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2018 (4) TMI 1199 - AT - Income TaxNon-deduction of TDS payment made under the head ‘Sales Commission to foreign Agents’ - Held that:- When a sales commission has been made by the assessee company on export orders from the buyers abroad and services have not been rendered by the payee in India, no part of the said income has arisen in India and as such, TDS is not required to be deductible at source and disallowance u/s 40(a)(i) of the Act made by the AO is not sustainable in the eyes of law. So, ld. CIT (A) has rightly deleted the addition made by the AO. See case of CIT vs. Eon Technology P. Ltd [2011 (11) TMI 20 - DELHI HIGH COURT] and CIT vs. Toshoku Limited [1980 (8) TMI 2 - SUPREME Court] Disallowance u/s 14A r.w.r. 8D - Held that:- As relying on Indus Valley Investment & Finance Pvt. Ltd. vs. DCIT [2015 (4) TMI 1171 - ITAT DELHI] CIT-A correctly restricted the disallowance u/s 14A read with Rule 8D(iii) to the extent of dividend income earned by the assessee company which is in accordance with the settled principles of law applicable - AO is directed to compute the disallowance accordingly. - Appeal of assessee partly allowed.
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