SWANSTON MULTIPLEX CINEMAS P.LTD, MUMBAI V. ASST CIT CIR 11(1), MUMBAI

ITA 1135/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9695 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 12-09-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 25-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JUSTIN DR
• Assessee Lawyers: R DESHPANDE
• Keywords: Reopening of assessment; Capital asset; Gift; Business income; Depreciation; Transfer pricing; Double taxation relief; Opportunity of being heard; International transaction; Deemed to accrue or arise in india; Permanent establishment; Cost of acquisition; Difference of opinion; Competent authority; Onus to prove; Retraction; Reason to believe; Documents seized; Change of opinion; Reassessment proceedings
• Section: 44AD; 92F; 92A; 133A; 147; 131; 148; 90; 139

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI , . , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ITA NO.1135/MUM/2015 ASSESSMENT YEAR: 2005-06 SWANSTON MULTIPLEX CINEMAS PRIVATE LIMITED, 9 TH FLOOR, VIRAJ TOWERS, W.E. HIGHWAY NEXT TO ANDHERI FLYOVER ANDHERI (EAST), MUMAI-400093 / VS. ACIT, CIRCLE-11(1), R. NO.467, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI-400020 ( ! ' /ASSESSEE) ( ' / REVENUE) PAN NO.:-AAFCS6295K ! ' / ASSESSEE BY SHRI R. DESHPANDE ' / REVENUE BY SHRI V. JUSTIN-DR ( ' ) ' * / DATE OF HEARING : 12/09/2017 ) ' * / DATE OF ORDER: 03/10/2017 ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 22/12/2014 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. THE FIRST GROUND RAISED BY THE ASSESSEE PERTAINS TO REOPENING OF ASSESSMENT U/S 147 R.W.S 148 OF THE INCOME TAX A CT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSE E, SHRI R. DESHPANDE, CONTENDED THAT REOPENING WAS DON E BEYOND FOUR YEARS, THUS, IT IS BAD IN LAW. OUR ATTE NTION WAS INVITED TO PAGE-2 OF THE IMPUGNED ORDER BY CONTENDI NG THAT THE ASSESSMENT WAS COMPLETED U/S 143(1) OF THE ACT. ON THE OTHER HAND, THE LD. DR, SHRI V. JUSTIN, STRONGLY DEFENDED THE REOPENING OF ASSESSMENT U/S 147 BY INVITING OUR ATT ENTION TO THE FINDING RECORDED IN THE IMPUGNED ORDER. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE IS IN THE BUSINESS OF EXHIBIT ION OF FILMS, PROGRAMMING, CONDUCTING, OPERATING AND MANAGEMENT O F MULTIPLEX THEATERS, DECLARED INCOME OF ` 5,53,21,141/- IN ITS ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 3 RETURN FILED ON 30/03/2012. THE ASSESSMENT WAS COM PLETED U/S 143(1) OF THE ACT ACCEPTING THE RETURNED INCOME . LATER ON, THE LD. ASSESSING OFFICER RECORDED THE REASONS FOR REOPENING AS REPRODUCED IN PARA-3.1 OF THE IMPUGNED ORDER AS THE RE WAS REASON TO BELIEVE THAT INCOME OF ` 30,94,732/-, CHARGEABLE TO TAX, HAD ESCAPED ASSESSMENT. THE NOTICE U/S 148 WA S SERVED UPON THE ASSESSEE AND THEREAFTER ANOTHER NOTICE U/S 143(2) DATED 24/09/2012 WAS SERVED UPON THE ASSESSEE. THE LD. ASSESSING OFFICER VIDE ANOTHER NOTICE DATED 11/04/2 012 ASKED THE ASSESSEE TO SHOW CAUSE AS TO WHY TDS ON FILM RE NTALS MAY NOT BE DISALLOWED U/S 40(A) OF THE ACT AND THE ASSE SSEE WAS ALSO ASKED TO FURNISH THE PROOF AND DOCUMENTARY EVI DENCE TO JUSTIFY ITS CLAIM. THE ASSESSEE FURNISHED ITS REPLY VIDE LETTER DATED 16/04/2012. THE LD. ASSESSING OFFICER WAS UNS ATISFIED WITH THE REPLY OF THE ASSESSEE AND HELD THAT SINCE, THE ASSESSEE COMPANY HAS MADE PAYMENT TO A NON-RESIDENT FILM DIS TRIBUTOR I.E. M/S PARAMOUNT FILMS AND HAS NOT DEDUCTED TDS A S PER THE PROVISION OF SECTION 40(A) OF THE ACT, THEREFOR E, THE LD. ASSESSING OFFICER DISALLOWED THE AMOUNT OF ` 30,94,732/- BEING THE PAYMENT MADE TO A NON-RESIDENT DISTRIBUTO R TO THE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 4 TOTAL INCOME OF THE ASSESSEE. NOW, UNDER THESE FAC TS, WE SHALL ANALYZE, THE VALIDITY OF REOPENING U/S 147 R.W.S 14 8 OF THE ACT. 2.2. IN THE LIGHT OF THE FOREGOING UNCONTROVERTED FACTUAL MATRIX, THERE IS NO DISPUTE TO THE FACT THAT THE T AX WAS NOT DEDUCTED BY THE ASSESSEE ON THE PAYMENT MADE TO NON - RESIDENT FILM DISTRIBUTOR, THEREFORE, WE SHALL ANAL YZE, WHETHER THERE WAS A REASONABLE BELIEF WITH THE ASSESSING OF FICER WHETHER INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESS MENT. IT IS OUR BOUNDED DUTY TO EXAMINE THE VALIDITY OF REOP ENING U/S 147 R.W.S 148 OF THE ACT. BEFORE ADVERTING FURTHER WE ARE REPRODUCING HEREUNDER THE RELEVANT PROVISION OF SEC TION 147 OF THE ACT FOR READY REFERENCE AND ANALYSIS:- . IF THE ASSESSING OFFICER HAS REASON TO BELIEVE THA T ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY AS SESSMENT YEAR, HE MAY, SUBJECT TO THE PROVISIONS OF SECTIONS 148 T O 153, ASSESS OR REASSESS SUCH INCOME AND ALSO ANY OTHER INCOME CHAR GEABLE TO TAX WHICH HAS ESCAPED ASSESSMENT AND WHICH COMES TO HIS NOTICE SUBSEQUENTLY IN THE COURSE OF THE PROCEEDINGS UNDER THIS SECTION, OR RECOMPUTE THE LOSS OR THE DEPRECIATION ALLOWANCE OR ANY OTHER ALLOWANCE, AS THE CASE MAY BE, FOR THE ASSESSMENT Y EAR CONCERNED (HEREAFTER IN THIS SECTION AND IN SECTIONS 148 TO 1 53 REFERRED TO AS THE RELEVANT ASSESSMENT YEAR) : PROVIDED THAT WHERE AN ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 143 OR THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO ACTION SHALL BE TAKEN UNDER THIS SECTION AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLES S ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH A SSESSMENT YEAR BY REASON OF THE FAILURE ON THE PART OF THE ASSESSEE T O MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 5 (1) OF SECTION 142 OR SECTION 148 OR TO DISCLOSE FU LLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT, FOR TH AT ASSESSMENT YEAR: PROVIDED FURTHER THAT NOTHING CONTAINED IN THE FIRST PROVISO SHALL APPLY IN A CASE WHERE ANY INCOME IN RELATION TO ANY ASSET (INCLUDING FINANCIAL INTEREST IN ANY ENTITY) LOCATED OUTSIDE I NDIA, CHARGEABLE TO TAX, HAS ESCAPED ASSESSMENT FOR ANY ASSESSMENT YEAR : PROVIDED ALSO THAT THE ASSESSING OFFICER MAY ASSESS OR REASSESS SUCH INCOME, OTHER THAN THE INCOME INVOLVING MATTERS WHI CH ARE THE SUBJECT MATTERS OF ANY APPEAL, REFERENCE OR REVISION, WHICH IS CHARGEABLE TO TAX AND HAS ESCAPED ASSESSMENT. EXPLANATION 1.PRODUCTION BEFORE THE ASSESSING OFFI CER OF ACCOUNT BOOKS OR OTHER EVIDENCE FROM WHICH MATERIAL EVIDENC E COULD WITH DUE DILIGENCE HAVE BEEN DISCOVERED BY THE ASSESSING OFF ICER WILL NOT NECESSARILY AMOUNT TO DISCLOSURE WITHIN THE MEANING OF THE FOREGOING PROVISO. EXPLANATION 2.FOR THE PURPOSES OF THIS SECTION, TH E FOLLOWING SHALL ALSO BE DEEMED TO BE CASES WHERE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT, NAMELY : (A) WHERE NO RETURN OF INCOME HAS BEEN FURNISHED BY THE ASSESSEE ALTHOUGH HIS TOTAL INCOME OR THE TOTAL INCOME OF ANY OTHER P ERSON IN RESPECT OF WHICH HE IS ASSESSABLE UNDER THIS ACT DURING THE PR EVIOUS YEAR EXCEEDED THE MAXIMUM AMOUNT WHICH IS NOT CHARGEABLE TO INCOME-TAX ; (B) WHERE A RETURN OF INCOME HAS BEEN FURNISHED BY THE ASSESSEE BUT NO ASSESSMENT HAS BEEN MADE AND IT IS NOTICED BY THE A SSESSING OFFICER THAT THE ASSESSEE HAS UNDERSTATED THE INCOME OR HAS CLAIMED EXCESSIVE LOSS, DEDUCTION, ALLOWANCE OR RELIEF IN THE RETURN ; (BA) WHERE THE ASSESSEE HAS FAILED TO FURNISH A REP ORT IN RESPECT OF ANY INTERNATIONAL TRANSACTION WHICH HE WAS SO REQUIRED UNDER SECTION 92E; (C) WHERE AN ASSESSMENT HAS BEEN MADE, BUT (I) INCOME CHARGEABLE TO TAX HAS BEEN UNDERASSESS ED ; OR (II) SUCH INCOME HAS BEEN ASSESSED AT TOO LOW A RA TE ; OR (III) SUCH INCOME HAS BEEN MADE THE SUBJECT OF EXCE SSIVE RELIEF UNDER THIS ACT ; OR (IV) EXCESSIVE LOSS OR DEPRECIATION ALLOWANCE OR AN Y OTHER ALLOWANCE UNDER THIS ACT HAS BEEN COMPUTED; (D) WHERE A PERSON IS FOUND TO HAVE ANY ASSET (INC LUDING FINANCIAL INTEREST IN ANY ENTITY) LOCATED OUTSIDE INDIA. EXPLANATION 3.FOR THE PURPOSE OF ASSESSMENT OR REA SSESSMENT UNDER THIS SECTION, THE ASSESSING OFFICER MAY ASSESS OR R EASSESS THE INCOME IN ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 6 RESPECT OF ANY ISSUE, WHICH HAS ESCAPED ASSESSMENT, AND SUCH ISSUE COMES TO HIS NOTICE SUBSEQUENTLY IN THE COURSE OF T HE PROCEEDINGS UNDER THIS SECTION, NOTWITHSTANDING THAT THE REASON S FOR SUCH ISSUE HAVE NOT BEEN INCLUDED IN THE REASONS RECORDED UNDE R SUB-SECTION (2) OF SECTION 148. EXPLANATION 4.FOR THE REMOVAL OF DOUBTS, IT IS HER EBY CLARIFIED THAT THE PROVISIONS OF THIS SECTION, AS AMENDED BY THE F INANCE ACT, 2012, SHALL ALSO BE APPLICABLE FOR ANY ASSESSMENT YEAR BE GINNING ON OR BEFORE THE 1ST DAY OF APRIL, 2012. 