ITO 2(2)(1), MUMBAI V. INDO INDUSTRIES LTD, MUMBAI

ITA 4642/MUM/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7324 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 07-07-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARJU GARODIA
• Keywords: Capital asset; Services rendered outside India; Deemed to accrue or arise in india; Permanent establishment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, JM AND SHRI N. K. PRADHAN, AM ./ I.T.A. NO. 4642/MUM/2016 ( / ASSESSMENT YEAR: 2012 - 13 ) ITO - 2(2)(1) R. NO. 549, 5 TH FLOOR, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI - 400 020 / VS. M/S. INDO INDUSTRIES LTD. A - 1, SAMEER APARTMENTS, S. V. ROAD, ANDHERI (W), MUMBAI - 400 058 ./ ./ PAN/GIR NO. AAACI 8197 D ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : MS. ARJU GARODIA / RESPONDENT BY : SHRI BHUPENDRA SHAH / DATE OF HEARING : 09.03.2018 / DATE OF PRONOUNCEMENT : 11.05 .2018 / O R D E R PER SA KTIJIT DEY , J . M.: THE AFORESAID APPEAL AT THE INSTANCE OF THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 04.04.2016 OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 5, MUMBAI FOR THE ASSESSMENT YEAR 2012 - 13. 2. THE SOLITARY ISSUE ARISING FOR CONSIDERATION IN THE PRESENT APPEAL RELATES TO THE DELETION OF DISALLOWANCE MADE U/S. 40(A)(I) OF THE INCOME TAX ACT, 1961 BY THE ASSESSING OFFICER ON ACCOUNT OF COMMISSION PAID TO FOREIGN AGENTS. 2 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. 3. BRIEFLY THE FACTS ARE THAT THE ASSESSEE AN INDIAN C OMPANY , AS STATED BY THE ASSESSING OFFICER , IS A GOVERNMENT OF INDIA RECOGNIZED S TAR E XPORT H OUSE. THE MAIN BUSINESS OF THE ASSESSEE IS EXPORTING OF COTTON YARN. FOR THE ASSESSMENT YEAR UNDER DISPUTE, THE ASSESSEE FILED ITS RETURN OF INCOME ON 29.09.2012 D ECLARING TOTAL INCOME OF RS.21,03,080/ - . 4. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER WHILE VERIFYING THE FINANCIAL STATEMENTS OF THE ASSESSEE FOUND THAT THE ASSESSEE HAS CLAIMED DEDUCTION OF AN AMOUNT OF RS.1,36,71,242.13 ON ACCOUNT OF CO MMISSION PAID TO FOREIGN AGENTS FOR BOOKING EXPORT ORDERS FOR THE ASSESSEE. THE ASSESSING OFFICER WAS OF THE VIEW THAT WHILE PAYING COMMISSION TO THE FOREIGN AGENT S THE ASSESSEE WAS REQUIRED TO DEDUCT TAX AT SOURCE U/S.195 OF THE ACT. SINCE, HE HAS FAILED TO DO SO, HE CALLED UPON THE ASSESSEE TO EXPLAIN WHY THE DEDUCTION CLAIMED SHOULD NOT BE DISALLOWED. IN RESPONSE, IT WAS SUBMITTED BY THE ASSESSEE THAT COMMISSION WAS PAID TO FOREIGN AGENTS TOWARDS SERVICES RENDERED OUTSIDE INDIA AND THE SAID FOREIGN AGENT S NEITHER HAVE ANY PERMANENT ESTABLISHMENT NOR ANY BUSINESS CONNECTION IN INDIA . T HE PAYMENT WAS ALSO MADE OUTSIDE INDIA . THUS, IT WAS SUBMITTED, SUCH PAYMENT CANNOT BE CONSIDERED AS INCOME OF THE FOREIGN AGENTS CHARGEABLE TO TAX IN INDIA. THEREFORE, THE P ROVISIONS OF SECTION 195 ARE NOT