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2024 (3) TMI 633 - ITAT HYDERABADTDS u/s 195 - assessee made payments to concerns (USA) without deducting TDS u/s 195 r.w.s. 9(1)(vi) and (vii) - Assessee in default u/s 201(1) - as per AO assessee having not made any deduction of tax at source without making any application u/s 192(2) before the AO (TDS) and without ensuring that an application under section 195(3) of the Act was filed by the recipient to obtain necessary exemption, was liable to be treated as an assessee in default - assessee pleaded that a certificate u/s 195(3) was issued subsequently - HELD THAT:- We are of the considered opinion that it is only if the contents of the certificate issued in section 195(3) are verified and found to be correct and genuine, then the consequences would be that the remittances that have been made to M/s. IGTL Solutions (USA) would be non-taxable so far as the TDS is concerned, since if the contents of such certificate are accepted, then the action on the part of the Revenue in carrying out a deduction at source on the remittances made to M/s. IGTL Solutions (USA) would be bad. Thus AO is directed to cause verification of the certificate dated 10/02/2003, issued u/s 195(3)and if it is found to be genuine, the consequence shall be that the entire remittances that were made to M/s. IGTL Solutions (USA) would be non-taxable so far as TDS is concerned, and the impugned order u/s 201(1A) of the Act will have no legs to stand. Appeal of the assessee is treated allowed for statistical purposes.
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