2.3. IF THE AFORESAID PROVISION OF THE ACT IS ANAL YZED, WE FIND THAT AFTER INSERTION OF EXPLANATION -3 TO SECT ION 147 OF THE ACT BY THE FINANCE (NO.2) ACT OF 2009 WITH EFFECT F ROM 01/04/1989 SECTION 147 HAS AN EFFECT THAT ASSESSING OFFICER HAS TO ASSESS OR REASSESS INCOME (SUCH INCOME) WHIC H HAS ESCAPED ASSESSMENT AND WHICH WAS BASIS OF FORMATION OF BELIEF AND, IF HE DOES SO, HE CAN ALSO ASSESS OR REASSESS ANY OTHER INCOME WHICH HAS ESCAPED ASSESSMENT AND WHICH CAME TO THE NOTICE DURING THE COURSE OF PROCEEDINGS. IDENTICAL RATIO WAS LAID DOWN BY HONBLE JURISDICTIONAL HIGH COURT IN C IT VS JET AIRWAYS INDIA PVT. LTD. (2010) 195 TAXMAN 117 (MUM. ) AND THE FULL BENCH DECISION FROM HONBLE KERALA HIGH COURT IN CIT VS BEST WOOD INDUSTRIES AND SAW MILLS (2011) 11 TAXMAN .COM 278 (KERALA)(FB). A PLAIN READING OF EXPLANATION-3 TO SECTION 147 CLEARLY DEPICTS THAT THE ASSESSING OFFICER HAS POWER TO MAKE ADDITION, WHERE HE ARRIVED TO A CONCLUSION THA T INCOME ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 7 HAS ESCAPED ASSESSMENT WHICH CAME TO HIS NOTICE DUR ING THE COURSE OF PROCEEDINGS OF REASSESSMENT U/S 148. OUR VIEW IS FORTIFIED BY THE DECISION IN MAJINDER SINGH KANG VS CIT (2012) 25 TAXMAN.COM 124/344 ITR 358 (P & H) AND JAY BHARA T MARUTI LTD. VS CIT (2010) TAX LR 476 (DEL.) AND V. LAKSHMI REDDY VS ITO (2011) 196 TAXMAN 78 (MAD.). THE PROV ISION OF THE ACT IS VERY MUCH CLEAR AS WITH EFFECT FROM 01/0 4/1989, THE ASSESSING OFFICER HAS WIDE POWERS TO INITIATE PROCE EDINGS OF REOPENING. THE HONBLE KERALA HIGH COURT IN CIT VS ABDUL KHADAR AHMAD (2006) 156 TAXMAN 206 (KERALA) EVEN WE NT TO THE EXTENT SO LONG AS THE AO HAS INDEPENDENTLY APPL IED HIS MIND TO ALL THE RELEVANT ASPECT AND HAS ARRIVED TO A BELIEF THE REOPENING CANNOT BE SAID TO BE INVALID. 2.4. WE ARE AWARE THAT MERE CHANGE OF OPINION CA NNOT FORM THE BASIS OF REOPENING WHEN THE NECESSARY FACT S WERE FULLY AND TRULY DISCLOSED BY THE ASSESSEE IN THAT S ITUATION, THE ITO IS NOT ENTITLED TO REOPEN THE ASSESSMENT MERELY ON THE BASIS OF CHANGE OF OPINION. HOWEVER, POWERS UNDER AMENDED PROVISION ARE WIDE ENOUGH WHERE THERE IS A REASONAB LE BELIEF WITH THE ASSESSING OFFICER, THAT INCOME HAS ESCAPED ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 8 ASSESSMENT, BECAUSE THE POWERS WITH EFFECT FROM 01/ 04/1989 ARE CONTEXTUALLY DIFFERENT AND THE CUMULATIVE CONDI TIONS SPELT OUT IN CLAUSES (A) AND (B) OF SECTION 147, PRIOR TO ITS AMENDMENT ARE NOT PRESENT IN THE AMENDED PROVISION. THE ONLY CONDITION FOR ACTION IS THAT THE ASSESSING OFF ICER SHOULD HAVE REASON TO BELIEVE THAT INCOME CHARGEABLE TO T AX HAS ESCAPED ASSESSMENT. SUCH BELIEF CAN BE REACHED IN ANY MANNER AND IS NOT QUALIFIED BY A PRE-CONDITION OF F AITH AND TRUE DISCLOSURE OF MATERIAL FACTS BY AN ASSESSEE AS CONTEMPLATED IN PRE-AMENDED SECTION 147. VIEWED IN THAT ANGLE, POWER TO REOPEN ASSESSMENT IS MUCH WIDER UND ER THE AMENDED PROVISION. OUR VIEW IS FORTIFIED BY THE DE CISION FROM HONBLE DELHI HIGH COURT IN BAWA ABHAI SINGH VS DCI T (2001) 117 TAXMAN 12 AND RAKESH AGARWAL VS ACIT (1996) 87 TAXMAN 306 (DEL.). THE HONBLE APEX COURT IN CIT V S SUN ENGINEERING WORKS PVT. LTD. 198 ITR 297 (SC) CLEARL Y HELD THAT PROCEEDINGS U/S 147 ARE FOR THE BENEFIT FOR THE REV ENUE, WHICH ARE AIMED AT GATHERING THE ESCAPED INCOME. AT TH E SAME TIME, WE ARE AWARE THAT POWERS U/S 147 AND 148 OF T HE ACT ARE NOT UNBRIDLED ONE AS IT IS HEDGED WITH SEVERAL SAFE GUARDS CONCEIVED IN THE INTEREST OF ELIMINATING ROOM FOR A BUSE OF THIS ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 9 POWER BY THE AO. HOWEVER, THE MATERIAL AVAILABLE O N RECORD, CLEARLY INDICATES THAT INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT, THEREFORE, THE LD. ASSESSING OFFICER W AS WITHIN HIS JURISDICTION TO REOPEN THE ASSESSMENT. THE HON BLE APEX COURT IN ESS ESS KAY ENGINEERING CO. PVT. LTD. (20 01) 247 ITR 818 (SC) HELD THAT MERELY BECAUSE THE CASE OF T HE ASSESSEE WAS CORRECT IN ORIGINAL ASSESSMENT FOR THE RELEVANT ASSESSMENT YEAR, IT DOES NOT PRECLUDE THE ITO TO REOPEN THE AS SESSMENT OF AN EARLIER YEAR ON THE BASIS OF FINDING OF HIS FACT THAT FRESH MATERIAL CAME TO HIS KNOWLEDGE. 2.5. UNDER SECTION 147, AS SUBSTITUTED WITH EFFECT FROM 01/04/1989, THE SCOPE OF REASSESSMENT HAS BEEN WIDE NED. AFTER SUCH SUBSTITUTION, THE ONLY RESTRICTION, PUT IN THAT SECTION IS THAT REASON TO BELIEVE. THAT REASON HA S TO BE A REASON OF A PRUDENT PERSON WHICH SHOULD BE FAIR AND NOT NECESSARILY DUE TO FAILURE OF THE ASSESSEE TO DISCL OSE FULLY AND PARTIALLY SOME MATERIAL FACTS RELEVANT FOR ASSESSME NT (DR. AMINS PATHOLOGY LABORATORY VS JCIT (2001) 252 ITR 673, 682 (BOM.) IDENTICAL RATIO WAS LAID DOWN BY HONBLE DE LHI HIGH COURT IN UNITED ELECTRICAL COMPANY PVT. LTD. VS CIT (2002) 258 ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 10 ITR 317, 322 (DEL.) AND PRAFULL CHUNNILAL PATEL VS ACIT 236 ITR 832, 838 (GUJ.). THE ESSENTIAL REQUIREMENT FOR INITIATING REASSESSMENT PROCEEDING U/S 147 R.W.S 148 OF THE AC T IS THAT THE LD. ASSESSING OFFICER MUST HAVE REASON TO BELIE VE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY ASSESSMENT YEAR. THE HONBLE GUJARA HIGH COURT IN P RAFULL CHUNNILAL PATEL VS ACIT (SUPRA) EVEN WENT TO THE EX TENT THAT AT THE INITIATION STAGE FORMATION OF REASONABLE BELIEF IS NEEDED AND NOT A CONCLUSIVE FINDING OF FACTS. IDENTICAL RA TIO WAS LAID DOWN IN BRIJMOHAN AGRAWAL VS ACIT (2004) 268 ITR 4 00, 405 (ALL.) AND RATNACHUDAMANI S. UTNAL VS ITO (2004) 26 9 ITR 272, 277 (KARNATAKA) APPLYING SOWDAGAR AHMED KHAN V S ITO (1968) 70 ITR 79(SC). 2.6. SO FAR AS, THE MEANING OF EXPRESSION, REASON TO BELIEVE IS CONCERNED, IT REFERS TO BELIEF WHICH PR OMPTS THE ASSESSING OFFICER TO APPLY SECTION 147 TO A PARTICU LAR CASE. IT DEPEND UPON THE FACTS OF EACH CASE. THE BELIEF MUST BE OF AN HONEST AND REASONABLE PERSON BASED ON REASONABLE GR OUNDS. THE ASSESSING OFFICER IS REQUIRED TO ACT, NOT ON ME RE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 11 SUSPICION, BUT ON DIRECT OR CIRCUMSTANTIAL EVIDENCE . OUR VIEW FIND SUPPORT FROM THE RATIO LAID DOWN IN FOLLOWING CASES:- I. EPICA LABORATORIES LTD. VS DCIT 251 ITR 420, 425-426 (BOM.), II. VISHNU BOREWELL VS ITO (2002) 257 ITR 512 (ORISSA), III. CENTRAL INDIA ELECTRIC SUPPLY COMPANY LTD. VS ITO (201 1) 333 ITR 237 (DEL.), IV. V.J. SERVICES COMPANY MIDDLE EAST LTD. VS DCIT (2011) 339 ITR 169 (UTTRAKHAND), V. CIT VS ABHYUDAYA BUILDERS (P. ) LTD. (2012) 340 ITR 310 (ALL.), VI. CIT VS DR. DEVENDRA GUPTA (2011) 336 ITR 59 (RAJ.), VII. EMIRATES SHIPPING LINE FZE VS ASST. DIT (2012) 349 I TR 493 (DEL.). VIII. REFERENCE MAY ALSO MADE TO FOLLOWING JUDICIAL DECISI ONS:- IX. SAFETAG INTERNATIONAL INDIA P. LTD. (2011) 332 ITR 622 (DEL.), X. CIT VS ORIENT CRAFT LTD. (2013) 354 ITR 536 (DEL.) XI. ACORUS UNITECH WIRELSS PVT. LTD. VS ACIT (2014) 362 IT R 417 (DEL.). XII. PRAFUL CHUNILAL PATEL: VASANT CHUNILAL PATEL VS ASST. CIT (1999) 832, 843-44, 844-45 (GUJ.), XIII. VENUS INDUSTRIAL CORPORATION VS ASST. CIT (1999) 236 I TR 742, 746 (PUNJ.), XIV. SRICHAND LALCHAND TALREJA VS ASST. CIT (1998) 98 TAXM AN 14, 19 (BOM.), XV. USHA BELTRON LTD. VS JCIT (1999) 240 ITR 728, 736-37, 739 (PAT.) XVI. KAPOOR BROTHERS VS UNION OF INDIA (2001) 247 ITR 32 4, 331, 332-33 XVII. VIPPY PROCESSORS PVT. LTD. VS CIT (2001) 249 ITR 7, 8 (MP) ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 12 2.7. IN DILIP S. DAHANUKAR VS ASST. CIT (2001) 248 ITR 147, 150-51 (BOM.). THE HONBLE JURISDICTIONAL HIGH COURT HELD AS UNDER:- HELD, THAT THERE WAS MATERIAL ON RECORD ON THE BASIS OF SURVEY AND STATEMENT OF PERSON TO SHOW THAT THE ASSESSEE HAD WRONGFULLY CLAIM DEDUCTION U/S 80IA. THEREFORE, THE ASSESSING OFFICER HAD REASON TO BELIEVE THAT INCOME HAD ESCAPED ASSESSMENT FOR ASSESSMENT YEAR 1994-95. IDENTICALLY IN THE CASE OF SRICHAND LALCHAND TALREJ A V. ASST. CIT, (1998) 98 TAXMAN 14, 19 (BOM), WHERE THE INFORMATION REGARDING ACQUISITION OF THE ASSET WAS NOT AVAILABLE WITH THE ASSESSING OFFICER DURING THE REL EVANT ASSESSMENT YEAR 1992-93 AND SUCH INFORMATION WAS DISCLOSED IN THE RETURN FOR THE ASSESSMENT YEAR 199 5-96, THE HONBLE JURISDICTIONAL HIGH COURT HELD THAT THE ASSESSING OFFICER CAN FORM A BONA FIDE BELIEF THAT THERE WAS ESCAPEMENT OF INCOME IN RELATION TO ASSESSMENT YEAR 1992-93 . 2.8. THE HONBLE JURISDICTIONAL HIGH COURT IN EXP ORT CREDIT GUARANTEE CORPORATION OF INDIA LTD. V. ADDL. CIT, (2013) 350 ITR 651 (BOM), WHERE THERE HAD BEEN NO APPLICAT ION OF MIND TO THE RELEVANT FACTS DURING THE COURSE OF THE ASSESSMENT ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 13 PROCEEDINGS BY THE ASSESSING OFFICER, THE REOPENING OF THE ASSESSMENT WAS HELD TO BE VALID. 2.9. THE HONBLE JURISDICTIONAL HIGH COURT IN GIRI LAL & CO. V. S.L. MEENA, ITO, (2008) 300 ITR 432 (BOM), HELD THAT IN ORDER TO INVOKE THE EXTRAORDINARY JURISDICT ION OF THE COURT THE PETITIONER MUST ALSO MAKE OUT A CASE THAT NO PART OF THE RELEVANT MATERIAL HAD BEEN KEPT OUT FRO M THE ASSESSING OFFICER). THE INFORMATION WAS IN THE ANNE XURES AND CONSEQUENTLY EXPLANATION 2(C)(IV) OF SECTION 14 7 WOULD APPLY. THE REASSESSMENT PROCEEDINGS AFTER FOUR YEAR S WERE VALID. 2.10. IN THE CASE OF DEPUTY CIT V. GOPAL RAMNARAYA N KASAT, (2010) 328 ITR 556 (BOM), IT WAS NOT THE CAS E OF THE ASSESSEE THAT THE NOTICE ISSUED WAS AFTER THE EXPIR Y OF THE TIME LIMIT PROVIDED IN SECTION 153(2). THE REASSESSMENT PROCEEDINGS WERE HELD TO BE VALID. IN INDIAN HUME PIPE CO. LTD . V. ASST. CIT, (2012) 348 ITR 439 (BOM), BOTH IN THE COMPUTAT ION OF TAXABLE LONG-TERM CAPITAL GAINS IN THE ORIGINAL RET URN OF INCOME AND IN THE COMPUTATION THAT WAS SUBMITTED IN RESPON SE TO THE QUERY OF THE ASSESSING OFFICER THERE WAS A COMPLETE SILENCE IN REGARD TO THE DATES ON WHICH THE AMOUNTS WERE INVES TED, AS ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 14 SUCH THERE BEING A FAILURE TO DISCLOSE FULLY AND TR ULY MATERIAL FACTS NECESSARY FOR ASSESSMENT. THE REASSESSMENT PR OCEEDINGS WERE HELD TO BE VALID. THIS VIEW WAS ALSO CONFIRMED IN FOLLOWING CASES:- A. DALMIA P. LTD. V. CIT, (2012) 348 ITR 469 (DEL); B. CIT V. K. MOHAN & CO. (EXPORTS), (2012) 349 ITR 653 (BOM); C. REMFRY & SAGAR V. CIT, (2013) 351 ITR 75 (DEL); D. OPG METALS & FINSEC LTD. V. CIT, (2013) 358 ITR 144 ( DEL). 