APPLICABLE. IT WAS FURTHER SUBMITTED , IN THE ASSESSEES OWN CASE FOR THE PRECEDING ASSESSMENT YEAR S, THE TRIBUNAL HAS DE LET ED THE SIMILAR DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF PAYMENT OF COMMISSION TO FOR EIGN 3 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. AGENTS. THE ASSESSING OFFICER AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, HOWEVER, WAS NOT CONVINCED WITH THE SAME. T HE ASSESSING OFFICER HELD THAT AS PER THE RULING OF THE HONBLE SUPREME COURT IN THE CASE OF GVK INDUSTRIES VS. ITO 332 ITR 130 (SC) THE COMMISSION PAID TO FOREIGN AGENTS FOR OBTAINING EXPORT ORDER FOR EXPORTS FROM INDIA IS LIABLE TO BE TAXED IN INDIA. THEREFORE, THE ASSESSEE WAS LIABLE TO DEDUCT TAX AT SOURCE ON THE COMMISSION PAID AS IT FALLS WITHIN THE PURVIEW OF SECTION 9(1) (I )/9(1)(VII ) R.W.S. 195. THE ASSESSEE H AVING FAILED TO DEDUCT TAX AT SOURCE ON SUCH PAYMENT , IT WAS LIABLE FOR DISALLOWANCE U/S. 40(A)(I) OF THE ACT. IN THIS CONTEXT, THE ASSESSING OFFICER ALSO RELIED UPON HIS REASONING WHILE MAKING SIMILAR DISALLOWANCE IN THE ASSESSEES CASE FOR ASSESSMENT YEARS 2010 - 11 AND 2011 - 12. WHILE DOING SO, THOUGH HE TOOK NOTE OF THE FACT THAT THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010 - 11 HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE, HOWEVER, HE REFUSED TO F OLLOW THE DECISION OF THE TRIBUNAL ON THE REASONING THAT THE DEPARTMENT HAS NOT ACCEPTED SUCH DECISION AND FILED AN APPEAL BEFORE THE HONBLE HIGH COURT. 5. BEING AGGRIEVED BY THE DISALLOWANCE MADE U/S. 40(A)(I ) OF THE ACT, THE ASSESSEE PREFERRED AN APPE AL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS). 6. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) TAKING NOTE OF THE FACT THAT THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR ASSES SMENT YEAR 2010 - 11 HAS DELETED SIMILAR DISALLOWANCE MADE BY THE ASSESSIN G OFFICER U/S. 40(A)(I) OF THE ACT , FOLLOWED THE SAME AND DELETED THE ADDITION IN THE IMPUGNED ASSESSMENT YEAR AS WELL. 4 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. 7. THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY RELIED UPON THE OBSERVATIONS OF THE ASSESSING OFFICER AND SUBMITTED THAT THOUGH THE PAY MENTS WERE MADE TO FOREIGN AGENTS FOR PROCURING ORDERS OUTSIDE INDIA, HOWEVER, THE PAYMENT MADE TO THE FOREIGN AGENTS IS TAXABLE IN INDIA , AS THE WORK WAS EXECUTED IN INDIA. THE LD. DEPARTMENTAL REPRESENTATIVE RELYING UPON THE DECISION IN THE CASE OF GVK I NDUSTRIES (SUPRA) SUBMITTED THAT AS HELD BY TH E HONBLE SUPREME COURT , IN RESPECT OF SUCH TYPES OF PAYMENT THE SOURCE RULE WILL APPLY. FURTHER , HE SUBMITTED , THOUGH THE COMMISSION PAID BY THE ASSESSEE TO FOREIGN AGENTS IS TOWARDS PROCURING ORDERS OUTSIDE I NDIA, H OWEVER, SINCE SUCH PAYMENT HAS A NEXUS WITH THE SOURCE LOCATED IN INDIA, IRRESPECTIVE OF THE FACT WHETHER THE RECIPIENT IS