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2021 (1) TMI 1244 - AT - Income TaxDisallowance u/s 14A r.w.r. 8D - expenditure incurred on exempt income - HELD THAT:- CIT(A) has mentioned in his order that issue is covered by the decision given by his office in appellant own case for A.Y. 2012-13 [2019 (10) TMI 1504 - ITAT AHMEDABAD]wherein he has restricted the confirmed exempt income of the assessee. In our considered opinion, we do not find any infirmity in the order passed by the Ld. CIT(A). Hence, we confirm the order of the ld. CIT(A) and same does not require any kind of interference at our end. Late delivery charges disallowance - allowable business expenditure - HELD THAT:- As decided in own case [2018 (12) TMI 182 - ITAT AHMEDABAD] there is no dispute that apportion of the sale consideration was retained by the payees on account of /ate delivery of the machineries and as per the terms of contract, the assessee had to compensate the customers if it fails to deliver the goods on time. There is no dispute that such expenditures were incurred during the ordinary course of the business of the assessee and therefore are directly related to the business activity of the assessee. It is also true that these expenditures are not penalty levied for any infraction of any legislated law of the land but has been incurred out of a contractual obligation. In our considered opinion, such expenditures are definitely of revenue in nature and are allowable u/s. 37 of the Act. Appeal of assessee allowed. Disallowance of foreign commission u/s 40(a)(ia) - Commission paid to non-resident whose income is not taxable in India and all services rendered outside India and it has not permanent establishment or office of agent in India - HELD THAT:- As decided in own case [2018 (12) TMI 182 - ITAT AHMEDABAD] Section 9 of the act provides for the income deemed to accrue or arise in India. It is noticed that no income is deemed to accrue or arise in India by applying the provisions of section 9 (l)(i) as the assessing officer has failed to establish accruing or arising of any income from business connection in India or through or from any property or through the transfer of a capital asset situated in India. We observe that there was no material which can demonstrate that any of the agents had any Permanent Establishment in India as all the agents had their establishments situated in the overseas places. In the lights of the above facts and detailed findings of the Ld.CIT(A) it is clear that the Provisions of section 9 (1)(i) cannot be applied, therefore we consider that the CIT(A) has rightly deleted the impugned disallowance of commission payment made to the foreign agents. In the result the appeal of the revenue is dismissed.
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