MULTI SCREEN MEDIA P.LTD, MUMBAI V. DCIT CEN CIR 20, MUMBAI

CO 180/MUM/2014

• Counselvise Citation: [2015] 123 COUNSELVISE.COM (IT) 1515 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 1 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 09-10-2015
• Appeal Filed By: Assessee
• Bench Allotted: Not Allotted
• Next Hearing Date: 30-03-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 08-09-2014
• Court: TRIBUNAL
• Department Lawyers: N P SINGHDR
• Assessee Lawyers: NISHAN THAKKAR
• Keywords: Transfer pricing; Question of law; Commercial expediency
• Section: 37(1); 147; 148; 37

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,MUMBAI B BENCH , ,, , !'# , ,, , $ BEFORE S/SH. RAJENDRA,ACCOUNTANT MEMBER & SAKTIJIT DEY,JUDICIAL MEMBER /.ITA NO.4471 TO 73/MUM/2013, % & /ASSESSMENT YEAR-2004-05,06-07 & 07-08 DY.CIT-CENTRAL CIRCLE-20 ROOM NO.402, 4 TH FLOOR, ASSESSEEYAKAR BHAVAN, MK ROAD MUMBAI-400 020. VS M/S. MULTI SCREEN MEDIA PVT. LTD. (EARLIER KNOWN AS SET INDIA PVT. LTD.) 4 TH FLOOR, INTERFACE BUILDING NO.7 OFF. MALAD LINK ROAD, MALAD(W) MUMBAI-400 064. PAN: AABCS 1728 D ( / APPELLANT) ( / RESPONDENT) C.O. NO.180/MUM/2014 ARISING OUT OF /.ITA NO.4471 /MUM/2013, % & /ASSESSMENT YEAR-2004-05 M/S. MULTI SCREEN MEDIA PVT. LTD. MUMBAI-400 064. VS DY.CIT-CENTRAL CIRCLE-20 MUMBAI-400 020. ( / CROSS OBJECTOR) ( / RESPONDENT) %'# /ASSESSEE BY : SHRI NISHAN THAKKAR / REVENUE BY : SHRI N.P. SINGHDR / DATE OF HEARING : 07-10- 2015 / DATE OF PRONOUNCEMENT : 09 -10-2015 , 1961 1961 1961 1961 254 254 254 254( (( (1 11 1) )) ) )*# ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER BENCH: CHALLENGING THE ORDERS DT. 26.3.2013 OF THE CIT(A)- 39 MUMBAI, THE AO HAS FILED THE APPEAL FOR THE ABOVE MENTIONED THREE AY.S.THE ASSESSEE HAS FILED CROSS OBJECTION FOR THE AY 2004- 05.THE EFFECTIVE GROUNDS OF APPEAL ARE ALMOST SIMIL AR FOR ALL THE YEARS.THEREFORE, FOR THE SAKE OF CONVENIENCE WE ARE PASSING A CONSOLIDATED ORDER. A.Y. ROI FILED ON RETURNED INCOME ASSESSMENT DT. A SSESSED INCOME 2004-05 1.11.2005 16,35,92,360/- 5.5.2010 38,42,98, 940/- 2006-07 29.11.2006 35,82,44,496/- 4.12.2009 76,92,1 5,068/- 2007-08 31.10.2007 7,15,06,909/- 27.12.2010 75,17,9 7,261/- ITA NO.4771/MUM/2013(A.Y.2004-05): BRIEF FACTS: 2. ASSESSEE-COMPANY,ENGAGED IN THE PRODUCTION AND SALE OF TV PROGRAMMES FILMS DISTRIBU - TION OF SATELLITE CHANNELS FILED ITS RETURN OF INCO ME ON 1.11.2004, DECLARING TOTAL INCOME OF RS. 