TaxTMI 
TaxTMI 
2016 (7) TMI 1468
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....ht in law and on facts in deleting of expenditure incurred by subcontractor and claimed by the assessee of Rs. 68,63,154/- ? [D] Whether the Appellate Tribunal is right in law and of facts in deleting the expenditure debited in P & L Account belonging to subcontractor of Rs. 1,09,70,601/-?" 2. Tax Appeal No.2143 of 2010 challenges the order dated 05/03/2010 passed by the ITAT in ITA No.54/Ahd/2007 for assessment year 2000-2001 and came to be admitted on the following questions of law: "[A] Whether the Appellate Tribunal is right in law and on facts in deleting the entire addition of Rs. 4,83,71,408/- being reimbursement of expenses to Head Office? [B] Whether the Appellate Tribunal is right in law and on facts in deleting the addition of Rs. 1,82,55,408/- being expenditure incurred by the Head Office? [C] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of Rs. 1,42,85,226/- u/- s. 40(a)(i) of the Act? [D] Whether the Appellate Tribunal is right in law and on facts in deleting of expenditure incurred by subcontractor and claimed by the assessee of Rs. 68,63,154/- ? [E] Whether the ....
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....rred in paragraph No.3.1 of this order while adopting the reasonings given in its order passed in ITA Nos.46/Ahd/2007 and ITA No.52/ahd/2007 and relevant discussions made therein are confirmed by this Court while deciding Tax Appeal No.2130 of 2010, following the same order and relying upon the same reasons, we answer the issue Nos.'C' and 'D' of Tax Appeal No.2142 of 2010 and issue Nos.'D' and 'E' of Tax Appeal No.2143 of 2010 in favour of the assessee and against the Department. 4. Now, so far as the question No.(C) of Tax Appeal No.2143 of 2010 is concerned, the learned Tribunal has observed in paragraph Nos.30 and 34 to 38 as under: "30.Ground NO.7 in the appeal of the assessee reads as under: "7.The learned CIT (A) has erred in confirming action of the learned Assessing Officer of making disallowance of Rs. 1,42,85,226/- u/ s. 40(a)(i) of the Act." 31.*** 32.*** 33.*** 34. We have considered rival submissions and material available on record. The relevant provisions in the Act on this issue are reproduced as under: 35. Section 40(a) (i) of the Act provides "Notwithstanding anything to the....
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....Provided further that no such deduction shall be made in respect of any dividends referred to in section 115O.] Explanation. -- For the purposes of this section, where any interest or other sum as aforesaid is credited to any account, whether called "Interest payable account" or "Suspense account" or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly.]" 35. Section 9 (1) (vii) of the Act provides that the following incomes shall be deemed to accrue or arise in India: ---" income by way of fees for technical services payable by-- (a) the Government ; or (b) a person who is a resident, except where the fees are payable in respect of services utilised in a business or profession carried on by such person outside India or for the purposes of making or earning any income from any source outside India ; or (c) a person who is a non-residen, where the fees are payable in respect of services utilised in a business or profession carried on by such person in India or for ....
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....eral parties outside India for reimbursement of expenses incurred by the then KCIL (UK) (sub-contractor) for the purpose of Dahej Project so there was no element of income. The assessee also claimed that due to the above fact, there was no obligation of the assessee to deduct tax at source u/s 195 while making payments to non-residens. A O has not brought any evidence or material on record that the recipients who got 52 payments through sub contractor were liable to tax in India. A O has also not brought about their status for receiving the payments. No efforts have been made to prove as to how the payment in question was liable to tax under the provisions of Income Tax Act. Unless the income was chargeable to tax, there would be no tax liabilities to deduct tax as per provisions of Section 195 (1) of the IT Act. The A O has also not properly examined the provisions of DTA agreement with UK for the purpose of appreciating the issue. According to the assessee the amount is paid by the UK payer to UK payees, therefore, there was no reason to deduct TDS. The reimbursement of the expenses to the sub contractor for further payment to others was not appreciated in the light of the releva....
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....seller retains control over the goods by obtaining a bill of lading in his name or to his order, the property in the goods does not pass to the buyer until he endorses the bill to the buyer and delivers the documents to him. If however the seller's dealing with the bill of lading is only to secure the contract price not with the intention of withdrawing the goods from the contract, and he does nothing inconsistent with an intention to pass the property, the property may pass either forthwith subject to the seller's lien or conditional on performance by the buyer of his part of the contract. Even though the property in the goods may pass to the buyer when the documents are handed over, the buyer may yet retain the right to examine and repudiate the goods but this right generally which a buyer has in a c. i. f. contract does not by itself indicate that the property in the goods has not passed to him." In the case of C I T Vs Gulf Oil (Great Britain) Ltd. 108 ITR 874 (Bom) the Hon'ble Bombay High Court held, "on the facts that 54 the contracts were made in U. K. as the indents placed by the Indian company were accepted in U. K. The contracts were also exe....
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....er is tax resident of USA but operating internationally. It was found from facts that Penser has rendered consultancy services in India, therefore, consultancy fees was held to be deemed income of Penser in India. The facts of this case are therefore, clearly distinguishable from the facts of this case. Considering the facts on this issue and in the absence of specific finding and material brought on record by the A O, we do not find any justification to sustain the findings of authorities below. We accordingly set aside the orders of authorities below and delete the entire disallowance. As a result, ground No.7 in the appeal of the assessee is allowed." 4.1 Thus, in light of the above observations and discussions, when the learned Tribunal has decided the above referred question by making detail discussions, without assigning any further reasons, while adopting the said reasonings, we answer the said question in favour of the assessee and against the Department. 5. Now, so far as question No.(F) of Tax Appeal No.2143 of 2010 is concerned, the learned Tribunal has discussed the said in detail and relevant discussion made in paragraph No.43 which reads thus: ....