Citation Codes

Equivalent Citations

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Case Number

T.C (A) No. 789 of 2013

Attorney(S)

Mr. T. Ravikumar Senior Standing Counsel
Mr. M.P Senthil Kumar

Judges

Hon'ble Thiru.Justice G.M.Akbar Ali
Hon'ble Thiru.Justice R. Sudhakar

Acts

clause (v) or clause (vi) or clause (vii) of sub-section (1)
provisions of Section 9(1)(vii) of the Income Tax Act.
Section 9(1)(vii) and the explanation to Section 9(2)
clause (v) or clause (vi) or clause (vii) of Section 9(1)
clause (v) or (vi) of sub-section (1) of Section 9
INCOME TAX ACT 1961
u/s 9(1)(vii) of the Income Tax Act.
SECTION 37 INCOME TAX ACT
s. 42 of the Indian I.T Act, 1922,
GOVERNMENT OF INDIA ACT 1935
FINANCE ACT 2010

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Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

The assessee is a company engaged in manufacture and export of leather articles. It entered into an Agency Agreement with a non-resident agent to procure export orders (for leather shoe uppers and full shoes) and to secure payments from overseas customers. The agreement provided that the agent would be paid commission of 2.5% on FOB value for orders procured. The assessee claimed the commission payments as business expenditure under Section 37 of the Income Tax Act, 1961.

The Assessing Officer disallowed the commission claim under Section 40(a)(i) on the ground that payments to the non-resident agent were governed by Section 9(1) read with Section 195 (i.e., the payments were deemed to arise or accrue in India and tax should have been deducted at source). The Commissioner of Income Tax (Appeals) allowed the assessee's appeal, finding the services did not constitute "fees for technical services" under Section 9(1)(vii) and concluding the commission was not taxable in India (relying on the Supreme Court decision in GE India Technology Cen. (P) Ltd. v. CIT). The Tribunal agreed with the Commissioner (dismissing the Revenue's appeal). The Revenue then appealed to the High Court under Section 260A of the Income Tax Act, 1961, challenging the Tribunal's order for assessment year 2009-2010.

Legal Issues Presented

Whether the Tribunal was right in holding that the disallowance of Rs. 2,06,99,780/- under Section 40(a)(i) (for non-deduction of TDS under Section 195) was to be allowed (i.e., whether the commission paid to overseas agents should be disallowed for non-deduction of tax at source).
Whether the finding of the Tribunal was proper when the agent's service is claimed to be technical in nature and would thus fall under Section 9(1)(vii) and attract the Explanation to Section 9(2).
Whether the commission payment to the non-resident outside India for services rendered under Section 9(1)(vii) is deemed to have arisen in India as per the Explanation (inserted by Finance Act, 2010) with retrospective effect from 1.6.1976, bringing such income into the total income of the non-resident under clause (v) or (vi) or (vii) of Section 9(1).

Arguments of the Parties

Revenue's Arguments

Explanation (2) to Section 9(1)(vii) defines "fees for technical services" broadly to include managerial, technical or consultancy services, and the payments to the non-resident agent fall within this wide definition.
The Explanation to Section 9(2) (as substituted by the Finance Act, 2010, with retrospective effect) deems income of a non-resident to accrue or arise in India under clauses (v), (vi) or (vii) of Section 9(1) and to be included in his total income, whether or not the non-resident has a business connection or has rendered services in India; consequently, services rendered outside India would not prevent taxation in India.
Counsel relied on the decision in Transmission Corporation of A.P. Ltd. v. Commissioner of Income Tax ([1999] 239 ITR 587, SC) to support the proposition that the assessee was under an obligation to deduct tax at source under Section 195 with respect to payments to non-residents.
The Revenue also relied on observations of the Assessing Officer that activities such as procuring orders and arranging letters of credit could fall within the ambit of "fees for technical services" per Explanation (2) to Section 9(1)(vii).