LOCATED OUTSIDE INDIA, THE PAYMENT MADE TO THEM IS TAXABLE IN INDIA . IN THIS CONTEXT, HE REFERRED TO THE PROVISION CONT AINED U /S. 9(1)( VI I) (B) AND EXPLANATION TO SECTION 9(2) OF THE ACT. 8. THE LD. AUTHORIZED REPRESENTATIVE STRONGLY RELYING UPON THE FINDINGS OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) SUBMITTED THAT THE PAYMENT WAS MADE BY THE ASSESSEE TO PERSONS W HO ARE NO T ONLY LOCATED OUTSIDE INDIA BUT THEY HAVE RENDERED SERVICES IN THEIR RESPECTIVE COUNTRIES. THEREFORE, NEITHER THEY HAVE ANY BUSINESS CONNECTION IN INDIA NOR ANY PERMANENT ESTABLISHMENT IN INDIA. HE SUBMITTED , AS PER THE PROVISION OF SECTION 195 OF THE ACT , ONLY IN THE EVENT OF A PARTICULAR PAYMENT MADE TO A NON RESIDENT, IS CHARGEABLE TO TAX IN INDIA TAX IS REQUIRED TO BE DEDUCTED AT SOURCE WHILE MAKING SUCH PAYMENT. HE SUBMITTED , SINCE , THE PAYMENT MADE BY THE ASSESSEE 5 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. TO FOREIGN AGENTS ARE NOT CHARGEABLE TO TAX IN INDIA, THE PROVISION OF SECTION 195 ARE NOT APPLICABLE AND THE ASSESSEE IS NOT REQUIRED TO DEDUCT TAX AT SOURCE ON SUCH PAYMENT. HE SUBMITTED , IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2010 - 11 AND 2011 - 12, SIMILAR DISALLOWANCE MADE BY THE ASSE SSING OFFICER WAS DELETED BY THE TRIBUNAL. HE SUBMITTED , THERE BEING NO DIFFERENCE IN FACTS IN THE IMPUGNED ASSESSMENT YEAR. THE DECISIONS OF THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE PRECEDING ASSESSMENT YEARS HAVE TO BE FOLLOWED. 9. WE HAVE CAREFU LLY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS ON RECORD. THE BASIC ISSUE WHICH ARISES FOR CONSIDERATION BEFORE US IS , WHETHER THE COMMISSION/BROKERAGE PAID TO FOREIGN AGENTS ARE CHARGEABLE TO TAX IN INDIA, THEREBY RE QUIR ING THE ASSESSEE TO DEDUCT TAX AT SOURCE ON SUCH PAYMENT IN TERMS OF SECTION 195 OF THE ACT. ON A PERUSAL OF THE IMPUGNED ASSESSMENT ORDER, IT IS EVIDENT THAT THE ASSESSING OFFICER HAS ACCEPTED THE FACT THAT THE ASSESSEE HAS PAID COMMISSION/BROKERAGE TO PERSONS/ENTITIES LOCA TED OUTSIDE INDIA FOR BOOKING EXPORT ORDERS FOR THE ASSESSEE. T HE REASONING OF THE ASSESSING OFFICER FOR DISALLOWING THE PAYMENT MADE IS THAT SUCH PAYMENT IS CHARGEABLE TO TAX IN INDIA , AS IT FALLS WITHIN THE PURVIEW OF SECTION 9(1)(I)/9(1)(VII) OF THE ACT . AT THIS STAGE, IT WILL BE RELEVANT TO LOOK INTO CERTAIN PROVISIONS OF THE ACT. SECTION 5 OF THE ACT DEFINES THE SCOPE OF TOTAL INCOME. SUB SECTION (2) OF SECTION 5 SAYS THAT THE TOTAL INCOME OF A NON RESIDENT OF ANY PREVIOUS YEAR WILL INCLUDE ALL INCOME FROM WHATEVER SOURCE DERIVED, WHICH IS EITHER 6 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. RECEIVED OR DEEMED TO BE RECEIVED IN INDIA OR ACCRUED OR ARISES O R IS DEEMED TO ACCRUED OR ARISE IN INDIA. SECTION 9 SPEAKS OF INCOME DEEMED TO ACCRUE OR ARISE IN INDIA. AS PER SECTION 9(1)(I) OF THE ACT, ALL I NCOME ACCRUING OR ARISING DIRECTLY OR INDIRECTLY THROUGH OR FROM ANY BUSINESS CONNECTION IN INDIA OR THROUGH AND FROM ANY PROPERTY IN INDIA OR THROUGH SOURCE OF ASSET IN INDIA OR THROUGH THE TRANSFER OF CAPITAL ASSET SITUATED IN INDIA, SHALL BE DEEMED TO A CCRUES OR ARISES IN INDIA. HOWEVER, EXPLANATION 1 CARVES OUT CERTAIN EXCEPTIONS BY PROVIDING THAT IN THE CASE OF A BUSIN ESS OF WHICH ALL THE OPERATIONS ARE NOT CARRIED OUT IN INDIA, IT SHALL BE RESTRICTED TO SUCH PART OF THE INCOME AS IS REASONABLY ATTRIBU TABL E TO THE OPERATIONS CARRIED OUT IN INDIA . EXPLANATION 2 TO SECTION 9(1)(I) OF THE ACT DEFINES BUSINESS CONNECTION WHICH MEANS AND INCLUDES ANY BUSINESS ACTIVITY CARRIED OUT THROUGH A PERSON WHO, ACTING ON BEHALF OF THE NON - RESIDENT, HAS AND HABITUALLY EXERCISES IN INDIA, AN AUTHORITY TO CONCLUDE CONTRACTS ON BEHALF OF THE NON - RESIDENT; OR HABITUALLY MAINTAINS IN INDIA A STOCK OF GOODS OR MERCHANDISE FROM WHICH HE REGULARLY DELIVERS GOODS OR MERCHANDISE ON BEHALF OF THE NON - RESIDENT; OR HABITUALLY SECURE S ORDERS IN INDIA, MAINLY OR WHOLLY FOR THE NON - RESIDENT . THUS FROM THE READING OF THE AFORESAID PROVISION, IT IS CLEAR THAT IF ANY INCOME IS RECEIVED BY A NON RESIDENT THROUGH ITS BUSINESS CONNECTION IN INDIA THEN IT WILL BE TAXABLE IN INDIA . FROM THE DEF INITION OF THE BUSINESS CONNECTION AS PROVIDED UNDER EXPLANATION 2 TO SECTION 9(1)(I) OF THE ACT, IT IS VERY MUCH CLEAR THAT THE NONRESIDENT AGENTS TO WHOM THE ASSESSEE HAS PAID COMMISSION/BROKERAGE DO NOT HAVE ANY BUSINESS CONNECTION IN INDIA. FURTHER, TH E OTHER CONDITIONS OF SECTION 9(1)(I) ARE ALSO NOT APPLICABLE TO THE PAYMENTS 7 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. MADE BY THE ASSESSEE TO NON - RESIDENT AGENTS. IT IS ALSO A FACT ON RECORD THAT NONE OF THE NON - RESIDENT AGENTS HAVE PERMANENT ESTABLISHMENT IN INDIA . WH ILE MAKING THE DISALLOWANCE U/S. 40(A)(I) OF THE ACT, THE ASSESSING OFFICER HAS PLACED STRONG RELIANCE UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GVK INDUSTRIES (SUPRA) AND IN FACT TO APPLY THE SAID DECISION, THE ASSESSING OFFICER HAS MADE ATTEMPT TO ROPE IN THE P AYMENT MADE BY THE ASSESSEE U/S. 9(1)(VII). THEREFORE, AT THIS STAGE, IT IS NECESSARY TO EXAMINE THE NATURE OF THE PAYMENT MADE BY THE ASSESSEE TO NON - RESIDENT AGENTS. AS COULD BE SEEN, THE ASSESSING OFFICER HIMSELF AT MORE THAN ONE PLACE IN THE ASSESSMENT ORDER HAS RECORDED A FINDING OF FACT THAT THE ASSESSEE HAS PAID COMMISSION TO FOREIGN AGENTS FOR BOOKING/OBTAINING EXPORT ORDERS. THUS, IT IS VERY MUCH CLEAR THAT THE PAYMENT BY THE ASSESSEE IS SIMPLY AND PURELY IN THE NATURE OF COMMISSION/BROKERAGE FOR P ROCURING EXPORT ORDERS. SECTION 9(1)(VII) SPEAKS OF PAYMENT OF FEES FOR TECHNICAL SERVICES. APPLYING THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GVK INDUSTRIES (SUPRA), THE PAYMENT MADE