IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’, NEW DELHI BEFORE SHRI MAHAVIR SINGH, HON’BLE VICE PRESIDENT &

MRS. RENU JAUHRI, HON’BLE ACCOUNTANT MEMBER ITA No. 6354/DEL/2025; Assessment Year: 2017-18 ITUPLE TECHNOLOGIES Vs ACIT CICRCLE 4(1)

PVT. LTD.

SR-38D, Siris Estates, DLF III Gurgaon- 122010 Haryana (APPELLANT) (RESPONDENT)

PAN No. AAECI1720J Assessee by : Shri Umesh Thakur, CA Revenue/Department by : Shri Ajay Kumar Arora, Sr. DR Date of Hearing: 20.01.2026 Date of Pronouncement: 25.02.2026 ORDER PER RENU JAUHRI :

1. The above captioned appeal is filed by revenue is preferred against the orders of Ld. CIT(A)/NFAC, New Delhi passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as, “Act”) dated 07.10.2025 in Appeal No. CIT(A), Gurgaon-1/10992/2019-20

2. The assessee has raised following grounds of appeal which are reproduced as under:

“1. That on the facts and circumstances of the case Ld. CIT(A) was not justified in ignoring the fact that proper show cause notice as required under the law was not issued by the Ld. Assessing Officer, before passing a final order. Order of the CIT(A), is totally silent on this legal and factual ground. It is well settled legal position that show cause notice should clearly state the reason for issuing the notice and the implication of the non-

compliance. In the absence of requisite particulars, the Show Cause Notice would be liable to be quashed on the ground of being wholly vague. Therefore, the action of AO in completing the assessment without giving proper show cause notice and the action of the Ld. CIT(A), of totally ignoring the important legal aspect and confirming the action of the Ld. AO is against the provision of the laws and need to be quashed.

2. That on the facts and circumstances of the case Ld. CIT (appeal)

is not justified in confirming disallowance of Rs. 2,03,43700/- u/s 40(a)(i) due to non-deduction of tax u/s 195. Section 195 requires deduction of tax if the sum is chargeable to tax under the provision of the Income Tax Act. No TDS was deducted by the assessee on these payments because as per the provision of Section 9(1)(vii) no income accrue or arise in India in this case, so no tax was deductible. Therefore, disallowance made by ld. AO and confirmed by CIT(A) is not justified, against the provision of law and uncalled for.

3. That on the facts and circumstances of the case Ld. CIT (appeal)

is not justified in concluding that documents submitted by the assessee does not demonstrate that services have been utilized for the purpose of earning income from source outside India. During the year assessee was only providing services to only one client situated in USA, so there cannot be any doubt of services not used for the purpose of earning income from source outside India.

4. Assessee craves leave to add, amend, alter or withdraw any or all the above grounds of appeal before or at the time of the hearing.”

3. Brief facts of the case are that the assessee company filed its return for A.Y. 2017-18 on 25.08.2017, declaring an income of Rs. 3,87,25,850/-. The case was selected for limited scrutiny for the following reasons.

‘Commission, Royalty or Professional fee is paid outside India but no corresponding TDS statement has been filed’.

3.1 In response to the notice u/s 142(1) calling for details of expenses on which no TDS was deducted, the assessee furnished the details from which it was seen that no TDS on payment of Rs. 2,03,43,700/- made towards professional services received from outside India had been made. After rejecting the assessee’s contention that fees payable in respect of services utilized for the purpose of earning income from source outside India is not covered u/s 40(a)(i) as no TDS was deductible, the Ld. AO proceeded to disallow Rs. 20,34,3700/- u/s 40(a)(i) of the Act and completed the assessment u/s 143(3) vide order dated 03.12.2019.

3.2 Aggrieved, the assessee preferred an appeal before the Ld. CIT(A). Before Ld. CIT(A), the assessee submitted