2.11. IN THE CASE OF VENUS INDUSTRIAL CORPORATION V. ASST. CIT, (1999) 236 ITR 742, 746 (P & H) [WHERE INITIAT ION WAS STARTED WITHIN FOUR YEARS FOR RE-EXAMINING THE DEDU CTION UNDER SECTION 80HHC, WAS HELD TO BE WRONGLY ALLOWED IN TH E ORIGINAL ASSESSMENT. IDENTICALLY, IN THE CASE OF HAPPY FOR GING LTD. V. CIT, (2002) 253 ITR 413,416-17 (P & H), WHERE EXCIS E DUTY PAID IN ADVANCE WAS SHOWN AS AN ASSET IN THE BALANC E SHEET AND WAS ALLOWED AS A DEDUCTION, REASSESSMENT NOTICE ON THE GROUND THAT EXCISE DUTY WAS SHOWN AS AN ASSET IN TH E BALANCE SHEET AND WAS NOT ROUTED THROUGH THE PROFIT AND LOS S ACCOUNT. THE REOPENING AT THIS STAGE WAS HELD TO BE VALID. IN THE CASE OF VIPAN KHANNA V. CIT, (2002) 255 ITR 220, 2 30 (P & H), ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 15 WHERE FROM THE FACTS IT WAS CLEAR THAT THE ASSESSEE HAD CLAIMED DEPRECIATION IN THE RETURN AT THE RATE OF 5 0 PER CENT AND HE HAD NOWHERE DISPUTED THE FACT THAT THE ADMIS SIBLE RATE OF DEPRECIATION TO HIM WAS 40 PER CENT., SUCH FACT ALONE WAS SUFFICIENT TO INITIATE REASSESSMENT PROCEEDINGS UND ER SECTION 147 AND, THEREFORE, SUCH INITIATION WAS SUSTAINED. THE HONBLE PUNJAB & HARYANA HIGH COURT IN MRS. RAMA SINHA V. C IT, (2002) 256 ITR 481, 483, 486, WHERE THE REASSESSMEN T NOTICE HAS BEEN ISSUED ON THE BASIS OF DEFINITE INFORMATIO N FROM CBI REGARDING INVESTMENTS BY THE ASSESSEE WHICH HAD NOT BEEN DISCLOSED DURING THE ORIGINAL ASSESSMENT PROCEEDING S, SUCH INITIATION HAS BEEN UPHELD. 2.12. IN THE CASE OF PAL JAIN V. ITO, (2004) 267 I TR 540, 544-45, 548, 549 (P & H), APPLYING PHOOL CHAND BAJR ANG LAL V. ITO, (1993) 203 ITR 456 (SC), ALTHOUGH THE TRANSACT ION OF SALE OF SHARES WAS DISCLOSED AND ACCEPTED IN THE ORIGINA L ASSESSMENT, BUT THE SUBSEQUENT DISCOVERY BY THE DDI (INVESTIGATION) REVEALED THAT THE TRANSACTION WAS N OT GENUINE, A REASSESSMENT NOTICE AFTER FOUR YEARS HAS BEEN HELD TO BE VALID BECAUSE THERE WAS NO TRUE DISCLOSURE OF THE MATERIA L FACTS. IN ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 16 THIS REGARD, THE PETITIONER-ASSESSEE CANNOT DRAW AN Y SUPPORT FROM THE STATEMENT FOR CHALLENGING THE VALIDITY OF THE NOTICE FOR REASSESSMENT. IT GOES WITHOUT SAYING THAT FOR THE P URPOSE OF MAKING THE ASSESSMENT, THE ASSESSING OFFICER SHALL HAVE TO CONFRONT THE PETITIONER WITH THE ENTIRE MATERIAL IN HIS POSSESSION ON THE BASIS OF WHICH HE PROPOSES TO MAK E THE ADDITIONS. IN PUNJAB LEASING PVT. LTD. V. ASST. CIT , (2004) 267 ITR 779, 781-82 (P & H), WHERE DEPRECIATION WAS ALL OWED TO THE ASSESSEE, WHO WAS ENGAGED IN THE BUSINESS OF FI NANCING OF VEHICLES AND CONSUMER DURABLES ON 'HIRE-PURCHASE BA SIS' AS WELL AS ON 'LEASE/RENT BASIS', A REASSESSMENT NOTIC E ISSUED AFTER FOUR YEARS HAS BEEN HELD NOT TO SUFFER FROM A NY ILLEGALITY AS THE SAME WAS BASED ON THE BONA FIDE ACTION OF TH E COMPETENT AUTHORITY TO DETERMINE WHETHER OR NOT THE VEHICLES IN RESPECT OF WHICH THE PETITIONER HAD BEEN CLAIMIN G DEPRECIATION, WERE ACTUALLY OWNED BY IT. 2.13. IN JAWAND SONS V. CIT(A), (2010) 326 ITR 39 (P & H), IN THE INITIAL ASSESSMENT, THE BENEFIT OF DEDUC TION OF THE DUTY DRAWBACK AND DEPB UNDER SECTION 80-IB WAS WRON GLY GRANTED TO THE ASSESSEE, FOR WHICH IT WAS NOT ENTIT LED. ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 17 THEREFORE, REASSESSMENT PROCEEDINGS TO WITHDRAW THE DEDUCTION WERE HELD TO BE VALID. LIKEWISE, IN CIT V. HINDUSTAN TOOLS & FORGINGS P. LTD., (2008) 306 ITR 209 (P & H ), WHERE, THE ASSESSEE IN THE REGULAR ASSESSMENT HAD BEEN ALL OWED DEDUCTION MORE THAN ACTUALLY ALLOWABLE UNDER SECTIO N 80HHC. THEREFORE, THE ACTION INITIATED BY THE AO FOR REASS ESSMENT UNDER SECTION 147(B) COULD NOT BE HELD TO BE INVALI D. 2.14. IN THE CASE OF MARKANDA VANASPATI MILLS LTD. V. CIT, (2006) 280 ITR 503 (P & H), WHEREIN, THE INFORMATIO N FURNISHED BY THE ASSESSEE GAVE NO CLUE TO THE PAYME NT OF LIABILITY IN REGARD OF THE SALES TAX COLLECTED IN E XCESS. THE ASSESSING OFFICER WAS HELD TO BE VALIDLY INITIATED THE REASSESSMENT PROCEEDINGS UNDER SECTION 147 FOR BOTH THE YEARS UNDER CONSIDERATION. IN THE CASE OF SAT NAR AIN V. CIT, (2010) 320 ITR 448 (P & H), THE DOCUMENT DID NOT FO RM THE SOLE BASIS FOR THE ASSESSING OFFICER TO INITIATE R EASSESSMENT PROCEEDING BUT HE ALSO TOOK INTO CONSIDERATION THE LETTER WRITTEN BY THE ASSISTANT COMMISSIONER AS WELL AS TH E FACT THAT NO RETURN HAD BEEN FILED BY THE ASSESSEE FOR ASSESS MENT YEAR 1995-96. THUS, IT WAS HELD THAT THE ASSESSING OFFIC ER HAD ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 18 RIGHTLY INVOKED THE JURISDICTION TO INITIATE THE RE ASSESSMENT PROCEEDINGS UNDER SECTION 147. IN THE CASE OF CIT V. HUKAM SINGH, (2005) 276 ITR 347 (P & H), IT WAS HEL D THAT THE RESPONDENTS DID NOT HAVE THE LOCUS STANDI TO QUESTI ON THE ORDERS OF REASSESSMENT ON THE GROUND OF LACK OF NOT ICE. NON- ISSUANCE OF NOTICE TO SOME OF THE LEGAL HEIRS OF TH E LATE P WAS MERELY AN IRREGULARITY AND THE SAME DID NOT AFFECT THE VALIDITY OF THE REASSESSMENT ORDERS. LIKEWISE, IN TILAK RAJ BEDI V. JOINT CIT, (2009) 319 ITR 385 (P & H), WHEREIN, FAC TS COMING TO LIGHT IN A SUBSEQUENT ASSESSMENT YEAR COULD VALI DLY FORM THE BASIS FOR INITIATING REASSESSMENT PROCEEDINGS, IN VIEW OF EXPLANATION 2 TO SECTION 147. THE ACTION OF THE INC OME TAX AUTHORITIES IN REOPENING THE ASSESSMENT OF THE ASSE SSEE AND RESTRICTING THE DEDUCTION UNDER SECTION 80-IB WAS H ELD TO BE VALID. 2.15. IN THE CASE OF SMT. USHA RANI V. CIT, (2008) 301 ITR 121 (P & H), THERE WAS NOTHING ON RECORD TO SHOW TH E RELATIONSHIP BETWEEN THE DONOR AND THE DONEE, CAPAC ITY OF THE DONOR TO MAKE GIFTS AND THE OCCASION THEREFORE. THE ASSESSEE HAD FAILED TO DISCHARGE THE ONUS TO PROVE THE GIFTS . THE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 19 REASSESSMENT PROCEEDINGS WERE HELD TO BE VALID. IN THE CASE OF USHA BELTRON LTD. V. JOINT CIT, (1999) 240 ITR 728, 736-37, 739 (PAT), WHERE THE INVESTIGATION REPORT INDICATED THAT THE OFFICER HAD REASON TO BELIEVE THAT ON ACCOUNT OF FA ILURE ON THE PART OF THE PETITIONER-ASSESSEE TO DISCLOSE TRUE AN D FULL FACTS, INCOME HAD BEEN GROSSLY UNDER ASSESSED, REASSESSMEN T PROCEEDINGS WERE HELD VALIDLY INITIATED. 2.16. IN THE CASE OF KAPOOR BROTHERS V. UNION OF I NDIA, (2001) 247 ITR 324, 331, 332-33 (PAT), WHERE THE MA TERIAL EVIDENCE FOR THE PURPOSE OF REOPENING OF THE ASSESS MENT ALREADY COMPLETED HAS BEEN BROUGHT TO THE NOTICE OF THE AUTHORITY DURING THE COURSE OF ENQUIRY. THE NOTICE WAS HELD TO BE VALID BY THE HONBLE HIGH COURT. IN THE CASE OF VIPPY PROCESSORS PVT. LTD. V. CIT, (2001) 249 ITR 7, 8 (M P), WHERE THE NEED TO ISSUE NOTICE AROSE DUE TO NOTICING OF VAST DIFFERENCE IN VALUE OF PROPERTIES DISCLOSED BY THE ASSESSEE AND T HAT OF THE REPORT OF THE VALUATION OFFICER AND THE REASONS THA T LED TO THE ISSUE OF THE NOTICE WERE DULY RECORDED AND THE SAME WERE ALSO ADEQUATE AND BASED ON RELEVANT FACTS AND MATERIAL, INITIATION WAS UPHELD. IN TRIPLE A TRADING & INVESTMENT PVT. LTD. V. ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 20 ASST. CIT, (2001) 249 ITR 109, 110-11 (MP), WHERE T HE NOTICE WAS ISSUED AFTER RECORDING REASONS IN THAT REGARD, INITIATION WAS UPHELD. 2.17. LIKEWISE, HONBLE GUJARAT HIGH COURT IN GARD EN FINANCE LTD. V. ADD/. CIT, (2002) 257 ITR 481, 489, 494-95, SPECIAL LEAVE PETITION DISMISSED BY THE SUPREME COU RT: (2002) 255 ITR (ST.) 7-8 (SC), WHERE THE ASSESSEE WAS HOLD ING SHARES IN AN AMALGAMATING COMPANY AND HE WAS ALLOTTED SHAR ES IN THE AMALGAMATED COMPANY AND SUCH SHARES WERE SOLD B Y HIM AND HE HAS DISCLOSED THE MARKET PRICE OF SUCH SHARE S AS ON THE DATE OF AMALGAMATION AS THE COST OF ACQUISITION OF SUCH SHARES AND HAS NOT DISCLOSED THE COST OF ACQUISITIO N OF SHARES IN THE AMALGAMATING COMPANY IN ACCORDANCE WITH SECT ION 49(2) READ WITH SECTION 47(VII), INITIATION OF REAS SESSMENT PROCEEDINGS AFTER FOUR YEARS HAS BEEN SUSTAINED BEC AUSE THERE WAS FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE MATERIAL FACTS NECESSARY FOR ASSESSMENT. LIKEWISE, IN SUMAN STEELS V. UNION OF INDIA, (2004) 269 ITR 412,418-19 (RAJ), WHERE THE RETURN OF THE ASSESSEE FOR ASSESSMENT YEAR 1995-96 WAS PROCESSED UNDER SECTION 143(1)(A) ACCEPTING THE NET PROFIT RATE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 21 DECLARED BY THE ASSESSEE, WHO CARRIED ON CON- TRACT BUSINESS, INITIATION OF REASSESSMENT PROCEEDINGS BY ISSUING A NOTICE DATED 15-5-2001 PROPOSING TO REASSESS PETITIONER-AS SESSEE AT HIGHER RATE IN VIEW OF THE PRESUMPTIVE RATE PRESCRI BED UNDER SECTION 44AD HAS BEEN SUSTAINED. IN THE CASE OF D R. SAHIB RAM GIRI V. ITO, (2008) 301 ITR 294 (RAJ), THE REAS SESSMENT PROCEEDINGS WERE INITIATED AFTER RECORDING REASONS IN WRITING BY THE AO. THE NON-AVAILABILITY OF A FEW DOCUMENTS DEM ANDED BY THE ASSESSEE WOULD NOT MAKE THE REASSESSMENT PROCEE DINGS INITIATED FOR THE REASONS RECORDED IN DETAIL ILLEGA L. 2.18. IN THE CASE OF DESH RAJ UDYOG : CHAMAN UDYOG V. ITO, (2009) 318 ITR 6 (ALL), IN THE ASSESSMENT YEAR S IN QUESTION, THE MATTER WAS STILL TO BE DECIDED FINALL Y BY THE ASSESSING AUTHORITY WHETHER THE INCOME SHOULD BE TR EATED UNDER THE HEAD 'BUSINESS INCOME' OR 'PROPERTY INCOM E'. THE ASSESSEE WOULD GET OPPORTUNITY TO SHOW SUFFICIENT C AUSE TO THE ASSESSING AUTHORITY DURING THE COURSE OF ASSESSMENT . THUS, IT COULD NOT BE SAID THAT THERE WAS NO RELEVANT MATERI AL TO