BY THE ASSESSEE TO FOREIGN AGENTS UNDER NO CIRCUMSTANCES CAN BE BROUGHT WITHIN THE TERM FEES FOR TECHNICAL SERVICES AS PRESCRIBED U/S. 9(1)(VII) OF THE ACT. IN FACT, WHILE EXAMINING IDENTICAL NATURE OF PAYMENT MADE BY THE ASSESSEE IN ASSESSMENT YEAR 2010 - 11, THE CO - ORDINATE BENCH IN ITA NO. 183/MUM/2014 DATED 14.11.2014 HAS CLEARLY AND CATEGORICALLY HELD THAT THE COMMISSION/BROKERAGE PAID TO NON - RESIDENT AGENTS CANNOT BE TERMED AS FEES FOR TECHNICAL SERVICES. THAT BEING THE CASE, THE REASONING OF THE 8 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. ASSESSING OFFICER THAT THE PROVISIONS OF SECTION 9(1)(VII) OF THE ACT IS APPLICABLE TO THE COMMISSION PAID, IS UNACCEPTABLE. 10. AS REGARDS THE ARGUMENT OF THE DEPARTMENT THAT THE SOURCE RULE APPLIES TO THE PAYMENT MADE BY THE ASSESSEE , BY RELYING UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF GVK I NDUSTRIES (SUPRA) , ON A CAREFUL READING OF THE SAID DECISION IT IS CRYSTAL CLEAR THAT THE RATIO LAID DOWN IN THE SAID DECISION CANNOT BE APPLIED TO THE FACTS OF THE PRESENT CASE. AS COULD BE SEEN FROM THE FACTS OF GVK INDUSTRIES (SUPRA) CASE THE ASSESSEE T HEREIN WA N TED TO SET UP A GAS BASED POWER PROJECT TO GENERATE AND S ELL ELECTRICITY. FOR ACHIEVING THE DESIRED OBJECT, IT W ENT TO UTILIZE THE EXP E RT SERVICES OF QUALIFIED AND EXPERIENCED PROFESSIONALS WHO COULD PREPARE A SCHEME FOR RAISING THE REQUIRED FINA NCE AND TIE - UP THE REQUIRED LOAN. FOR THAT PURPOSE, IT ENTERED INTO AN AGREEMENT WITH A NON RESIDENT COMPANY WHO AGREED TO OFFER ITS SERVICES AS FINANCIAL ADVISOR FOR THE ASSESSEES PROJECT. THE SERVICES INCLUDED INTER ALIA FINANCIAL STRUCTURE AND SECURITY PA CKAGE TO BE OFFERED TO THE LENDE R, MAKING AN ASSESSMENT OF EXPORT CREDIT AGENCIES WORLDWIDE AND OBTAINING COMMERCIAL BANK SUPPORT ON THE MOST COMPETITIVE TERMS , ASSISTING THE ASSESSEES LOAN NEGOTIATION AND DOCUMENTATION WITH LEND E R AND STRUCTURING/NEGO TIATING AND CLOSING THE FINANCING FOR THE PROJECT IN A COORDINATE AND EXPEDITIOUS MANNER. FOR THE SERVICES RENDERED, THE NON RESIDENT COMPANY WAS TO BE PAID AT THE RATE OF 0.75% OF THE TOTAL DEBT FINANCING WHICH IS TERMED AS SUCCESS FEE . THE DISPUTE BETW EEN THE ASSESSEE AND THE DEPARTMENT WAS WITH REGARD TO THE NATURE OF 9 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. SUCCESS FEE AND WHETHER THE ASSESSEE WAS REQUIRED TO DEDUCT TAX AT SOURCE IN TERMS OF SECTION 195 WHILE MAKING PAYMENT OF SUCCESS FEE. THE HONBLE SUPREME COURT AFTER EXAMINING THE ISSUE AT DEPTH AS WELL AS THE NATURE OF THE PAYMENT MADE BY THE ASSESSEE HELD THAT SUCCESS FEE PAID BY THE ASSESSEE TO THE NON - RESIDENT COMPANY IS IN THE NATURE OF FEE FOR TECHNICAL SERVICES AS PER SECTION 9(1)(VII) OF THE ACT. HAVING HE LD SO, THE HONBLE SUPREM E COURT REFERRING TO THE PROVISIONS OF SECTION 9(1)(VII )( B) OF THE ACT AS WELL AS SECTION 