2018 (10) TMI 737

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....o the non-residents and consequent levy of interest u/s 201(1)/201(1A) of the Income Tax Act, 1961 (herein after called as 'Act'). 3. Brief facts of the case are that the assessee has purchased an immovable property of land admeasuring 399.71 sq.yards located at D.No.67-3-14/2, Kakinada, East Godavari Dist., from Shri Marla Veerabhadra Sastry (Shri M.V.Sastry), father and his two non resident sons namely Shri Marla Vishnu Tej and Shri Marla Krishna Tej residents of U.S.A. The sale transaction was represented by Shri M.V.Sastry as a General Power of Attorney (GPA)holder for both Shri Marla Vishnu Tej and Shri Marla Krishna Tej. Shri M.V.Sastry was given GPA by both the non-resident sons on 21.03.2008 to transact the impugned property jointl....

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....d interest @1%p.m. and the details are as under : Amount Paid (Rs.) Tax deductible @20.60% (Rs.) No. of months for which interest u/s 201(1A) is payable from April 2008 to Feb' 2013 Interest u/s 201(1A) @ 1% p.m. Total amount payable (Rs.) 20,49,330 4,22,160 59 2,49,070 6,71,230 4. Aggrieved by the order of the AO, the assessee went on appeal before the Ld.CIT(A) and the Ld.CIT(A) confirmed the order of the AO. 5. Aggrieved by the order of the Ld.CIT(A), the assessee is in appeal before this Tribunal. 6. We have heard both the parties and perused the material placed on record. In this case, the assessee had purchased the property from Shri M.V.Sastry and his two non resident sons. Both the non resident sons have given the G....

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.... submissions, perused the orders of the lower authorities and the materials available on record. We find in the case before us that the payment has been made to an individual resident in India i.e., Shri Paramjit Singh. This payment has been made in respect of purchase of land which belongs to the non-residents but the rights therein were assigned unequivocally to the power of attorney holder. The agreement has been entered into with the power of attorney holder and it is not a case that the payment has been made to Shri Paramjit Singh as a representative nominated by the nonresident. No doubt, when non-resident himself nominates a particular agent to whom payment should be made and pursuant to that direction, the assessee pays the sum to t....