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2015 (8) TMI 842 - AT - Income TaxTDS liability - CIT on his jurisdiction u/s 263 directed the AO to disallow payment of foreign commission u/s 40(a)(i) - Held that:- It is incumbent on the part of the Assessing Officer to disclose the reasons in the assessment order for allowing or disallowing a claim of the assessee. This Tribunal is of the considered opinion that the CIT has rightly exercised his jurisdiction u/s 263 of the Act. However, the CIT has directed the Assessing Officer to disallow a sum of ₹ 37,18,965/- said to be paid to the non-residents for non-compliance of provisions of section 40(a)(i) of the Act. This Tribunal is of the considered opinion that an opportunity shall be given to the assessee to explain the nature of payment before the Assessing Officer. Accordingly, the order of the CIT is modified and the Assessing Officer is directed to examine the payment of commission to the non-residents independently and decide the same in accordance with law. It is made clear that the Assessing Officer shall examine the issue independently without being influenced by the observation made by the CIT in the impugned order or by this Tribunal in this order and decide the same in accordance with law after giving a reasonable opportunity to the assessee. - Decided in favour of assessee in part.
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