TaxTMI 
TaxTMI 
2026 (9) TMI 30
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....en upheld by Ld. Appellate authority without any basis / justification or making adequate enquiries when in fact all TDS amount were deposited by the Appellant within due date/time and nothing remains to be paid. 2. Because both the Ld. Appellate Authority & Assessing Officer while passing impugned order dated 12-01-2026 u/s 250 of the Act and u/s 154/201(1)/201(1A) dated 10-07-2024 respectively erred and misconstrued themselves by relying upon information received from DCIT(TDS) office, Jaipur regarding Commission Expenses of Rs. 10,10,40,144/- i.e Commission expenses to Travael Agent against booking of Palace on Wheels amounting Rs. 7,10,08,344/- and commission expenses to travel Agent against booking of Royal Rajasthan on wheels amounting Rs. 2,94,31,810/- without any basis/justification and verifying/examining substance therein whereas in facts gros commission amounting Rs. 5,79,23,844/- were paid by the Appellant to Travel Agents against bookings of their Luxury Train namely Place on Wheel and Gross Commission of Rs. 3,01,63,129/- were paid to Travel Agents booking of Luxury Train namely royal Rajasthan on wheel and thereby an aggregate amount of Rs. 8,80,86,973/- wer....
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....ng Officer while passing impugned order dated 10-07-2024 charging u/s 201(1) of the Act. 6. That the Appellant craves leave to add modify alter delete or raise any other ground at the time of hearing of appeal. 3. The appeal filed is time barred by 4 days. In the application sufficient cause has been shown by the assessee not to file the appeal within time therefore, the delay is condoned and appeal is admitted for adjudication. 4. The brief facts of the case are that the assessee company M/s Rajasthan Paryatan Vikas Nigam Limited is a Rajasthan State Government undertaking and is registered under the provision of companies Act, 1956. The assessee company is engaged in the field of tourism development and were running their two luxury trains namely Palace of Wheel and Royal Rajasthan on wheels during the financial year 2014-15. The assessee paid the commission against the booking of such trains to the travel Agents. Proceedings under section 201(1) r.w.s. 201(1A) of the Act was initiated on the basis of information regarding commission expenses received from DCIT, TDS Jaipur. Notice under section 201 r.w.s. 201(1A) of the Act was issued on 28-02-2022 which was duly s....
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....ryatan Vikas Nigam Limited (TAN: DELR08712E/PAN: AAACR7643H) also known as M/s. Rajasthan Tourism Development Corporation Limited (hereinafter referred as 'RTDC' for the sake brevity) is a Rajasthan State Government undertaking and is registered under the provision of Companies Act 1956 (As amended by Act of 2013), whose main aim is to extend and promote Tourism, in the State of Rajasthan. During the pertinent Financial Year 2014-15, under consideration, RTDC were running two Luxury Trains namely POW (Palace on Wheels) and RROW (Royal Rajasthan on Wheels) whose bookings was done by empanelled General Sales Agents and other Tour Operators both operating from India and those located outside and rendering services of bookings there from. This is pertinent to mention here that some of the GSA/Non-GSA who rendered services of booking of Tickets/Cabin of Luxury Trains namely POW & RROW and having establishment outside India were namely (1). Palace Tours, 31, Lehigh CT Princeton, NJ USQA-08540-Email Id. usa @ palacetours, (2) Mustafa Air Travels PTE Limited, 5 Verdun Road, SPA Building, Singapur-207274, (3). M/s. Exotic Journey-Exotic Journey, 980, North Michigan Road, Suite 1400, Chicago....
