Section 195 TDS not deductible on management fees paid to France entity

INCOME TAX APPELLATE TRIBUNAL

The Relevant Text of the Order as follows :

138. We have carefully considered the rival contention and perused the orders of the lower authorities. The learned dispute resolution panel has categorically held that as the revenue has not accepted the decision of the honourable Delhi High Court in case of DIT versus infra soft Ltd (2013) 39 taxmann.com 88) the decision of the honourable jurisdictional High Court and therefore the addition made by the learned assessing officer with respect to the disallowance for non-deduction of tax on a sum of ₹ 100,197,482/– was confirmed. Therefore, there is no dispute that the issue is covered by the decision of the honourable jurisdictional High Court in case of infra soft Ltd (supra). Therefore, we hold that the assessee is not required to deduct tax at source on a sum of ₹ 100,197,482/– paid by the assessee to its group entity based in France without deduction of tax at source. In view of this ground number 12 of the appeal is allowed.

139. Ground no 13 In the income tax computation form attached with the impugned final assessment order, TDS credit of Rs.10,19,36,626 is allowed to the appellant as against credit of Rs.10,26,17,626 claimed by the appellant in income tax return (also reflecting on Form 26AS), therefore resulting in short credit of Rs.6,81,000.

140. The learned authorised representative submitted that assessing officer be directed to grant appropriate credit of TDS to the appellant.

141. The learned departmental representative submitted that if the assessee is eligible for the credit supported with proper credit watchers/certificates, it can be verified by the learned assessing officer if produced by the assessee before him and found in order, the credit would be given.

142. We have carefully considered the rival contentions. The assessee is directed to produce the tax deduction at source certificates before the assessing officer. The learned assessing officer if found the same to be in order and in accordance with the law then credit for the same be allowed to the assessee. Accordingly, ground number 13 of the appeal is allowed with above direction.

143. Ground number 14 of the appeal is with respect of the levy of the excess interest u/s 234B of the act. This ground of appeal is consequential in nature, therefore same is dismissed.

144. In the result ITA number 5745/del/2018 for assessment year 2014 – 15 filed by the assessee is partly allowed.

145. Accordingly, all the three appeals filed by the assessee are disposed of by this order.

146. Meanwhile after the date of hearing of these appeals, the stay was granted to the assessee earlier was expiring and therefore assessee preferred stay petitions for extension of the above stay. As the appeal of the assessee has been disposed of by this order, the stay petition is filed by the assessee for all these three years become infructuous and therefore by this order, all the three stay petitions for all the three above assessment years are dismissed.

147. In the result appeal of the assessee as well as stay petitions filed are disposed of by this order.

Order pronounced in the open court on 28th September 2020.