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2015 (4) TMI 191 - HC - Income TaxDisallowance u/s 40(a)(ia)- Non deduction of TDS on export commission paid by the assessee to the non-resident - ITAT deleted the disallowance - Held that:- The facts of the present case are akin to the facts of the decision in Toshoku Ltd.'s case [1980 (8) TMI 2 - SUPREME Court] wherein held that the non-resident assessees did not carry on any business operations in the taxable territories. They acted as selling agents outside India. In the instant case also the assessee engaged the services of non-resident agent to procure export orders and paid commission. That apart, the Commissioner of Income-tax (Appeals) as well as the Tribunal have correctly applied the principle laid down in GE India Technology Centre (P.) Ltd.'s case[2010 (9) TMI 7 - SUPREME COURT OF INDIA] to hold that the assessee is not liable to deduct tax at source when the non-resident agent provides services outside India on payment of commission. The services rendered by the non-resident agent can at best be called as a service for completion of the export commitment and would not fall within the definition of fees for technical services, we are the firm view that section 9 of the Act is not applicable to the case on hand and, consequently, section 195 of the Act does not come into play. Also see Faizen Shoes case [2014 (8) TMI 170 - MADRAS HIGH COURT]- Decided in favour of assessee.
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