Jyoti Limited, Vadodara V. DCIT,(International Taxation), , Baroda

ITA 666/AHD/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 9044 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 21-04-2020
• Assessment Year: 2014-2015
• Appeal Filed On: 16-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRIR K MAKWANA
• Assessee Lawyers: SHRIMANISH SHAH
• Keywords: Double taxation relief; TDS
• Section: 206AA; 195; 201; 115A; 22; 92

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD (CONDUCTED THROUGH VIRTUAL COURT) BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER& MS. MADHUMITA ROY, JUDICIAL MEMBER I.T.A. NO.666/AHD/2018 (ASSESSMENT YEAR: 2014-15) JYOTI LIMITED NANUBHAI AMIN MARD INDUSTRIAL AREA, BARODA VS. DCIT (INTERNATIONAL TAXATION) VADODARA-390007 PAN NO.AAACJ4909N ( APPELLANT ) .. ( RESPONDENT ) APPELLANT BY : SHRIMANISH SHAH, AR RESPONDENTBY: SHRIR. K. MAKWANA, SR. DR DATE OF HEARING 22 . 12 .20 2 0 DATE OF PRONOUNCEMENT 22 . 0 3 . 20 2 1 O R D E R PER MS. MADHUMITA ROY - JM: THE INSTANT APPEAL FILED BY THE ASSESSEE IS DIRECT ED AGAINST THE ORDER DATED10.01.2018 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) 13, AHMEDABADARISING OUT OF THE ORDER DA TED 16.11.2016 PASSED BY THE DCIT, INTERNATIONAL TAXATION, BARODAU NDER SECTION 201 & 201AOF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERR ED AS TO THE ACT) FOR ASSESSMENT YEAR 2014-15. 2. DURING THE COURSE OF ASSESSMENT PROCEEDING IT WA S FOUND THAT THE APPELLANT HAS DEDUCTED TAX AT SOURCE ON FOREIGN REM ITTANCE @ 10% TO ONE CKD BLANSKO ENGINEERING, A NON-RESIDENT COMPANY RES IDENT OF CZECH ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 2 - REPUBLIC WHO HAS NOT FURNISHED THE PERMANENT ACCOUN T NUMBER TO THE ASSESSEE. THE APPELLANT IS A PUBLIC LIMITED LISTED COMPANY ENGAGED IN THE BUSINESS OF MANUFACTURE AND SALE OF PUMPS, ROTATING ELECTRIC MACHINES, HYDRO GENERATING SETS, SWITCH BOARD PENAL, HT CIRCU IT BREAKERS, RELAYS AND HOST AND OTHERS ELECTRICAL AND ENGINEERING ITEM S PARTICULARLY CONNECTED WITH HYDRAULIC, IRRIGATION, POWER AND HEA VY ENGINEERING INDUSTRIES. THE COMPANY HAS A BIG NAME IN THE POWE R SECTOR AND IRRIGATION DEPARTMENT. THE COMPANY HAS BEEN IN EXI STENCE FOR THE PAST MORE THAN 70 YEARS AND THE COMPANY ENJOYS SOUND REP UTATION IN THE ENGINEERING FIELD IN THE COUNTRY AND ABROAD. 3. DURING THE ASSESSMENT PROCEEDING WHILE REPLYING TO THE SHOW- CAUSE ISSUED TO THE APPELLANT AS TO WHY TDS @20% HA D NOT BEEN DEDUCTED FROM THE SAID PARTY, THE ASSESSEE SUBMITTE D INTER ALIA THAT THE TDS DEDUCTED @ 10%, IN TERMS OF THE RATE PRESCRIBED FOR THE SERVICES AS PER DOUBLE TAXATION AVOIDANCE AGREEMENT (DTAA) ENTE RED INTO BY THE GOVERNMENT OF INDIA WITH THAT PARTICULAR COUNTRY. HOWEVER, SUCH PLEA OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE AND ULTIMATEL Y A TOTAL ADDITION