EXPENDITURE WHICH COULD NOT BE DISALLOWED UNDER SECTION 40(A

Where the assessee paid selling commission, brokerage and other
related charges to its non-resident agents in respect of sale of tea
outside India, as per the Board's Circular No. 786, dated 7-2-2000
no income accrued or arose in India either under section 5(2) or
section 9 of the IT Act and no tax was therefore deductible under
section 195, consequently expenditure on commission and related
charges payable to non-resident agent could not be disallowed under
section 40(a)(i) on the ground that tax was not deducted.


IN THE ITAT, GAUHATI BENCH, GUWAHATI

Joint CIT

v.

George Williamson (Assam) Ltd.