TMI Blog2017 (10) TMI 1154X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the light of required documentary evidences. In view we are of the opinion that the issue of holding the services rendered by the agent as fee for consultancy services, need reexamination by the Assessing Officer. Accordingly, we restore the matter to the file of the Assessing Officer for re-examination of the issue in dispute. The ground No.1 of the appeal is accordingly allowed for statistical purposes. Disallowance of credit card expenses - Held that:- In view of the facts of the case, we feel it appropriate to restore the matter to the file of the Assessing Officer for consideration afresh. The assessee shall be afforded sufficient opportunity of being heard. The Ground No. 2 of the appeal is also allowed for statistical purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee was selected for scrutiny and notice under section 143(2) of the Income-tax Act, 1961 (in short the Act ) was issued and complied with. The assessment was completed on 15/03/2016 and total income was assessed at ₹ 51,68,376/- after making certain additions. Aggrieved, the assessee filed appeal before the Ld. CIT-(A), who upheld the additions made by the Assessing Officer. Aggrieved, the assessee is in appeal before the Tribunal raising the grounds as reproduced above. 3. The ground No. 1 of the appeal relates to disallowance made under section 40(a)(i) of the Act in respect of commission paid of ₹ 31,61,046/- on sales to a non-resident individual, situated outside India. 3.1 During assessment proceeding, the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use (vi) or clause (vii) of sub-section 1 and shall be included in the total income of the non-resident, whether or not- (i) the non-resident has a residence or place of business or business connection in India ; or (ii) the non-resident has rendered services in India. Accordingly, the AO held that the assessee was required to deduct tax at source while making payment towards fee for consultancy services rendered to the non-resident and due to non-deduction of tax at source, the payment was disallowable under section 40(a)(i) of the Act. 3.2 The Ld. CIT-(A) confirmed the disallowance with following observations: It is being claimed by the Ld. AR that the payment in question has been made to non-resident agent outside India for the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ough to procure orders from the international market, the basis on which a product can be launched. For the same specific specialization is also required to study the market which is a pre-condition for any businessmen to explore business opportunities abroad. And procure orders. In the absence of any documentary evidence provided by the Ld. AR to controvert the finding of the AO, it is worthwhile to mention here that to explore business opportunities on behalf of the appellant technical expertise is required without which no person can study the market and give advice to launch a product in an alien country the basis on which businessmen commences his business. Mere procuring a order cannot fetch a substantial amount of payment to the exte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invoice raised etc. The Ld. counsel submitted that no specific documents to hold that income was in the nature of fee for managerial, technical and consultancy, were asked by the Assessing Officer. According to him, the assessee explained nature of services rendered by the commission agent and onus was on the Revenue to establish that it was in the nature of fee for services in the nature of consultancy requiring specialized knowledge. 3.4 The Ld. Sr. DR, on the other hand, relied on the order of the lower authorities and submitted that the assessee was liable for deducting tax at source on the payments. However, he submitted that issue may be restored to the file of the Assessing Officer for re-examination in the light of the agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatistical purposes. 4. The ground No. 2 relates to disallowance of ₹ 32,663/- out of credit card expenses. The Ld. CIT-(A) adjudicated the issue as under: In ground no.4, the issue involved is addition of ₹ 32,663/- made by the AO on account of difference by making payment through credit cards in the month of April, 2014 which were noticed from the details submitted by the assessee during the course of assessment proceedings. During the appellate proceedings, Ld. AR has provided a copy of statement dt.07.04,2013 for the transactions during the month of March, 2013 and on the basis of the same it is being explained that no disallowance is called for. However, ongoing through the statement filed for the month of April, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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