In Brief
Ramnath & Co. and Laxmi Agencies, engaged as buying agents for foreign seafood enterprises, claimed income tax deduction for foreign exchange received. The Supreme Court upheld dismissal of their claims under Section 80-O of the Income Tax Act, 1961. The Court held that the assessees were merely procuring agents sourcing marine products in India, not providers of technical or professional services. Although agreements mentioned information and advice, these were incidental to the primary agent function and were rendered 'in India' not 'from India' as required. Payment was conditioned on goods satisfaction, not specialist knowledge. The burden fell on assessees to prove which portions of receipts related to qualifying services, which they failed to do. The Court applied strict interpretation principles to the deduction provision and found no grounds for interference with the High Court's judgment.
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