16.35LACS.THE AO COMPLETED THE ASSESSMENT U/S.143(3 ) OF THE ACT ON 22/12/2006, DETERMIN - ING THE INCOME OF THE ASSESSEE AT RS.19.39 CRORES. SUBSEQUENTLY, THE MATTER WAS RE-OPENED BY THE AO AS PER THE PROVISIONS OF SECTION 147 OF THE ACT. HE COMPLETED THE ASSESSMENT U/S. 143 (3)R.W.S. 147 OF THE ACT, ON 5.5.2010 COMPUTING THE TOTAL INCOME OF THE ASSESSEE AT RS.38.42 CRORES.AS PER THE AO DURING THE COURSE OF ASSESSMEN T FOR AY 05-06 DISALLOWANCE AMOUNTING TO RS.32.49 CRORES WAS MADE ON ACCOUNT OF SELLING A ND DISTRIBUTION CHARGES. TO VERIFY AS TO WHETHER SIMILAR ISSUE EXISTED IN THE YEAR UNDER APP EAL THE AO ISSUED A NOTICE U/S. 148 OF THE ACT.THE ASSESSEE OBJECTED THE RE-OPENING OF THE ASS ESSMENT VIDE ITS LETTER DT.28.8.2009.THE 4471,72,73/13 &CO180/14MULTISCREEN/A.Y.04-05 TO07-0 8 2 ISSUE OF REOPENING TRAVELLED UP TO HONBLE SUPREME COURT,WHO HELD THAT RE-ASSESSMENT PROCEEDINGS WERE VALID. 3. EFFECTIVE GROUND IS ABOUT DELETING THE DISALLOWANCE OF 81.25% OF THE EXPENDITURE INCURRED ON ADVERTISEMENT AND SALES PROMOTION AMOUNTING TO R S.21.74 CRORES. WHILE COMPLETING THE ASSESSMENT,THE AO MENTIONED THAT THE AMOUNT OF INCO ME ESCAPING ASSESSMENT WAS MENTIONED AT RS.29.26 CRORES,THAT THE ENTIRE REASONING WAS BA SED ON ASSESSMENT COMPLETED FOR AY 2005- 06,THAT IN THE ASSESSMENT THE AO HAD DISALLOWED 81. 25% OF ONLY ADVERTISEMENT AND SALES PROMOTION RATHER THAN FULL SELLING EXPENSES, THAT F OR THE YEAR UNDER CONSIDERATION THE DISALLOWANCE WARRANTED WOULD BE 81.25% OF THE ADVER TISEMENT AND SALES PROMOTION EXPENSES I.E.RS.21.74 CRORES.THE ASSESSEE WAS REQUIRED TO JU STIFY AS TO WHY ADVERTISEMENT AND SALES PROMOTION SHOULD BE ALLOWED AS A DEDUCTION WHEN THE EXPENDITURE BENEFITTED ITS PRINCIPAL. IT MADE A DETAILED SUBMISSION BEFORE THE AO.FOLLOWING THE ORDER OF THE AO,FOR 2005-06 A DISALLOWANCE OF RS.21.74 CRORES WAS MADE. 4. AGGRIEVED BY THE ORDER OF THE AO,IT PREFERRED AN AP PEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA).BEFORE HIM,IT WAS CONTENDED THAT THE EXPENDITURE HAD BEEN INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS AND IT WAS ELIGIBLE FOR DEDUCTION U/S. 37 OF THE ACT,THAT THE EXPENDITURE HELPED THE ASSESSEE TO INC REASE THE SUBSCRIPTION REVENUE.IT RELIED UPON THE CASE OF STAR INDIA P.LTD.(103 ITD 73),VIAC OM 18 MEDIA PVT. LTD.