TMI Blog2023 (2) TMI 904X X X X Extracts X X X X X X X X Extracts X X X X ..... while the AO had applied higher rates as per Act considering appellant to be assessee in default. The order of the CIT(A) shows that the judgment of Danisco India Pvt. Ltd Vs. UOI [ 2018 (2) TMI 1289 - DELHI HIGH COURT ] wherein case of Dy. CIT Vs. Serum Institute of India [ 2015 (6) TMI 26 - ITAT PUNE ] Further without a wording of discussion to distinguish the legal proposition on facts or law, CIT(A) had failed to follow the same. This leaves no doubt in the mind of this bench that the ld Tax Authorities below have fallen in error in not extending the benefits of section 90(2) - DR could not point out the provisions of the Act or DTAA to support the observations of CIT(A). The matter of fact remains that what were the rates of taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ') by the Id Assessing Officer, CPC-TDS, Vaishali, Ghaziabad (hereinafter referred as the Ld. AO 2. The facts in brief are that the assessee s return was processed and intimation u/s 200A was issued raising a demand on account of short deduction of the taxes. The assessee had made certain payments in the nature of fees for technical services to non residents and other income of non-resident and filed e-TDS quarterly statement in Form 27Q for relevant Financial year. The ld AO(TDS), CPC, Ghaziabad through automatic system held that the assessee is liable for deduction of tax at higher rate for want of Permanent Account Number of the concerned non-resident payees as per the provisions of section 206A of the Act. The assessee had challe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and judicial propositions the Ld. CIT(A) grossly erred in concluding that the section 206AA of the I.T Act, 1961 overrides provisions of section 90(2) applicable to non residents of the foreign country with whom DTAAS were signed. 2.That having regard to the facts of the case, provisions of law and judicial propositions the Ld. CIT(A) grossly erred in ignoring the decision of the Delhi High Court in the case of Danisco India (P) Ltd Vs. UOI (2018) 404 ITR 539 (Del.HC), in which it was held that section 206AA of the Act does not override the provisions of section 90(2) of the Act and that in case of payments made to non residents, the rate of tax to be applied as prescribed under the DTAA and not as per section 206AA of the Act because ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es below, here in appeal the claim cannot be raised. 7. Giving thoughtful consideration to the matter on record and the submission it comes up that there is no dispute to the fact that all the payments were made to the non resident of the countries with whom there are DTAA agreement by India. There is no dispute to the fact that the assessee had applied rate at lower level while the ld AO had applied higher rates as per Act considering appellant to be assessee in default. The order of the ld CIT(A) shows that the judgment of Hon'ble Delhi High Court in case of Danisco India Pvt. Ltd Vs. UOI (supra) wherein, Pune Tribunal in case of Dy. CIT Vs. Serum Institute of India (supra) was reproduced at page 11 to 14 of the order. Further with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In-fact, in the context of section 195 of the Act also, the Hon'ble Supreme Court in the case of CIT vs. Eli Lily Co., (2009) 312 ITR 225 (SC) observed that the provisions of tax withholding i.e. section 195 of the Act would apply only to sums which are otherwise chargeable to tax under the Act. The Hon'ble Supreme Court in the case of GE India Technology Centre Pvt. Ltd. vs. CIT, (2010) 327 ITR 456 (SC) held that the provisions of DTAAs along with the sections 4, 5, 9, 90 91 of the Act are relevant while applying the provisions of tax deduction at source. Therefore, in view of the aforesaid schematic interpretation of the Act, section 206AA of the Act cannot be understood to override the charging sections 4 and 5 of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the files of Ld. AO to take into consideration the rate of the DTAA and recalculate the tax demand considering difference between the rate applied by the Ld. AO and the rates on which tax deducted by the assessee in terms of the relevant DTAA. 11. Furthermore, as far as the claim of refund is concerned there is no force in the submissions of the ld DR that claim is being raised belated as order of the ld CIT(A) shows that rectification petition u/s 154 was filed by the assessee wherein, the request for refund of the excess TDS deducted was made and being aggrieved by non rectification and non-refund of the tax deposited appeal was filed. Further, this issue is also subject to the determination of tax rates as directed to be recalculat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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