Case Law Details
JCIT Vs ADF Foods Ltd. (ITAT Ahmedabad)
In this case, the assessee himself has claimed that certain payments are covered in provisions of Section 5, 9, 195 of the Act and also under DTAA. Therefore, tax was not applicable. As per this letter, the assessee has explained that it is engaged in the business of processing and packaging various food items and its turnover is mainly from exports to foreign countries. Hence, to improve its international market it had paid the said payment to the persons who were non residents and they provided all business and marketing related services abroad.
These expenses were booked under the head advertisement expenses, legal and professional fees and sales commission expenses. In circular dated 20th August, 2018, it is mentioned ‘where addition relates to undisclosed foreign income/undisclosed foreign assets (including financial assets)/ undisclosed foreign bank account. But in this case, everything has been disclosed by the assessee only payments were made to the foreign entities under double taxation avoidance agreement. In our considered opinion, circular dated 20th August, 2018 is not applicable in this case.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This miscellaneous application has been filed by the Revenue under s.254(2) of the Act against the Tribunal order dated 01.10.2019 for dismissing the appeal on the basis of low tax effect Circular No. 17 of 2019 dated 08.08.2019.
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