CLOUTH GUMMIWERKE AKTIENGESELLSCHAFT Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THESE two RCs are disposed of by a common order as the questions referred are similar.

(2.) THE following questions are referred by the Tribunal for the opinion of this court in R. C. No. 71 of 1990 :

(3.) ACCORDINGLY, the NR carried out the erection and issued a bill for DM. 33,000 on October 20, 1978, in R.C. No. 71 of 1990 and DM. 32,542 in R.C. No. 149 of 1990. The Income-tax Officer held that the amounts of DM. 33,000 and DM. 32,542 would be subject to taxation and advised the assessee to deduct the tax. The assessee had paid a tax of Rs. 1,19,450 and Rs. 1,20,674, respectively. The amount was remitted thereafter. The amount of DM. 33,000 paid was understood to be free of Indian income-tax. The NMDC thereafter filed the return in which it was claimed that these amounts were not taxable. The Income-tax Officer held that it was taxable since the payments were covered by Section 9(1)(vii) of the Income-tax Act (for short "the Act"). The Commissioner agreed with the assessee. On appeal, the Tribunal held that the payments are taxable under Section 9(1)(vii) of the Act. However, at the instance of the assessee, question No. 1 set out in the earlier paragraph was referred for the opinion of this court.