OF RS. 1,29,61,300/- WAS MADE UPON MAKING THE ASSESSEE LIABLE TO PAY TDS @ 20% ON THE RESPECTIVE PAYMENTS MADE TO THE SAID P ARTY BY THE LD. DCIT (IT), VADODARA WHICH, IN TURN, WAS AFFIRMED BY THE LD. CIT(A). HENCE, THE INSTANT APPEAL BEFORE US. 4. AT THE TIME OF HEARING OF THE INSTANT APPEAL THE LD. COUNSEL APPEARING FOR THE ASSESSEE SUBMITTED BEFORE US THAT DEDUCTION OF TAX @10% WAS DONE IN TERMS OF THE DOUBLE TAXATION AVOID ANCE AGREEMENT ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 3 - (DTAA) ENTERED INTO BY AND BETWEEN THE GOVERNMENT O F INDIA AND CZECH REPUBLIC. ARTICLE 12 OF THE SAID DTAA PRESCRIBES S UCH RATE OF TAX TO BE DEDUCTED AND IN THAT VIEW OF THE MATTER THERE IS NO SHORT DEDUCTION OF TAX AT SOURCE. HE FURTHER RELIED UPON THE CIRCULAR NO. 333 DATED 02.04.1982 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES (CBDT). HE FURTHER CONTENDED THAT THE REMITTANCES EFFECTED AFTER WITHH OLDING TAX @ 10% IS IN COMPLIANCE WITH THE REQUIREMENTS OF LAW. ON THIS I SSUE HE RELIED UPON THE JUDGMENT PASSED BY THE HONBLE APEX COURT IN TH E MATTER OF UNION OF INDIA & ANR. VS. AZADI BACHAO ANDOLAN & ANR. REP ORTED IN 263ITR 706(SC). HE FURTHER CONTROVERTED THE CASE MADE OUT BY THE REVENUE TO THE EFFECT THAT SECTION 206AA OVERRIDES CIRCULAR NO . 333, WHICH IS BENEFICIAL TO THE ASSESSEE.IN THE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE, THE RATE HAS BEEN ADOPTED ON THE BASIS OF AGR EEMENT ENTERED INTO BY AND BETWEEN THE TWO SOVEREIGN STATES WHICH WILL HAV E PRECEDENCE OVER ALL OTHER LOCAL LAWS AS WAS THE REPLY OF THE LD. AR . THE LD. COUNSEL APPEARING FOR THE ASSESSEE FURTHER RELIED UPON THE SPECIFIC RECOMMENDATION MADE BY THE JUSTICE EASWAR S COMMITTEE IN THIS REGARD. HE FURTHER RELIED UPON THE JUDGMENT PASSED IN THE MATTER OF UNIPHOS ENVIROTRONIC PVT. LTD. VS. DCIT IN ITA NO. 1974/AHD/2015 FOR A.Y. 2014-15 PASSED BY THE CO-ORDINATE BENCH. 5. THE CASE OF THE REVENUE IS THIS THAT THE TAX DED UCTION AT SOURCE WAS REQUIRED TO BE MADE @ 20% IN THE ABSENCE OF FURNISH ING OF PERMANENT ACCOUNT NUMBER (PAN) BY THE RECIPIENT NON-RESIDENTS , HAVING REGARD TO THE SECTION 206AA OF THE ACT. ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 4 - THE LD. DR ULTIMATELY RELIED UPON THE ORDER PASSED BY THE AUTHORITIES BELOW. 6. WE HAVE HEARD THE RESPECTIVE PARTIES AND PERUSED THE RELEVANT MATERIALS AVAILABLE ON RECORD. THE CASE OF THE APPLICANT IS THIS THAT TDS HAS BEE N DEDUCTED @ 10% IN TERMS OF THE DOUBLE TAXATION AVOIDANCE AGREE MENT (DTAA) ENTERED INTO BY AND BETWEEN THE GOVERNMENT OF INDIA WITH CZECH REPUBLIC. THOUGH THE INCOME TAX ACT SPECIFIES TO D EDUCT TDS @ 20%, DTAA WOULD OVERRIDE THE PROVISION OF THIS PARTICULA R DOMESTIC ACT SINCE THE PROVISION OF DTAA ARE MORE BENEFICIAL TO THE AS SESSEE.IN THIS REGARD WE HAVE CONSIDERED THE ARTICLE 12 OF DTAA WHICH PRE SCRIBES SUCH RATE OF TAX TO BE DEDUCTED @ 10%. 