Assessee's Arguments

The assessee supported the Tribunal's order, which found that the non-resident agent only procured orders and followed up payments from overseas buyers and did not render technical or managerial services that would qualify as "fees for technical services".
The assessee contended that the commission related to services provided outside India, that the agent had no permanent establishment or business place in India, and that commission was remitted directly outside India; on this basis the commission was held not chargeable to tax in India and Section 195 was not applicable.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
GE India Technology Cen. (P) Ltd. v. CIT, (2010) 327 ITR 456 (SC)	Interpreting when payments to non-residents constitute fees for technical services and whether such payments are taxable in India.	The Commissioner (Appeals) and the Tribunal relied on this Supreme Court decision in favour of the assessee; the High Court found that the Commissioner and Tribunal correctly applied GE India and that it supported the assessee's position that commission paid for procuring orders outside India was not taxable in India.
Transmission Corporation of A.P. Ltd. v. Commissioner of Income Tax, [1999] 239 ITR 587 (SC)	Held that the payer is under an obligation to deduct tax at source under Section 195 where sums payable to non-residents are chargeable under the Act; discussed scope of "any other sum chargeable under the provisions of this Act".	Relied upon by the Revenue to support the duty to deduct tax under Section 195. The High Court held that that decision was not applicable to the facts of the present case because the payments did not amount to fees for technical services or other income deemed to arise in India.
Commissioner of Income Tax v. Toshoku Limited, (1980) 125 ITR 525 (SC)	Principle that commission earned by non-resident selling agents for services rendered abroad cannot be deemed to accrue or arise in India when the non-residents did not carry out business operations in India; only that portion of income reasonably attributable to operations in India can be deemed to accrue in India.	The High Court held the facts of the present case to be akin to Toshoku: non-resident agent acted outside India in procuring orders and therefore the commission was not deemed to accrue or arise in India. The Court relied on Toshoku's principle to reject the Revenue's contention.
CIT v. R.D. Aggarwal & Co., [1965] 56 ITR 20 (SC)	Used in Toshoku to support the proposition that only operations carried out in India can attract deeming provisions under the corresponding earlier statutory provision.	Referenced (via Toshoku) as part of the line of authority establishing that if no operations of the non-resident are carried out in India, income arising abroad cannot be deemed to accrue in India.
Carborandum Co. v. CIT, [1977] 108 ITR 335 (SC)	Also part of the authority cited in Toshoku on the scope of deeming provisions relating to business connection and operations in India.	Referenced (via Toshoku) to support the same principle that income from services performed abroad by non-resident agents is not deemed to accrue in India where no operations are carried out in India.

Court's Reasoning and Analysis

The Court proceeded by examining the statutory provisions invoked by the Revenue—Sections 9(1)(i), 9(1)(vii) and the Explanation to Section 9(2)—and the factual matrix established in the lower authorities (Assessing Officer, Commissioner (Appeals), and Tribunal). The key steps in the Court's analysis were:

Statutory framework: The Court quoted Section 9(1)(vii) and Explanation 2 defining "fees for technical services" as consideration for managerial, technical or consultancy services (including provision of personnel). The Court also noted the Explanation to Section 9(2) (substituted by the Finance Act, 2010) which deems certain categories of income of a non-resident to accrue in India irrespective of residence or rendering of services in India, but observed that the Explanation applies only if the amount falls within clauses (v), (vi) or (vii) (interest, royalty, or fees for technical services).
Nature of services rendered: On the facts, the non-resident agent procured orders, followed up payments, and arranged letters of credit—activities incident to and necessary for completing export transactions. The Court found no clear basis in the assessment record to treat these activities as "technical services" within the meaning of Explanation 2 to Section 9(1)(vii). The Court stated that the agent did not provide technical services for running the assessee's business in India; at best the services were to complete export commitments.
Application of precedent: The Court found the facts analogous to Commissioner of Income Tax v. Toshoku Limited, where non-resident selling agents acting abroad were held not to have earned income that could be deemed to accrue or arise in India because they did not carry out business operations in India. The Court also accepted that the Commissioner (Appeals) and the Tribunal had correctly applied GE India Technology Cen. (P) Ltd. in reaching the conclusion favourable to the assessee.
Effect of Explanation to Section 9(2): The Court observed that the substituted Explanation to Section 9(2) would only be engaged if the payment fell within interest, royalty or fees for technical services. Having concluded that the commission did not qualify as "fees for technical services", the Court held that the Explanation did not apply.
Consequence for Section 195: Because the Court concluded that Section 9 did not cover the commission payments (i.e., the payments were not income deemed to accrue or arise in India under the relevant clauses) Section 195 (the deduction of tax at source obligation) did not come into play. For the same reason, the Court held that the Transmission Corporation decision relied upon by the Revenue was not applicable to the facts of this case.

