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TMI Blog2015 (12) TMI 1233X X X X Extracts X X X X X X X X Extracts X X X X ..... Mds/2015. The first ground is general in nature and does not require any adjudication. 3. The next ground raised by the assessee is that the Commissioner of Income-tax (Appeals) erred in rejecting the contentions of the assessee on the issue relating to reopening of the assessment. 4. At the time of hearing, the learned authorised representative submitted that the assessee is not interested to press this ground. Accordingly, this ground is dismissed as not pressed. 5. The next grounds raised by the assessee are as follows : "3. The learned Commissioner of Income-tax (Appeals) erred in law in confirming the disallowance of interest paid to the Canara Bank on the overdraft facility, which disallowance, by the Assessing Officer was against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner of Income-tax (Appeals), who confirmed the order of the Assessing Officer. Aggrieved, the assessee is in appeal before us. 7. We have heard both sides and perused the material on record, Before us, the assessee has filed additional evidences accompanied by the petition stating that the assessee is having interest-free funds and advanced the same to others without charging any interest and the additional evidences are as follows : "1. Statement copy, Form 3CB, Form 3CD and return filed acknowledgment. 2. IncomeâEUR"tax assessment order under section 143(1) dated January 10, 2005. 3. Notice under section 154 dated December 5, 2007. 4. Reply to notice under section 154 dated December 19, 2007. 5. Income-tax office letter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts. It was stated that the assessee was paid the said amount for arranging foreign business. However, the assessee has not produced any requisite evidence regarding the payments. Being so, the Assessing Officer invoked the provisions of section 40(a) of the Act. Aggrieved, the assessee went in appeal before the Commissioner of Income-tax (Appeals), who confirmed the order of the Commissioner of Income-tax (Appeals). Against this, the assessee is in appeal before us. 11. The learned authorised representative submitted that the requirement to deduct tax under section 195 would arise only when such commission paid is chargeable to tax in India under the Act. The learned authorised representative further submitted that the Commissioner of Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... set, certain provisions of the Act needs to be looked into section 40(a)(i) which reads as under : "40. Notwithstanding . . . (a) In the case of any assessee- (i) any interest (not being interest on a loan issued for public subscription before the 1st day of April, 1938), royalty, fees for technical services or other sum chargeable under this Act, which is payable,- A. outside India ; or B. in India to a non-resident, not being a company or to a foreign company, on which tax is deductible at source under Chapter XVII-B and such tax has not been deducted or, after deduction, has not been paid during the previous year, or in the subsequent year before the expiry of the time prescribed under sub-section (1) of section 200 :" 14. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, it is exempted, if the assessee is able to prove that the services were rendered by those non-residents abroad. In the present case, the assessee has not established the facts on record that the non- resident has rendered services abroad and there is no business connection in India by producing relevant records, viz., either agreement entered into by the assessee with them or the correspondence took place between the parties. Without examining these details, we are not in a position to decide the nature of services rendered by the non-resident agent. Therefore, it is appropriate to remit the entire issue back to the file of the Assessing Officer with direction to the assessee to prove that it was sales commission towards procurement of o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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