2015 (11) TMI 915

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.... Income-tax Act, 1961. 2. The assessee has raised twelve elaborate grounds in its appeal, however the crux of the issue is that : (i) The learned Commissioner of Income-tax (Appeals) has erred in upholding the disallowance under section 40(a)(ia) of the Act towards professional charge paid to non-resident in foreign currency outside India, viz., Mr. Harry Davis (USA) Rs. 8,66,202, Mr. Anthony Battaglia (USA) Rs. 32,48,252 and Mr. Tony (Australia) Rs. 5,21,591. (ii) The learned Commissioner of Income-tax (Appeals) has erred in not taking into consideration of the Double Taxation Avoidance Agreement while considering the professional charges paid to the aforesaid three individuals. 3. The brief facts of the case are that the assessee is a....

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...., the CFO of the company Shri S. R. Venkatach alam appeared and filed the details of consultancy fees paid to Mr.Anthony Battaglia and Ms. Sharin Dawn Farrell. The CFO clarified that there is no written agreement regarding the professional charges paid to various consultants.  (i) Mr. Anthony Battaglia : This professional is a U.S. citizen and he was paid consultancy charges from April 2009 to December 2009. As seen from the invoices which were raised on 1st of every month, an amount of 7500 US Dollars were paid as consultancy fees. The appellant also furnished details of air ticket for Mr. Anthony Battaglia dated June 13, 2009. As seen from the invoices filed by the assessee, the service charges were paid for aircraft tyre retreading....

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.... signatory Mr. Harry Davis. It has to be considered that the invoice was raised by Mr. Harry Davis. Coming to the nature of services rendered, the invoice says retreading service for the month of . . .". The appellant also could not explain the nature of services rendered by Mr. Harry Davis in India. There is no agreement between Mr. Harry Davis and the appellant-company even though monthly consultancy fees were paid from April, 2009 to December, 2009. The basis for fixing the amount of value at 2000 US dollars per month also could not be explained by the appellant. The nature of services is technical in nature and come under fees for technical services rendered in India. The Assessing Officer after discussing the provisions of sections 9 a....