2016 (9) TMI 705

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..... isement and exhibition expenses. 1. On the facts and circumstance of the case, Ld CIT(A) has erred in adjudicating on the nature of payment and liability to withhold tax as it is beyond the purview of the provisions of the section 154 of the Act, as held by the AO. 1.2 an the facts and circumstance of the case, Ld CIT(A) has erred not appreciating the fact that there is no mistake apparent from record in processing of Form 27Q, as held by the AO in order u/s 154 which was the subject matter of appeal before CIT(A) 1.3 On the facts and circumstance of the case, Ld CIT(A) has erred in not appreciating that no enquiries or detailed examination of nature of the transactions, nature and scope of the services rendered can be made in the .....

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..... s per the intimation a rate of 20% has been applied by the AO owing to non-availability of foreign parties. Thereafter, AO has rejected the application of the assessee filed u/s. 154 of the I.T. Act vide his order passed u/s. 154 of the I.T. Act, 1961 on 22.2.2013. 3. Aggrieved with the aforesaid order, assessee preferred an appeal before the Ld. CIT(A), who vide his impugned order dated 30.12.2014 has allowed the appeal of the assessee. 4. Now the Revenue is aggrieved against the impugned order and filed the present appeal before the Tribunal. 5. Notice of hearing was sent to both the parties and in response to the same none appeared on behalf of the Department, nor any application for adjournment has been filed by the Department. Keepi .....

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..... e nature of business receipts in hands of payee. Such business receipts are taxable in India only if payee had 'PE' in India within meaning of relevant DTAA. From the facts as furnished by the appellant, it is seen that foreign entities did not have PE in India and therefore payments were not chargeable to tax in India. Accordingly, the appellant was under no obligation to deduct taxes at source while making these payments. 5.2 Accordingly, I hold that taxes were not required to be withheld u/s. 195(1) of the Act on the impugned payments made by the appellant. Various ground of appeal taken by the appellant are argumentative in nature and are in respect of on issue only which is allowed in favour of the appellant. 6.0 In the result, t .....

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