9(2) HELD THAT APPLYING THE SOURCE RULE, THE SUCCESS FEE PAID TO THE NON RESIDENT COMPANY IS CHARGEABLE TO TAX IN INDIA. FACTS ARE COMPLETELY DIFFERENT IN THE APPEAL BEFORE US. IN ASSESSING OFFICERS OWN ADMISSION, THE MAIN BUSINESS OF THE ASSESSEE IS EXPORT OF COTTON YARN AND THE DISPUTED PAYMENT IS IN THE NATURE OF COMMISSION PAID TO FOREIGN AGENTS FOR PROCURING ORDERS IN THEIR RESPECTIVE COUNTRIES OF RESIDENCES. THA T BEING THE CASE, THE PAYMENT IS NOT IN THE NATURE OF FE E FOR TECHNICAL SERVICES. THUS KEEPING IN PERSPECTIVE , THE AFORESAID FACTUAL AS WELL AS LEGAL POSITION, IT NEEDS TO BE SEEN WHETHER THE PROVISIONS OF SECTION 195 ARE APPLICABLE. A READING OF THE SAID PROVISION MAKES IT CLEAR THAT WHILE MAKING PAYMENT TO A NON RESIDENT, WHICH IS CHARGEABLE TO TAX IN INDIA, THE ASSESSEE IS REQUIRED TO DEDUCT TAX AT SOURCE AS PER THE SAID PROVISION. IN THE FACTS OF THE PRESENT CASE, THE COMMISSION PAID TO NON - RESIDENT AGE NTS ARE NOT CHARGEABLE TO TAX IN INDIA EITHER U/S. 9(1)(I) OR UNDER ANY OTHER PROVISIONS OF THE ACT S INCE THE NON RESIDENTS HAVE NO BUSINESS CONNECTION IN INDIA OR PERMANENT ESTABLISHMENT IN INDIA. THAT BEING THE CASE, THERE WAS NO LIABILITY ON THE ASSESSE E TO DEDUCT TAX AT SOURCE WHILE PAYING COMMISSION TO THE NON RESIDENT AGENT. 10 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. MOREOVER, THE PROVISIONS OF SECTION 9(2) OF THE ACT ARE NOT APPLICABLE , AS THE PAYMENT MADE BY THE ASSESSEE ARE NOT OF THE NATURE AS PROVIDED UNDER CLAUSES (V), (VI) AND (VII) OF SECTION 9 OF THE ACT. WHILE DEALING WITH IDENTICAL ISSUE IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010 - 11 IN ITA NO. 183/MUM/2014, THE CO - ORDINATE BENCH HAS HELD THAT THE PAYMENT MADE TO NON - RESIDENT FOR SERVICES RENDERED OUTSIDE INDIA, IS NOT CHARGE ABLE TO TAX IN INDIA. HENCE, THE ASSESSEE WAS NOT LIABLE TO DEDUCT TAX AT SOURCE ON SUCH PAYMENT. THE SAME VIEW WAS REITERATED BY THE TRIBUNAL WHILE DECIDING ASSESSEES APPEAL FOR ASSESSMENT YEAR 2011 - 12 IN ITA NO. 1379/MUM/2015 DATED 01.05.2015. RESPECTFULL Y FOLLOWING THE AFORESAID DECISIONS OF THE CO - ORDINATE BENCH, WE UPHOLD THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) BY DISMISSING THE GROUNDS RAISED BY THE DEPARTMENT. 11. BEFORE PARTING WE MUST OBSERVE, THE OTHER DECISIONS REFERRED BY THE ASSESSING OFFICER WERE NOT FOUND TO BE APPLICABLE TO THE FACT S OF THE PRESENT CASE, HE NCE, IT IS NOT CONSIDERED NECESSARY TO DISCUSS IN DETAIL THE RATIO LAID DOWN IN THE SAID DECISION S . 12. IN THE RESULT, THE R EVENUE S APPEAL IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 11.05.2018 SD/ - SD/ - ( N. K. PRADHAN ) (S A KTIJIT DEY ) / A CCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 11.05.2018 . . ./ ROSHANI , SR. PS 11 ITA NO. 4642/MUM/2016 M/S. INDO INDUSTRIES LTD. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI