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2012 (12) TMI 691 - AT - Income TaxTDS on commission paid to foreign agents - disallowance u/s 40(a)(i) - commission payments were deemed to have been received in India only because the telegraphic transfer of the remittances towards commission was made from a bank in India. - held that:- The provisions contained u/s 195 were not meant that the moment there is a remittance, the obligation to deduct TDS automatically arise. Considering the fact that the AO has not brought any material on record to show that the foreign agents have rendered any part of the services in India or have a permanent establishment and business connection in India, it cannot be said that any part of the commission payment made to them accrued or arisen in India requiring deduction of tax u/s 195(1) of the Act. - Deduction allowed - Decided in favor of assessee. Deduction u/s 80HHC - setting off of interest receipt against interest payment having nexus - held that:- 90% of the net interest and not the gross interest which has been included in the profits of the business of the assessee as computed under the head profits and gains of business or profession is to be deducted under clause (i) of Explanation (baa) to section 80HHC for determining the profits of business. - Decision of CIT(A) sustained - Decided in favor of assessee.
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