The Court therefore affirmed the concurrent findings of the Commissioner (Appeals) and the Tribunal that the commission payments to the non-resident agent were not taxable in India and that the assessee was not obliged to deduct tax under Section 195.

Holding and Implications

Core Ruling: APPEAL DISMISSED.

Direct implications:

The orders of the Tribunal and the Commissioner of Income Tax (Appeals), which held that the commission payments to the non-resident agent were not chargeable to tax in India and that Section 195 did not apply, are affirmed.
On these facts, the commission paid to the non-resident agent was held not to be "fees for technical services" under Section 9(1)(vii), and therefore the Explanation to Section 9(2) (and the obligation to deduct tax at source under Section 195) does not apply.

Broader implications:

The Court applied existing Supreme Court authority (Toshoku and GE India) to the facts; the decision resolves the dispute in this case but does not purport to lay down a new legal principle beyond applying those precedents.
No new precedent was set by this decision; the Court answered the substantial questions of law against the Revenue and upheld the concurrent factual and legal conclusions of the lower authorities.

Note: This summary is based exclusively on the information contained in the provided opinion and does not add or infer facts beyond that text.

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The Commissioner Of Income Tax Chennai v. Faizan Shoes Pvt. Limited 55, Vepery High Road Chennai - 600 003

Appeal under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal Chennai ‘D’ Bench, dated 23.4.2013 made in ITA No. 2095.Mds/2012 for the assessment year 2009-2010.

JUDGMENT

(Delivered by R. SUDHAKAR, J.)

The appeal has been filed by the Revenue challenging the order of the Income Tax Appellate Tribunal, Chennai ‘D’ Bench, dated 23.4.2013 made in ITA No. 2095.Mds/2012 for the assessment year 2009-2010.

2.1 The facts in a nutshell are as under: The assessee is a company engaged in the business of manufacture and export of articles of leather. In the course of business, the assessee entered into an Agency Agreement with a non-resident agent to secure orders from various customers, including retailers and traders, for the export of leather shoe uppers and full shoes by the assessee. As per the terms of the Agency Agreement, the business will be transacted by opening letters of credit or by cash against document basis. The non-resident agent will be responsible for prompt payment in respect of all shipments effected on cash against document basis. The assessee undertook to pay commission of 2.5% on FOB value on all orders procured by the non-resident agent. The said commission paid by the assessee was claimed as expenditure in terms of Section 37 of the Income Tax Act (for brevity, “the Act”).

2.2 The Assessing Officer disallowed the above said claim of the assessee under Section 40(a)(i) of the Act and held that payment of commission to the non-resident agent is to be dealt with in accordance with the provisions of Section 9(1) read with Section 195 of the Act. In paragraph (5) of the assessment order, referring to Section 9(1)(i) of the Act, the Assessing Officer held that the payment made to non-resident agent abroad is deemed to have been arisen in India. However, in paragraph (11) of the assessment order, the Assessing Officer held that the amount paid over to the non-resident agent is deemed to have accrued or arisen in India under Section 9(1)(vii) of the Act and the assessee failed to discharge its onus to prove that the payments were not made for the services covered under Section 9(1)(vii) of the Act. On this premise, the Assessing Officer concluded that since the assessee had not deducted tax at source on the payments made to the non-resident agent, as required under Section 195 of the Act, the claim made by the assessee that the amount paid over to the non-resident agent was expenditure was disallowed under Section 40(a)(i) of the Act.

2.3 Assailing the order passed by the Assessing Officer, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals), after detailed analysis of the submissions made on either side and in the light of the Agency Agreement and Circular No. 23 of 1969, held as under:

“4.2 ….. Further, the Assessing Officer has considered the services rendered by the agent u/s 9(1)(vii) of the Income Tax Act. When you take the services rendered by the agent to the appellant into consideration, it is clear that they do not fall under the provisions of Section 9(1)(vii) of the Income Tax Act. No technical services have been provided by the agent. It is a question of only pure procuring the contract for the sale of appellant goods. There is no question of payment of royalty or technical fees for the agent on contract with the appellant.

4.3 As seen from the facts of the case,

• Agent is a non-resident.

• Agent is operating his business activities outside India.

