TaxTMI 
TaxTMI 
2015 (2) TMI 1281
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....93/- made by the assessing officer on account of non-deduction of TDS on payment of commission to Foreign Agent without appreciating the facts brought on record by the Assessing Officer during the course of assessment proceedings. 2. That the Ld. Commissioner of Income Tax (Appeals)-II, Kanpur has erred in law and on facts in not appreciating the fact that the payment by the resident assessee in connection with its business in India to a person outside country is nothing but a fee which has been paid by the resident assessee to the non-resident for the technical services rendered by him. 3. That the Ld. Commissioner of Income Tax (Appeals)-II, Kanpur has erred in law and on facts in not appreciating the fact that in the as....
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....ax (Appeals)-II, Kanpur has erred in Law and on facts in deleting the above addition without considering the Board's circular No.7/2009 dated 22.10.2009. 8. That the order of the Ld. CIT (A)-II, Kanpur dated 10.06.2014 needs to be quashed and the order passed by the Assessing Officer dated 26.11.2013 to be restored." 3. None appeared on behalf of the assessee on the appointed date of hearing in spite of notice and hence, we proceed to decide this appeal of the assessee ex-parte qua the assessee. 4. Learned D.R. of the Revenue supported the assessment order. 5. We have considered the submissions of Learned D.R. of the Revenue, perused the material available on record and gone through the orders of the authorities below.....
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....d to be deducted from these payments and as a consequence, no disallowance can be made u/s 40(a)(i) of the Act as has been made by the Assessing Officer. 6. Now, we examine other contentions raised by the Revenue in its grounds. In ground No. 6, the Revenue has raised the issue regarding applicability of the explanation in sub section (2) of section 9 inserted by Finance Act, 2010 with effect from 01/06/96. We have considered this explanation and we find that as per this explanation, income of non-resident shall be deemed to accrue or arise in India under clause (v) or clause (vi) or clause (vii) of sub-section (1) of section 9 of the Act even if the non-resident does not have a residence or place of business or business connection in In....
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....nue that the non-resident commission agents have rendered services in India or have received the payment in India without the help of Circular No. 786 dated 07/02/2000, income is not taxable in India in the hands of those non-resident commission agents and therefore, TDS was not required to be deducted and as a consequence, no disallowance can be made u/s 40(a)(i) in respect of those payments. 8. The CIT(A) has decided the issue by following various judgments including a judgment of Hon'ble Delhi High Court rendered in the case of DIT v. Sheraton International Inc. [2009] 313 ITR 267. The CIT(A) has also followed Tribunal decision in the case of ITO v. Faizan Shoes (P.) Ltd. [2013] 58 SOT 245 (Chennai - Trib.). In that case, the asse....