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2020 (12) TMI 395 - AT - Income TaxTDS u/s 195 - disallowance u/s.40(a)(i) for non-deduction of TDS - export commission paid to foreign agents for rendering services outside India - HELD THAT:- We find that the assessee has made payment to M/s.Biggleswade Ltd., Hong Kong, a non-resident agent who rendered services to the assessee outside India for marketing the products of the assessee. Assessee has filed necessary evidence to prove that although the agreement between the parties specifies various services but payment made for the impugned assessment year is only for export sales and such services are rendered outside India. Considering the facts and circumstances of the case and also the consistent view taken by the co-ordinate Bench in the case of M/s. Turbo Energy Ltd. [2017 (5) TMI 1749 - ITAT CHENNAI] we are of the view that the export commission paid to foreign agents for rendering services outside India is not liable for deduction of tax at source u/s.195 and consequently, no disallowance could be made u/s.40(a)(i) for non-deduction of TDS. CIT(A) after considering the relevant facts and also by following the decision of the Hon’ble High Court in the case of Faizan Shoes Pvt.Ltd, [2014 (8) TMI 170 - MADRAS HIGH COURT] has rightly deleted the addition made towards disallowance of export commission made to non-resident agents - Decided in favour of assessee.
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