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2021 (2) TMI 265 - AT - Income TaxIncome accrued in India - Reimbursement of expenses as “not income” - assessee submitted that the reimbursement of expenses is not income - As argued sums from India are purely reimbursement of expenses towards activities performed by the appellant for group entities in India and hence, cannot be regarded as “income” taxable under the Act as well as the Double Taxation Avoidance Agreement between India and United Kingdom (‘DTAA’) - non-applicability of section 44DA - alternative ground according to which income, if any, should be taxable u/s 44BB - HELD THAT:- Provisions of section 44DA of the Act were applicable where the income was by way of royalty or fees for technical services, which was received from Government or Indian concern in pursuance to an agreement made by a non-resident or a foreign company with Government or Indian concern after 31.03.2003. Since the payment in the case of the assessee was neither received from the Government nor from the Indian concern, it was hold that the provisions of section 44DA of the Act were not applicable. Applying the said parity of reasoning, we also hold that the provisions of section 44DA of the Act were not applicable to the facts of the case and the income of the assessee is to be computed u/s 44BB of the Act. Respectfully following the decision of the Tribunal in assessee’s own case [2019 (1) TMI 1851 - ITAT DELHI] we hold that the provision of section 44DA of the Act is not applicable and income, if any, should be taxed u/s 44BB of the Act. Accordingly ground of appeal No. 1.1. by the assessee is dismissed whereas grounds of appeal No. 2 and 3 are decided in favour of the assessee. Non application of provisions of DTAA for interest income - HELD THAT:- Since the issue has been decided against the assessee by the Hon’ble Jurisdictional High Court in the case of B.J Services Co. Vs. ACIT [2015 (5) TMI 1036 - UTTARAKHAND HIGH COURT] therefore, the ground of appeal No. 4 by the assessee is dismissed. Computation of tax on interest income - HELD THAT:- An application dated 13th October, 2020 for rectification u/s 154 of the Act wherein it was stated that the interest income was taxed twice as per Act at 40% and as per DTAA at 15%. Further surcharge and cess has also been levied on the aggregate tax amount. Since the same is pending before the AO, therefore, as agreed by both sides we remit the matter back to the file of the AO with a direction to dispose of the application before him at the earliest by deciding the issue as per fact and law after giving due opportunity of being heard by the assessee. Ground No. 5 of the assessee is accordingly allowed for statistical purposes. Non granting credit of TDS - HELD THAT:- An application u/s 154 dated 13th October, 2020 is also pending before the AO. Considering the totality of the facts of the case we restore the issue to the file of the AO with the direction to dispose of the 154 application pending before him and verify the TDS certificates and if the same is due to the assessee then grant TDS as applicable. Needless to say the AO shall decide the issue as per fact and law after giving due opportunity of being heard to the assessee Levy of interest u/s 234B - HELD THAT:- Respectfully following the decision of the Tribunal in assessee’s own case in the immediately preceding assessment year we hold that in the instant case the provisions of section 234B of the Act are not applicable and so also the provisions u/s 209 (1)(d) of the Act. Ground of the assessee is accordingly allowed Levy of interest u/s 234C - HELD THAT:- As per provisions of section 234C the interest on shortfall of advance tax is to be calculated on the returned income and not on the assessed income as held in various decisions. Further the rectification application filed by the assessee before the AO u/s 154 of the Act is still pending with him. Considering the totality of the facts of the case we restore this issue to the file of the AO with a direction to dispose of the said application at the earliest and decide the issue of levy of interest u/s 234C as per law. Needless to say the AO shall give due opportunity of being heard to the assessee. This ground raised by the assessee is accordingly allowed for statistical purposes.
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