INITIATE PROCEEDINGS UNDER SECTION 147. IN THE CAS E OF KARTIKEYA INTERNATIONAL V. CIT, (2010) 329 ITR 539 (ALL), IN VIEW ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 22 OF THE MATTER, THE PETITIONER WAS NOT ENTITLED FOR THE DEDUCTION ON THE DUTY DRAWBACK AMOUNT UNDER SECTION 80-IB AND SINCE IT HAD BEEN ALLOWED IN THE ASSESSMENT ORDER PASSED UNDER SECTION 143(1), IT HAD ESCAPED ASSESSMENT. ON THESE FACTS THE INITIATION OF THE PROCEEDINGS UNDER SECTION 147 REA D WITH SECTION 148 FOR ASSESSMENT YEARS 2005-06 AND 2006-0 7 WAS LEGAL AND IN ACCORDANCE WITH LAW. 2.19. LIKEWISE, IN THE CASE OF SUNIL KUMAR LAIN: S URESH CHANDRA LAIN V. ITO, (2006) 284 ITR 626 (ALL), NOTW ITHSTANDING THE FACT THAT THE AMOUNT HAD BEEN ASSESSED TO TAX I N THE HANDS OF P, HE HAD TAKEN A STAND THAT THE AMOUNT DI D NOT BELONG TO HIM AND INSTEAD BELONGED TO S. THUS, IT W AS NOT CLEAR AS TO IN WHOSE HANDS THE AMOUNT IN QUESTION H AD TO BE ASSESSED. THE ITO WAS JUSTIFIED IN TAKING PROCEEDIN GS UNDER SECTION 147 FOR ASSESSING THE AMOUNTS IN THE HANDS OF THE PETITIONERS ACCORDING TO THE CLAIM MADE BY THE PETI TIONERS. LIKEWISE, HONBLE KERALA HIGH COURT IN CIT V. DR. S ADIQUE UMMER, (2010) 322 ITR 602 (KER), WHERE, THE ASSESSI NG OFFICER COLLECTED FURTHER INFORMATION TO COMPLETE THE REASS ESSMENTS WHICH WAS ALSO PERMISSIBLE UNDER THE ACT. THE FINDI NG OF THE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 23 FIRST APPELLATE AUTHORITY AS WELL AS THE TRIBUNAL, THAT THE ASSESSING OFFICER HAD NO MATERIAL TO BELIEVE THAT T HE INCOME HAD ESCAPED ASSESSMENT WAS WRONG AND CONTRARY TO FA CTS. THE ASSESSEE HAD NOT MAINTAINED ANY BOOKS OF ACCOUNT. T HEREFORE, THE REOPENING OF ASSESSMENTS WAS HELD TO BE VALID A ND WITHIN TIME. IN THE CASE OF CIT V. UTTAM CHAND NAHAR, (2 007) 295 ITR 403 (RAJ), THE NOTICE REQUIRING THE ASSESSEE TO FILE THE RETURN WITHIN 30 DAYS WAS IN ACCORDANCE WITH SECTIO N 148 AS IT MUST BE DEEMED TO BE IN FORCE WITH EFFECT FROM 1-4- 1989, AND IN FORCE AS ON THE DATE NOTICE WAS ISSUED. THERE WA S NO VIOLATION OF SECTION 148 IN RESPECT OF THE SPECIFIE D PERIOD WITHIN WHICH THE RETURN IS TO BE SUBMITTED. THE REASSESSME NT PROCEEDINGS WERE HELD TO BE VALID. 2.20. IN THE CASE OF CIT V. C. V. LAYACHANDRAN, (2 010) 322 ITR 520 (KER), WHERE, THE ASSESSEE DID NOT CONCEDE THE INCOME ON CAPITAL GAIN EITHER UNDER THE UN-AMENDED PROVISI ON OR UN-DER THE AMENDED PROVISION, THE RECOURSE OPEN TO THE DEPARTMENT WAS TO BRING TO TAX INCOME ESCAPING ASSE SSMENT UNDER SECTION 147 WHICH WAS NOT TIME BARRED OR OTHE RWISE INVALID. LIKEWISE, IN ATUL TRADERS V. ITO, (2006) 282 ITR 536 ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 24 (ALL), THE ACCOUNT BOOKS OR RECORD AND OTHER MATERI AL WERE ALL COMMON WHICH WERE BEING CONSIDERED BY THE CIT(A) IN THE PROCEEDINGS RELATING TO THREE APPEALS. THE PETITION ER HAD NOTICE AND OPPORTUNITY OF BEING HEARD. THE REASSESS MENT PROCEEDINGS WERE HELD TO BE VALIDLY INITIATED. IN THE CASE OF INDUCTOTHERM (INDIA) P. LTD. V. LAMES KURIAN, ASST. CIT, (2007) 294 ITR 341 (GUJ), THE ASSESSING OFFICER HAD FOUND THAT THERE WERE ERRORS IN THE COMPUTATION OF ALLOWANCES. THE REASSESSMENT PROCEEDINGS WERE HELD TO BE VALID. IN THE CASE OF PAPAYA FARMS PVT. LTD. VS. DCIT, (2010) 323 ITR 60 (MAD), WHERE THE ASSESSEE HAD FURNISHED INCORRECT PARTICUL ARS AND THEREFORE, THE REOPENING OF THE ASSESSMENT WAS HELD TO BE JUSTIFIED. 2.21. IN THE CASE OF CIT V. KERALA STATE CASHEW DEVELOPMENT CORPORATION LTD., (2006) 286 ITR 553 (K ER), WHEREIN, THE ASSESSEE WAS FOLLOWING THE MERCANTILE SYSTEM OF ACCOUNTING SHOULD NOT HAVE CLAIMED DEDUCTION OF PEN AL INTEREST WHICH HAD ACCRUED NOT IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR BUT IN EARLIER YEARS. THIS THE ASSESSEE HAD NOT DISCLOSED. THE REASSESSMENT WAS HELD TO BE VALID. ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 25 LIKEWISE, IN KUSUM INDUSTRIES P. LTD. V. CIT, (200 8) 296 ITR 242 (ALL), AS THE AWARD HAD BECOME FINAL IT WOULD B E TAKEN THAT THE DIRECTORS OF THE ASSESSEE HAD ACCEPTED THE FACT UM OF EARNING OF SECRET PROFIT NOT REFLECTED IN THE BOOKS OF ACCOUNT, WHICH WAS ALSO BINDING ON THE COMPANY. THE NON-APPE ARANCE OF ONE OF THE ARBITRATORS AND ONE OF THE DIRECTORS IN RESPECT OF THE SUMMON ISSUED UNDER SECTION 131 WOULD NOT MAKE THE REASSESSMENT INVALID. THE HONBLE KERALA HIGH COURT IN CIT V. INDO MARINE AGENCIES (KERALA) P. LTD., (2005) 279 I TR 372 (KER), HELD THAT THE ENTRY WOULD AMOUNT TO AN ORDER UNDER SECTION 144. THE MERE FACT THAT IT WAS NOT COMMUNIC ATED TO THE ASSESSEE WOULD NOT MAKE SUCH AN ASSESSMENT RECO RDED IN THE ORDER SHEET ILLEGAL AND THAT WOULD NOT BAR FURT HER PROCEEDINGS UNDER SECTION 147. THUS, THE ASSESSMENT WAS HELD TO BE VALIDLY REOPENED UNDER EXPLANATION 2(C) TO SECTION 147. LIKEWISE, IN CIT V. N. JAYAPRAKASH, (2006) 28 5 ITR 369 (KER), WHERE, THE ASSESSEE COULD NOT, AFTER HAVING PERSUADED THE ASSESSING AUTHORITY TO WITHDRAW THE NOTICE DATE D 1-10- 1993, POINTING OUT THAT IT WAS NOT IN CONFORMITY WI TH LAW, BE ALLOWED TO CONTEND THAT THE NOTICE WAS VALID DUE TO THE OMISSION OF THE TIME-LIMIT BY THE FINANCE (NO.2) AC T, 1996, ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 26 WITH EFFECT FROM 1-4-1989. IN THE ABSENCE OF SPECIF IC PROVISION IN THE FINANCE (NO. 2) ACT, 1996, INVALIDATING PROC EEDINGS INITIATED BY THE INCOME-TAX OFFICER, THE ACTION TAK EN BY HIM APPLYING THE THEN EXISTING LAW COULD NOT BE SAID TO BE INVALID. 2.22. LIKEWISE, IN CIT V. S.R. TALWAR, (2008) 305 ITR 286 (ALL), THE FACTUM OF TAKING ADVANCES OR LOAN FROM T AND K, IN WHICH THE ASSESSEE WAS ONE OF THE DIRECTORS HAD NOT BEEN DISCLOSED NOR A COPY OF THE LEDGER ACCOUNT OF THE A SSESSEE MAINTAINED BY THE COMPANY FILED. IN VIEW OF THE ABS ENCE OF THESE DETAILS, THE ASSESSING OFFICER COULD NOT EXAM INE THE TAXABILITY OF ADVANCES OR LOAN RAISED BY THE ASSESS EE. THERE WAS FAILURE TO DISCLOSE MATERIAL FACTS NECESSARY FO R ASSESSMENT. THE REASSESSMENT PROCEEDINGS WERE HELD TO BE VALID. IN ANOTHER CASE, THE HONBLE ALLAHABAD HIGH COURT IN C HANDRA PRAKASH AGRAWAL V. ASST. CIT, (2006) 287 ITR 172 (A LL), WHEREIN, THE INCOME-TAX DEPARTMENT HAD SENT A REQUI SITION ON 27-3-2002, UNDER SECTION 132A REQUISITIONING THE BO OKS OF ACCOUNT AND OTHER DOCUMENTS SEIZED BY THE CENTRAL E XCISE DEPARTMENT. THE RECORD OF THE PROCEEDING DATED 18-4 -2002, SHOWED THAT THE REQUISITION WAS NOT FULLY EXECUTED AS ALL THE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 27 BOOKS OF ACCOUNT AND OTHER DOCUMENTS HAD NOT BEEN D ELIVERED TO THE REQUISITIONING AUTHORITY. THE PROCEEDINGS IN ITIATED UNDER SECTION 147 WAS HELD TO BE VALID. 2.23. IN RAMILABEN RATILAL SHAH V. CIT, (2006) 282 ITR 176 (GUJ), HELD THAT THE NOTING IN THE DIARY CONSTI TUTED SUFFICIENT INFORMATION FOR THE ESCAPEMENT OF INCOME BY EITHER NON-DECLARATION OF CORRECT SALE CONSIDERATIO N OR FURNISHING OF INACCURATE PARTICULARS AS REGARDS SAL E CONSIDERATION. THUS, THE TRIBUNAL WAS JUSTIFIED IN HOLDING THAT THE ASSESSEE HAD FAILED TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR THE ASSESSMENT OF THE RELEVANT ASSESSMENT YEAR. THE REASSESSMENT PROCEEDINGS HAD B EEN VALIDLY INITIATED. LIKEWISE, IN CIT V. ABDUL KHADER AHAMED, (2006) 28 5 ITR 57 (KER), IT WAS CLEAR FROM THE REASONS RECORDE D BY THE DEPUTY CIT THAT HE PRIMA FACIE HAD REASON TO BELIEV E THAT THE ASSESSEE HAD OMITTED TO DISCLOSE FULLY AND TRULY TH E MATERIAL FACTS AND THAT AS A CONSEQUENCE INCOME HAD ESCAPED ASSESSMENT. THE REASSESSMENT WAS HELD TO BE VALID. IN THE CASE OF U.P. STATE BRASSWARE CORPORATION LTD. V. CI T, (2005) ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 28 277 ITR 40 (ALL), THE PRINCIPLES LAID DOWN BY THE C ALCUTTA HIGH COURT IN CIT V. NEW CENTRAL JUTE MILLS CO. LTD. : ( 1979) 118 ITR 1005 (CAL) DID CONSTITUTE INFORMATION ON A POIN T OF LAW WHICH SHOULD BE TAKEN INTO CONSIDERATION BY THE ITO IN FORMING HIS BELIEF THAT THE INCOME TO THAT EXTENT H AD ESCAPED ASSESSMENT TO TAX AND, THE REASSESSMENT WAS HELD TO BE VALID. IN SUNDER CARPET INDUSTRIES V. ITO, (2010) 324 ITR 417 (ALL), HELD THAT THE DEPARTMENTAL VALUER'S REPORT CONSTITU TED MATERIAL FOR ENTERTAINING A BELIEF OF ESCAPED INCOM E IN THE YEARS UNDER CONSIDERATION. THE REASSESSMENT PROCEED ING WAS HELD TO BE VALID. 