TDS not deductible on reimbursement of Information technology costs

Briefly stated facts are that the assessee has claimed the expenses of Rs.1 ,01 ,28,788/- in the form of reimbursement cost incurred by AT & S Austria towards the cost of repair / remanufacturing of defective products. The AO held that expenses as fees for technical services as defined under section 9(1 )(vii) of the Act, so he disallowed the said expenses for the violation of the provisions of section 40(a)(i) of the Act. The AO also relied on the judgment Hon’ble Delhi Tribunal in the case of Sahara Airlines Ltd. Vs DCIT( 2002) 83 ITD 11, 41(Delhi) and Hon’ble ITAT Hyderabad in the c...