Commission paid to foreign agents for services rendered outside India was not fees for technical services and was not taxable in India. Accordingly, it was held that there was no liability to deduct tax at source and no disallowance can be made u/s 40(a)(i). (AY .2011-12)
Dy. CIT v. Sterling Ornament (P.) Ltd. (2018) 65 ITR 492 (Delhi)(Trib.)
S. 40(a)(i) : Amounts not deductible – Deduction at source -Non-resident – Interest – Royalty – Fes for technical services – foreign agency commission – services rendered outside India – Held, no tax to be deducted at source – Held, no disallowance can be made. [S. 195]