TMI Blog2018 (6) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... llowance - Decided in favor of assessee. - ITA No. 93/Kol/2015 & ITA No. 1462/Kol/2016 - - - Dated:- 31-5-2018 - Shri S. S. Godara, Judicial Member And Dr. A. L. Saini, Accountant Member By Revenue : Shri S. Dasgupta, Addl. CIT-DR By assessee : Shri A.K. Tulsiyan, FCA ORDER Per S.S.Godara, Judicial Member:- These two Revenue s appeal for assessment years 2010-11 and 2012- 13 arose against Commissioner of Income Tax (Appeals)-XX and Commissioner of Income Tax (Appeals)-10 Kolkata s orders dated 12.11.2014 22.04.2014, in case Nos.47/CIT(A)-XX/JCIT R-34/2013-14/Kol and 45/CIT(A)-10/R-34/2014-15/Kol; respectively involving proceedings u/s. 143(3) of the Income Tax Act, 1961; in short the Act . Heard both the parties. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he IT Act. In the assessment order, The AO also discussed about services rendered by M/s Allcasat Corporation to the appellant. From the contents of the agreement the appellant had with M/s Allcast Corporation, the AO concluded that the nature of services rendered the aforesaid company was of professional services rendered as market research providing main power in USA for carrying out these activities and other incidental activities connected with the company in USA. Since, the payment was not made for procuring business but the same was made with regard to professional services rendered by the aforesaid company, therefore, the provisions of sec. 195 is clearly attracted in this case. Since, the appellant fail to deduct tax as provided u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n India. Therefore, the payment made in respect of the amount which was not chargeable to tax under the provisions of the Act, no tax was liable to be deducted on the same. After going through the facts and circumstances of the case and also the decision of the Hon'ble Supreme Court (supra) as mentioned by the appellant, I find merit in their argument. The income earned by M/s Allcast Corporation was not chargeable to tax in India. There was no permanent establishment of the said company in India. The payment was made in lieu of services rendered in USA and Canada. The company was a non resident company based on USA. No part of its income had accrued or arose in India. The money was paid with reference to procuring export orders o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red any of its services in India thereby making it liable to be assessed u/s 9 r.w.s 5 of the Act. The assessee s payee has not rendered any service in India as per the relevant agreement dated 01.4.009 forming part of the case file. It rather emerges that Article 7 of the Indo-USA Double Taxation Avoidance Agreement makes it clear that the profits of an enterprise of a contracting state shall be taxable only in that state unless the enterprise carries on business in the other contracting state through permanent establishment situated . It has already come on record that assessee s payee (supra) does not have any permanent establishment in India. We therefore quote Section 90(2) of the Act that where the Government of India has executed su ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