7. WE HAVE CONSIDERED THE SECTION 206AA OF THE INCO ME TAX ACT WHICH READS AS FOLLOWS:- (1) NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTHE R PROVISIONS OF THIS ACT, ANY PERSON ENTITLED TO RECEIVE ANY SUM OR INCOME OR AMO UNT, ON WHICH TAX IS DEDUCTIBLE UNDER CHAPTER XVIIB (HEREAFTER REFERRED TO AS DEDUC TEE) SHALL FURNISH HIS PERMANENT ACCOUNT NUMBER TO THE PERSON RESPONSIBLE FOR DEDUCT ING SUCH TAX (HEREAFTER REFERRED TO AS DEDUCTOR), FAILING WHICH TAX SHALL BE DEDUCTE D AT THE HIGHER OF THE FOLLOWING RATES, NAMELY:- (I) AT THE RATE SPECIFIED IN THE RELEVANT PROVISIO N OF THIS ACT; OR (II) AT THE RATE OR RATES IN FORCE; OR (III) AT THE RATE OF TWENTY PER CENT. (2) NO DECLARATION UNDER SUB-SECTION (1) OR SUB-SEC TION (1A) OR SUB-SECTION (1C) OF SECTION 197A SHALL BE VALID UNLESS THE PERSON FU RNISHES HIS PERMANENT ACCOUNT NUMBER IN SUCH DECLARATION. (3) IN CASE ANY DECLARATION BECOMES INVALID UNDER S UB-SECTION (2), THE DEDUCTOR SHALL DEDUCT THE TAX AT SOURCE IN ACCORDANCE WITH T HE PROVISIONS OF SUB-SECTION (1). ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 5 - (4) NO CERTIFICATE UNDER SECTION 197 SHALL BE GRANT ED UNLESS THE APPLICATION MADE UNDER THAT SECTION CONTAINS THE PERMANENT ACCO UNT NUMBER OF THE APPLICANT. (5) THE DEDUCTEE SHALL FURNISH HIS PERMANENT ACCOUN T NUMBER TO THE DEDUCTOR AND BOTH SHALL INDICATE THE SAME IN ALL THE CORRESP ONDENCE, BILLS, VOUCHERS AND OTHER DOCUMENTS WHICH ARE SENT TO EACH OTHER. (6) WHERE THE PERMANENT ACCOUNT NUMBER PROVIDED TO THE DEDUCTOR IS INVALID OR DOES NOT BELONG TO THE DEDUCTEE, IT SHALL BE DEEMED THAT THE DEDUCTEE HAS NOT FURNISHED HIS PERMANENT ACCOUNT NUMBER TO THE DEDUC TOR AND THE PROVISIONS OF SUB- SECTION (1) SHALL APPLY ACCORDINGLY.] 8. HOWEVER, IN THIS RESPECT WE HAVE FURTHER CONSIDE RED THE CIRCULAR NO. 333 DATED 02.04.1982 ISSUED BY THE CENTRAL BOAR D OF DIRECT TAXES (CBDT) WHICH SPEAKS THAT THE SPECIFIC PROVISIONS M ADE IN DOUBLE TAXATION AVOIDANCE AGREEMENTS WOULD PREVAIL OVER GE NERAL PROVISIONS CONTAINED IN THE INCOME TAX ACT. THIS IS A CARDIN AL PRINCIPLE OF LAW THAT WHEN THERE IS AN AGREEMENT ENTERED INTO BETWEEN TWO SOVEREIGN STATES THEN THE PROVISION WHICH HAVE MORE BENEFICIAL TO TH E ASSESSEE AS PER THE SAID SOVEREIGN AGREEMENTS BECOME APPLICABLE AND THE PROVISIONS OF INCOME TAX ARE TO THE EXTENT TO BE GIVEN A GO BY. 9. FURTHERMORE, THE SPECIFIC RECOMMENDATION MADE BY THE JUSTICE EASWARS COMMITTEE IN THIS REGARD IS AS FOLLOWS:- UNDER THE CURRENT PROVISIONS OF SECTION 206AA, TAX IS REQUIRED TO BE DEDUCTED BY THE DEDUCTOR AT A HIGHER RATE AS PRESCRIBED UNDER T HE SAID SECTION, WHERE THE DEDUCTEE DOES NOT FURNISH HIS PERMANENT ACCOUNT NUM BER (PAN). THIS SECTION WAS INTRODUCED WITH THE OBJECTIVE THAT THE FURNISHING O F PAN WAS IMPORTANT WITH A