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2016 (5) TMI 1351 - AT - Income TaxTDS u.s 195 - commission paid to the non-resident agents - non deduction of tds - P.E. in India - Held that:- The said payment are covered by Circular Nos.23 dated 23rd July, 1969 and No. 786 dated 7th February, 2000 in this regard which clarifies that commission to the non-resident agent operating outside the country, where no part of his income arises in India, would not be taxable in India. Commission paid to one agent having no PE in India, are not liable to tax in India as no taxable income accrues or arose to such agents in India, therefore, the assessee was not required to deduct tax at source while making payment to such commission agent. In view of the above, we do not find any merit in the disallowance so made by the AO. See Indo Industries Ltd. Versus Income-tax Officer, 2 (2) (2) (1) , Mumbai [2015 (5) TMI 709 - ITAT MUMBAI] - Decided in favour of assessee. Disallowance u/s.14A/36(1)(iii) - Held that:- there is no infirmity in the order of CIT(A) for restoring the matter back to the file of AO for recalculating the disallowance u/s.14A/36(1)(iii) as per the directions given by the Tribunal in its order for the assessment year 2004-05 and 2006-07 it is held that the action of the AO in making the additions under the sections under discussion is upheld but to maintain a rule of consistency and to bring the correct income to taxation, the AO is directed to take necessary action regarding the calculation of the quantum of disallowance that has to be made in the case of the appellant following the directions as given in AY 2007-08 by the CIT(A). Here the AO is also directed to ensure that in the recalculation so done, double disallowance of the same expenditure claimed does not occur.
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