https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=283204 https://www.taxtmi.com/caselaws?id=283204 Delay in filing appeal u/s. 248 extending upto 933 days - TDS on payments made to non-resident payees, and deposited the same in the State Exchequer - assessee approached the CIT(A) u/s 248 claiming that on the payments made to three non-resident payees, no tax was required to be deducted at source and CIT-A accepted the same - Indo-Thailand DTAA - HELD THAT:- Section 248 of the Act primarily deals with a situation where a person has deducted and paid tax to the Government, but thereafter denies his liability to deduct such tax. Thus, an appeal u/s 248 of the Act is preferred by a person only after he has actually paid the tax to the credit of the Central Government, whose liability he seeks to deny. In such a situation, where the bonafides of the assessee are not in challenge, the reasons advanced for the delay ought to be construed liberally. In conclusion, we hereby affirm the action of the CIT(A) condoning the delay in filing of the appeals before him. Thus, Revenue fails on this aspect. TDS on payments made to non-resident payees - DTAA between Indo-Thailand - PE in India - In the present case, there is no material to suggest that the recipient concerns have a permanent establishment in India or that they were present in India for a period exceeding 183 days during the previous year relevant to the assessment year under consideration. In this context, learned counsel for the assessee furnished appropriate certificates from the three recipient concerns tabulating the period for which their representatives were present in India during the relevant period which show that the presence in India was for less than 183 days. Therefore, on this aspect also, we find no merit in the plea of the Revenue and the discussion made by the CIT(A) in para 3.8 of his order in this context is hereby affirmed. As revenue CIT(A) has not considered the taxability of the impugned income as business income under Article 7 of the DTAA - Article 7 of the DTAA deals with business profits to be considered for taxation. The said Article states that the income or profits of the enterprise of a contracting State shall be taxable only in that State unless the enterprise carries on business in the other contracting State through a Permanent Establishment (PE) situated therein. The taxability is only of so much income as is attributable to that PE for the sales in that other State of the goods or merchandise. In this context, having regard to the definition of PE provided in Article 5(2)(j) of the Indo-Thailand DTAA, we find that the three recipient concerns cannot be said to have any PE in India so as to bring the impugned income to tax as business profits in India as per Article 7 of the DTAA. Therefore, on this count also we find no reason to interfere with the conclusion of the CIT(A) to the effect that assessee was not required to deduct tax on payments to the three recipient concerns. - Decided in favour of assessee Case-Laws Income Tax Thu, 28 Aug 2014 00:00:00 +0530