VIEW TO TRAIL THE TAXABILITY OF THE PAYMENTS IN THE HANDS O F A NON-RESIDENT. AS REGARDS NON- RESIDENTS, THE COMMITTEE NOTED THAT IN VIEW OF THE SPECIFIC PROVISIONS OF SECTION 115A AND THE PROVISIONS UNDER THE RESPECTIVE DOUBLE TAXA TION AVOIDANCE AGREEMENTS (DTAAS) PRESCRIBING SPECIFIC RATES FOR TAX DEDUCTIO N AT SOURCE UNDER SECTION 195, THERE WAS NO JUSTIFICATION FOR PROVIDING DEDUCTION OF TAX AT A HIGHER RATE THAN AS PRESCRIBED UNDER SECTION 115A OR UNDER THE RESPECTI VE DTAA. IN FACT, THIS PROVISION HAS PROVED TO BE AN IMPEDIMENT IN TERMS OF EASE OF BUSINESS, AS MANY NON-RESIDENTS PREFER NOT TO DO BUSINESS WITH INDIAN RESIDENTS, IF OBTAINING OF PAN IS INSISTED FROM ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 6 - THEM. THE COMMITTEE WAS OF THE VIEW THAT IT SHOULD SUFFICE IF THE CONCERNED NON- RESIDENT FURNISHED TO THE DEDUCTOR, IN LIEW OF SUCH PERMANENT ACCOUNT NUMBER, HIS TAX IDENTIFICATION NUMBER IN THE COUNTRY OR THE SPE CIFIED TERRITORY OF RESIDENCE AND IN CASE THERE IS NO SUCH NUMBER, THEN, A UNIQUE NUMBER ON THE BASIS OF WHICH THE PERSON IS IDENTIFIED BY THE GOVERNMENT OF THE COUNTRY OR T HE SPECIFIED TERRITORY OF WHICH SUCH PERSON CLAIMS TO BE A RESIDENT. 10. HOWEVER, PRACTICALLY, THE PROVISION OF SECTION 90(2) HAS COME TO THE RESCUE OF THE ASSESSEE. IT PROVIDES THAT THE P ROVISION OF THE DTAAS WOULD OVERRIDE THE PROVISIONS OF THE DOMESTIC ACT I N CASE WHERE THE PROVISIONS OF DTAAS ARE MORE BENEFICIAL TO THE ASSE SSEE. NEEDLESS TO MENTION THAT, THE ISSUE THAT IN CASE OF NON-RESIDEN TS, TAX LIABILITY IN INDIA IS LIABLE TO BE DETERMINED IN ACCORDANCE WITH THE P ROVISIONS OF THE ACT OR THE DTAA BETWEEN INDIA AND CZECH REPUBLIC,HAVING RE GARD TO THE PROVISION OF SECTION 90(2) OF THE ACT TO BE SETTLE AT THE BENEFICIAL RATE OF TAXATION @ 10% IN TERMS OF ARTICLE 12 OF THE AGREEM ENT FOR AVOIDANCE OF DOUBLE TAXATION AND PROVISION OF FISCAL EVASION WITH CZECH REPUBLIC IN THE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE. 11. IN THIS RESPECT FURTHER CAREFULLY CONSIDERED TH E JUDGMENT PASSED BY THE HONBLE APEX COURT IN THE MATTER OF UNION OF IN DIA & ANR. VS. AZADI BACHAO ANDOLAN & ANR. REPORTED IN 263 ITR 706 (SC) WHICH HAS UPHELD THE PROPOSITION THAT THE PROVISION OF THE DTAA WOUL D PREVAIL OVER THE GENERAL PROVISION CONTEND IN THE ACT TO THE EXTENT THEY ARE BENEFICIAL TO THE ASSESSEE. IN THIS CONTEXT, IT WOULD BE WORTHWH ILE TO OBSERVE THAT THE DTAAS ENTERED INTO BETWEEN INDIA AND THE OTHER RELE VANT COUNTRIES IN THE PRESENT CONTEXT PROVIDE FOR SCOPE OF TAXATION AND/O R A RATE OF TAXATION WHICH WAS DIFFERENT FROM THE SCOPE/RATE PRESCRIBED UNDER THE ACT. FOR THE SAID REASON, THE ASSESSEE DEDUCTED THE TAX AT S OURCE HAVING REGARD TO ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 7 - THE PROVISIONS OF THE RESPECTIVE DTAAS WHICH PROVID ES FOR A BENEFICIAL