(ITA 5057/ MUM/ 07)AND SABENA DETERGENTS P.LTD. (303 ITR 320). AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE AN D THE ASSESSMENT ORDER,THE FAA REFERRED TO THE ORDER OF THE TRIBUNAL DATED 20/3/2013 (ITA/4 686/MUM/2010 OF AY 2005-06).HE HELD THAT THE TRIBUNAL HAD CONSIDERED ALL THE FACTUAL AS PECTS AND HAD DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE.RELYING UPON THE ORDER OF THE TRIBUNAL FOR AY.05-06 AND THE DECISION OF HON'BLE BOMBAY HIGH COURT IN CASE OF STAR INDIA (SUPRA), T HE FAA ALLOWED THE APPEAL FILED BY THE ASSESSEE. 5. BEFORE US, DEPARTMENTAL REPRESENTATIVE(DR) STATED T HAT MATTER COULD BE DECIDED ON MERITS. AUTHORISED REPRESENTATIVE(AR) RELIED UPON THE ORDER OF THE TRIBUNAL DATED 20.3.2013 (SUPRA). WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US.WE FIND THAT WHILE DECIDING THE APPEAL FOR AY 2005-06 THE TRIBUNAL HAS DISCUSSED THE ISSUE AS UNDER: 3. REMAINING ISSUE IS AGAINST CONFIRMING DISALLOW ANCE OF ADVERTISEMENT AND SALES PROMOTION EXPENSES OF RS.32,49,91 ,062/-, BEING 81.25% OF TOT AL EXPENSES CLAIMED UNDER SECTION 37(1) OF THE ACT. 4. THE AO DISALLOWED THE AFORESAID EXPENSES ON THE GROUND THAT THE EXPENDITURE IS OF THE CHANNEL PRINCIPAL. THE ASSESSEE STATED BEFORE THE C IT(A) THAT THE AO HAS LEGALLY ERRED IN APPORTIONING ONLY 18.75% OF TOTAL EXPENDITURE OF A DVERTISEMENT AND SALES PROMOTION AS ALLOWABLE TO THE ASSESSEE. IT WAS FURTHER SUBMITTED THAT THE AO ERRED IN DISALLOWING THE EXPENDITURE ON ADVERTISEMENT AND SALES PROMOTION AM OUNTING, TO RS 32,49,91,0621- MERELY ON THE BASIS OF PRESUMPTION AND SURMISES AND WITHOUT A PPRECIATING THAT THE EXPENDITURE WAS INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS, AND, THEREFORE, THE EXPENSES ARE ALLOWABLE IN FULL. IT WAS ARGUED THAT THE EXPENDITU RE ON ADVERTISEMENT AND SALES PROMOTION AMOUNTING TO RS.32,49,91,062/- WAS DISALLOWED WITHO UT APPRECIATING THE FACT THAT THE TRANSFER PRICING OFFICER HAD EXAMINED THE INTERNATIONAL TRAN SACTIONS BETWEEN THE APPELLANT AND ITS ASSOCIATED ENTERPRISES AND HAD HELD THAT THE MARGIN ARRIVED AT AS PER THE TRANSACTIONAL NET MARGIN METHOD IS AT ARMS' LENGTH AND ACCORDINGLY TH E SAID EXPENDITURE SHOULD ALSO BE CONSIDERED BE AT ARMS LENGTH AND NOT EXCESSIVE AND UNREASONABLE. RELIANCE WAS PLACED ON VARIOUS CASE LAWS ALSO INCLUDING THE DECISION OF TH IRD MEMBER OF THE TRIBUNAL IN THE CASE OF INDIA PRIVATE LIMITED, REPORTED IN 103 ITO 73 AND A LSO IN THE CASE OF NESTLE INDIA PRIVATE 4471,72,73/13 &CO180/14MULTISCREEN/A.Y.04-05 TO07-0 8 3 LIMITED, DECIDED BY THE DELHI BENCH OF THE TRIBUNA L. IT WAS FURTHER EXPLAINED