2.24. IN AUROBINDO SANITARY STORES V. CIT, (2005) 276 ITR 549 (ORI), THERE BEING A SUBSTANTIAL DIFFERENCE BET WEEN THE FIGURES OF LIABILITIES TOWARDS SUNDRY CREDITORS IN THE PARTY LEDGERS OF THE ASSESSEE-FIRM AND THE FIGURES OF LIA BILITIES TOWARDS SUNDRY CREDITORS IN THE BALANCE-SHEET OF TH E ASSESSEE- FIRM FOR THE PREVIOUS YEAR RELEVANT TO THE ASSESSME NT YEAR 1989-90. THESE MATERIALS HAD A DIRECT LINK AND NEXU S FOR FORMATION OF A BELIEF BY THE ASSESSING OFFICER THAT INCOME OF THE ASSESSEE-FIRM HAD ESCAPED ASSESSMENT BECAUSE OF FAILURE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 29 OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MAT ERIAL FACTS NECESSARY FOR THE ASSESSMENT. IN THE CASE OF CIT V . BEST WOOD INDUSTRIES & SAW MILLS, (2011) 331 ITR 63 (KER), TH E ASSESSEE CHALLENGED THE VALIDITY OF THE REASSESSMENT ON THE GROUND THAT THE AO HAD EXCEEDED HIS JURISDICTION UNDER SECTION 147 AND BOTH THE FIRST APPELLATE AUTHORITY AS WELL AS THE T RIBUNAL ACCEPTED THE CONTENTION OF THE ASSESSEE HOLDING THA T SO FAR AS THE REASSESSMENTS RELATED TO ASSESSMENT OF UNEXPLAI NED TRADE CREDITS, THEY WERE INVALID. ON APPEAL, IT HAS BEEN HELD THAT THE REASSESSMENTS WERE TO BE VALID. IN HONDA SIEL POWE R PRODUCTS LTD. V. DEPUTY CIT, (2012) 340 ITR 53 (DEL), THERE BEING OMISSION AND FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY MATERIAL FACTS THUS REASSESSMENT PR OCEEDINGS WERE HELD TO BE VALID. IN ATMA RAM PROPERTIES PRIVATE LTD. V. DEPUTY CIT, (2012) 343 ITR 141 (DEL), AS THE BOOKS OF ACCOUNT A ND OTHER MATERIAL WERE NOT PRODUCED AND NO LETTER WAS FILED, THE ORDER PASSED BY THE COMMISSIONER (APPEALS) IN THE ASSESSM ENT YEAR 2001-02 WOULD CONSTITUTE 'INFORMATION' OR MATERIAL FROM ANY EXTERNAL SOURCE AND, AS SUCH, THE REASSESSMENT PROC EEDINGS ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 30 FOR THE ASSESSMENT YEAR 2000-01 WERE HELD TO BE VAL ID. LIKEWISE, IN THE CASE OF CIT V. SMT. R. SUNANDA BA I, (2012) 344 ITR 271 (KER), THE REASSESSMENT IN QUESTION WER E HELD TO BE VALID ON THE FACT THAT THE ASSESSEE CLAIMED AND WAS GIVEN RELIEF UNDER SECTION 80HHA FOR THE THREE PRECEDING YEAR WHICH DISENTITLED HER FOR DEDUCTION UNDER SECTION 80HH FO R THE ASSESSMENT YEARS 1992-93 AND 1993-94. 2.25. IN THE CASE OF AQUAGEL CHEMICALS P. LTD. V. ASST. CIT, (2013) 353 ITR 131 (GUJ), SINCE THERE BEING SU FFICIENT MATERIAL ON RECORD FOR THE ASSESSING OFFICER TO FOR M A BELIEF AS REGARDS THE ESCAPEMENT OF INCOME IN RELATION TO THE CLAIM OF DEPRECIATION IN RESPECT OF THE BUILDING OF COAL FIR E BOILER, THE REASSESSMENT WAS HELD TO BE VALID. IN THE CASE OF CONVERGYS CUSTOMER MANAGEMENT V. ASST. DIT, (2013) 357 ITR 17 7 (DEL), WHERE THERE BEING PRIMA FACIE MATERIAL IN THE POSSE SSION OF THE ASSESSING OFFICER TO FORM A TENTATIVE BELIEF THAT S ECTION 9(1)(I) HELD ATTRACTED, SAID REASON BY ITSELF CONSTITUTED A RELEVANT GROUND TO REOPEN THE ASSESSMENT OF THE ASSESSEE. REFERENCE CAN ALSO BE MADE TO FOLLOWING CASES AND T HE RATIO LAID DOWN THEREIN:- ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 31 I. AJAI VERMA V. CIT [(2008) 304 ITR 30 (ALL)]; II. ASHOK ARORA V. CIT [(2010) 321 ITR 171 (DEL)]; III. CIT V. CHANDRASEKHAR BALAGOPAL [(2010) 328 ITR 619 (KER)]; IV. JAYARAM PAPER MILLS LTD. V. CIT [(2010) 321 ITR 56 ( MAD)]; V. KERALA FINANCIAL CORPORATION V. JOINT CIT [(2009) 30 8 ITR 434 (KER)]; VI. MAVIS SATCOM LTD. V. DEPUTY CIT [(2010) 325 ITR 428 ( MAD)]; VII. CIT V. MADHYA BHARAT ENERGY CORPORATION LTD. [(2011) 3 37 ITR 389 (DEL)]; VIII. KONE ELEVATOR INDIA P. LTD. V. ITO [(2012) 340 ITR 45 4 (MAD)]; IX. VIJAY KUMAR SABOO V. ASST. CIT [(2012) 340 ITR 382 ( KARN)]; X. SIEMENS INFORMATION SYSTEMS LTD. V. ASST. CIT [(2012) 3 43 ITR 188 (BOM)]; XI. I.P. PATEL & CO. V. DEPUTY CIT [(2012) 346 ITR 207 (GUJ)]; XII. DISHMAN PHARMACEUTICALS & CHEMICALS LTD. V. DEPUTY CI T [(2012) 346 ITR 228 (GUJ)]; XIII. VIDEO ELECTRONICS LTD. V. JOINT CIT [(2013) 353 ITR 73 (DEL)]; XIV. A G GROUP CORPORATION V. HARSH PRAKASH [(2013) 353 I TR 158 (GUJ)]; XV. INDUCTOTHERM (INDIA) P. LTD. V. M. GOPALAN, DEPUTY CIT [(2013) 356 ITR 481 (GUJ)]; CIT V. DHANALEKSHMI BAN K LTD. [(2013) 357 ITR 448 (KER)]; XVI. SITARA DIAMOND PVT. LTD. V. ITO [(2013) 358 ITR 424 (B OM)]; XVII. RAYALA CORPORATION P. LTD. V. ASST. CIT [(2014) 363 I TR 630 (MAD)]. 2.26. SO FAR AS, THE DECISION IN THE CASE OF CIT V S KELVINATOR OF INDIA LTD. (2010) 320 ITR 561 (SC) IS CONCERNED, THE HONBLE APEX COURT, WHILE COMING TO A PARTICULA R ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 32 CONCLUSION, ONLY IN A SITUATION, WHEN NOT A SINGLE PIECE OF PAPER OR DOCUMENT WAS RECOVERED, THEREFORE, THE HON BLE COURT HELD THAT SINCE THERE WAS NO TANGIBLE MATERIA L FOUND AND THE ADDITION WAS MERELY ON THE BASIS OF STATEME NT ONLY THEN REOPENING OF ASSESSMENT U/S 147 OF THE ACT WAS NOT PERMISSIBLE. IT IS FURTHER NOTED THAT RETRACTION WA S MADE BY THE ASSESSEE, MERELY AFTER A LONG GAP OF MORE THAN TWO YEARS AND NOT AT THE EARLIEST POSSIBLE TIME. IT WAS MEREL Y AS AFTERTHOUGHT. THERE IS A POSSIBILITY THAT THE STAT EMENT, IF, RECORDED UNDER DURESS AND THREAT (WHICH IS NOT THE CASE IN THE PRESENT APPEALS) IN THAT SITUATION, THERE IS A LESS POSSIBILITY OF RETRACTION DURING THAT PERIOD, HOWEVER, IF THE RETR ACTION IS MADE WITHIN SHORT SPAN OF TIME THEN RETRACTION CARR IES MORE WEIGHT. THE ASSESSEE NEVER ALLEGED THAT THE STATEM ENT WAS RECORDED UNDER DURESS AND THREAT. LIKEWISE, IN THE CASE OF CIT VS S. KHADER KHAN SON (2012) 254 CTR 228 (SC), AFFI RMING THE DECISION OF MADRAS HIGH COURT IN (2008) 300 ITR 157 (MAD.), THE WHOLE ADDITION WAS MADE SOLELY ON THE BASIS OF STATEMENT U/S 133A AND NO OTHER MATERIAL WAS FOUND, IN THAT S ITUATION, IT WAS HELD THAT THE SUCH STATEMENT HAS NO EVIDENTI ARY VALUE, THUS, UNDER THE PECULIAR FACTS IN THE PRESENT APPEA L, THE CASES ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 33 RELIED UPON BY THE ASSESSEE ARE NOT OF MUCH HELP AS IS CLEARLY OOZING OUT FROM THE CONTENTS OF THE STATEMENT TENDE RED BY THE ASSESSEE WITHOUT DURESS OR THREAT, CONNECTING THE A SSESSEE OF NON-RECORDING OF PURCHASE AND SALE IN THE REGULAR B OOKS OF ACCOUNTS. IF THE MATERIAL AVAILABLE ON RECORD AND THE JUDICI AL PRONOUNCEMENTS DISCUSSED HEREINABOVE ARE KEPT IN JUXTAPOSITION WITH THE FACTS OF THE PRESENT APPEAL, WE FIND THAT THERE WAS REASONABLE BELIEF WITH THE LD. ASSESSING OFFICER THAT INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT AS THE LD. ASSESSING OFFICER MADE PAYMENT TO THE NON-RESIDENT FILM DISTRIBUTOR WITHOUT DEDUCTING TDS, THEREFORE, WE AR E OF THE OPINION THAT, SO FAR AS, INITIATION OF PROCEEDINGS U/S 147 R.W.S. 148 OF THE ACT ARE CONCERNED, THE LD. ASSESSING OFF ICER WAS JUSTIFIABLY WITHIN THE PARAMETER OF THE LAW TO REOP EN THE ASSESSMENT, THEREFORE, WE AFFIRM THE STAND OF THE L D. FIRST APPELLATE AUTHORITY, RESULTING INTO DISMISSAL OF TH E IMPUGNED GROUND RAISED BY THE ASSESSEE. 3. SO FAR AS, THE MERIT OF THE CASE WITH RESPECT T O DISALLOWANCE OF ` 30,94,732/- MADE U/S 40(A) FOR NON- ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 34 DEDUCTION OF TAX AT SOURCE U/S 195 OF THE ACT, ON T HE PAYMENT MADE A NON-RESIDENT COMPANY IS CONCERNED, THE ARGUM ENT OF THE LD. COUNSEL IS THAT A NON-RESIDENT COMPANY IS E XCLUDED FROM THE DEFINITION OF ROYALTY, PER CLAUSE (V) TO E XPLANATION-2 TO SECTION 9(1)(VI) OF THE ACT. RELIANCE WAS PLACED UPON THE DECISION IN THE CASE OF CHANNEL GUIDE INDIA LTD. VS ACIT (2012) 25 TAXMAN.COM 25 (MUM.). IT WAS ALSO PLEADE D THAT WHEN THE PAYMENT WAS MADE, THERE WAS NO SUCH PROVIS ION IN THE ACT, THEREFORE, RELIANCE WAS PLACED UPON THE DE CISION FROM HON'BLE APEX COURT IN THE CASE OF KRISHNASWAMY S. P D. VS UOI (2006) 281 ITR 305 (SC). IT WAS ALSO PLEADED T HAT THE DECISION IN THE CASE OF G.E. INDIA (327 ITR 456)(SC ) FAVOURS THE CASE OF THE ASSESSEE. OUR ATTENTION WAS INVITED TO SECTION 40(A) OF THE ACT. 3.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. BEFORE AD VERTING FURTHER, WE ARE REPRODUCING HEREUNDER THE RELEVANT PROVISION OF SECTION 40(A) OF THE ACT:- 40. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN SECTIO NS 30 TO 38, THE FOLLOWING AMOUNTS SHALL NOT BE DEDUCTED IN COMPUTIN G THE INCOME ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 35 CHARGEABLE UNDER THE HEAD 'PROFITS AND GAINS OF BUS INESS OR PROFESSION', ( A ) IN THE CASE OF ANY ASSESSEE ( I ) ANY INTEREST (NOT BEING INTEREST ON A LOAN ISSUE D FOR PUBLIC SUBSCRIPTION BEFORE THE 1ST DAY OF APRIL, 1938), RO YALTY, FEES FOR TECHNICAL SERVICES OR OTHER SUM CHARGEABLE UNDER THIS ACT, WH ICH IS PAYABLE, ( A ) OUTSIDE INDIA; OR ( B ) IN INDIA TO A NON-RESIDENT, NOT BEING A COMPANY OR TO A FOREIGN COMPANY, ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII-B AND SUCH TAX HAS NOT BEEN DEDUCTED OR, AFTER DEDUCTION, HAS NOT BEEN PAID ON OR BEFORE THE DUE DATE SPECIFIED IN SUB-SECTION (1) OF SECTIO N 139 : PROVIDED THAT WHERE IN RESPECT OF ANY SUCH SUM, TAX HAS BEE N DEDUCTED IN ANY SUBSEQUENT YEAR, OR HAS BEEN DEDUCTED DURING THE PREVIOUS YEAR BUT PAID AFTER THE DUE DATE SPECIFIED IN SUB-SECTIO N (1) OF SECTION 139, SUCH SUM SHALL BE ALLOWED AS A DEDUCTION IN COMPUTI NG THE INCOME OF THE PREVIOUS YEAR IN WHICH SUCH TAX HAS BEEN PAID. EXPLANATION. FOR THE PURPOSES OF THIS SUB-CLAUSE, ( A ) 'ROYALTY' SHALL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE ( VI ) OF SUB-SECTION (1) OF SECTION 9; ( B ) 'FEES FOR TECHNICAL SERVICES' SHALL HAVE THE SAM E MEANING AS IN EXPLANATION 2 TO CLAUSE ( VII ) OF SUB-SECTION (1) OF SECTION 9; ( IA ) THIRTY PER CENT OF ANY SUM PAYABLE TO A RESIDENT, ON WHICH TAX IS DEDUCTIBLE AT SOURCE UNDER CHAPTER XVII-B AND SUCH TAX HAS NOT BEEN DEDUCTED OR, AFTER DEDUCTION, HAS NOT BEEN PAID ON OR BEFORE THE DUE DATE SPECIFIED IN SUB-SECTION (1) OF SECTION 139 : PROVIDED THAT WHERE IN RESPECT OF ANY SUCH SUM, TAX HAS BEEN DEDUCTED IN ANY SUBSEQUENT YEAR, OR HAS BEEN DEDUCTED DURING THE PREVIOUS YEAR BUT PAID AFTER THE DUE DATE SPECIFIED IN SUB-SECTIO N (1) OF SECTION 139, THIRTY PER CENT OF SUCH SUM SHALL BE ALLOWED AS A D EDUCTION IN COMPUTING THE INCOME OF THE PREVIOUS YEAR IN WHICH SUCH TAX H AS BEEN PAID : PROVIDED FURTHER THAT WHERE AN ASSESSEE FAILS TO DEDUCT THE WHOLE O R ANY PART OF THE TAX IN ACCORDANCE WITH THE PROVISIO NS OF CHAPTER XVII-B ON ANY SUCH SUM BUT IS NOT DEEMED TO BE AN ASSESSEE IN DEFAULT UNDER THE FIRST PROVISO TO SUB-SECTION (1) OF SECTION 201, TH EN, FOR THE