Explain the treatment as to their taxability and/or allowability, under the provisions of Income Tax Act, 1961 for the AY 2021-22, in the following case : Saloni Ltd. paid Singapore dollar equivalent to 1 crore as sales

A foreign agent of an Indian exporter operates in his own country and not having permanent establishment in India, no part of his income accrues or arises in India. His commission is usually remitted directly to him and is therefore, not received by him or on his behalf in India. The commission paid to the non-resident agent for services rendered outside India is, thus not chargeable to tax in India. Since commission is not subject to tax in India, disallowances under section 40(a) (i) of Income Tax Act is not attracted even though tax has not been deducted at sources. It shall be allowed as expenses.