TaxTMI 
TaxTMI 
TaxTMI 
2016 (6) TMI 296
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.... such payments. 3. The assessee is engaged in the business of manpower recruitment services filed return of income on 30.9.2009 declaring income at Rs. 25,02,480/-. The assessment was completed u/s. 143(3) on 22.12.2011 determining income at Rs. 2,04,64,180/-. While completing the assessment, the Assessing Officer disallowed Rs. 1,56,73,056/- u/s. 40(a)(ia) being the payments made by the assessee to the persons recruited by her treating such payments as not in the nature of salary. It is the contention of the assessee that the payments were made towards salary to the employees who are all non-residents and therefore the provisions of Sec. 195 have no application for the salary payments. However, the Assessing Officer held that the amount d....
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....geable under provisions of the I.T. Act except income chargeable under the head salaries. Therefore, he submits that the provisions of Sec. 195 are very clear that the same are not attracted to the payments made towards salaries. He also submits that provisions of Sec. 192 are also not attracted since all these salaries were paid to the non-resident employees and they are not chargeable to tax in India. He strongly places reliance on the order of the Ld. CIT(A) in deleting the disallowance made u/s. 40(a)(ia) of the Act and pleads for sustaining the order of the Ld. CIT(A). 7. Heard both sides, perused the orders of the authorities below. The Assessing Officer treated the payments made by the assessee to the persons recruited abroad is not....
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....g advance in the event of contingencies and other welfare measures are implemented by the assessee. iv)The power to settle disputes, to terminate services of the employees vests with assessee solely. 2) ln addition to various evidences laid in support of abovestated contention of employer-employee relationship, it is proposed to submit further evidence as under: i) Copy of license issued by Ministry of Labour/ Overseas Indian Affairs Pursuant to which the entire business of the assessee is carried out is market as Annexure-I. The attention of learned CIT(A) is drawn to clauses of the License. ii) The license was issued to recruit maximum 300 workers for 5 years. vi) The assessee cannot appoint sub agents to carry out her b....
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....gal position it has been endeavor of the assessee to provide employment to the employees who completed their tenure. Specimen example is in case of Mr. Rajan Chatham vally who was working on Saudi Arabia site from 17.05.2008 to 23.06.2008 was employed to work on Qatar site from 25.1 1.2008 to 24.05.2009 Annexure 5 ' 3.3 Along with this the appellant has filed a copy of agreement Technical Service Blanket Contract by and between Toyo Engineering Corporation, on behalf of Joint Venture of TOYO ENGINEERING CORPORATION (TEC, INDUSTRIAL DEVELOPMENT & RENOVATION ORGANIZATION OF IRAN (IDRO), JGC CORPORATION (JGC) ANI DAELIM INDUSTRIAL CO. LTD. (DIC). He has also filed a copy of agreement of Technical Service Contract entered by appellant wi....
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....duty and excess baggage charges on personal effects which will be borne by the person entering in to the contract with the appellant firm. In view of these clauses there is no doubt that appellant has entered in to the contract with these persons who are deployed as man power of the appellant to the Site of the project as was required by the blanket contract between TEC and the appellant Radiant Services is Technical service contract is governed by the contract between TEC and appellant only dealing with issues of sick leave, reimbursement of Air Fare, PA Policy, Visa Documentation, Provisions for bonus for overtime and most importantly Job description to be specified at the job site and then provision for accommodation and meal free of cos....
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....d as under: "195. (1) Any person responsible for paying to a non-resident, not being a company, or to a foreign company, any interest {***} or any other sum chargeable under the provisions of this Act (not being income chargeable under the head "Salaries" shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct Income-tax thereon at the rate in force:" 3.5 Since sec. 195 does not take salary in its purview application of Sec.195 in the case is not tenable. The appellant in the submission has made an alternative submission also and i.e. as all the persons are working outside India to whom remu....