ACIT, CHENNAI V. M/s. Eagle Press (P) Ltd., CHENNAI

ITA 776/CHNY/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4978 (ITAT-CHENNAI)
• Duration Of Justice: 3 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 06-06-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 15-04-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Assessee Lawyers: N DEVANATHAN
• Keywords: TDS
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH D, CHENNAI B E F O R E DR. O.K.NARAYANAN, VICE PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER .. I.T.A. NO.776(MDS)/2008 & C.O. NO.113(MDS)/2008 ASSESSMENT YEAR: 2004-05 THE ASSISTANT COMMISSIONER M/S.EAGL E PRESS(P) LTD., OF INCOME-TAX, 1/5, VAIDYANATHAN SALAI, COMPANY CIRCLE II(1), VS. TOND IARPET, CHENNAI-600081. CHENNAI. PAN AAACE1442P. (APPELLANT) (RESPONDENT/CROSS OBJECTOR) APPELLANT BY : S HRI K.E.B.RENGARAJAN, JR. STANDING COUNSEL RESPONDENT BY: SHRI N.DEVANATHAN O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT: THE APPEAL IS FILED BY THE REVENUE AND TH E CROSS OBJECTION IS FILED BY THE ASSESSEE. THE RELEVANT A SSESSMENT YEAR IS 2004-05. THE APPEAL AND THE CROSS OBJECTION ARE DI RECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I II AT CHENNAI ITA 776/2008 & CO 113/2008 2 DATED 25-1-2008 AND ARISE OUT OF THE ASSESSMENT COM PLETED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961. 2. THE ONLY GROUND RAISED BY THE REVENUE IS THAT T HE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN D ELETING THE ADDITION MADE BY THE ASSESSING OFFICER TOWARDS DISA LLOWANCE OF COMMISSION PAID TO FOREIGN AGENTS ON THE GROUND THA T THE ASSESSEE HAS NOT DEDUCTED TAX AT SOURCE WHILE MAKING PAYMENT S TO THE FOREIGN AGENTS. THE REVENUE HAS ALSO RELIED ON THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF TRANSMISSION CORPORATI ON OF A.P. LTD. VS. CIT, 239 ITR 587. 3. AS FAR AS THE FACTS OF THE PRESENT CASE ARE CON CERNED, THE SERVICES WERE RENDERED OUTSIDE INDIA AND SUCH SERVI CES WERE RENDERED BY NON RESIDENTS. NEITHER THE DELIVERY OF THE SERVICES WAS IN INDIA, NOR THE CONSUMPTION OF THE SERVICES WAS I N INDIA. IN SUCH CIRCUMSTANCES THE HONBLE SUPREME COURT IN THE CASE OF GE INDIA TECHNOLOGY CENTRE P. LTD. VS. COMMISSIONER OF INCOM E-TAX AND ANOTHER, 327 ITR 456 HAS HELD THAT SUCH PAYMENTS DO NOT CONTAIN WHOLLY OR PARTLY ANY INCOME TAXABLE IN INDIA. THER EFORE THE LIABILITY OF TDS IS NOT CAST ON THE ASSESSEE WHILE MAKING SUCH P AYMENTS. THE INCOME-TAX APPELLATE TRIBUNAL, CHENNAI BENCH B (S PECIAL BENCH) IN ITA 776/2008 & CO 113/2008 3 THE CASE OF INCOME-TAX OFFICER, INTERNATIONAL TAXAT ION, CHENNAI VS.PRASAD PRODUCTION LTD.,125 ITD 263(CHENNAI)(SB) HAS HELD ON THE SAME LINE ON THE ISSUE OF TDS IN SUCH CIRCUMSTANCES . 4. IN VIEW OF THE ABOVE LEGAL POSITION, WE FIND TH AT THE APPEAL FILED BY THE REVENUE CANNOT BE ALLOWED. IT IS LIAB LE TO BE DISMISSED. 5. AS THE APPEAL FILED BY THE REVENUE IS LIABLE TO BE DISMISSED, THE CROSS OBJECTION FILED BY THE ASSESSE E HAS BECOME INFRUCTUOUS. 6. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS DI SMISSED AS INFRUCTUOUS. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON MONDAY, THE 6 TH DAY OF JUNE, 2011 AT CHENNAI. SD/- SD/- (HARI OM MARATHA) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 6 TH JUNE, 2011. V.A.P. COPY TO: (1) APPELLANT 5. D.R. (2) RESPONDENT 6.G.F. (3) CIT (4) CIT(A)