PURPOSE OF THIS SUB-CLAUSE, IT SHALL BE DEEMED THAT THE ASSESS EE HAS DEDUCTED AND PAID THE TAX ON SUCH SUM ON THE DATE OF FURNISHING OF RETURN OF INCOME BY THE RESIDENT PAYEE REFERRED TO IN THE SAID PROVISO. EXPLANATION. FOR THE PURPOSES OF THIS SUB-CLAUSE, ( I ) 'COMMISSION OR BROKERAGE' SHALL HAVE THE SAME MEA NING AS IN CLAUSE ( I ) OF THE EXPLANATION TO SECTION 194H; ( II ) 'FEES FOR TECHNICAL SERVICES' SHALL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE ( VII ) OF SUB-SECTION (1) OF SECTION 9; ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 36 ( III ) 'PROFESSIONAL SERVICES' SHALL HAVE THE SAME MEANI NG AS IN CLAUSE ( A ) OF THE EXPLANATION TO SECTION 194J; ( IV ) 'WORK' SHALL HAVE THE SAME MEANING AS IN EXPLANATION III TO SECTION 194C; ( V ) 'RENT' SHALL HAVE THE SAME MEANING AS IN CLAUSE ( I ) TO THE EXPLANATION TO SECTION 194-I; ( VI ) 'ROYALTY' SHALL HAVE THE SAME MEANING AS IN EXPLANATION 2 TO CLAUSE ( VI ) OF SUB-SECTION (1) OF SECTION 9; [( IB ) ANY CONSIDERATION PAID OR PAYABLE TO A NON-RESIDE NT FOR A SPECIFIED SERVICE ON WHICH EQUALISATION LEVY IS DEDUCTIBLE UN DER THE PROVISIONS OF CHAPTER VIII OF THE FINANCE ACT, 2016, AND SUCH LEV Y HAS NOT BEEN DEDUCTED OR AFTER DEDUCTION, HAS NOT BEEN PAID ON O R BEFORE THE DUE DATE SPECIFIED IN SUB-SECTION (1) OF SECTION 139 : PROVIDED THAT WHERE IN RESPECT OF ANY SUCH CONSIDERATION, T HE EQUALISATION LEVY HAS BEEN DEDUCTED IN ANY SUBSEQUE NT YEAR OR HAS BEEN DEDUCTED DURING THE PREVIOUS YEAR BUT PAID AFTER TH E DUE DATE SPECIFIED IN SUB-SECTION (1) OF SECTION 139, SUCH SUM SHALL BE A LLOWED AS A DEDUCTION IN COMPUTING THE INCOME OF THE PREVIOUS YEAR IN WHI CH SUCH LEVY HAS BEEN PAID;] ( IC ) ANY SUM PAID ON ACCOUNT OF FRINGE BENEFIT TAX UND ER CHAPTER XIIH; ( II ) ANY SUM PAID ON ACCOUNT OF ANY RATE OR TAX LEVIE D ON THE PROFITS OR GAINS OF ANY BUSINESS OR PROFESSION OR ASSESSED AT A PROPORTION OF, OR OTHERWISE ON THE BASIS OF, ANY SUCH PROFITS OR GAIN S. EXPLANATION 1. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED TH AT FOR THE PURPOSES OF THIS SUB-CLAUSE, ANY SUM PAID ON AC COUNT OF ANY RATE OR TAX LEVIED INCLUDES AND SHALL BE DEEMED ALWAYS TO H AVE INCLUDED ANY SUM ELIGIBLE FOR RELIEF OF TAX UNDER SECTION 90 OR, AS THE CASE MAY BE, DEDUCTION FROM THE INDIAN INCOME-TAX PAYABLE UNDER SECTION 91. EXPLANATION 2. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED TH AT FOR THE PURPOSES OF THIS SUB-CLAUSE, ANY SUM PAID ON AC COUNT OF ANY RATE OR TAX LEVIED INCLUDES ANY SUM ELIGIBLE FOR RELIEF OF TAX UNDER SECTION 90A; ( IIA ) ANY SUM PAID ON ACCOUNT OF WEALTH-TAX. EXPLANATION. FOR THE PURPOSES OF THIS SUB-CLAUSE, 'WEALTH-TAX' MEANS WEALTH-TAX CHARGEABLE UNDER THE WEALTH-TAX ACT, 195 7 (27 OF 1957), OR ANY TAX OF A SIMILAR CHARACTER CHARGEABLE UNDER ANY LAW IN FORCE IN ANY COUNTRY OUTSIDE INDIA OR ANY TAX CHARGEABLE UNDER S UCH LAW WITH REFERENCE TO THE VALUE OF THE ASSETS OF, OR THE CAP ITAL EMPLOYED IN, A BUSINESS OR PROFESSION CARRIED ON BY THE ASSESSEE, WHETHER OR NOT THE DEBTS OF THE BUSINESS OR PROFESSION ARE ALLOWED AS A DEDUCTION IN COMPUTING THE AMOUNT WITH REFERENCE TO WHICH SUCH T AX IS CHARGED, BUT DOES NOT INCLUDE ANY TAX CHARGEABLE WITH REFERENCE TO THE VALUE OF ANY PARTICULAR ASSET OF THE BUSINESS OR PROFESSION; ( IIB ) ANY AMOUNT ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 37 ( A ) PAID BY WAY OF ROYALTY, LICENCE FEE, SERVICE FEE, P RIVILEGE FEE, SERVICE CHARGE OR ANY OTHER FEE OR CHARGE, BY WHATE VER NAME CALLED, WHICH IS LEVIED EXCLUSIVELY ON; OR ( B ) WHICH IS APPROPRIATED, DIRECTLY OR INDIRECTLY, F ROM, A STATE GOVERNMENT UNDERTAKING BY THE STATE GOVERNM ENT. EXPLANATION. FOR THE PURPOSES OF THIS SUB-CLAUSE, A STATE GOVER NMENT UNDERTAKING INCLUDES ( I ) A CORPORATION ESTABLISHED BY OR UNDER ANY ACT OF TH E STATE GOVERNMENT; ( II ) A COMPANY IN WHICH MORE THAN FIFTY PER CENT OF T HE PAID-UP EQUITY SHARE CAPITAL IS HELD BY THE STATE GOVERNMENT; ( III ) A COMPANY IN WHICH MORE THAN FIFTY PER CENT OF THE PAID-UP EQUITY SHARE CAPITAL IS HELD BY THE ENTITY REFERRED TO IN CLAUSE ( I ) OR CLAUSE ( II ) (WHETHER SINGLY OR TAKEN TOGETHER); ( IV ) A COMPANY OR CORPORATION IN WHICH THE STATE GOVE RNMENT HAS THE RIGHT TO APPOINT THE MAJORITY OF THE DIRECTORS OR T O CONTROL THE MANAGEMENT OR POLICY DECISIONS, DIRECTLY OR INDIREC TLY, INCLUDING BY VIRTUE OF ITS SHAREHOLDING OR MANAGEMENT RIGHTS OR SHAREHOLDERS AGREEMENTS OR VOTING AGREEMENTS OR IN ANY OTHER MAN NER; ( V ) AN AUTHORITY, A BOARD OR AN INSTITUTION OR A BODY E STABLISHED OR CONSTITUTED BY OR UNDER ANY ACT OF THE STATE GOVERN MENT OR OWNED OR CONTROLLED BY THE STATE GOVERNMENT; ( III ) ANY PAYMENT WHICH IS CHARGEABLE UNDER THE HEAD 'S ALARIES', IF IT IS PAYABLE ( A ) OUTSIDE INDIA; OR ( B ) TO A NON-RESIDENT, AND IF THE TAX HAS NOT BEEN PAID THEREON NOR DEDUCT ED THEREFROM UNDER CHAPTER XVII-B; ( IV ) ANY PAYMENT TO A PROVIDENT OR OTHER FUND ESTABLI SHED FOR THE BENEFIT OF EMPLOYEES OF THE ASSESSEE, UNLESS THE ASSESSEE H AS MADE EFFECTIVE ARRANGEMENTS TO SECURE THAT TAX SHALL BE DEDUCTED A T SOURCE FROM ANY PAYMENTS MADE FROM THE FUND WHICH ARE CHARGEABLE TO TAX UNDER THE HEAD 'SALARIES'; ( V ) ANY TAX ACTUALLY PAID BY AN EMPLOYER REFERRED TO IN CLAUSE ( 10CC ) OF SECTION 10; 3.2. THE LD. COUNSEL FOR THE ASSESSEE, BEFORE US, CONTENDED THAT THE DISTRIBUTOR SHARES PAID TO A NON -RESIDENT COMPANY IS EXCLUDED FROM THE DEFINITION OF ROYALTY AS PER ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 38 SECTION 9(1)(VI) EXPLANATION-2 CLAUSE (V) OF THE AC T. THEREFORE, WE ARE REPRODUCING HEREUNDER THE RELEVANT SECTION:- 9. (1) THE FOLLOWING INCOMES SHALL BE DEEMED TO ACCRU E OR ARISE IN INDIA : ( I ) ALL INCOME ACCRUING OR ARISING, WHETHER DIRECTLY OR INDIRECTLY, THROUGH OR FROM ANY BUSINESS CONNECTION IN INDIA, OR THROUGH O R FROM ANY PROPERTY IN INDIA, OR THROUGH OR FROM ANY ASSET OR SOURCE OF IN COME IN INDIA, OR THROUGH THE TRANSFER OF A CAPITAL ASSET SITUATE IN INDIA. EXPLANATION 1 .FOR THE PURPOSES OF THIS CLAUSE ( A ) IN THE CASE OF A BUSINESS OF WHICH ALL THE OPERAT IONS ARE NOT CARRIED OUT IN INDIA, THE INCOME OF THE BUSINESS DEEMED UNDER THIS CLAUSE TO ACCRUE OR ARISE IN INDIA SHALL BE ONLY SUCH PART OF THE INCOME AS I S REASONABLY ATTRIBUTABLE TO THE OPERATIONS CARRIED OUT IN INDIA ; ( B ) IN THE CASE OF A NON-RESIDENT, NO INCOME SHALL BE DEEMED TO ACCRUE OR ARISE IN INDIA TO HIM THROUGH OR FROM OPERATIONS WH ICH ARE CONFINED TO THE PURCHASE OF GOODS IN INDIA FOR THE PURPOSE OF EXPOR T ; ( C ) IN THE CASE OF A NON-RESIDENT, BEING A PERSON ENG AGED IN THE BUSINESS OF RUNNING A NEWS AGENCY OR OF PUBLISHING NEWSPAPERS, MAGAZINES OR JOURNALS, NO INCOME SHALL BE DEEMED TO ACCRUE OR ARISE IN IND IA TO HIM THROUGH OR FROM ACTIVITIES WHICH ARE CONFINED TO THE COLLECTION OF NEWS AND VIEWS IN INDIA FOR TRANSMISSION OUT OF INDIA ; ( D ) IN THE CASE OF A NON-RESIDENT, BEING ( 1 ) AN INDIVIDUAL WHO IS NOT A CITIZEN OF INDIA ; OR ( 2 ) A FIRM WHICH DOES NOT HAVE ANY PARTNER WHO IS A C ITIZEN OF INDIA OR WHO IS RESIDENT IN INDIA ; OR ( 3 ) A COMPANY WHICH DOES NOT HAVE ANY SHAREHOLDER WHO IS A CITIZEN OF INDIA OR WHO IS RESIDENT IN INDIA, NO INCOME SHALL BE DEEMED TO ACCRUE OR ARISE IN IND IA TO SUCH INDIVIDUAL, FIRM OR COMPANY THROUGH OR FROM OPERATIONS WHICH AR E CONFINED TO THE SHOOTING OF ANY CINEMATOGRAPH FILM IN INDIA; [( E ) IN THE CASE OF A FOREIGN COMPANY ENGAGED IN THE B USINESS OF MINING OF DIAMONDS, NO INCOME SHALL BE DEEMED TO ACCRUE OR AR ISE IN INDIA TO IT THROUGH OR FROM THE ACTIVITIES WHICH ARE CONFINED TO THE DI SPLAY OF UNCUT AND UNASSORTED DIAMOND IN ANY SPECIAL ZONE NOTIFIED BY THE CENTRAL GOVERNMENT IN THE OFFICIAL GAZETTE IN THIS BEHALF.] EXPLANATION 2.FOR THE REMOVAL OF DOUBTS, IT IS HER EBY DECLARED THAT 'BUSINESS CONNECTION' SHALL INCLUDE ANY BUSINESS AC TIVITY CARRIED OUT THROUGH A PERSON WHO, ACTING ON BEHALF OF THE NON-RESIDENT, ( A ) HAS AND HABITUALLY EXERCISES IN INDIA, AN AUTHORITY TO CONCLUDE CONTRACTS ON BEHALF OF THE NON-RESIDENT, UNLESS HIS ACTIVITIE S ARE LIMITED TO THE PURCHASE OF GOODS OR MERCHANDISE FOR THE NON-RESIDENT; OR ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 39 ( B ) HAS NO SUCH AUTHORITY, BUT HABITUALLY MAINTAINS I N INDIA A STOCK OF GOODS OR MERCHANDISE FROM WHICH HE REGULARLY DELIVERS GOO DS OR MERCHANDISE ON BEHALF OF THE NON-RESIDENT; OR ( C ) HABITUALLY SECURES ORDERS IN INDIA, MAINLY OR WHO LLY FOR THE NON-RESIDENT OR FOR THAT NON-RESIDENT AND OTHER NON-RESIDENTS CO NTROLLING, CONTROLLED BY, OR SUBJECT TO THE SAME COMMON CONTROL, AS THAT NON-RES IDENT: PROVIDED THAT SUCH BUSINESS CONNECTION SHALL NOT INCLUDE ANY BUSINESS ACTIVITY CARRIED OUT THROUGH A BROKER, GENERAL COMM ISSION AGENT OR ANY OTHER AGENT HAVING AN INDEPENDENT STATUS, IF SUCH BROKER, GENERAL COMMISSION AGENT OR ANY OTHER AGENT HAVING AN INDEPENDENT STATUS IS ACTING IN THE ORDINARY COURSE OF HIS BUSINESS : PROVIDED FURTHER THAT WHERE SUCH BROKER, GENERAL COMMISSION AGENT O R ANY OTHER AGENT WORKS MAINLY OR WHOLLY ON BEHALF OF A N ON-RESIDENT (HEREAFTER IN THIS PROVISO REFERRED TO AS THE PRINCIPAL NON-RESID ENT) OR ON BEHALF OF SUCH NON-RESIDENT AND OTHER NON-RESIDENTS WHICH ARE CONT ROLLED BY THE PRINCIPAL NON-RESIDENT OR HAVE A CONTROLLING INTEREST IN THE PRINCIPAL NON-RESIDENT OR ARE SUBJECT TO THE SAME COMMON CONTROL AS THE PRINCIPAL NON-RESIDENT, HE SHALL NOT BE DEEMED TO BE A BROKER, GENERAL COMMISSION AGENT OR AN AGENT OF AN INDEPENDENT STATUS. EXPLANATION 3. WHERE A BUSINESS IS CARRIED ON IN INDIA THROUGH A P ERSON REFERRED TO IN CLAUSE ( A ) OR CLAUSE ( B ) OR CLAUSE ( C ) OF EXPLANATION 2 , ONLY SO MUCH OF INCOME AS IS ATTRIBUTABLE TO THE OPERATIONS CARRIED OUT IN INDIA SHALL BE DEEMED TO ACCRUE OR ARISE IN INDIA. EXPLANATION 4. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY CLARIFIED T HAT THE EXPRESSION 'THROUGH' SHALL MEAN AND INCLUDE AND SHA LL BE DEEMED TO HAVE ALWAYS MEANT AND INCLUDED 'BY MEANS OF', 'IN CONSEQ UENCE OF' OR 'BY REASON OF'. EXPLANATION 5. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY CLARIFIED T HAT AN ASSET OR A CAPITAL ASSET BEING ANY SHARE OR INTERES T IN A COMPANY OR ENTITY REGISTERED OR INCORPORATED OUTSIDE INDIA SHALL BE D EEMED TO BE AND SHALL ALWAYS BE DEEMED TO HAVE BEEN SITUATED IN INDIA, IF THE SHARE OR INTEREST DERIVES, DIRECTLY OR INDIRECTLY, ITS VALUE SUBSTANT IALLY FROM THE ASSETS LOCATED IN INDIA: [PROVIDED THAT NOTHING CONTAINED IN THIS EXPLANATION SHALL APPLY TO AN ASSET OR CAPITAL ASSET, WHICH IS HELD BY A NON-RESI DENT BY WAY OF INVESTMENT, DIRECTLY OR INDIRECTLY, IN A FOREIGN INSTITUTIONAL INVESTOR AS REFERRED TO IN CLAUSE ( A ) OF THE EXPLANATION TO SECTION 115AD FOR AN ASSESSMENT YEAR COMMENCING ON OR AFTER THE 1ST DAY OF APRIL, 2012 B UT BEFORE THE 1ST DAY OF APRIL, 2015: ] [PROVIDED FURTHER THAT NOTHING CONTAINED IN THIS EXPLANATION SHALL APPLY TO AN ASSET OR CAPITAL ASSET, WHICH IS HELD BY A NO N-RESIDENT BY WAY OF INVESTMENT, DIRECTLY OR INDIRECTLY, IN CATEGORY-I O R CATEGORY-II FOREIGN PORTFOLIO INVESTOR UNDER THE SECURITIES AND EXCHANG E BOARD OF INDIA (FOREIGN PORTFOLIO INVESTORS) REGULATIONS, 2014, MADE UNDER THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 (15 OF 1992). ] [ EXPLANATION 6. FOR THE PURPOSES OF THIS CLAUSE, IT IS HEREBY DECLA RED THAT ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 40 ( A ) THE SHARE OR INTEREST, REFERRED TO IN EXPLANATION 5 , SHALL BE DEEMED TO DERIVE ITS VALUE SUBSTANTIALLY FROM THE ASSETS (WHE THER TANGIBLE OR INTANGIBLE) LOCATED IN INDIA, IF, ON THE SPECIFIED DATE, THE VA LUE OF SUCH ASSETS ( I ) EXCEEDS THE AMOUNT OF TEN CRORE RUPEES; AND ( II ) REPRESENTS AT LEAST FIFTY PER CENT OF THE VALUE O F ALL THE ASSETS OWNED BY THE COMPANY OR ENTITY, AS THE CASE MAY BE; ( B ) THE VALUE OF AN ASSET SHALL BE THE FAIR MARKET VA LUE AS ON THE SPECIFIED DATE, OF SUCH ASSET WITHOUT REDUCTION OF LIABILITIE S, IF ANY, IN RESPECT OF THE ASSET, DETERMINED IN SUCH MANNER AS MAY BE PRESCRIB ED; ( C ) 'ACCOUNTING PERIOD' MEANS EACH PERIOD OF TWELVE M ONTHS ENDING WITH THE 31ST DAY OF MARCH: PROVIDED THAT WHERE A COMPANY OR AN ENTITY, REFERRED TO IN EXPLANATION 5 , REGULARLY ADOPTS A PERIOD OF TWELVE MONTHS ENDING O N A DAY OTHER THAN THE 31ST DAY OF MARCH FOR THE PURPOSE OF ( I ) COMPLYING WITH THE PROVISIONS OF THE TAX LAWS OF THE TERRITORY, OF WHICH IT IS A RESIDENT, FOR TAX PURPOSES; OR ( II ) REPORTING TO PERSONS HOLDING THE SHARE OR INTERES T, THEN, THE PERIOD OF TWELVE MONTHS ENDING WITH THE O THER DAY SHALL BE THE ACCOUNTING PERIOD OF THE COMPANY OR, AS THE CASE MA Y BE, THE ENTITY: PROVIDED FURTHER THAT THE FIRST ACCOUNTING PERIOD OF THE COMPANY OR, AS THE CASE MAY BE, THE ENTITY SHALL BEGIN FROM THE DATE O F ITS REGISTRATION OR INCORPORATION AND END WITH THE 31ST DAY OF MARCH OR SUCH OTHER DAY, AS THE CASE MAY BE, FOLLOWING THE DATE OF SUCH REGISTRATIO N OR INCORPORATION, AND THE LATER ACCOUNTING PERIOD SHALL BE THE SUCCESSIVE PER IODS OF TWELVE MONTHS: PROVIDED ALSO THAT IF THE COMPANY OR THE ENTITY CEASES TO EXIST B EFORE THE END OF ACCOUNTING PERIOD, AS AFORESAID, THEN, THE A CCOUNTING PERIOD SHALL END IMMEDIATELY BEFORE THE COMPANY OR, AS THE CASE MAY BE, THE ENTITY, CEASES TO EXIST; ( D ) 'SPECIFIED DATE' MEANS THE ( I ) DATE ON WHICH THE ACCOUNTING PERIOD OF THE COMPAN Y OR, AS THE CASE MAY BE, THE ENTITY ENDS PRECEDING THE DATE OF TRANSFER OF A SHARE OR AN INTEREST; OR ( II ) DATE OF TRANSFER, IF THE BOOK VALUE OF THE ASSETS OF THE COMPANY OR, AS THE CASE MAY BE, THE ENTITY ON THE DATE OF TRANSFER EXC EEDS THE BOOK VALUE OF THE ASSETS AS ON THE DATE REFERRED TO IN SUB-CLAUSE ( I ), BY FIFTEEN PER CENT. EXPLANATION 7 . FOR THE PURPOSES OF THIS CLAUSE, ( A ) NO INCOME SHALL BE DEEMED TO ACCRUE OR ARISE TO A NON-RESIDENT FROM TRANSFER, OUTSIDE INDIA, OF ANY SHARE OF, OR INTERE ST IN, A COMPANY OR AN ENTITY, REGISTERED OR INCORPORATED OUTSIDE INDIA, REFERRED TO IN THE EXPLANATION 5 , ( I ) IF SUCH COMPANY OR ENTITY DIRECTLY OWNS THE ASSET S SITUATED IN INDIA AND THE TRANSFEROR (WHETHER INDIVIDUALLY OR ALONG WITH ITS ASSOCIATED ENTERPRISES), AT ANY TIME IN THE TWELVE MONTHS PRECEDING THE DATE OF TRANSFER, NEITHER HOLDS THE RIGHT OF MANAGEMENT OR CONTROL IN RELATION TO S UCH COMPANY OR ENTITY, NOR HOLDS VOTING POWER OR SHARE CAPITAL OR INTEREST EXC EEDING FIVE PER CENT OF THE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 41 TOTAL VOTING POWER OR TOTAL SHARE CAPITAL OR TOTAL INTEREST, AS THE CASE MAY BE, OF SUCH COMPANY OR ENTITY; OR ( II ) IF SUCH COMPANY OR ENTITY INDIRECTLY OWNS THE ASS ETS SITUATED IN INDIA AND THE TRANSFEROR (WHETHER INDIVIDUALLY OR ALONG WITH ITS ASSOCIATED ENTERPRISES), AT ANY TIME IN THE TWELVE MONTHS PRECEDING THE DATE OF TRANSFER, NEITHER HOLDS THE RIGHT OF MANAGEMENT OR CONTROL IN RELATION TO S UCH COMPANY OR ENTITY, NOR HOLDS ANY RIGHT IN, OR IN RELATION TO, SUCH COMPANY OR ENTITY WHICH WOULD ENTITLE HIM TO THE RIGHT OF MANAGEMENT OR CONTROL I N THE COMPANY OR ENTITY THAT DIRECTLY OWNS THE ASSETS SITUATED IN INDIA, NO R HOLDS SUCH PERCENTAGE OF VOTING POWER OR SHARE CAPITAL OR INTEREST IN SUCH C OMPANY OR ENTITY WHICH RESULTS IN HOLDING OF (EITHER INDIVIDUALLY OR ALONG WITH ASSOCIATED ENTERPRISES) A VOTING POWER OR SHARE CAPITAL OR INTEREST EXCEEDI NG FIVE PER CENT OF THE TOTAL VOTING POWER OR TOTAL SHARE CAPITAL OR TOTAL INTERE ST, AS THE CASE MAY BE, OF THE COMPANY OR ENTITY THAT DIRECTLY OWNS THE ASSETS SIT UATED IN INDIA; ( B ) IN A CASE WHERE ALL THE ASSETS OWNED, DIRECTLY OR INDIRECTLY, BY A COMPANY OR, AS THE CASE MAY BE, AN ENTITY REFERRED TO IN TH E EXPLANATION 5, ARE NOT LOCATED IN INDIA, THE INCOME OF THE NON-RESIDENT TR ANSFEROR, FROM TRANSFER OUTSIDE INDIA OF A SHARE OF, OR INTEREST IN, SUCH C OMPANY OR ENTITY, DEEMED TO ACCRUE OR ARISE IN INDIA UNDER THIS CLAUSE, SHALL B E ONLY SUCH PART OF THE INCOME AS IS REASONABLY ATTRIBUTABLE TO ASSETS LOCA TED IN INDIA AND DETERMINED IN SUCH MANNER AS MAY BE PRESCRIBED; ( C ) 'ASSOCIATED ENTERPRISE' SHALL HAVE THE MEANING AS SIGNED TO IT IN SECTION 92A ;] ( II ) INCOME WHICH FALLS UNDER THE HEAD 'SALARIES', IF IT IS EARNED IN INDIA. EXPLANATION. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED TH AT THE INCOME OF THE NATURE REFERRED TO IN THIS CLAUSE PAY ABLE FOR ( A ) SERVICE RENDERED IN INDIA; AND ( B ) THE REST PERIOD OR LEAVE PERIOD WHICH IS PRECEDED A ND SUCCEEDED BY SERVICES RENDERED IN INDIA AND FORMS PART OF THE SE RVICE CONTRACT OF EMPLOYMENT, SHALL BE REGARDED AS INCOME EARNED IN INDIA ; ( III ) INCOME CHARGEABLE UNDER THE HEAD 'SALARIES' PAYAB LE BY THE GOVERNMENT TO A CITIZEN OF INDIA FOR SERVICE OUTSID E INDIA ; ( IV ) A DIVIDEND PAID BY AN INDIAN COMPANY OUTSIDE INDI A ; ( V ) INCOME BY WAY OF INTEREST PAYABLE BY ( A ) THE GOVERNMENT ; OR ( B ) A PERSON WHO IS A RESIDENT, EXCEPT WHERE THE INTE REST IS PAYABLE IN RESPECT OF ANY DEBT INCURRED, OR MONEYS BORROWED AND USED, FOR THE PURPOSES OF A BUSINESS OR PROFESSION CARRIED ON BY SUCH PERSON OU TSIDE INDIA OR FOR THE PURPOSES OF MAKING OR EARNING ANY INCOME FROM ANY S OURCE OUTSIDE INDIA ; OR ( C ) A PERSON WHO IS A NON-RESIDENT, WHERE THE INTERES T IS PAYABLE IN RESPECT OF ANY DEBT INCURRED, OR MONEYS BORROWED AND USED, FOR THE PURPOSES OF A BUSINESS OR PROFESSION CARRIED ON BY SUCH PERSON IN INDIA ; [ EXPLANATION. FOR THE PURPOSES OF THIS CLAUSE, ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 42 ( A ) IT IS HEREBY DECLARED THAT IN THE CASE OF A NON-R ESIDENT, BEING A PERSON ENGAGED IN THE BUSINESS OF BANKING, ANY INTEREST PA YABLE BY THE PERMANENT ESTABLISHMENT IN INDIA OF SUCH NON-RESIDENT TO THE HEAD OFFICE OR ANY PERMANENT ESTABLISHMENT OR ANY OTHER PART OF SUCH N ON-RESIDENT OUTSIDE INDIA SHALL BE DEEMED TO ACCRUE OR ARISE IN INDIA AND SHA LL BE CHARGEABLE TO TAX IN ADDITION TO ANY INCOME ATTRIBUTABLE TO THE PERMANEN T ESTABLISHMENT IN INDIA AND THE PERMANENT ESTABLISHMENT IN INDIA SHALL BE D EEMED TO BE A PERSON SEPARATE AND INDEPENDENT OF THE NON-RESIDENT PERSON OF WHICH IT IS A PERMANENT ESTABLISHMENT AND THE PROVISIONS OF THE A CT RELATING TO COMPUTATION OF TOTAL INCOME, DETERMINATION OF TAX A ND COLLECTION AND RECOVERY SHALL APPLY ACCORDINGLY; ( B ) 'PERMANENT ESTABLISHMENT' SHALL HAVE THE MEANING ASSIGNED TO IT IN CLAUSE ( IIIA )OF SECTION 92F ;] ( VI ) INCOME BY WAY OF ROYALTY PAYABLE BY XXXXXXXXXXXXXX EXPLANATION 2. FOR THE PURPOSES OF THIS CLAUSE, 'ROYALTY' MEANS CONSIDERATION (INCLUDING ANY LUMP SUM CONSIDERATION BUT EXCLUDING ANY CONSIDERATION WHICH WOULD BE THE INCOME OF THE RECI PIENT CHARGEABLE UNDER THE HEAD 'CAPITAL GAINS') FOR ( I ) THE TRANSFER OF ALL OR ANY RIGHTS (INCLUDING THE GRANTING OF A LICENCE) IN RESPECT OF A