RATE OF TAXATION. IT WOULD ALSO BE RELEVANT TO OBS ERVE THAT EVEN THE CHARGING SECTION 4 AS WELL AS SECTION 5 OF THE ACT WHICH DEALS WITH THE PRINCIPLE OF ASCERTAINMENT OF TOTAL INCOME UNDER TH E ACT ARE ALSO SUBORDINATE TO THE PRINCIPLE ENSHRINED IN SECTION 9 0(2) AS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF AZADI BACHAO A NDOLAN (SUPRA). THUS, IN SO FAR AS THE APPLICABILITY OF THE SCOPE/R ATE OF TAXATION WITH RESPECT TO THE IMPUGNED PAYMENTS MADE TO THE NON-RE SIDENTS IS CONCERNED, NO FAULT CAN BE FOUND WITH THE RATE OF T AXATION INVOKED BY THE ASSESSEE BASED ON THE DTAAS, WHICH PRESCRIBED FOR A BENEFICIAL RATE OF TAXATION. 12. WE HAVE FURTHER CONSIDERED THE JUDGMENT PASSED BY THE CO- ORDINATE BENCH IN ITA NO. 1974/AHD/2015 FOR A.Y. 20 14-15 THE RELEVANT PORTION IS AS FOLLOWS:- [2] TO ADJUDICATE ON THIS APPEAL, ONLY A FEW MATER IAL FACTS NEED TO BE TAKEN NOTE OF. THE ASSESSEE HAS MADE A REMITTANCE TO A GERMAN TAX RESIDENT, AND, IN ACCORDANCE WITH THE PROVISIONS OF THE INDO GERMAN DOUBLE TAXAT ION AVOIDANCE AGREEMENT, THE PAYMENT SO MADE BY THE ASSESSEE IS TAXABLE @10% ON GROSS BASIS IN THE HANDS OF THE GERMAN ENTITY. THERE IS NO DISPUTE ON THESE ASPECTS . ACCORDINGLY, THE ASSESSEE DEDUCTED TAX AT SOURCE @ 10% UNDER SECTION 195 AND MADE REMITTANCE OF THE NET AMOUNT ACCORDINGLY. HOWEVER, WHEN THE RELATED TDS R ETURN WAS PROCESSED UNDER SECTION 200A, A SHORT DEDUCTION DEMAND WAS RAISED O N THE GROUND THAT THE TAX WITHHOLDING RATE WAS TO APPLY @ 20%, IN TERMS OF TH E PROVISIONS OF SECTION 206AA, AS THE GERMAN ENTITY HAD NOT OBTAINED THE PERMANENT ACCOUNT NUMBER (PAN) FROM THE INDIAN TAX AUTHORITIES. THE ASSESSEE OBJECTED T O THIS TREATMENT AND FILED A RECTIFICATION PETITION. NOT SUCCESSFUL, THE ASSESSE E CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) BUT WITHOUT ANY SUCCESS. LEARNED CIT(A), RELYING UPON THE PRESS RELEASE DATED 20TH JANUARY 2010 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES, HELD THAT, IN TERMS OF THE PROVISIONS OF SECTION 206AA, IN A CASE IN WHICH THE RECIPIENT FOREIGN ENTITY HAS NOT OBTAINED PAN FROM THE INDIAN TAX AUT HORITIES, THE TAX WILL BE DEDUCTED AT A HIGHER RATE OF 20%. THE ASSESSEE IS NOT SATISF IED AND IS IN FURTHER APPEAL BEFORE US. ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 8 - [3] WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED TH E MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. [4] IT IS ONLY ELEMENTARY THAT, UNDER THE SCHEME OF THE INCOME TAX ACT 1961- AS SET OUT UNDER SECTION 90(2) OF THE ACT, THE PROVISIONS OF THE APPLICABLE TAX TREATIES OVERRIDE THE PROVISIONS OF THE INCOME TAX ACT 1961- EXCEPT WHEN THE PROVISIONS OF THE ACT ARE MORE BENEFICIAL TO THE ASSESSEE. THE PR OVISIONS OF THE APPLICABLE TAX TREATY, IN THE PRESENT CASE, PRESCRIBE THE TAX RATE @ 10%. THIS RATE OF 10% IS