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2015 (11) TMI 1876 - AT - Income TaxTDS u/s 192 to 195 - re-insurer remittance made in three financial year to non-resident reinsurer (NRRs) @ 41.82% - AO charged interest u/s.201(1)/201(1A) on these remittance - whether non-resident insurers from the non treaty countries have no business connection in India without appreciating that the source of income is in India and the property in the form of reinsured assets are in India? - as pleaded that the assessee is not liable to make any deduction on the reinsurance remittance to NRRs - HELD THAT:- As carefully gone through the orders of the authorities below and found that detailed finding has been recorded by the CIT(A) to the effect that assessee is an independent broker and not an agent. The assessee does not carry out any activity on behalf of anyone in India and has no authority to enter into any contract in India. In these circumstances, the provisions of Section 192 to 195 relating to tax deduction at source are not applicable to the assessee. The provisions of Section 9(1)(i) specifically excludes an independent broker, neither the non-resident reinsurer nor any independent insurance company have any control over the assessee. AO has also accepted in order u/s.201/201(1)(A) of the Act that the countries with which India do not have a DTAA, the income of NRRs could be taxed in India only if the NRRs has permanent establishment in India. Since the assessee has no business activity on behalf of the NRRs, the provision of Section 192 to 195 are not applicable, hence, the question of tax deduction at source does not arise at all. It is pertinent to mention that none of the earlier/subsequent years, the assessee was found to be liable for deduction of tax u/s.192 to 195 of the IT Act. - Decided against revenue.
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