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2014 (7) TMI 1231 - AT - Income TaxAddition u/s 14A - Held that:- We find from section 14A(2) that in arriving at such a dissatisfaction over an assessee’s claim of not having incurred any expenditure relatable to its ‘exempt’ income in books of account, the concerned Assessing Officer has to take into account the said books and then only, he can resort to computation of such expenses under Rule 8D. In this case, the Assessing Officer has only drawn an inference that some indirect expenditure is always involved in supervision of such huge investments. And that too, without even specifically stating anything regarding the entries in the assessee’s books. In our view, this approach is nowhere a part of the relevant statutory provision in section 14A(2) of the Act. So, both the lower authorities have wrongly made the disallowance in question u/s 14A r.w. rule 8D. The same stands deleted. - Decided in favour of assessee Disallowance to provision for insurance settlement - Held that:- Admitted factual position is that the assessee being a bulk drug manufacturer had exported its produce to a Dutch consignee. A part of this consignment has been rejected for quality reasons because the produce was kept in a ‘customs bonded house’ instead of immediate delivery resulting in deterioration of its quality. Before us, there is no cogent evidence produced to conclude that mere rejection of such a produce wholly or in part by whatsoever reasons gives rise to a compensation claim. The fact also remains that till date, the consignee entity is yet to raise its claim. The damages’ amount is yet to be ascertained. In these circumstances, we observe that the assessee has failed to prove the nature of liability claimed as an ascertained one. Therefore, we find no fault with the CIT(A)’s order affirming the impugned disallowance - Decided against assessee TDS u/s 195 - Disallowance u/s 40(a)(i) - non deduction of TDS on export commission payments made to overseas agents - Held that:-no cogent material has been placed on record to prove rendering of any technical or managerial services u/s 9 of the Act or that the payments are taxable as income in India. The assessee’s overseas agents have procured export orders and rendered marketing services outside India and in lieu thereof payments have been made in foreign countries. hence no TDS liability arises to an assessee. See GE India Technology Centre Private Ltd. Versus Commissioner of Income Tax & Anr. [2010 (9) TMI 7 - SUPREME COURT OF INDIA ] .- Decided in favour of assessee
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