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2014 (1) TMI 1074 - AT - Income TaxDisallowance u/s 40(a)(ia) - Held that:- Following ACIT circle-1, Udaipur Vs. M/s Minpro Industries [2012 (5) TMI 232 - ITAT, Jodhpur] - payments made to C&F agents were reimbursement of expenses incurred by the C&F agents on behalf of the appellant - The C&F Agents have raised separate debit note for reimbursement of expenses incurred by them on behalf of the appellant and separate invoice for the agency charges - Most of the payments to C & F Agents are by way of reimbursement of expenses which were incurred by C& F agents on behalf of the assessee and they did not represent payments for carrying out any work by the agent - Following ACIT Vs. Grandprix Fab (P)Ltd [2009 (10) TMI 659 - ITAT DELHI] - No element of income is embedded in such payment - The appellant has also submitted separate bills for agency commission paid to the C & F Agents and debit note regarding the reimbursement of expenses incurred by the C& F Agents on behalf of the assessee for export of goods which shows that the amount represent reimbursement of expenses to C & F agents and these expenses were incurred for shipping line, concor charges, examination charges, custom sealing charges, unloading, chocking, shifting, labour charges etc. As per Board circular No.723 dated 19.09.1995 - In case of any ship belonging to or chartered by a non resident which carries passenger, livestock, material or goods shipped at a port in India, the provisions of section 172 of the IT Act would apply and no deduction of tax is required as per section 194C of the IT Act. It is also clarified that since the agent acts on behalf of the non- resident ship owners or charterer, he steps into the shoes of the principal and accordingly, provisions of section 194C of the IT Act would not apply in the case of the assessee - Decided against Revenue.
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