GST Helpdesk   Subscription   Demo   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
What's New Case Laws Highlights Articles News Forum Short Notes Statutory TMI SMS More ...
Extracts
Home List
← Previous Next →

2015 (11) TMI 113 - ITAT CHENNAI

2015 (11) TMI 113 - ITAT CHENNAI - TMI - Disallowance u/s 40(a)(ia) - amount paid to seconded employees on which tax is not deducted at source - Held that:- Since the issue raised in this appeal is identical to the issue decided by this Bench of the Tribunal in the assessee’s own case for the subsequent assessment year 2010-11 what has been paid to the deputed personnel is a salary and hence the assessee was not liable to deduct tax at source from the payment made by it to IHC as reimbursement o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d by him. In the instant case, it is not disputed that the deputed persons, wherever liable, have paid the tax on the salaries received by them and hence no further tax can be collected from the assessee. The order passed under ss. 201, and 201(1A) is bad in law and the CIT(A) had also erred in confirming the same. Needless to add, since the assessee was not liable to deduct tax under s. 194J, there is no question of levying any interest also under s. 201(1A)

Both the Revenue Authorit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

oes not amount to additional service charges payable by the assessee company to the assessee’s subsidiary company and also the decisions cited by the assessee hereinabove, we hereby remit back the matter to the file of the Ld. Assessing Officer to consider all these aspects discussed hereinabove and pass appropriate order as per merits and law. - Decided in favour of assessee.

Disallowance invoking Section-14A of the Act and Rule 8D of the Rules - Held that:- This issue is also identi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

as to what is submitted by the Ld. A.R before us and if found to be so, delete the addition made on account of Section-14A of the Act. - Decided in favour of revenue for statistical purposes - I.T.A.No.1712/Mds./2013 - Dated:- 29-9-2015 - SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER For The Appellant : Dr.B.Nischal, JCIT, D.R For The R .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

oking the provisions of section 40(a)(ia) of the Act for not deducting tax on the payment of ₹ 1,13,51,946/- made to the seconded employees from the assessee s subsidiary company which is to be reimbursed by the assessee s subsidiary company. 2. The Ld. CIT (A) had erred in directing the A.O to delete the disallowance made by invoking Section-14A of the Act and Rule 8D of the Rules. 3. The brief facts of the case are that the assessee company is engaged in the business of consultancy & .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

being the amount paid to seconded employees on which tax is not deducted at source. During the course of scrutiny assessment proceedings, it was observed by the Ld. Assessing Officer that the assessee had not deducted tax on the remuneration paid to the seconded employees from the assessee s subsidiary company. On query by the Ld. Assessing Officer as to why tax is not deducted at source?, the assessee had explained that the remuneration paid to the seconded employees by the assessee is to be re .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tion paid to the assessee s seconded employees because of the following reasons:- i. There exist a separate agreement to render services to the assessee company by the other party i.e. M/s.Simpson & C. Ltd. ii. Being both the parties are different legal entities and one party rendered services to other party, the provisions of Chapter XVII-B is attracted. iii. None of the employees or man power which rendered the services under this head of expenses are in the roll of the assessee company an .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

to be subjected to TDS. vi. In general, men and materials are major inputs either directly or indirectly for any business activity. The assessee s explanation that there is no income or benefit accrued out of such services rendered by M/s. Simpson Co. Ltd, will vitiate the entire claim of such expenses under the business head since it was not incurred for the purpose of business. Hence such expenses without any corresponding income needs disallowance per-se as there is no matching concept betwee .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ds./2015 vide order dated 16.09.2015. The relevant portion of the order is extracted herein below for reference We have heard both the parties and carefully perused the materials available on record. The claim of the assessee is that the assessee is only making payment to its seconded employees from the assessee s subsidiary company on behalf of its subsidiary company which is to be reimbursed to the assessee company by the assessee s subsidiary company. The tax is deducted at source directly by .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

then once again deduction of tax on such salary payment would amount to double deduction of tax at source. It is apparent from the facts of the case that the assessee company is obtaining some service from its subsidiary company for which the assessee company pays service charges to its subsidiary company. Ld. A.R. submitted before us that the amount paid to the seconded employees from the assessee s subsidiary company is not the additional remuneration paid to the assessee s subsidiary company .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n the assessee s hotel were carrying on any profession. If an accounts executive was deputed, he was doing the duty as was assigned to him by his employer. It cannot be said that he was carrying on the profession of accountancy and that what he received were fees in the course of carrying on such profession. In fact, what he received was merely salary from the employer for doing the duty assigned to him by the employer. Similarly, if an engineer was deputed, the engineer was not rendering any te .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