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....ion will not be liable to section 195 of the IT Act. If such income is not taxable, then it is an allowable expenditure under section 40 of the IT Act, for companies making such payments In the case of CIT vs. Toshoku Ltd 125 ITR 0525 (SC) it was held that the commission amounts which were earned by the Non-resident assessee for services rendered outside India cannot, therefore, be deemed to be incomes which have either accrued or arisen in India. As per provisions of section 195(1) of the Income tax Act, the tax at source is required to be deducted in respect of any sum paid to non-resident which is chargeable to tax in India under the provisions of the Income Tax Act. It means that if any payment made to non-resident is chargeable to tax in India under the provisions of the Income tax Act then person responsible for paying to a non-resident is required to deduct income tax thereon at the rates in force. The provisions of section 195 of the Income Tax Act are applicable only in those cases where the payment made to non-resident is chargeable to tax in India under the provisions of the Income Tax Act. If any payment made to non-resident is not chargeable under the provisions of the....
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....-08540-Email Id. usa @ palacetours for amounting Rs. 32,52,679/-(Thirty Two Lakhs Fifty Two Lakhs Six Hundreds SEventy Nine Only), (2) Mustafa Air Travels PTE Limited, 5 Verdun Road, SPA Building, Singapur-207274 for amounting Rs. 1,28,136/- (One Lakh Twenty Eight Thousands One Hundred Thirty Six only), (3) M/s. Exotic Journey-Exotic Journey, 980, North Michigan Road, Suite 1400, Chicago, IL60611 USA for amounting Rs. 2,91,443/- (Two Lakhs Ninety One Thousands Four Hundred Forty Three Only), (4) Royal India Train Journey for amounting Rs. 90,674/- (Ninety Thousands Six Hundreds Seventy Four Only, (5) Gets Holiday for amounting Rs. 6,72,106/- (Six Lakhs Seventy Two Thousands One Hundred Six Only) and 6)Apex Tours for amounting Rs. 4,76,073/- (Four Lakhs Seventy Six Thousands Seventy Three Only). Copy of Commission Ledger of Palace on Wheels alongwith Copies of Ledgers of GSA located abroad etc. are enclosed herewith and marked as ANNEXURE- 2. Copy of Commission Ledger of Royal Rajasthan on Wheels alongwith Copies of Ledgers of GSA located abroad etc. are enclosed herewith and marked as ANNEXURE-3. 3. That the Appellant during the pertinent Financial Year 2014-15 duly discha....
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....15 7. 1,78,804 017036.1 01817 04.02.2015 8. 2,98,0630 170361 01803 03.03.2015 9. 9,00,4710 170361 00395 28.03.2015 Copies of Acknowledgment evidencing filing of TDS Returns for the Quarters of Financial Year 2014-15 are enclosed herewith and marked as ANNEXURE- 6(Colly). 4. That in 1st Week of June,2023, the Appellant ascertained that the Ld. Assessing Officer-Circle -78(1), New Delhi has passed an Order U/s 2O1(1)/2O1(1A) of Income Tax Act,1961 pertaining to Financial Year 2014- 15 and has raised demand of Rs. l,98,03,867/(One Crore Ninety Eight Lakhs Three Thousands Eight Hundred Sixty Seven Only) alongwith interest against which an Application U/s 154 of The Income Tax Act, 1961 was preferred on 22.07.2023 by contending that since the Appellant has paid Gross Commission of Rs. 8,80,86,973/-(Eight Crores Eighty Lakhs Eight Six Thousands Nine Hundreds Seventy Three Only) to their Travel Agents and has dischai'ged their tax liability within stipulated period of time and therefore nothing remains to be paid and hence demand raised of Rs. l,98,03,867/(One Crore Ninety Eight Lakhs Three Thousands Eight Hundred Sixty Se....
