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2015 (12) TMI 1233 - AT - Income TaxDisallowance of commission payment under section 40(a)(i) to non-resident - whether there was no agreement to suggest the payment of sales commission? - Held that:- The assessee has not discharged the burden cast upon it to show the nature of services rendered by non-resident agent. If there are services rendered by non-residents, who have no permanent establishment in India or have any business connection in India, by virtue of which the payment of commission accrued or arose in India then, it is exempted, if the assessee is able to prove that the services were rendered by those non-residents abroad. In the present case, the assessee has not established the facts on record that the non- resident has rendered services abroad and there is no business connection in India by producing relevant records, viz., either agreement entered into by the assessee with them or the correspondence took place between the parties. Without examining these details, we are not in a position to decide the nature of services rendered by the non-resident agent. Therefore, it is appropriate to remit the entire issue back to the file of the Assessing Officer with direction to the assessee to prove that it was sales commission towards procurement of orders from abroad.
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