M/s. Joint Stock Company Zangas, Gandhinagar V. The Dy.DIT(Intl. Taxn.)-1, Ahmedabad

CO 289/AHD/2014

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 3170 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 30 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 26-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 27-10-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAKET BAKSHI
• Assessee Lawyers: V K SINGH
• Keywords: Business income
• Section: 143(3); 148

Judgement Text

ITA NO. 2364/AHD/2014 & CO 289/AHD/2014 DCIT VS. JOINT STOCK COMPANY ZANGAS ASSESSMENT YEAR: 2008-09 PAGE 1 OF 2 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND S S GODARA JM] ITA NO.2364/AHD/2014 & CO NO.289/AHD/2014 ASSESSMENT YEAR: 2008-09 DEPUTY DIRECTOR OF INCOME-TAX .............. ....APPELLANT (INTERNATIONAL TAXATION)-I, AHMEDABAD VS. JOINT STOCK COMPANY ZANGAS ........................RESPONDENT & A 4-1, SECTOR-25, GIDC ESTATE CROSS-OBJECTOR GANDHINAGAR 382 016 [PAN : AABCJ 6038 K] APPEARANCES BY: VK SINGH FOR THE APPELLANT SAKET BAKSHI FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 13.10.2017 DATE OF PRONOUNCING THE ORDER : 26.10.2017 O R D E R PER PRAMOD KUMAR, AM: 1. THIS APPEAL FILED BY THE ASSESSING OFFICER, AS A LSO THE CROSS OBJECTION FILED BY THE ASSESSEE, ARE DIRECTED AGAINST THE ORDER DATED 11 TH JUNE 2014 PASSED BY THE CIT(A) IN THE MATTER OF ASSESSMENT UNDER SECTION 14 8 R.W.S. 143(3) OF THE INCOME- TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2008-09. 2. GRIEVANCES RAISED IN THE APPEAL ARE AS FOLLOWS:- (I) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THAT THE FOREIGN COMPANY DID NOT HAVE ANY BUSINESS CONNECTIO N IN INDIA. (II) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS I N NOT APPRECIATING THE FACT THAT THE PRIMARY RESPONSIBILITY OF THE EXECUTION OF THE CONTRACT WAS OF THE ASSESSEE. FURTHER THE ASSESSEE COMPANY'S RESPONSIBI LITY WAS FOR THE EXECUTION OF THE PROJECT RIGHT FROM THE REVIEW OF D RAWINGS, PROJECT MANAGEMENT TILL THE FINAL COMMISSIONING OF THE PROJ ECT. THUS IT IS EVIDENT THAT THE ASSESSEE COMPANY'S ROLE IS MUCH MORE THAN SIMPL Y PROVIDING TECHNICAL SERVICES THEREBY THE RECEIPTS WERE TREATED AS BUSIN ESS INCOME. (III) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS I N DIRECTING TO TREAT THE INCOME AS FEES FOR TECHNICAL SERVICES AND TAX THE S AME AS SUCH. ITA NO. 2364/AHD/2014 & CO 289/AHD/2014 DCIT VS. JOINT STOCK COMPANY ZANGAS ASSESSMENT YEAR: 2008-09 PAGE 2 OF 2 3. LEARNED REPRESENTATIVES FAIRLY AGREE THAT THE AB OVE ISSUES ARE SQUARELY COVERED, IN FAVOUR OF THE ASSESSEE, BY TRIBUNALS D ECISIONS DATED 19.08.2011 AND 26.07.2016 IN ASSESSEES OWN CASES, WHEREIN IT HAS BEEN HELD THAT THE INCOME IN QUESTION CAN ONLY BE TAXED AS FEES FROM TECHNICAL S ERVICES, AND NOT AS BUSINESS INCOME. NOTHING HAS BEEN BROUGHT TO OUR NOTICE BY THE LEARNED CIT(A) WHICH CAN JUSTIFY ANY DEPARTURE FROM THE VIEWS SO EXPRESSED B Y THE CO-ORDINATE BENCHES. IN VIEW OF THESE DISCUSSIONS, WE SEE NO REASONS TO TAK E ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY THE CO-ORDINATE BENCHES. LEARNED CIT(A)S ORDER THUS DOES NOT CALL FOR ANY INTERFERENCE, AS IT IS ON THE SAME LINES AS THE ORDER OF THE CO- ORDINATE BENCHES, AND IT SPECIFICALLY FOLLOWS THE S AME. WE CONFIRM THE ACTION OF THE CIT(A) AND DECLINE TO INTERFERE IN THE MATTER. 4. AS REGARDS THE CROSS-OBJECTION FILED BY THE ASSE SSEE, LEARNED COUNSEL FOR THE ASSESSEE SUBMITS THAT IN THE EVENT OF THE APPEAL BE ING DISMISSED, THE CROSS- OBJECTION WILL BE RENDERED INFRUCTUOUS INASMUCH AS IT DEALS WITH THE MANNER IN WHICH BUSINESS INCOME, IF AT ALL REQUIRED TO BE COMPUTED, IS TO BE COMPUTED. THAT ASPECT OF THE MATTER IS NOW ACADEMIC. ACCORDINGLY, CROSS-OBJ ECTION IS ALSO DISMISSED. 5. IN THE RESULT, THE APPEAL AS ALSO THE CROSS-OBJE CTION ARE DISMISSED. PRONOUNCED IN THE OPEN COURT TODAY ON THE 26 TH OCTOBER, 2017. SD/- SD/- S S GODARA PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, THE 26 TH DAY OF OCTOBER, 2017 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ......TWO PAGES MANUSCRIPTS OF HONBLE AM ATTACHED....TYPED ON 26.10.2017 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: ... 26.10.2017........ 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: ... 26.10.2017.... . 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 26.10.2017... 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : ... 30.10.2017... 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER: