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2015 (1) TMI 1106 - AT - Income TaxNon-deduction of TDS on payment of commission to Foreign Agent - CIT(A) deleted the addition - Held that:- The income of the non-resident was not chargeable to tax in India since the same was neither received in India nor had it accrued or deemed to accrue in India. Accordingly, the appellant was not required to deduct Tax at Source u/s 195 in respect of commission paid to the Foreign Agents. Disallowance u/s 40 (a) (i) is, therefore, deleted. - Decided in favour of assessee. Addition towards valuation of export debtors as on the last day of accounting year on the basis of RBI Reference Rate - assessee has valued them on the basis of actual realization - Held that:- Undisputedly assessee has been following this method of accounting in the past also and the same was accepted by the Revenue. Therefore, we find no justification to disturb the method of accounting consistently being followed by the assessee. Though the application of correct accounting policies and principles is important for determination of correct income, but concept of consistency and real income are vital principles in the Tax Law, which cannot be ignored. Had this addition been sustained, it will disturb the returned income of the appellant for subsequent Assessment Years also i.e. for A.Y. 2010-11, 2011-12 and so on. - Decided in fvaour of assessee. Ad hoc addition - Job Work Charges,Manufacturing Expenses,Checking & Inspection Charges and Export Development Expenses - CIT(A) deleted the addition - Held that:- Assessing Officer has not pointed out any specific defect either in the maintenance of the books of account or any particular expense. He has made general observation that the expenses claimed by the assessee were not fully verifiable and thereafter he started making ad hoc disallowances, which are not permissible under the law. We, therefore, find no merit in this ground of the Revenue’s appeal, as the ld. CIT(A) has properly deleted the addition made on ad hoc basis. - Decided in fvaour of assessee. Disallowance of interest paid by the assessee to his wife, Smt. Anu Gupta amounting to ₹ 1,44,427/- for not charging interest on certain loans and advances - CIT(A) deleted the additon - Held that:- Revenue is in appeal before the Tribunal, but could not establish the nexus between the borrowed funds and the interest free advances. Therefore, disallowance of corresponding interest is not permissible. Accordingly, we find no merit in this ground of the Revenue’s appeal and we confirm the order of the ld. CIT(A) on this issue. - Decided in fvaour of assessee.
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