APPLICABLE ON THE RELATED INCOME WHETHER OR NOT THE ASSESSEE HAS OBTAINED THE PERMANENT ACCOUNT NUMBER. IN EFFECT, THEREFORE, EVE N WHEN A FOREIGN ENTITY DOES NOT OBTAIN PAN IN INDIA, THE APPLICABLE TAX RATE IS 10% IN THIS CASE. SECTION 206AA, WHICH PROVIDES A HIGHER TAX BURDEN- I.E. TAXABILITY @ 20% IN THE EVENT OF FOREIGN ENTITY NOT OBTAINING THE PERMANENT ACCOUNT NUMBER I N INDIA, THEREFORE, CANNOT BE PRESSED INTO SERVICE, AS HAS BEEN DONE IN THE COURS E OF PROCESSING OF RETURN UNDER SECTION 200A. TO THAT EXTENT, SHORT DEDUCTION OF TA X AT SOURCE DEMAND, RAISED IN THE COURSE OF PROCESSING OF TDS RETURN UNDER SECTION 20 0A, IS UNSUSTAINABLE IN LAW. WE QUASH THIS SHORT DEDUCTION OF TAX AT SOURCE DEMAND. THE GRIEVANCE OF THE ASSESSEE IS INDEED JUSTIFIED, MERITS ACCEPTANCE AND IS HEREBY U PHELD. [5] IN THE RESULT, THE APPEAL IS ALLOWED. THE RATIO LAID DOWN BY THE HONBLE APEX COURT IN T HE MATTER OF AZADI BACHAO ANDOLAN (SUPRA) HAS BEEN FOLLOWED IN I TS ENTIRETY AS WE FIND FROM THIS JUDGMENT PASSED BY THE CO-ORDINATE B ENCH AS MENTIONED ABOVE. 13. TAKING INTO CONSIDERATION OF THE ENTIRE ASPECT OF THE MATTER THE PROVISIONS OF ART 12 OF DTAA ENTERED INTO BY AND BE TWEEN TWO SOVEREIGN STATES INDIA AND CZECH REPUBLIC, THE CI RCULAR NO. 333 DATED 02.04.1982 ISSUED BY CBDT, THE SPECIFIC RECOMMENDAT ION MADE BY THE JUSTICE EASWARS COMMITTEE, THE RATIO LAID DOWN BY THE HONBLE APEX COURT IN THE JUDGMENT OF AZADI BACHAO ANDOLAN (SUPR A), IN OUR CONSIDERED OPINION THE PROVISION OF SECTION 206AA O F THE ACT CANNOT BE INVOKED BY THE REVENUE TO INSIST THE TAX DEDUCTION @ 20% HAVING REGARD TO THE OVERRIDING NATURE OF THE PROVISION OF SECTIO N 92 OF THE ACT IN THE ITA NO.666/AHD/2018 JYOTI LIMITED VS. DCIT ASST.YEAR 2014-15 - 9 - PRESENT FACTS AND CIRCUMSTANCES OF THE CASE. IN FA CT, SECTION 206AA OF THE ACT DOES NOT OVERRIDE THE PROVISION OF SECTION 92 OF THE ACT AND IN THAT VIEW OF THE MATTER IN THE CASE IN HAND THE TDS HAS BEEN DEDUCTED TO THE NON-RESIDENT RIGHTLY APPLYING THE TAX RATE PRES CRIBED UNDER THE DTAAS AND NOT AS PER SECTION 206AA OF THE ACT, HAVI NG REGARD TO THE MORE BENEFICIAL PROVISION IN THE RATE OF TAX MADE I N THE DTAA. HENCE, WE FIND NO JUSTIFICATION IN MAKING THE ASSE SSEE LIABLE TO PAY TDS @ 20% ON THE FOREIGN REMITTANCE AS HELD BY THE REVENUE BY THE ORDER IMPUGNED. SUCH DECISION, IN OUR CONSIDERED O PINION, IS OF NO MERIT AND THUS, REJECTED. THE APPEAL PREFERRED BY THE AS SESSEE IS, THEREFORE, ALLOWED. 14. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 22 / 0 3 /20 2 1 SD/- SD/- (PRADIP KUMAR KEDIA) (MS. MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 22/03/2021 TANMAY, SR. PS TRUE COPY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)- 5. , ! ' , #$%% / DR, ITAT, AHMEDABAD 6. &' () / GUARD FILE. / BY ORDER, / (DY./ASSTT.REGISTRAR) !, #$ / ITAT, AHMEDABAD