Taxability of non-resident payments and TDS issues sent back for fresh appellate consideration after no specific findings were recorded.

Disputed issues concerning taxability of payments to non-residents, the exceptions under section 9(1)(vi)(b) and section 9(1)(vii)(b), liability to deduct tax under section 195, the effect of section 206AA on grossing up under section 195A, and refund interest required fresh adjudication because no specific finding had been recorded on those points. The appellate authority was directed to reconsider the matter after giving the assessee an opportunity of hearing, and the appeals were allowed for statistical purposes.

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Issues: Whether the disputed issues relating to taxability of payments to non-residents, deduction of tax at source, grossing up, and interest on refund should be restored to the first appellate authority for fresh adjudication.

Analysis: The appeal records that the first appellate authority had not returned a specific finding on the assessee's contention that the payments fell within the exceptions to section 9(1)(vi) and section 9(1)(vii) of the Income-tax Act, 1961 and were not chargeable to tax under the treaty framework. In the absence of a clear finding on the disputed issue, the matter was considered fit to be remitted so that the issues could be examined afresh after giving the assessee an adequate opportunity to place evidence and submissions.

Conclusion: The disputed issues were restored to the file of the first appellate authority for fresh adjudication; the appeal was allowed for statistical purposes.

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