TaxTMI 
TaxTMI 
2015 (9) TMI 1355
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....aborate grounds in its appeal; however the cruxes of the issues are that:- 1. The Ld. CIT (A) has erred in directing the AO to delete the disallowance made invoking the provisions of section 40(a)(ia) of the Act for not deducting tax on the payment of Rs. 1,13,51,946/- made to the seconded employees from the assessee's subsidiary company which is to be reimbursed by the assessee's subsidiary company. 2. The Ld. CIT (A) had erred in directing the A.O to rework the disallowance made by applying the limb (iii) of Rule 8D(2) after reducing the investments made in subsidiary companies. 3. The brief facts of the case are that the assessee company is engaged in the business of consultancy in export agency services, investments....
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....e assessee's seconded employees because of the following reasons:- "i. There exist a separate agreement to render services to the assessee company by the other party i.e. M/s.Simpson & C. Ltd. ii. Being both the parties are different legal entities and one party rendered services to other party, the provisions of Chapter XVII-B is attracted. iii. None of the employees or man power which rendered the services under this head of expenses are in the roll of the assessee company and in fact they are all employees of the other party i.e. M/s. Simpson & Co. Ltd. which rendered the services. iv. The arrangement or agreements are between two legal entities and not between the assessee and the employees. Even in t....
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....is squarely covered in favour of the assessee by the decision of the Delhi Bench of the Tribunal in the case United Hotels Ltd Vs. ITO in ITA No.1600/Del./2001 for the assessment year 1998-99 vide order dt 11.11.2004 reported in 93 TTJ (Del) 822. The Ld. D.R on the other hand argued in support of the order of the Ld. Assessing Officer. 4.3 We have heard both the parties and carefully perused the materials available on record. The claim of the assessee is that the assessee is only making payment to its seconded employees from the assessee's subsidiary company on behalf of its subsidiary company which is to be reimbursed to the assessee company by the assessee's subsidiary company. The tax is deducted at source directly by the assessee's s....
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....ssessee's hotel were carrying on any profession. If an accounts executive was deputed, he was doing the duty as was assigned to him by his employer. It cannot be said that he was carrying on the profession of accountancy and that what he received were fees in the course of carrying on such profession. In fact, what he received was merely salary from the employer for doing the duty assigned to him by the employer. Similarly, if an engineer was deputed, the engineer was not rendering any technical consultancy to the assessee. He was merely doing his duty as an employee. The meaning assigned to the expression "fees for technical services" is the same as is given in Expln 2 to s. 9(l)(vii). The case of the Revenue is that the persons who were d....
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....sement of salaries in respect of various personnel deputed to the hotel of the assessee. The alternative contention of the counsel also has to be accepted in view of the clear provisions of the Explanation to s. 191. Assuming, without admitting, that the assessee was liable to deduct tax at source under s. 194J, still no demand for non-deduction of tax could have been raised against the assessee. This is because the deductor will be liable only if the recipient has not paid the tax on the amount received by him. In the instant case, it is not disputed that the deputed persons, wherever liable, have paid the tax on the salaries received by them and hence no further tax can be collected from the assessee. The order passed under ss. 201, and 2....
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....10(34) of the Act. Therefore, the Ld. Assessing Officer invoked the provisions of Section-14A read with Rule 8D and made additions. On appeal the Ld. CIT (A) held the issue in favour of the assessee by following the decision of this Bench of Tribunal by observing as under:- "5.2 I have carefully considered the facts of the case and the submissions of the Ld. A.R. Similar issue has come up for discussion before me in the appellant's own case for A.Y 08-09 wherein the ground was partly allowed vide ITA No.340/10-11/A-I (New ITA 124/CIT(A)-1/2010- 11) dated 26.12.2014 with a direction tot eh A.O to rework the disallowance under limb (iii) of Rule 8D(2) and disallow the amount, if any, after reducing the investments made in subsidiary ....