THAT IN THE AGE OF MULTIPLE CHANNELS, IN ORDER TO KEEP ITS SUBSCRIBER BASE INTACT AND KEEP THE VIEWERS CONSTANTLY INTERESTED, IT WAS IMPORTANT TO INCUR EXPENDITURE O N ADVERTISING AND SALES PROMOTION AS IT ALSO, HELPED ITS DISTRIBUTION BUSINESS AND IN DEVELOPING CONTENT IN LINE WITH VIEWERSHIP PREFERENCE AND TO MAINTAIN ITS SUBSCRIPTION FEES. RELIANCE WAS PLACED ON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF SASSOON J. DAVID & CO. LTD. AFTER CONSIDERING THE SUBMISSION AND PERUSING THE MATERIAL ON RECORD, LEARNED CIT(A ) NOTED THAT FULL COPIES OF OTHER AGREEMENTS REGARDING ADVERTISEMENT COMMISSION AND SALE OF PROG RAMS DISCUSSED IN THE ORDER HAVE NOT BEEN FILED, THOUGH THE ASSESSEE HAS FILED COPY OF DISTRIBUTION AGREEMENT ENTERED INTO BY THE ASSESSEE WITH THE PRINCIPAL I.E. SET SINGAPORE. LEA RNED CIT(A) NOTED THAT THE MAIN ARGUMENT OF THE ASSESSEE ARE THAT THE EXPENDITURE INCURRED WAS FOR THE PURPOSE OF ITS BUSINESS AND IN COMMERCIAL EXPEDIENCY WHICH DISCRETION AND DECISION IS WITH THE ASSESSEE. IT WAS FURTHER NOTED THAT AGAINST THE ORDER OF THE TRIBUNAL IN THE CASE OF STAR INDIA LTD., THE REVENUE HAS FILED AN APPEAL BEFORE THE HON'BLE HIGH COURT, HOWEVER, HON' BLE BOMBAY HIGH COURT HAS DISMISSED THE APPEAL OF THE REVENUE BUT NOT DETAIL FINDING HA S BEEN GIVEN. THEREAFTER THE CIT(A) NOTED THAT THERE ARE CERTAIN DISTINGUISHING FEATURE IN TH E CASE OF STAR INDIA PVT. LTD. (SUPRA) AND IN CASE OF THE ASSESSEE, THEREFORE, WITHOUT FOLLOWING THE DECISION IN THE CASE OF STAR INDIA PVT. LTD., LEARNED CIT(A) CONFIRMED THE ACTION OF THE A O. DISTINGUISHING FEATURES HAVE ALSO BEEN NOTED BY THE CIT(A) IN HIS ORDER AT PAGES 6 TO 8. 5. BEING AGGRIEVED WITH THE OBSERVATIONS MADE BY TH E LEARNED CIT(A), THE ASSESSEE HAS FILED THE PRESENT APPEAL HERE BEFORE THE TRIBUNAL. 6. LEARNED COUNSEL OF THE ASSESSEE, WHO APPEARED B EFORE THE TRIBUNAL, STATED THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF THE HON'BLE BO MBAY HIGH COURT IN THE CASE OF STAR INDIA PRIVATE LIMITED, DECIDED IN ITA NO.165/2009, DATED 24-3-2009. IT WAS STATED THAT IT IS NOT NECESSARY ALL THE TIME THAT THE HON'BLE HIGH COURT SHOULD DISCUSS THE FACTS IN DETAIL THEN PASS AN ORDER. THE HON'BLE HIGH COURT HAS OBSERVED THAT THE TRIBUNAL HAS PASSED A DETAILED ORDER BY DISCUSSING ALL THE FACTS AND NO QUESTION OF LAW ARISES OUT OF THE ORDER OF THE TRIBUNAL. ACCORDINGLY, THE ORDER OF THE TRIBUNAL HAS BEEN CON FIRMED BY THE HON'BLE HIGH COURT WHICH IS BINDING IN NATURE. 