TaxTMI 
TaxTMI 
2015 (3) TMI 5
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....as well CIT(A) was not justified in disallowing export commission of Rs. 2,82,54,644/-. 3. The assessee craves the right to add, delete, modify any one or more of the grounds of appeal at the time of hearing. 3. The sole ground of appeal. Apropos disallowance of export commission to the tune of Rs. 2,82,54,644/-. 4. Brief facts of the case are that the assessee company is engaged in the business of manufacturing of Steel Ingots, Bar Etc and filed the of income for the Assessment Year 2009-10 before DCIT Circle-1(1), New Delhi declaring loss of Rs. 77,92,270/- on 29.09.2009. The AO, vide order under section 143(3) of the Income Tax Act, made certain addition/ disallowances and assessed the income at Rs. 2,04,62,374/- vide order date....
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....submissions of the ld AR are rejected. In view of the above facts and circumstances of the case, legal position and judicial pronouncement of the jurisdictional High Court, I hold that the AO was fully justified in coming to the conclusion that the commission paid to non-resident is income deemed to accrue or arise in India within the meaning of section 9 of the IT Act, 1961 and therefore, the assessee was liable to deduct TDS on export commission paid to non-resident and in making the disallowance u/s 40(a)(ia). The disallowance made by the AO is upheld. The ground of appeal is rejected." 6. Aggrieved by the said order of the ld CIT(A), the assessee/ appellant is before us. 7. At the outset the ld AR pointed out that in the assessee&....
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....sessment Year, wherein, by order dated 25.02.2013 in ITA No. 2264/Del/2012 it was held as under:- "6. We have heard both the sides, considered the material on record as well as orders of authorities below. It is found that the assessee has filed commission agreement at first appellate stage and CIT(A) has concluded to delete the impugned addition by elaborately discussing such issue from paras 5.10 to 5.13 of his order which reads as under: 5.10 I have carefully considered the assessment order, remand reports of the AO and the submissions made by the ld AR. The copy of commission agreement with M/s. Tranox GMBH to whom major commission was paid by the assessee was not asked for the AO during the assessment proceeding, although AO has ....
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....onal market. The assessee does not have any office outside of India. The export orders are received through agents in various countries approved to procure the orders against which the assessee supplies the goods to the foreign buyers. The assessee has submitted details of services rendered by the foreign agents. The assessee has also submitted bill-wise details of exports made and commission paid, along with copy of account of foreign agents giving particulars of the payments made to them against export invoices as well as commission accrued thereon, copy of payment vouchers and outward remittance advice issued by the Bank showing that the remittance advice issued by the Bank showing that the remittance was made directly by the Bank to the....
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....atories Ltd. 140 TTJ 796 has held that the commission paid to non-resident agent for services rendered outside India are not chargeable to tax in India. Similar view has also been expressed by the Hon'ble ITAT, Jaipur in the case of ACIT Vs. Modern Insulators Ltd. 140TTJ 715. The AO while making addition has relied upon the judgment of Hon'ble ITAT, Delhi which as pointed out by the ld AR has been overruled by the Hon'ble Delhi High Court in the case of Vanoord ACZ India Pvt. Ltd. Vs. CIT 323 ITR 130. Further the Hon'ble Delhi High court recently in CIT Vs. Eon Technology Pvt. Ltd. (2012) 246 CTR (Del) 40 on similar facts held that disallowance under section 40(a)(i) was not called for on sales commission paid to non-resident as per the fol....
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....ed opinion that conclusion as drawn by the CIT(A) in this case is just and appropriate, which calls for no interference at our ends. As such, while concurring with the finding as arrived at by the CIT(A), we uphold his order and dismiss the appeal of the Revenue being de void of any merits." 9. Having regard to the aforesaid decision, we are of the opinion that the assessee was not obliged to deduct TDS on payment of export commission to the non-resident and therefore disallowance need to be deleted. The ld CIT(A) as well as the ld DR, have relied upon the judgment in Havell's case (supra), in the said case, the assessee had incurred testing charges to a U. S. Company which was disallowed u/s 40(a)(i) of the Act. The Tribunal held th....