• The commission paid related to services provided outside India.

• The agent does not have any permanent establishment or permanent business place in India.

• The commission was remitted to the agent directly outside India.

4.4 All the above conditions bring to a reasonable conclusion that the commission paid in the facts of the present case to the non-resident agent is not taxable in India.”

In coming to this conclusion, the Commissioner of Income Tax (Appeals) relied upon a decision of the Supreme Court in GE India Technology Cen. (P) Ltd. v. CIT, (2010) 327 ITR 456 (SC). Thus, the Commissioner of Income Tax (Appeals) allowed the appeal filed by the assessee.

2.4 Aggrieved by the said order, the Revenue preferred an appeal to the Tribunal. The Tribunal, while concurring with the findings of the Commissioner of Income Tax (Appeals) that the non-resident agent was only procuring orders for the assessee and following up payments and no other services are rendered, held that the non-resident agent was not providing any technical services to the assessee. The Tribunal also held that the commission payment made to non-resident agent does not fall under the category of royalty or fee of technical services and, therefore, the Explanation to Section 9(2) of the Act has no application to the facts of the assessee's case. It was also held that the decision of the Supreme Court in GE India Technology Cen. (P) Ltd. case, referred supra, is in favour of the assessee. The Tribunal, while dismissing the appeal filed by the Revenue, held that the commission payments to non-resident agents are not chargeable to tax in India and, therefore, the provisions of Section 195 of the Act are not applicable.

2.5 Challenging the said order passed by the Tribunal, the Revenue has preferred this appeal raising the following substantial questions of law:

“1. Whether the Tribunal was right in holding that the disallowance of Rs. 2,06,99,780/- being the payment made towards overseas agents commission paid to non-resident under Section 40(a)(i) for non deduction of TDS u/s. 195 is to be allowed?

2. Whether the finding of the Tribunal is proper, especially when the agent's service is technical in nature and would fall under the purview of Section 9(1)(vii) and the explanation to Section 9(2) would apply?

3. Whether the commission payment made by the assessee to the non-resident outside India for the services rendered under Section 9(1)(vii) of the Act is deemed to have arisen in India as per Explanation inserted by Finance Act, 2010 with retrospective effect from 1.6.1976, which clearly states that the income of the non-resident shall be deemed to have accrued or arisen in India under clause (v) or (vi) of sub-section (1) of Section 9 and shall be included in the total income of the non-resident whether or not he is resident or place of business in connection in India or has rendered service in India?”

3.1 Mr. T. Ravikumar, learned Senior Standing Counsel appearing for the Revenue, referring to Explanation (2) to Section 9(1)(vii) of the Act, would submit that the words “fees for technical services” are wide enough to engulf services in the nature of managerial, technical or consultancy services. He also relied upon the Explanation to Section 9(2) of the Act to plead that income of a non-resident shall be deemed to accrue or arise in India under clause (v) or clause (vi) or clause (vii) of Section 9(1) and shall be included in the total income of the non-resident, whether or not,

(1) the non-resident has a residence or place of business or business connection in India; or

(2) the non-resident has rendered services in India.

In other words, the argument advanced by the learned Senior Standing Counsel is that rendering of some services by the non-resident agent outside India would not make any difference, as the service rendered by him is more in the nature of technical services in relation to the business of the assessee.

3.2 The learned Senior Standing Counsel also relied upon certain observations made by the Assessing Officer to say that the nature of services rendered by the non-resident agent, which includes procuring orders and arranging letters of credit, would fall within the realm of the term “fees for technical services” as stated in Explanation (2) to Section 9(1)(vii) of the Act.

3.3 The learned Standing Counsel for the appellant relied upon a decision of the Supreme Court in Transmission Corporation of A.P Ltd. v. Commissioner of Income Tax, [1999] 239 ITR 587, in support of his plea that the assessee is under an obligation to deduct tax at source under Section 195 of the Act. The learned Standing Counsel relies on the following paragraphs of the said decision:

“Hence, in our view, there is no substance in the contention of learned counsel for the appellant that the expression “any other sum chargeable under the provisions of this Act” would not include cases where any sum payable to the non-resident is a trading receipt which may or may not include “pure income”. The language of section 195(1) for deduction of income-tax by the payer is clear and unambiguous and casts an obligation to deduct appropriate tax at the rates in force. We make it clear that learned counsel for the parties have not advanced any submissions with regard to other findings given by the High Court.