6.1 IN RESPECT TO DISTINGUISHING THE FACTS BY THE CIT(A), LEARNED COUNSEL OF THE ASSESSEE HAS FILED A CHART MENTIONING THE OBJECTION OF THE LEARN ED CIT(A) AND MENTIONING THE ASSESSEE'S SUBMISSIONS. THIS CHART CONTAINS TWO PAGES. IT WAS FURTHER STATED THAT EVEN IN THE CASE OF ASSESSEE ITSELF, THE TRIBUNAL HAS ALLOWED THE ISSUE IN FAVOUR OF ASSESSEE EARLIER. HOWEVER, THERE WAS A DIVERGENT VIEW AMONG THE MEMBERS OF THE TRIB UNAL IN THE CASE OF STAR INDIA PVT. LIMITED. THE MATTER WAS REFERRED TO THE THIRD MEMBER AND TH E THIRD MEMBER AFTER DISCUSSING THE ISSUE IN DETAIL, HAS ALLOWED THE ISSUE IN FAVOUR OF THE ASSESSEE. THE ORDER OF THE TRIBUNAL HAS BEEN REPORTED IN 103 ITO 73, WHICH PERTAINS TO ASSESSME NT YEAR 1998-99 AND 1999-2000. THE FACTS ARE IDENTICALLY SAME IN THE CASE OF THE ASSESSEE AN D IN THE CASE OF STAR INDIA PVT. LIMITED. 7. LEARNED OR HAS PLACED RELIANCE ON THE ORDER OF CIT(A). IT WAS FURTHER SUBMITTED THAT THE FULL DOCUMENTS WERE NOT FILED BEFORE THE CIT(A). I N RESPECT TO DECISION OF THE HON'BLE BOMBAY HIGH COURT, IT WAS STATED THAT THE HON'BLE HIGH CO URT HAS NOT DISCUSSED THE FACTS OF THE CASE AS SIMPLY HAS STATED THAT NO QUESTION OF LAW ARISES OUT OF THE ORDER OF THE TRIBUNAL. IN THIS RESPECT, RELIANCE WAS PLACED ON THE DECISION REPOR TED IN 255 ITR 147 (SC), WHEREIN IT WAS HELD THAT WITHOUT DISCUSSING IN DETAIL, ORDER PASSED WA S NOT JUSTIFIED. 8. IN REJOINDER, LEARNED COUNSEL OF THE ASSESSEE S TATED THAT THE ISSUE HAS BEEN EXAMINED IN DETAIL IN EARLIER YEARS, WHICH HAVE BEEN ALLOWED I N FAVOUR OF THE ASSESSEE. THERE IS NO NEW FACTS IN THE YEAR UNDER CONSIDERATION AND, THEREFO RE, STATED THAT FACTS ARE NOT DISCUSSED IN DETAIL, IS NOT CORRECT. IT WAS FURTHER SUBMITTED TH AT FACTS OF THE CASE OF STAR INDIA PVT. LTD. AND THE FACTS IN THE CASE IN HAND, ARE IDENTICALLY SAM E. THE DECISION OF STAR INDIA PVT. LTD. HAS BEEN AFFIRMED BY THE HON'BLE JURISDICTIONAL HIGH COURT , THEREFORE, THE SAME IS BINDING. 9. WE HAVE HEARD RIVAL SUBMISSIONS AND CONSIDERED THEM CAREFULLY, AFTER CONSIDERING THE SUBMISSION AND PERUSING THE MATERIAL ON RECORD, WE FIND THAT THE ASSESSEE DESERVES TO SUCCEED ON THE ISSUE INVOLVED. WE FIND THAT LEARNED CIT(A) WAS NOT JUSTIFIED IN OBSERVING THAT HON'BLE HIGH COURT HAS NOT PASSED A DETAILED ORDER, THEREFO RE, THE SAME WAS NOT FOLLOWED, IN OUR VIEW, 4471,72,73/13 &CO180/14MULTISCREEN/A.Y.04-05 TO07-0 8 4 WHETHER THE ORDER OF THE HON'BLE HIGH COURT IS, I N DETAIL OR IN SHORT, THAT HAS TO BE FOLLOWED. WE FURTHER NOTED THAT LEARNED CIT(A) HAS TRIED TO D ISTINGUISH THE FACTS IN THE CASE OF STAR INDIA PRIVATE LIMITED AND IN THE CASE OF ASSESSEE. DISTIN GUISHING FEATURE HAS BEEN EXPLAINED BY THE ASSESSEE WHILE FILING A CHART. 9.1 THE FIRST OBJECTION OF THE CIT(A) IS THAT THE STAR INDIA WAS ENTITLED TO COMMISSION OF 15% ON ADVERTISEMENT REVENUES SECURED BY IT WHEREAS IN APPELLANT'S CASE IT IS STATED BY ASSESSING OFFICER TO BE AT 12.5%. WHETHER THE COMMISSION IS 1 5% OR 12.5%, IN OUR VIEW, THERE SHOULD NOT BE ANY OBJECTION. EVEN WE NOTED THAT IN SUBSEQUENT YEARS, STAR INDIA HAS ALSO BEEN EARNING 10% COMMISSION ON ADVERTISING REVENUES WHICH FACT I S RECORDED IN IT AT ORDERS IN CASE OF STAR INDIA FOR AY 2000-01, REPORTED IN {(2009) 1171TD 31 9 (MUM) AND FOR AY 2002- 03, REPORTED IN {2008-TIOL-426-ITAT-MUM}. MULTI SCREEN MEDIA PVT . LTD. (MSMI) HAD BEEN SUBJECTED TO SCRUTINY UNDER TRANSFER PRICING ASSESSMENT AND THE TPO HAS CONFIRMED THAT THE MARGIN EARNED BY THE NET MARGIN METHOD (TNMM) IS AT ARMS LENGTH. 9.2 THE SECOND OBJECTION IS THAT STAR INDIA WAS S UPPLYING PROGRAMMES TO STAR HONG KONG AT COST +5% WHEREAS AS PER THE ASSESSMENT ORDER, APPEL LANT DOES THIS FOR A FIXED FEE. THE ASSESSEE HAS FILED EXPLANATION THAT THE AVERAGE MARK-UP EARN ED BY MSMI ON CONTENT SUPPLIED DURING THE PERIOD IS 18.75% WHICH FACT IS ACCEPTED BY THE ASSE SSING OFFICER IN IS ORDER AT PAGE 17. THEREFORE, AGAIN WE FIND THAT THERE IS NO DISTINGUI SHABLE FEATURE AS TO WHETHER SUPPLYING PROGRAMMES TO STAR HONG KONG AT COST +5% OR SOME OT HER RATES, BUT THE FACT IS THAT METHOD OF DOING BUSINESS IS THE SAME. 9.3 THE NEXT OBJECTION NOTED BY THE LEARNED CIT(A) THAT THE STAR INDIA WAS EARNING CABLE SUBSCRIPTION CHARGES FOR ITSELF WHEREAS THE APPELLA NT IS COLLECTING GROSS DISTRIBUTION REVENUES FOR ITSELF AND THE PRINCIPAL I.E. SET SINGAPORE W HOSE SHARE IS 75% OF THE GROSS. THE STAKE OF THE PRINCIPAL IN THE APPELLANT'S CASE IS LARGE AN D CRITICAL AND NOT MERELY INCIDENTAL. IN THIS REGARD, THE EXPLANATION HAS BEEN FILED ON BEHALF OF THE ASSESSEE THAT IN SUBSEQUENT YEAR, THOUGH STAR INDIA HAD MADE PAYMENT TO ITS PRINCIP AL IN RESPECT OF ITS DISTRIBUTION INCOME WHICH FACT IS RECORDED IN IT AT ORDER IN CASE OF STAR INDIA FOR A Y 2002-03, YET THE ADVERTISEMENT EXPENSE WAS HELD TO BE ALLOWABLE. IN CASE OF VIACOM 18 MEDIA PVT. LTD. (ITA NO.5057/MUM/07, PB PG.NO.225/ THE ADVERTISEMENT EXP ENSES WERE HELD TO BE ALLOWABLE CONSIDERING VIACOM 18 WAS ADVERTISING SALE AGENT OF OVERSEAS CHANNEL COMPANY. IN CASE OF ASSESSEE , ASSESSEE HAD BEEN SUBJECTED TO SCRUTINY UNDER TRANSFER PRICING ASSESSMENT AND THE TPO HAS CONFIRMED THAT THE MARGIN EARNED BY THE A SSESSEE AS PER THE TNMM IS AT ARM'S LENGTH, THIS FACT NOTED BY THE CIT(A) AT PAGE 4 A ND BY THE AO AT PAGE 2 & 7 OF THEIR ORDER RESPECTIVELY. AFTER COMPARING THE OBJECTION OF THE LEARNED CIT(A) AND THE EXPLANATION OF THE ASSESSEE, WE FOUND AGAIN THERE IS NO CHANGE OF FA CTS BUT THERE IS CHANGE IN EARNING OF PROFIT. EVERY ASSESSEE HAS ITS OWN FACT AND ITS OWN CRITERI A TO EARN THE MONEY BUT THE MAIN THING IS TO BE SEEN AS TO WHETHER LINE OF BUSINESS IS SAME OR N OT. LEARNED CIT(A) HAS NOT STATED ANYWHERE IN HER ORDER THAT LINE OF BUSINESS IS SEPARATE AN D DISTINCT TO EACH OTHER. 9.4 THE NEXT OBJECTION NOTED BY THE LEARNED CIT(A) THAT THE STAR INDIA HAD 'EXCLUSIVE RIGHTS' FOR THE TERRITORY ASSIGNED IN RESPECT OF THE THRE E REVENUE STREAMS WHEREAS THE ASSESSEE HAS ONLY 'NON-EXCLUSIVE RIGHTS' IN THE TERRITORY ASSI GNED. IN REPLY IT HAS BEEN STATED THAT THIS IS FACTUALLY INCORRECT. STAR INDIA ALSO' HAD ONLY NON- EXCLUSIVE RIGHTS WHICH FACT IS ITSELF RECORDED BY THE IT AT ORDER OF STAR INDIA, REPORTED IN 103 ITD 73, WHICH HAS BEEN PLACED AT PAGES 52, 54, 55, 63 & 91 OF THE PAPER BOOK. 9.5 THE NEXT OBJECTION NOTED BY THE LEARNED CIT(A) IN THE CASE OF STAR LNDIA THAT 100% OF THE EXPENDITURE WAS DISALLOWED WHEREAS IN ASSESSEES CA SE THE AO HAD ALLOWED PARTIAL EXPENDITURE. WHETHER THE EXPENDITURE DISALLOWED B Y THE AO IS 100% OR PART, DOES NOT MATTER LINE OF BUSINESS IS THE SAME. FURTHER IT MAKES THE 'ASSESSEE'S CASE STRONGER FOR THE REASON THAT THE AO IS SATISFIED THAT SAME EXPENDITURE HAS BEE N INCURRED BY THE ASSESSEE. HOWEVER, IT IS SEEN THAT IN CASE OF STAR INDIA, THE CIT(A) THE CIT (A) ALLOWED 20% OF THE EXPENDITURE AND ON SECOND APPEAL, THE TRIBUNAL HAS ALLOWED THE FULL EXPENDITURE. THEREFORE, FOR THE SAME REASON ALSO IT CANNOT BE SAID THAT THERE IS ANY DISTINGU ISHABLE FEATURE IN THE CASE OF STAR INDIA AS COMPARED TO THE CASE OF THE ASSESSEE. 