TaxTMI 
TaxTMI 
2014 (8) TMI 1189
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....the CIT(A). Grounds No.1, 12 and 13 are general in nature and hence, needs no adjudication. So far as ground Nos.2 to 4 are concerned, brief facts of the case are that the assessee-company which is engaged in the business of manufacture of printed circuits boards and export thereof, had filed its return of income for the assessment year 2005-06 on 25-10-2005 declaring an income of Rs. 1,43,26,747/-. During the assessment proceedings u/s 143(3) of the Income-tax Act, 1961[hereinafter referred to as 'the Act'], the Assessing Officer (AO) observed that the assessee has debited a sum of Rs. 1,19,46,454/- as freight outward expenses debited to the profit and loss account under the head 'administrative expenses'. The AO therefore asked th....
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....ions of sec.194C and therefore is distinguishable on facts. He accordingly disallowed the entire sum of Rs. 1,19,46,454/- u/s 40(a)(ia) of the Act and brought it to tax. 3. Aggrieved, the assessee preferred an appeal before the CIT(A) who confirmed the order of the AO and the assessee is in appeal before us. 4. Shri S.Parthasarathy, learned counsel for the assessee, while reiterating the submissions made by the assessee before the authorities below, has drawn our particular attention to the assessee's submission before the CIT(A) wherein it was clarified that payments are made to the non-resident through their local agent only for remittance of funds and the local agent acted as a conduit but the ultimate destination of the payment was ....
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.... have been that the local agent of the foreign shipping company is only a conduit but the destination of the payment is the foreign shipping company and therefore, it is not liable to TDS provisions. Though the AO has observed that the local agent has rendered services to the assessee, his order is silent as to the nature of services rendered by the local agent of the foreign shipping company. The Board's circular No.723 dated 19-91995,in force during the relevant assessment year, clearly provides that payments made to the shipping agent of nonresident ship-owners or charterers for carriage of passengers, etc., from the port in India is not liable for TDS u/s 194C and 195 of the Act. The Board's circulars are binding on the Revenue authorit....
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.... supported the orders of the authorities below. 8. Having considered the material on record, we find that there is a finding of the AO which is not disputed by the assessee that the bad debts have not been written off in its books of account for the relevant assessment year. In view of the same, the said claim is not allowable and the AO has rightly disallowed the same and brought to tax. As regards the assessee's prayer to give a direction that the same may be considered in the next assessment year, we are not inclined to accept this contention, as a direction can be given only for the issues arising in the assessment of income for the relevant assessment year and not to any earlier or subsequent assessment year. It is for the assessee t....