S.9(1)(i): Income deemed to accrue or arise in India - Business connection-Deduction at source-Commission-
Foreign agent-Not liable to deduct tax at source.(S.40(a) (ia), 195)
Assessee paid commission to foreign agents for services rendered by them in connection with effectuating export sales. Assessing Officer observed that such foreign agents were paid by way of telegraphic transfer obtained from banks in India and formed an opinion that banks in India acted as agents of foreign agents and received payment on their behalf in India. Assessing Officer on such facts held commission so paid to be deemed to have been received in India and charged tax thereupon. Tribunal held that merely because commission were paid to foreign agents in their bank accounts by telegraphic transfer through banks in India, it could not be said that income were deemed to have been arisen to such foreign agents in India when there was no material on record to show that such foreign agents had rendered any part of services in India or had a permanent establishment and business connection in India. In favour of assessee. (A.Y.2005-06)
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