TMI Blog2021 (4) TMI 466X X X X Extracts X X X X X X X X Extracts X X X X ..... E M.DURAISWAMY AND THE HON'BLE MRS.JUSTICE R.HEMALATHA For the Appellant : Mr.M.Swaminathan, Senior Standing Counsel For the Respondent : Mr.Aasim Shezad and Mr.Vedhavel for M/s. BFS Legal JUDGMENT (Judgment was delivered by M.DURAISWAMY, J.) Challenging the order passed in I.TA.No.1029/Mds/2013 in respect of the assessment year 2008-2009 on the file of the Income Tax Appellate Tribunal, Chennai, C Bench, the Revenue has filed the above appeal. 2.The above appeal was admitted on the following substantial questions of law: (i) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the Tribunal was justified in cancelling the order of the CIT under section 263 without considering that the CIT had validly exercised his powers under section 263 of the Income Tax Act, 1961? (ii) Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the jurisdiction of the CIT while invoking section 263 of the Income Tax Act is confined only to those issues which form part of the Show Cause Notice ? (iii) Whether the facts and in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes of this clause, 'fees for technical services' means any consideration (including any lump sum consideration) for the rendering of any managerial, technical or consultancy services (including the provision of services of technical or other personnel) but does not include consideration for any construction, assembly, mining or like project undertaken by the recipient or consideration which would be income of the recipient chargeable under the head 'Salaries'. (2) Notwithstanding anything contained in subsection( 1), any pension payable outside India to a person residing permanently outside India shall not be deemed to accrue or arise in India, if the pension is payable to a person referred to in article 314 of the Constitution or to a person who, having been appointed before the 15th day of August, 1947, to be a Judge of the Federal Court or of a High Court within the meaning of the Government of India Act, 1935, continues to serve on or after the commencement of the Constitution as a Judge in India. Explanation. For the removal of doubts, it is hereby declared that for the purposes of this section, income of a non-resident shall be deemed to accr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance and sold through non-resident assessees who were paid commission, held as under: 8. The second aspect of the same question is whether the commission amounts credited in the books of the statutory agent can be treated as incomes accrued, arisen, or deemed to have accrued or arisen in India to the non-resident assessees during the relevant year. This takes us to section 9 of the Act. It is urged that the commission amounts should be treated as incomes deemed to have accrued or arisen in India as they, according to the department, had either accrued or arisen through and from the business connection in India that existed between the non-resident assessees and the statutory agent. This contention overlooks the effect of clause (a) of the Explanation to clause (i) of sub-section (1) of section 9 of the Act which provides that in the case of a business of which all the operations are not carried out in India, the income of the business deemed under that clause to accrue or arise in India shall be only such part of the income as is reasonably attributable to the operations carried out in India. If all such operations are carried out in India, the entire income accruing therefr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the definition of fees for technical services, we are the firm view that section 9 of the Act is not applicable to the case on hand and, consequently, section 195 of the Act does not come into play. In view of the above finding, the decision of the Supreme Court in Transmission Corporation of A. P. Ltd.'s case, referred to supra, relied upon by the learned standing counsel for the Revenue is not applicable to the facts of the present case. We find no infirmity in the order of the Tribunal in confirming the order of the Commissioner of Income-tax (Appeals). 8. The above decision of this Court in Faizen Shoes (P.) case (supra) is squarely applicable to the facts of the present case. 9. In the result, this Court finds no reason to interfere with the order passed by the Tribunal. No question of law, much less substantial question of law arises for consideration in this appeal. Accordingly, the order passed by the Tribunal is confirmed and this appeal is dismissed. No costs. 4. Mr.Aasim Shezad, learned counsel appearing for the respondent assessee submitted that the Hon'ble Supreme Court in the Judgment reported in (2000) 2 Supreme Court Cases 718 [Malabar Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X
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