In this view of the matter, the answers given by the High Court that (i) the assessee who made the payments to the three non-residents was under obligation to deduct tax at source under section 195 of the Act in respect of the sums paid to them under the contracts entered into; and (ii) the obligation of the respondent-assessee to deduct tax under section 195 is limited only to the appropriate proportion of income chargeable under the Act, are correct.”

4. Per contra, Mr. M.P Senthil Kumar, learned counsel appearing for the assessee sought to support the order passed by the Tribunal and stated that the same does not warrant any interference.

5. We have heard the learned counsel on either side and perused the orders of the Tribunal and the authorities below.

6. Before adverting the merits of the case, it would be apposite to refer to Sections 9(1)(i), 9(1)(vii) and 9(2) of the Act, which read as under:

“Section 9. Income deemed to accrue or arise in India.—

(1) The following incomes shall be deemed to accrue or arise in India—

(i) all income accruing or arising, whether directly or indirectly through or from any business connection in India, or through or from any property in India, or through or from any asset or source of income in India, or through the transfer of a capital asset situate in India;

……

(vii) income by way of fees for technical services payable by—

(a) the Government; or

(b) a person who is a resident, except where the fees are payable in respect of services utilised in a business or profession carried on by such person outside India or for the purposes of making or earning any income from any source outside India; or

(c) a person who is a non-resident, where the fees are payable in respect of services utilised in a business or profession carried on by such person in India or for the purposes of making or earning any income from any source in India:

Provided that nothing contained in this clause shall apply in relation to any income by way of fees for technical services payable in pursuance of an agreement made before the 1st day April, 1976, and approved by the Central Government.

Explanation 1.—For the purposes of the foregoing proviso, an agreement made on or after the 1 day of April, 1976, shall be deemed to have been made before that date if the agreement is made in accordance with proposals approved by the Central Government before that date.

Explanation 2.—For the purposes of this clause, “fees for technical services” means any consideration (including any lump sum consideration) for the rendering of any managerial, technical or consultancy services (including the provision of services of technical or other personnel) but does not include consideration for any construction, assembly, mining or like project undertaken by the recepient or consideration which would be income of the recipient chargeable under the head “Salaries”.

(2) Notwithstanding anything contained in sub-section (1), any pension payable outside India to a person residing permanently outside India shall not be deemed to accrue or arise in India, if the pension is payable to a person referred to in article 314 of the Constitution or to a person who, having been appointed before the 15th day of August, 1947, to be a Judge of the Federal Court or of a High Court within the meaning of the Government of India Act, 1935, continues to serve on or after the commencement of the Constitution as a Judge in India.

Explanation.- For the removal of doubts, it is hereby declared that for the purposes of this section, income of a non-resident shall be deemed to accrue or arise in India under clause (v) or clause (vi) or clause (vii) of sub-section (1) and shall be included in the total income of the non-resident, whether or not,-

(i) the non-resident has a residence or place of business or business connection in India; or

(ii) the non-resident has rendered services in India.”

7. On a reading of Section 9(1)(vii) of the Act, we are not inclined to accept the plea taken by the learned Senior Standing Counsel appearing for the Revenue that commission paid by the assessee to the non-resident agent would come under the term “fees for technical services”. In the case on hand, for procuring orders for leather business from overseas buyers - wholesalers or retailers, as the case may be, the non-resident agent is paid 2.5% commission on FOB basis. That appears to be a commission simpliciter. What is the nature of technical service that the so-called non-resident agent has provided abroad to the assessee is not clear from the order of the Assessing Officer. The opening of letters of credit for the purpose of completing export obligation is an incident of export and, therefore, the non-resident agent is under an obligation to render such services to the assessee, for which commission is paid. The non-resident agent does not provide technical services for the purposes of running of the business of the assessee in India. The services rendered by the non-resident agent can at best be called as a service for completion of the export commitment. We are, therefore, of the considered opinion that the commission paid to the non-resident agent will not fall within the definition of “fees for technical services”.

8. The other plea raised by Mr. T. Ravikumar, learned Senior Standing Counsel appearing for the appellant referring to Explanation to Section 9(2) of the Act is that the income of the non-resident shall be deemed to accrue or arise in India under Clauses (v) or (vi) or (vii) of Section 9(1) of the Act and shall be included in the total income of the non-resident, whether or not the non-resident has rendered services in India.

