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TMI Blog2019 (5) TMI 2010X X X X Extracts X X X X X X X X Extracts X X X X ..... mmission earned by non-resident agent who carried on the business of selling Indian goods outside India cannot be said to have deemed to be income which has accrued or arise in India. Also decided in Toshoku Ltd. [ 1980 (8) TMI 2 - SUPREME COURT] held that commission earned by non-resident who carried business of selling Indian goods outside India cannot be said to have deemed income which has accrued or arising in India. Decided against revenue. - Shri G.S. Pannu, Vice-President And Shri Pawan Singh, Judicial Member For the Appellant : Shri Manjunath Karkihalli (DR). For the Respondent : Shri Nitesh Joshi (AR). ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. These two appeal by revenue under section 253 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hed the copy of the decision of Bombay High Court in CIT vs. Gujarat Reclaim and Rubber Products Ltd. (supra). 3. On the other hand, the ld. Departmental Representative (DR) for the revenue strongly relied upon the order of Assessing Officer. 4. We have considered the rival submission of the parties and have gone through the orders of authorities below. 5. Brief facts of the case leading to the disallowance of Commission payments are that the assessee is in the business of manufacturing of embroidered fabrics and allied products, filed its return of income declaring income from Business Profession of Rs. 2,16,98,891/-. During the assessment, the Assessing Officer noted that assessee has paid commission of Rs. 97,66,610/- on which no tax was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he payment to such non-resident is made outside India on account of sale percentage. The non-resident does not have any geographical or Permanent Establishment in India. Tax Treaty exists with the country of residents of non-resident, residents of non-resident, residents of Italy, Franc Japan. The ld. CIT(A) further concluded that perusal of the agreements with the nonresidents agent disclosed that the agents were procured order from customer based on the price given by the assessee and pass such order to assessee for a fixed percentage of commission payable to the agent at the FOB value of the invoice and foreign currency after the fully payment has been received from the customers. From the term of agreement, it is clear that nature of se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court followed the decision of Hon ble Supreme Court in CIT vs. Toshoku Ltd. (158 ITR 525) on identical facts held that commission earned by non-resident who carried business of selling Indian goods outside India cannot be said to have deemed income which has accrued or arising in India. Considering the fact and the legal position as discussed above, we affirm the order of ld. CIT(A). Non contrary facts or law is brought to our notice to take other view. 9. In the result, appeal of Revenue for Assessment Year 2010-11 is dismissed. ITA No. 1148/Mum/2017 for A.Y. 2011-12 10. As we have noted above the revenue have raised identical grounds of appeal. The facts of the case are under consideration is that identical grounds except variation of fi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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