Tax Appeal v. Prithviraj K. Chavan, Jj

1 TXA 67-18dt.06.12.2018 IN THE HIGH COURT OF BOMBAY AT GOA TAX APPEAL NO.67 OF 2018 The Commissioner of Income Tax,…Panaji.Appellant Versus Sesa Resources Ltd.…Respondent Ms. Susan Linhares, Standing Counsel for the appellant. Mr. R. G. Ramani, Advocate for the respondent. Coram : R. M. Borde & Prithviraj K. Chavan, JJ. Date : 6[th] December 2018. P.C. : Heard Ms. S. Linhares, learned Standing Counsel for theappellant and Mr. R. G. Ramani, learned counsel for the respondent. 2. The substantial questions of law that have been framed in thisappeal, we quote- “(A) Whether the ITAT failed to consider the provisions ofsection 195 as amended by the introduction of Explanation –II to the said section 195 by the Finance Act, 2012 withretrospective effect from 01.04.1992, whereby it is clarified 2 TXA 67-18dt.06.12.2018 that the obligation to comply with sub section (1) and to makededuction there under applies and shall be deemed to havealways applied and extends and shall be deemed to have alwaysextended to all persons, resident or non resident, whether ornot the non resident person has (i) a residence or place ofbusiness or business connection in India or (ii) any otherpresence in any manner whatsoever in India ? (B) Whether the ITAT failed to consider that as therespondent had not deducted TDS under section 195 and theA.O. had correctly made the disallowance ? 3. The issue raised in this appeal is no more res integra and iscovered by the decision rendered by the Division Bench of this Court inthe matter of the Commissioner of Income Tax-10 V/s Gujarat Reclaimand Rubber Products Ltd.[1] Our attention is also invited to the decision ofthe Division Bench of this Court in the matter of the PrincipalCommissioner of Income Tax Vs Sesa Goa Ltd.,[2]. 4. As regards the question (B) framed in the instant appeal is concerned, it is recorded in the paragraph 7 of the judgment that thequestion of TDS on commission income paid to foreign agents and thenon-deduction of TDS is an issue fully covered by the decision of theSupreme Court in GE India Technology Centre Private Limited Vs 1 Income Tax Appeal Nos.2116 of 2013 & 169 of 2014 dated 8[th] December 2015. 2 Tax Appeal No.68 of 2016 dated 16[th] August 2017. 3 TXA 67-18dt.06.12.2018 Commissioner of Income Tax and Another[3]. It has been held in theaforesaid judgment as well as in the matter of CIT Vs Gujarat Reclaim &Rubber Products Ltd., by following the decision of the Supreme Court inCIT Vs Toshoku Ltd.[4], that the commission earned by a non-resident( that is to say, foreign ) agent who carried on the business of selling Indiangoods outside India cannot be said to be deemed income accrued or arisingin India. 5. In view of the determination of the issue by the SupremeCourt as well as by the Division Bench of this Court as has been recordedabove, the appeal does not deserve any consideration and the same isdismissed. Prithviraj K. Chavan , J.R. M. Borde , J. at*