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....0, an error which is apparent from the record should be one which is not an error which depends for its discovery on elaborate arguments on questions of fact or law. A similar view was also expressed in Satyanarayan Laxminarayan Hegde v. Mallikarjun Bhavanappa Tirumale [1960] AIR 1960 SC 137. It is to be noted that the language used in order 47, rule 1 of the code of civil procedure, 1908 (in short the CPC), is different from the language used in section 154 of the Act. The power is given to various authorities to rectify any mistake apparent from record under Section 154 of the Act. In the Civil Procedure Code, the words are an error apparent on the face of the record. The two provisions do not mean the same thing. The power of the Tribunal in Section 154 to rectify any mistake apparent from the record is undoubtedly not more than that of the High Court to entertain a writ petition on the basis of an error apparent on the face of the record (see T.S Balaram, ITO v. Volkart Brothers, [1971] 82 ITR 50 (SC)). Mistake is an ordinary word but in taxation laws, it has a special significance. It is not an arithmetical error which, after a judicious probe into the record from which it is ....
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....istake in the orders sought to be rectified. The mistake to be rectified must be one apparent from the record. Records must show that there has been an error and that error may be rectified; Reference of documents outside the record and the law is impermissible when applying the provisions of section 154. [CIT V Keshri Metal Pvt Ltd. (1999) 237 ITR 165 SC]. Mistake means commission that is not designed and which is obvious and something which has no two opinions or which is debatable. [CIT V Lakshmi Prasad Lahkar (1996) 220 ITR 100 (GAU)]. When mistake apparent from record is bought to the notice of Assessing Officer, he is mandatorily bound to pass such order. [Hirday Narain (L) V ITO (1970) 78 ITR 26 (SC)].Hence in view of above made submissions and judicial pronouncements placed herein, the demand vide order dated 22.03.2022 as discussed above required to deleted. Copy of Indemnity Bond/Undertaking dated 28.05.2024 is enclosed herewith and marked as ANNEXURE-7. 5. That the Ld. Assessing Officer-Circle-78(1) New Delhi while passing impugned Order dated 10.07.2024 strictly relied upon the observation made by Ld. Add. CIT, Range-78, New Delhi in penalty Order dated 22.08.2....
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.... remains to be paid and in view of same impugned Order dated 10.07.2024 passed by Ld. Assessing Officer deserves to be suitably modified and the demand raised therein be deleted accordingly. Copy of Order dated 22.08.2023 passed by Ld. Addl. CIT, Range-78, New Delhi is enclosed herewith and marked as ANNEXURE-8. 6. That Aggrieved from impugned Order dated 10.07.2024 as passed by Ld. Assessing Officer, the Appellant preferred an Appeal bearing No. NFAC/ 2013- 14/10392045 U/s 250 of The Act by contending that the A.O. has computed the default on an incorrect figure of commission and that as per correct figure no demand is liable to be paid. Ld. Appellate Authority while passing impugned Order that all the issues contested by the appellant pertain to Order u/s. 2O1/2O1(1A) dated 22.03.2022 and does not pertain to order u/s. 154 dated 10.07.2024 and thereby failed to construe that in order to attract power to rectify under section 154, it is not sufficient if there is merely a mistake in the orders sought to be rectified. The mistake to be rectified must be one apparent from the record. Records must show that there has been an error and that error may be rectified. Mistake mea....
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....e assessee. The assessee has paid the commission to the other Agents who having establishment outside of India namely (i) Palace Tours (ii) Mustafa Air Travels PTE Limited (iii) M/s Exotic Journey Exotic Journey (iv) Sita World Travels (v) M/s Gets Holiday and (vi) Apex Tours ete. without deducted TDS. It is argued that the no need to deduct TDS under section 195 Of the Act, on the commission paid to the foreign entity who do not have PES in India and carrying all functions outside of India. Relevant portion of the section 195 of the Act reproduce as under: 195(1) Any person responsible for paying to a non-resident, not being a company, or to a foreign company, any interest or any other sun chargeable under the provisions of this Act ( not being income chargeable under the head "Salaries") shall at the time of credit of such income to the account of the payee or at the time of payment there of in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier deduct income-tax thereon at the rates in force; 10.If the companies engaging the services of overseas agents would be liable to pay tax deducted at source if such incomes are deemed to arise i....