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TMI Blog2012 (5) TMI 125X X X X Extracts X X X X X X X X Extracts X X X X ..... e Government of Poland and Government of India. According to the Assessing Officer (A.O), the assessee's case was not covered under DTAA and therefore, notice u/s./ 148 was issued. The assessment was completed u/s. 143(3) r.w.s. 147 on 30-12-2008. The claim of the salary of Rs.10,86,950/- received from Polish Company did not find favour with A.O. for the following reasons and therefore the same was added to his total income. "4. The claim of the assessee that the income received from foreign company is exempt from tax did not acceptable due to the following reasons:- (i) During the year under consideration, the assessee was employed as a 'Service Provider' providing services for Polpharma Indian Representative, Office at Bangalore. Thus, the place of employment is Bangalore and not outside India and therefore, any income that arise or accrued, due to employment, in India only. (ii) As per Article 17(2) of the Agreement between India and Poland for Avoidance of Double Taxation, the person is required to be Top Level Managerial position. In the instant case, the assessee has been repeatedly requested to provide his terms of employment with the Poland Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia. Since, he was the final authority at Bangalore based Indian Office and since during the year under consideration the appellant assessee was responsible for establishing the Indian Officer after taking the relevant RBI permission, getting the Indian Office registered with the Registrar of Companies, Income Tax Authorities and local Bangalore, Karnataka authorities as per prevailing Rules and Laws of India. Also the fact that the assessee was taking all the decisions of the company at Bangalore based Indian Office. The fact that the assessee opened Indian Office Bank Account at HDFC Bank and was the signing authority. In view of the discussion hereinabove, and also keeping into account the case laws, circulars cited and on the basis of the arguments of the A.R. of the assessee on the subject, the disallowance of exemption under DTAA made by the Assessing Officer is not justified and the A.O. is directed to grant the full exemption under DTAA as claimed by the assessee in his Return of Income. Thus, the first ground raised by the appellant is allowed. 4. Aggrieved by the order of CIT(A), the Revenue is in appeal before us. 5. Ground No. 1, the Ld. D.R. strongly urged that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is sufficient. Then the assessee was continuously requesting the Poland company management to issue such certificate but due to their own business, other important works etc, such company could not issue the required certificate. Thus the assessee as prevented by sufficient cause due to which he could not submit such certificate before Assessing Officer. (2) Now the Poland company has issued the certificate to the assessee mentioning the facts that the assessee was appointed in the capacity as an official in a Top Level Managerial Position in the Company for period of 14.6.2004 to 31.3. 2005 in Zaclady Farmacerutycrne Polpharma SA. Such certificate also contains the authorities given to the assessee as well as his appointment as Business Development Director in such company from 1.6.2005. (3) We humbly request your honour to admit such certificate as an additional evidence. (4) The Poland Company authorities have signed the certificate and send the scanned copy of such certificate to the assessee. As intimated by the assessee Poland Company shall send such certificate from Poland to Assessee at Banglore office and after receiving the same the assessee shall sen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s "service provider" and the salary paid to the assessee. In view of these facts, the dispute that has to be decided is whether the Assessee can be considered as "Top Level Managerial Person" so as to become entitled to the benefit of Article 17(2) of the DTAA between India and Poland. It is a fact that the assessee was employed as "Service Provider" and during the period under dispute he was providing the service from Bangalore in India. As per the Cooperation agreement dated 14.12.2004 entered into between the assessee and the Polish Company, the function of the assessee was "to support establishing and preparing organization of the company's representative office in India by the date of 31st May 2005". We are of the view that the function to support establishing and preparing organization can at best be termed as a management function but cannot be equated with "Top Level Managerial Position". The term "Top Level Managerial Position" has not been defined in DTAA. Business dictionary.com defines top management as "The highest ranking executives (with titles such as Chairman/Chairperson, Chief Executive Officer, Managing Director, President, executive Directors, executive Vice Pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 submitted that he made cash withdrawals of Rs. 3,06,200/- from various banks for household expenses and others. The AO was of the view that considering the status of the assessee, the withdrawals are found to be sufficient for household expenses and there left nothing to make donation. Accordingly he denied the benefit of deduction u/s 80G. 19. Aggrieved by the denial of benefit the Assessee filed appeal before CIT (A). CIT (A) allowed the benefit by holding as under: "Before me the A.R. submitted that the family of the assessee is very small containing himself, his wife and minor daughter. Such family is a very simple South Indian family not having any ostentatious expenses or expensive lifestyle. The assessee has also incurred/paid for household expenses by Credit Card/Debit Card, expenses of Rs. 64,269.54 during this period. Under these circumstances, the money withdrawn by cash and expenses by credit card/debit card is more than sufficient for their simple lifestyle and to make the donations. The A.R. further argued that when the Assessing Officer has not looked the face and figure of the assessee and his family which is very simple, not looked the residential house of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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