9. The Explanation to Section 9(2) of the Act was substituted by the Finance Act, 2010 with retrospective effect from 1.6.1976 The above said explanation would come into play only if the said amount paid would fall under the headings:

(i) income by way of interest as set out in Section 9(1)(v) of the Act; or

(ii) income by way of royalty as set out in Section 9(1)(vi) of the Act; or

(iii) income by way of fees for technical services as set out in Section 9(1)(vii) of the Act.

10. While dealing with Section 9(1) of the Act, the Supreme Court in Commissioner of Income Tax v. Toshoku Limited, (1980) 125 ITR 525, on considering a transaction where tobacco was exported to Japan and France and sold through non-resident assessees who were paid commission, held as under:

“8. The second aspect of the same question is whether the commission amounts credited in the books of the statutory agent can be treated as incomes accrued, arisen, or deemed to have accrued or arisen in India to the non-resident assessees during the relevant year. This takes us to s. 9 of the Act. It is urged that the commission amounts should be treated as incomes deemed to have accrued or arisen in India as they, according to the department, had either accrued or arisen through and from the business connection in India that existed between the non-resident assessees and the statutory agent. This contention overlooks the effect of cl. (a) of the Explanation to cl. (i) of sub-s. (1) of s. 9 of the Act which provides that in the case of a business of which all the operations are not carried out in India, the income of the business deemed under that clause to accrue or arise in India shall be only such part of the income as is reasonably attributable to the operations carried out in India. If all such operations are carried out in India, the entire income accruing therefrom shall be deemed to have accrued in India. If however, all the operations are not carried out in the taxable territories, the profits and gains of business deemed to accrue in India through and from business connection in India shall be only such profits and gains as are reasonably attributable to that part of the operations carried out in the taxable territories. If no operations of business are carried out in the taxable territories, it follows that the income accruing or arising abroad through or from any business connection in India cannot be deemed to accrue or arise in India (See CIT v. R.D Aggarwal and Co. [1965] 56 ITR 20 (SC) and Carborandum Co. v. CIT [1977] 108 ITR 335 (SC) which are decided on the basis of s. 42 of the Indian I.T Act, 1922, which corresponds to s. 9(1)(i) of the Act).

9. In the instant case, the non-resident assessees did not carry on any business operations in the taxable territories. They acted as selling agents outside India. The receipt in India of the sale proceeds of tobacco remitted or caused to be remitted by the purchasers from abroad does not amount to an operation carried out by the assessees in India as contemplated by cl. (a) of the Explanation to s. 9(1)(i) of the Act. The commission amounts which were earned by the non-resident assessees for services rendered outside India cannot, therefore, be deemed to be incomes which have either accrued or arisen in India. The High Court was, therefore, right in answering the question against the department.”

11. The facts of the present case are akin to the facts of the decision in Toshoku Limited case, referred supra. In the instant case also the assessee engaged the services of non-resident agent to procure export orders and paid commission. That apart, the Commissioner of Income (Appeals) as well as the Tribunal have correctly applied the principle laid down in GE India Technology Cen. (P) Ltd. case, referred supra, to hold that the assessee is not liable to deduct tax at source when the non-resident agent provides services outside India on payment of commission.

12. In the light of the above said decisions and the finding rendered by us on the earlier issue that the services rendered by the non-resident agent can at best be called as a service for completion of the export commitment and would not fall within the definition of “fees for technical services”, we are the firm view that Section 9 of the Act is not applicable to the case on hand and consequently, Section 195 of the Act does not come into play. In view of the above finding, the decision of the Supreme Court in Transmission Corporation of A.P Ltd. case, referred supra, relied upon by the learned Standing Counsel for the Revenue is not applicable to the facts of the present case. We find no infirmity in the order of the Tribunal in confirming the order of the Commissioner of Income Tax (Appeals).

13. For the foregoing reasons, the substantial questions of law raised for our consideration are answered against the Revenue and we find no reason to differ with the concurrent findings rendered by the Commissioner of Income Tax (Appeals) and the Tribunal.

In the result, this appeal is dismissed. No costs.

The Commissioner Of ... v. Faizan Shoes Pvt. Li...