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Section 40 Disallowance Fails for Overseas Commission Payments
Case Law Details
- Case Name
- Kloeckner Desma Machinery Private Limited Vs DCIT (ITAT Ahmedabad)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2017-18
- Courts
- All ITAT, ITAT Ahmedabad
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Kloeckner Desma Machinery Private Limited Vs DCIT (ITAT Ahmedabad)
Export Commission Paid to Non-Resident Agents Not Taxable in India — No TDS Required; Disallowance Deleted (A.Y. 2017-18)
The Ahmedabad Bench of the ITAT allowed the assessee’s appeal and deleted the disallowance of export commission paid to non-resident agents for A.Y. 2017-18. The AO had disallowed 30% of commission for non-deduction of TDS by invoking Section 40(a)(ia) (erroneously, instead of Section 40(a)(i)) on payments to foreign agents.
The Tribunal held that:
The non-resident agents rendered services entirely outs...
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