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2013 (12) TMI 1095 - AT - Income TaxApplicability of section 172 – Payments towards shipping business of the non-residents through shipping agents - Held that:- Special procedures are provided u/s. 172 of the Act for payment of taxes in case of any shipping owners or charters by non-resident - The Board Circular No. 723 dated 19-09-1995 (supra) clarifies that the provisions of section 172 would apply and no deduction of tax is required to be made as per provision of section 194C of the Act – Decided against Revenue. Purchase of Lac and Shellac – Disallowance on account of inflation of local purchase - Held that:- No defects have been pointed out by the AO to show that there was any inflation in the purchases – Disallowance cannot be made on the basis of estimation – Decided against Revenue. Commission paid to non-resident – Held that:- The commission has been paid to non-resident outside India for services rendered outside India – Following G.E India Technology Centre (P.) Ltd v. CIT [2010 (9) TMI 7 - SUPREME COURT OF INDIA] – CBDT Circular No. 786 dated 07-07-2000 as also Circular no. 23 dated 23-7-1969 clarifies that where the non-resident agent operates outside India, no part of his income arises in India - Decided against Revenue. Disallowance of supervision charges, export expenses, packing expenses, lorry hire charges and motor car and telephone expenses – Held that:- All the disallowance are made on estimate basis and no specific defect has been pointed out by the AO – Decided against Revenue. expenditure under the head foreign travelling – Held that:- Foreign travel by husband of the assessee was exclusively for the business purpose of the assessee - Assessee's husband was also promoting his own business during the same time – Decided against assessee.
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