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2018 (12) TMI 1965 - AT - Income TaxTDS u/s 195 - payment made to BASF SE, Germany, is in the nature of fees for technical services and further direction to deduct tax at source @ 10% on gross basis - assessee, an Indian company, is part of BASF Group of companies having its Headquarters in Germany and the holding company of the entire group is BASF SE, Germany - HELD THAT:- Before concluding that the remittances are in the nature of fees for technical services and chargeable to tax at the hands of the recipient in India, all necessary and relevant documents including the cost sharing agreement, the auditor’s report as well as other additional evidences filed by the assessee before us needs to be properly analysed and examined. Further, contention of learned Sr. Counsel that BASF SE having not rendered any services to the assessee, payment made cannot be treated as fees for technical services as per Explanation–2 to section 9(1)(vii) has not been considered by the Departmental Authorities both factually and legally. The contention of the assessee that when another Indian company of BASF group, a party to the same cost sharing agreement has been issued a no deduction certificate under section 195(2) why a differential treatment should be meted out to the assessee also needs to be considered with proper reasoning. Since, the aforesaid aspects have not been considered by the Departmental Authorities and many of the documentary evidences were furnished for the first time before us by way of additional evidences and were not before the Departmental Authorities, though we are of the opinion that the additional evidences furnished by the assessee require to be admitted as they will have a crucial bearing for deciding the issue, however, to afford a fair opportunity to the Department to examine such documents, we are inclined to restore the issues raised in the aforesaid grounds to the Assessing Officer for de novo adjudication after due opportunity of being heard to the assessee. While doing so, the Assessing Officer must consider the ratio laid down in the decisions to be cited before him - Assessee’s appeals are allowed for statistical purposes.
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