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2018 (2) TMI 1344 - AT - Income TaxDisallowance u/s 40(a)(i) - non deduction of tds on account of commission paid to non-resident parties - Held that:- DRP has decided a similar issue in favour of the assessee for A.Y. 2011-12 [2016 (7) TMI 1419 - ITAT KOLKATA] by following the Tribunal’s order in assessee’s own case for the earlier years and the Department has not challenged the same by filing an appeal before the Tribunal as held where payments are made to agents of non-resident ship-owners or charters for carriage of passengers etc. shipped at a port in India, since the agent acts on behalf of the non-resident shipowner or charterer, he steps into the shoes of the principal. Accordingly, provisions of Section 172 of the Act shall apply and those of sections 194C and 195 - Decided against revenue Disallowance u/s 14A r.w.r. 8D - Held that:- No disallowance under section 14A was suo motu made by the assessee nor it was the case of the assessee before the Assessing Officer that no expenditure was incurred by it for earning the exempt income. AO, in our opinion, therefore, was not required to record any satisfaction as contemplated in section 14A before making a disallowance under the said provision. We, therefore, find no merit in this contention of the assessee. Merit in the alternative contention raised by the assessee that while working out the disallowance as per Rule 8D(2)(iii), AO should have taken into consideration only those investments on which exempt income was actually earned by the assessee during the year under consideration as it is duly supported by the decision of this Tribunal in the case of DCIT vs. REI Agro Limited [2013 (5) TMI 582 - ITAT KOLKATA]. We accordingly direct AO to re-compute the disallowance under section 14A as per Rule 8D(2)(iii) by taking into consideration only the value of those investments, which actually fetched exempt income to the assessee during the year under consideration.
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