4471,72,73/13 &CO180/14MULTISCREEN/A.Y.04-05 TO07-0 8 5 10. ON OBSERVATION OF ALL THE ABOVE FIVE OBJECTIONS RAISED BY THE CIT(A) IN HIS ORDER, IN OUR VIEW, DO NOT SPELL THAT THE LINE OF BUSINESS OF T HE ASSESSEE IN CASE OF STAR, ARE SEPARATE AND DISTINCT. THE ACTIVITIES ARE SIMILAR, THEREFORE, IN OUR CONSIDERED VIEW, THE DECISION IN THE CASE OF STAR INDIA PVT.LTD (SUPRA), IS SQUARELY APPLICAB LE ON THE FACTS OF THE PRESENT CASE. WE FURTHER NOTED THAT IN PAST EVEN IN THE CASE OF THE ASSESSEE ITSELF, THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. IN THIS YEAR, PERHAPS FOR THE REASON THAT THERE IS A DIVERGENT VIEW BETWEEN THE MEMBER OF THE TRIBUNAL IN CASE OF STAR INDIA PVT. LTD., THEREFORE, FOR THIS REASON, THE ISSUE WAS NOT DECIDED AND IT WAS PENDING. HOW EVER, FOR THE EARLIER YEAR, THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. COPI ES OF THE ORDER OF ASSESSMENT YEARS 2000-01 & 2001-02 ARE PLACED ON RECORD. EVEN WE FURTHER N OTICED THAT IN CASE OF OTHER ASSESSEE I.E. IN THE CASE OF NGC NETWORK (INDIA) P. LTD., DECIDED IN ITA NO.635/MUM/2010 AND IN THE CASE OF VIACOM 18 MEDIA PVT. LTD., DECIDED IN ITA NO.5057/M UM/2007, SIMILAR FACTS WERE INVOLVED AND THE ISSUE HAS BEEN DECIDED BY THE TRIBUNAL IN FAVOUR OF THESE ASSESSEES. 11. IN VIEW OF THESE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE AND WITHOUT GOING INTO DETAIL FURTHER, WE HOLD THAT THE ISSUE IS SQUARELY COVER ED BY THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF STAR INDIA PVT. LTD. (SUPRA) . ACCORDINGLY, WE DECIDE THE ISSUE IN FAVOUR OF THE ASSESSEE AND DIRECT THE AO TO ALLOW THE EXPE NDITURE TO THE ASSESSEE IN VIEW OF THE ABOVE OBSERVATIONS. RESPECTFULLY,FOLLOWING THE ABOVE WE DECIDE THE EFFE CTIVE GROUND OF APPEAL AGAINST THE AO. C.O.NO. 180/MUM/2014(A.Y.04-05): 6. AS WE HAVE DECIDED THE ISSUE IN FAVOUR OF THE ASSES SEE,THEREFORE THE CO FILED BY IT BECOMES INFRUCTUOUS. ITANOS.4772 TO 4773/MUM/2013 AY2006-07 AND 07-08 : 7. EFFECTIVE GROUND OF APPEAL FOR BOTH THE YEARS IS ID ENTICAL TO THE EFFECTIVE GROUND RAISED BY THE AO FOR THE AY.04-05,AS STATED EARLIER.THEREFORE ,FOLLOWING THE ORDER OF AY . 2004-05,WE DECIDE THE ISSUE AGAINST THE AO. AS A RESULT, APPEAL FILED BY THE AO FOR ALL THE THR EE YEARS AND CO FILED BY THE ASSESSEE STANDS DISMISSED. , . ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH OCTOBER,2015. 9, ,2015 SD/- SD/- !'# / SAKTIJIT DEY) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER /MUMBAI, /DATE: 09. 1 0. 2015 . . . .. . JV.SR.PS. +# ,&# / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ !'& ( , 4. THE CONCERNED CIT / !'& ( 5. DR A BENCH, ITAT, MUMBAI / $+ , , . . . 6. GUARD FILE/ *. //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.