l within the scope of fees for technical services . This is because Expln. 2 clearly excludes consideration which would be income of the recipient chargeable under the head salaries . In the present case, it is not in dispute that what is reimbursed by the assessee is the actual salary of the• deputed personnel. Undoubtedly, far each deputed person, the amount received by him is income chargeable under the head salary and therefore, it cannot be termed as fees for technical services What s. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ot be chargeable to tax under the head salaries , In the- present case, what has been paid to the deputed personnel is a salary and hence the assessee was not liable to deduct tax at source from the payment of ₹ 39,55,161 made by it to IHC as reimbursement of salaries in respect of various personnel deputed to the hotel of the assessee. The alternative contention of the counsel also has to be accepted in view of the clear provisions of the Explanation to s. 191. Assuming, without admitting .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

and 201(1A) is bad in law and the CIT(A) had also erred in confirming the same. Needless to add, since the assessee was not liable to deduct tax under s. 194J, there is no question of levying any interest also under s. 201(1A). Since the Both the Revenue Authorities has not examined the following aspects and held the issue against and in favour of the assessee; i.e., whether the tax has been duly deducted at source by the assessee s subsidiary company on the payment made by the assessee to the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Officer to consider all these aspects discussed hereinabove and pass appropriate order as per merits and law. We further direct the assessee to co-operate with the Revenue in its proceedings to expedite their orders. This ground is accordingly disposed off. Since the issue raised in this appeal is identical to the issue decided by this Bench of the Tribunal in the assessee s own case for the subsequent assessment year 2010-11, this appeal is also disposed off with similar directions to the Ld. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

mpany following the decision of the Chennai Bench of the Tribunal in the case EIH Associates Hotels Vs. CIT reported in 2013-TIOL-796-ITAT-MAD-A.Y 2008-09 dated 17.2.2013, we hereby direct the Ld. Assessing Officer to verify whether the fact of the case is identical as to what is submitted by the Ld. A.R before us and if found to be so, delete the addition made on account of Section-14A of the Act. 6. In the result, the appeal of Revenue is partly allowed for statistical purposes as indicated he .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

an>

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

5 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Placeholder Text />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Locked= false Priority= 68 SemiHidden= false UnhideWhenUsed= false Name= Medium Grid 2 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

3 SemiHidden= false UnhideWhenUsed= false Name= Medium Shading 1 Accent 1 /> .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

y= 68 SemiHidden= false UnhideWhenUsed= false Name= Medium Grid 2 Accent 1 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

eption Locked= false Priority= 63 SemiHidden= false UnhideWhenUsed= false Name= Medium Shading 1 Accent 2 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

= Colorful Shading Accent 2 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

dden= false UnhideWhenUsed= false Name= Medium List 2 Accent 3 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Locked= false Priority= 61 SemiHidden= false UnhideWhenUsed= false Name= Light List Accent 4 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Grid 3 Accent 4 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ideWhenUsed= false Name= Medium Shading 2 Accent 5 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

se Priority= 73 SemiHidden= false UnhideWhenUsed= false Name= Colorful Grid Accent 5 />

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Advanced Search


Latest Notifications:

    Dated      Category

20-7-2017 Cus (NT)

20-7-2017 GST CESS Rate

19-7-2017 IT

19-7-2017 IT

18-7-2017 IT

18-7-2017 CE (NT)

18-7-2017 CE

18-7-2017 GST CESS Rate

15-7-2017 Kerala SGST

14-7-2017 Andhra Pradesh SGST

14-7-2017 Cus (NT)

14-7-2017 Cus

13-7-2017 Co. Law

13-7-2017 Co. Law

13-7-2017 ADD

13-7-2017 ADD

12-7-2017 Jammu & Kashmir SGST

12-7-2017 Gujarat SGST

12-7-2017 Gujarat SGST

12-7-2017 CGST Rate

More Notifications


Latest Circulars:

20-7-2017 Goods and Services Tax

19-7-2017 Goods and Services Tax

19-7-2017 Income Tax

18-7-2017 Customs

17-7-2017 Customs

14-7-2017 Income Tax

13-7-2017 Central Excise

13-7-2017 Customs

13-7-2017 Central Excise

13-7-2017 Customs

More Circulars



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version