Asstt. CIT Vs. Nuova Shoes (ITAT Agra)
The assessing officer completed assessments under section 143(3) for the assessment years 2011-12 and 2012-13 wherein the learned assessing officer has not made any disallowance in respect of the payment of commission to the foreign agents residing in the country, with which India has entered into DTAA.
Apropos assessing officer’s contention that the CBDT, vide Circular No. 7, dt. 22-10-2009, had withdrawn its Circulars Nos. 23, dt. 23-7-1969, 163, dt. 29-5-1975 and 786, dt. 7-2-2000, which were based on Circular No. 23; that the Circular No. 23 was issued in the context of section 9 of the Act which deems certain incomes to accrue or arise in India for non-residents; and that in view of this, the assessee should have deducted tax at source under section 195 of the Act on payments of commission made to non-residents agents with effect from 22-10-2009, we find that the assessing officer has not made out any case that whether the issue of Circular No. 7 of 2009 by CBDT by which the earlier circulars were withdrawn, will make any difference as to bringing the commission payments within the ambit of tax as he has not adverted to the admitted position that there exists no business connection or permanent establishment of such agents in India.
