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2004 (12) TMI 304 - ITAT BANGALORE-BDeduction Of Tax At Source - "Assessee in default" - levy of interest u/s 201(1A) - Payments made towards obtaining of market data and client's strategy details - HELD THAT:- It is trite law that provision of section 195 can be invoked only if the payment is otherwise taxable in India. The only provision invoked is section 9(1)(vi) to bring the payment as chargeable to tax in India. Since we hold that said section is not attracted, payment made is not subject to deduction of tax at source u/s 195. On this basis we feel the law is very clear that the payments to GG is not liable for taxation in India, consequently the assessee has no obligation to deduct tax u/s 195 of the Income-tax Act. When the law is clear and unambiguous on the liability to tax, it is not possible to confirm the liability on emotional plea of national interest as held by Hon'ble Supreme Court in Azadi Bachao Andolan's case[2003 (10) TMI 5 - SUPREME COURT]. The plea of national interest as made by DR though appeals at first sight, on close inspection we find nothing but a plea to ignore law or enactment, such pleas the Tribunal has no power to entertain. Further in the era of globalization when nation after nation are embracing each other in economic collaborations or co-operation, non-discriminatory treatment to one and all is the underlying principle. It would be incorrect to argue a case on a misplaced feeling that foreigners are getting away without paying any tax in India. We find that DTAA offers fair chance to Indian Business Houses outside India and similar treatment should also be extended in India. That is the basis of principle of reciprocity, one of the basic principles entering into agreement for avoidance of Double Taxation. The law should enforce all liability for tax no matter whether it is imposed on nationals or foreigners. Similarly if something is not found to be taxable the same should be excluded as otherwise there would be no difference between levy of tax and expropriation of property. While levy of tax is legal, expropriation is illegal. Thus, we feel the appeals are allowable and accordingly we hold that order of the authorities below is to be cancelled as unsustainable. Accordingly, the tax liability u/s 201(1) and interest levied u/s 201(1A), both are deleted. In the result, all the appeals are allowed.
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