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Judgment
Arijit Pasayat C. J.
Since the points at issue in all the three references are similar, we dispose of the same by this common judgment.
At the instance of the assessed, the following questions have been referred for the opinion of this court u/s 256(1) of the Income Tax Act, 1961 (in short "the Act"), by the Income Tax Appellate Tribunal, Delhi Bench-D (the "Tribunal" in short) :
"1. Whether, on the facts and circumstances of the case, the Tribunal was right in law in holding that the assessed-company had business connections with Nittetsu Mining Consultants Co. Ltd. of Japan and, Therefore, liable to be treated as their agents u/s 163 of the Income Tax Act, 1961 ?
Whether, on the facts and circumstances of the case, the Tribunal was right in holding that the assessment proceedings could be validly started by treating the assessed-company as an agent of the non-resident party even after it had deducted Income Tax at source according to the orders made by the Income Tax Officer u/s 195(2) of the Income Tax Act, 1961, and depositing the same to the credit of the Central Government ?"
The dispute relates to the assessment years 1975-76, 1976-77 and 1977-78.
We may not go into the factual position in detail in view of the fact that the issue whether the assessed had business connections with Nittelsu Mining Consultants Co. Ltd. of Japan (as raised in the first question), is a question of fact. The Tribunal has relied on certain provisions in the agreement to arrive at that conclusion. Therefore, no question of law arises. So far as the second issue is concerned it has to be noted that the actual assessment took place after the liability to deduct tax had arisen. The expression "unless he is himself liable to pay Income Tax as an agent" was introduced as an exception for the benefit of the person sought to be made liable for deduction u/s 195(1). It was not necessary that status of a person paying any sum chargeable to a non-resident who is sought to be made liable for deduction of tax should first be determined u/s 163 before deciding whether the other requisites u/s 195(1) were or were not satisfied. That being the position, the answer to the second question referred is in the affirmative, in favor of the Revenue and against the assessed.
The references stands disposed of accordingly.