight payments also made to foreign shipping companies. Admit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal to the ITAT was dismissed. It was noticed that the assessee had submitted a list of shipping lines along with the names of the agents and corresponding bills of lading to the Assessing Officer at the time of the survey itself. It was further held: In case the goods have been transported by a foreign shipping line, payments have obviously to be made to the foreign shipping lines or agents thereof. Even if payments have been made to sub-agents in some cases, these are passed on to the agents, who file return under section 172 in respect of such payments on behalf of the shipping lines. The finding of CIT (Appeals) is that confirma-tions have been filed from all the agents for filing of returns under section 172. Thus, finding has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany vide its reply dated 21-11-2003, had filed partywise details of Ocean Freight along with certain letters from the shipping companies/agents thereof stating that the said companies are Non- Resident Shipping Company or the agents thereof. 6. We are of the view that the question whether the payees, in the instant case, were agents of the nonresident shipping companies is a question of fact, which has been decided against the revenue concurrently by both the CIT (Appeals) as well as the ITAT. As already noticed, both the CIT (Appeals) as well as the ITAT have based their conclusions upon an appreciation of the evidence and held that in the facts and circumstances of the present case, the provisions of section 194C of the Act are not at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating the same as interest chargeable on the debit balance of Shri Madhu Sudhan Daga. Aggrieved, assessee preferred the appeal before CIT(A) who confirmed the action of the AO by observing in Para 5.6 as under: - 5.6 Ground 6: This is against the action of the AO in disallowing ₹ 1,15,370/- being interest on the debit balance of one of the partners capital account (Mr Madhusudhan Daga). The AO noted that the appellant was paying 12% interest to the other partners of the firm and no interest to this particular partner. However the fact that his capital account is in debit balance itself means that the interest bearing funds have been utilized by the partner himself. The AO therefore disallowed ₹ 1,15,370 being the interest o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
