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2016 (6) TMI 94 - AT - Income TaxDisallowance u/s.40(a)(ia) - payment made to Central Power Research Institute of Bangalore, Ministry of Power, Government of India - main contention of the ld.A.R is that nothing is payable at the end of the close of the Financial year, as such the issue is squarely covered by the order of the Special Bench of the Tribunal in the case of Merilyn Shipping and Transports v. Addl. CIT [2012 (4) TMI 290 - ITAT VISAKHAPATNAM ]- Held that:- There is a force in the argument of the ld.A.R and the Special Bench cited supra considered this issue and decided the issue in favour of the assessee. As decided in Shri N.Palanivelu Vs. ITO reported in [2015 (10) TMI 1415 - ITAT CHENNAI ] if the impugned amount is not outstanding at the end of the close of the assessment year in respect of the expenses either as outstanding expenses or as sundry creditors, this amount cannot be disallowed.In view of the order of the Tribunal, we are inclined to remit this issue to the file of the ld. Assessing Officer with similar direction. These grounds raised by the assessee u/s.40(a)(ia) of the Act is partly allowed for statistical purposes TDS u/s 195 - Disallowance u/s.40(a)(i) on payment made to M/s.Korea Electro Technology Research Institute - withholding tax liability - Held that:- The services availed by the assessee is nothing but technical services and the fees paid for technical services only and the assessee is liable for deduction of TDS u/s.195 of the Act. As decided in the case of M/s.Havells (India) Ltd., [2012 (5) TMI 449 - DELHI HIGH COURT ] wherein held that the fees paid by the assessee to the US Company on account of testing and certification services is taxable in the hands of the US Company in India and assessee was liable to deduct tax at source while making payment thereof, since the export activities have been fulfilled in India, source of income was located in India and not outside India, and the mere fact that export proceeds emanated from persons situated outside India did not constitute them as source of income. - Decided against assessee
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