2018 (1) TMI 884

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....ng to Rs. 34,63,534/- on account of commission paid to non-resident commission agents by the assessee. 2. Brief facts of the case are that the assessee company is engaged in the business of manufacturing of aluminium profiles, section and trading of aluminium ingot and billets. The return of income was filed declaring income of Rs. 2,96,86,077/- and the assessment was completed u/s 143(3) of the Act at an income of Rs. 34,63,634/- after making a disallowance u/s 40(a)(i) of the Act on the ground of non-deduction of withholding tax on payment of commission to two non-resident agents. A disallowance of Rs. 9,09,274/- under the provisions of section 14A of the Act was also made by the AO. 2.1 On appeal by the assessee before the Commissioner....

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....h the two parties was submitted before the Assessing Officer. The Ld. Departmental Representative also submitted that the Ld. CIT (A) had erred in deleting the disallowance by ignoring the fact that the said commission had accrued/arisen in India and, therefore, was liable for deduction of tax prior to the making of payment to the non-residents. 4. In response, the Ld. AR submitted that the assessee company was not liable to deduct any tax at source on the impugned commission in terms of provisions of section 195 of the Act as the foreign resident agents had provided services outside India and, therefore, as per section 9 of the Act, commission paid to them was not chargeable in India. It was submitted that the impugned payments were made ....