1. - This appeal under section 260A of the Income-tax Act (for short, "the IT Act") is directed against the order of the Income-tax Appellate Tribunal (for short, "the ITAT'") and is relevant for the assessment year 2007-08.

2. Brief facts necessary for disposal of this appeal are that the respondent is engaged in the business of manufacturing of insulators and bushings and is a limited company incorporated under the Companies Act. The short controversy relates to the payment of commission made by the respondent-company to (1) M/s. Alavabond Ltd, London, amounting to Rs. 3,17,93,218; (2) M/s. Jacob and Jacob S.A. De C.V., amounting to Rs. 32,75,683 ; (3) M/s Trafalghar Trading FZC, Sharjah (UAE) amounting to Rs. 2,53,89,798 and liability to deduct TDS thereon. While the claim of the respondent-assessee is that it relates to payments of commission to the non-resident agents and in view of the circular of the Central Board of Direct Taxes, bearing No. 786, dated February 7, 2000, (2000) 241 ITR (St.) 132 it was not required to deduct tax at source on the said commission payments, however, the Assessing Officer (for short, "the AO") was of the view that in view of the latest C