PATENT, INVENTION, MODEL, DESIGN, SECR ET FORMULA OR PROCESS OR TRADE MARK OR SIMILAR PROPERTY ; ( II ) THE IMPARTING OF ANY INFORMATION CONCERNING THE W ORKING OF, OR THE USE OF, A PATENT, INVENTION, MODEL, DESIGN, SECRET FORM ULA OR PROCESS OR TRADE MARK OR SIMILAR PROPERTY ; ( III ) THE USE OF ANY PATENT, INVENTION, MODEL, DESIGN, SECRET FORMULA OR PROCESS OR TRADE MARK OR SIMILAR PROPERTY ; ( IV ) THE IMPARTING OF ANY INFORMATION CONCERNING TECHN ICAL, INDUSTRIAL, COMMERCIAL OR SCIENTIFIC KNOWLEDGE, EXPERIENCE OR S KILL ; ( IVA ) THE USE OR RIGHT TO USE ANY INDUSTRIAL, COMMERCIA L OR SCIENTIFIC EQUIPMENT BUT NOT INCLUDING THE AMOUNTS REFERRED TO IN SECTION 44BB ; ( V ) THE TRANSFER OF ALL OR ANY RIGHTS (INCLUDING THE GRANTING OF A LICENCE) IN RESPECT OF ANY COPYRIGHT, LITERARY, ARTISTIC OR SCIENTIFIC WORK INCLUDING FILMS OR VIDEO TAPES FOR USE IN CONNECTION WITH TEL EVISION OR TAPES FOR USE IN CONNECTION WITH RADIO BROADCASTING, BUT NOT INCL UDING CONSIDERATION FOR THE SALE, DISTRIBUTION OR EXHIBITION OF CINEMAT OGRAPHIC FILMS ; OR XXXXXXXXXXX 3.3. IF THE AFORESAID SECTION IS ANALYZED, CLAUSE (V) OF EXPLANATION-2 TO SECTION 9(1)(VI) OF THE ACT SPECIF ICALLY EXCLUDES ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 43 THE PAYMENT OF DISTRIBUTOR SHARE PAID TO A NON-RESI DENT COMPANY SPECIFICALLY EXCLUDE/CONSIDERATION FOR THE SALE, DISTRIBUTION OR EXHIBITION OF CINEMATOGRAPHIC FILMS . IT IS ALSO NOTED THAT HON'BLE APEX COURT IN G.E. INDIA TECHNOL OGY CEN. (P.) LTD. VS CIT (2010) 327 ITR 456 /(2010) 234 CTR 153 (SC) VIDE ORDER DATED 09/09/2010 HELD AS UNDER:- THE MOST IMPORTANT EXPRESSION IN S. 195(1) CONSISTS OF THE WORDS 'CHARGEABLE UNDER THE PROVISIONS OF THE ACT'. A PER SON PAYING INTEREST OR ANY OTHER SUM TO A NON-RESIDENT IS NOT LIABLE TO DE DUCT TAX IF SUCH SUM IS NOT CHARGEABLE TO TAX UNDER THE IT ACT. FOR INSTANC E, WHERE THERE IS NO OBLIGATION ON THE PART OF THE PAYER AND NO RIGHT TO RECEIVE THE SUM BY THE RECIPIENT AND THAT THE PAYMENT DOES NOT ARISE O UT OF ANY CONTRACT OR OBLIGATION BETWEEN THE PAYER AND THE RECIPIENT BUT IS MADE VOLUNTARILY, SUCH PAYMENTS CANNOT BE REGARDED AS INCOME UNDER TH E IT ACT. IT MAY BE NOTED THAT S. 195 CONTEMPLATES NOT MERELY AMOUNT S, THE WHOLE OF WHICH ARE PURE INCOME PAYMENTS, IT ALSO COVERS COMP OSITE PAYMENTS WHICH HAS AN ELEMENT OF INCOME EMBEDDED OR INCORPOR ATED IN THEM. THUS, WHERE AN AMOUNT IS PAYABLE TO A NON-RESIDENT, THE PAYER IS UNDER AN OBLIGATION TO DEDUCT TAX AT SOURCE IN RESPECT OF SUCH COMPOSITE PAYMENTS. THE OBLIGATION TO DEDUCT TAX AT SOURCE IS , HOWEVER, LIMITED TO THE APPROPRIATE PROPORTION OF INCOME CHARGEABLE UND ER THE ACT FORMING PART OF THE GROSS SUM OF MONEY PAYABLE TO THE NON-R ESIDENT. THIS OBLIGATION BEING LIMITED TO THE APPROPRIATE PROPORT ION OF INCOME FLOWS FROM THE WORDS USED IN S. 195(1), NAMELY, 'CHARGEAB LE UNDER THE PROVISIONS OF THE ACT'. IT IS FOR THIS REASON THAT VIDE CIRCULAR NO. 728, DT. 30TH OCT., 1995 THE CBDT HAS CLARIFIED THAT THE TAX DEDUCTOR CAN TAKE INTO CONSIDERATION THE EFFECT OF DTAA IN RESPECT OF PAYMENT OF ROYALTIES AND TECHNICAL FEES WHILE DEDUCTING TAX AT SOURCE. T HE APPLICATION OF S. 195(2) PRE-SUPPOSES THAT THE PERSON RESPONSIBLE FOR MAKING THE PAYMENT TO THE NON-RESIDENT IS IN NO DOUBT THAT TAX IS PAYABLE IN RESPECT OF SOME PART OF THE AMOUNT TO BE REMITTED TO A NON- RESIDENT BUT IS NOT SURE AS TO WHAT SHOULD BE THE PORTION SO TAXABLE OR IS NOT SURE AS TO THE AMOUNT OF TAX TO BE DEDUCTED. IN SUCH A SITUATION, HE IS REQUIRED TO MAKE AN APPLICATION TO THE ITO(TDS) FOR DETERMINING THE AMOUNT. IT IS ONLY WHEN THESE CONDITIONS ARE SATISFIED AND AN APP LICATION IS MADE TO THE ITO(TDS) THAT THE QUESTION OF MAKING AN ORDER U NDER S. 195(2) WILL ARISE. WHILE DECIDING THE SCOPE OF S. 195(2) IT IS IMPORTANT TO NOTE THAT THE TAX WHICH IS REQUIRED TO BE DEDUCTED AT SOURCE IS DEDUCTIBLE ONLY OUT OF THE CHARGEABLE SUM. THIS IS THE UNDERLYING PRINC IPLE OF S. 195. HENCE, APART FROM S. 9(1), SS. 4, 5, 9, 90, 91 AS WELL AS THE PROVISIONS OF DTAA ARE ALSO RELEVANT, WHILE APPLYING TDS PROVISIONS. R EFERENCE TO ITO(TDS) UNDER S. 195(2) OR S. 195(3) EITHER BY THE NON-RESI DENT OR BY THE RESIDENT PAYER IS TO AVOID ANY FUTURE HASSLES FOR B OTH RESIDENT AS WELL AS NON-RESIDENT. SECS. 195(2) AND 195(3) ARE SAFEGUARD S. THE SAID PROVISIONS ARE OF PRACTICAL IMPORTANCE. FROM THIS I T FOLLOWS THAT WHERE A ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 44 PERSON RESPONSIBLE FOR DEDUCTION IS FAIRLY CERTAIN THEN HE CAN MAKE HIS OWN DETERMINATION AS TO WHETHER THE TAX WAS DEDUCTI BLE AT SOURCE AND, IF SO, WHAT SHOULD BE THE AMOUNT THEREOF. IF THE CO NTENTION OF THE DEPARTMENT THAT THE MOMENT THERE IS REMITTANCE THE OBLIGATION TO DEDUCT TAX AT SOURCE ARISES IS TO BE ACCEPTED THEN THE WORDS 'CHARGEABLE UNDER THE PROVISIONS OF THE ACT' IN S. 195(1) WOULD BE OBLITERATED. THE SAID EXPRESSION IN S. 195(1) SHOWS THAT THE REMITTA NCE HAS GOT TO BE OF A TRADING RECEIPT, THE WHOLE OR PART OF WHICH IS LI ABLE TO TAX IN INDIA. THE PAYER IS BOUND TO DEDUCT TAX AT SOURCE ONLY IF THE INCOME IS ASSESSABLE IN INDIA. IF INCOME IS NOT SO ASSESSABLE, THERE IS NO QUESTION OF TAX AT SOURCE BEING DEDUCTED. TRANSMISSION CORPORATION OF A.P. LTD. VS. CIT (1999) 155 CTR (SC) 489 : (1999) 239 ITR 587 (SC) A ND VIJAY SHIP BREAKING CORPN. & ORS. VS. CIT (2008) 219 CTR (SC) 639 : (2008) 14 DTR (SC) 74 : (2009) 314 ITR 309 (SC) RELIED ON; CIT VS. COOPER ENGINEERING LTD. (1968) 68 ITR 457 (BOM) IMPLIEDLY APPROVED. (PARAS 7 & 8) SEC. 195 FALLS IN CHAPTER XVII WHICH DEALS WITH COL LECTION AND RECOVERY. CHAPTER XVII-B DEALS WITH DEDUCTION AT SOURCE BY TH E PAYER. ON ANALYSIS OF VARIOUS PROVISIONS OF CHAPTER XVII ONE FINDS USE OF DIFFERENT EXPRESSIONS, HOWEVER, THE EXPRESSION 'SUM CHARGEABL E UNDER THE PROVISIONS OF THE ACT' IS USED ONLY IN S. 195. IN N ONE OF THE PROVISIONS THE EXPRESSION 'SUM CHARGEABLE UNDER THE PROVISIONS OF THE ACT' IS FOUND, WHICH, IS AN EXPRESSION USED ONLY IN S. 195( 1). IT FOLLOWS, THEREFORE, THAT THE OBLIGATION TO DEDUCT TAX AT SOU RCE ARISES ONLY WHEN THERE IS A SUM CHARGEABLE UNDER THE ACT. SEC. 195(2 ) IS NOT MERELY A PROVISION TO PROVIDE INFORMATION TO THE ITO (TDS). IT IS A PROVISION REQUIRING TAX TO BE DEDUCTED AT SOURCE TO BE PAID T O THE REVENUE BY THE PAYER WHO MAKES PAYMENT TO A NON-RESIDENT. THEREFOR E, S. 195 HAS TO BE READ IN CONFORMITY WITH THE CHARGING PROVISIONS, I.E., SS. 4, 5 AND 9. THIS REASONING FLOWS FROM THE WORDS 'SUM CHARGEABLE UNDER THE PROVISIONS OF THE ACT' IN S. 195(1). THE FACT THAT THE REVENUE HAS NOT OBTAINED ANY INFORMATION PER SE CANNOT BE A GROUND TO CONSTRUE S. 195 WIDELY SO AS TO REQUIRE DEDUCTION OF TAX AT SOURCE EVEN IN A CASE WHERE AN AMOUNT PAID IS NOT CHARGEABLE TO TAX IN INDIA AT ALL. SEC. 195 CANNOT BE READ, AS SUGGESTED BY THE DEPARTMENT, NAMELY, TH AT THE MOMENT THERE IS REMITTANCE THE OBLIGATION TO DEDUCT TAX AT SOURCE ARISES. IF SUCH A CONTENTION IS ACCEPTED IT WOULD MEAN THAT ON MERE PAYMENT INCOME WOULD BE SAID TO ARISE OR ACCRUE IN INDIA. THEREFOR E, AS STATED EARLIER, IF THE CONTENTION OF THE DEPARTMENT WAS ACCEPTED IT WO ULD MEAN OBLITERATION OF THE EXPRESSION 'SUM CHARGEABLE UNDE R THE PROVISIONS OF THE ACT' FROM S. 195(1). WHILE INTERPRETING A SECTI ON ONE HAS TO GIVE WEIGHTAGE TO EVERY WORD USED IN THAT SECTION. WHILE INTERPRETING THE PROVISIONS OF THE IT ACT ONE CANNOT READ THE CHARGI NG SECTIONS OF THAT ACT DE HORS THE MACHINERY SECTIONS. THE ACT IS TO B E READ AS AN INTEGRATED CODE. HENCE, THE PROVISION RELATING TO T DS APPLIES ONLY TO THOSE SUMS WHICH ARE CHARGEABLE TO TAX UNDER THE IT ACT. IF THE CONTENTION OF THE DEPARTMENT THAT ANY PERSON MAKING PAYMENT TO A NON-RESIDENT IS NECESSARILY REQUIRED TO DEDUCT TAX AT SOURCE IS ACCEPTED THEN THE CONSEQUENCE WOULD BE THAT THE DEPARTMENT W OULD BE ENTITLED TO APPROPRIATE THE MONEYS DEPOSITED BY THE PAYER EV EN IF THE SUM PAID IS NOT CHARGEABLE TO TAX BECAUSE THERE IS NO PROVIS ION IN THE IT ACT BY WHICH A PAYER CAN OBTAIN REFUND. SEC. 237 R/W S. 19 9 IMPLIES THAT ONLY THE RECIPIENT OF THE SUM, I.E., THE PAYEE COULD SEE K A REFUND. IT MUST ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 45 THEREFORE FOLLOW, IF THE DEPARTMENT IS RIGHT, THAT THE LAW REQUIRES TAX TO BE DEDUCTED ON ALL PAYMENTS. THE PAYER, THEREFORE, HAS TO DEDUCT AND PAY TAX, EVEN IF THE SO-CALLED DEDUCTION COMES OUT OF HIS OWN POCKET AND HE HAS NO REMEDY WHATSOEVER, EVEN WHERE THE SUM PAI D BY HIM IS NOT A SUM CHARGEABLE UNDER THE ACT. THE INTERPRETATION OF THE DEPARTMENT, THEREFORE, NOT ONLY REQUIRES THE WORDS 'CHARGEABLE UNDER THE PROVISIONS OF THE ACT' TO BE OMITTED, IT ALSO LEADS TO AN ABSU RD CONSEQUENCE. THE INTERPRETATION PLACED BY THE DEPARTMENT WOULD RESUL T IN A SITUATION WHERE EVEN WHEN THE INCOME HAS NO TERRITORIAL NEXUS WITH INDIA OR IS NOT CHARGEABLE IN INDIA, THE GOVERNMENT WOULD NONETHELE SS COLLECT TAX. SEC. 195(2) PROVIDES A REMEDY BY WHICH A PERSON MAY SEEK A DETERMINATION OF THE 'APPROPRIATE PROPORTION OF SUCH SUM SO CHARG EABLE' WHERE A PROPORTION OF THE SUM SO CHARGEABLE IS LIABLE TO TA X. THE ENTIRE BASIS OF THE DEPARTMENT'S CONTENTION IS BASED ON ADMINISTRAT IVE CONVENIENCE IN SUPPORT OF ITS INTERPRETATION. THERE IS NO MERIT IN THE CONTENTION. AS STATED HEREINABOVE, S. 195(1) USES THE EXPRESSION ' SUM CHARGEABLE UNDER THE PROVISIONS OF THE ACT.' ONE HAS TO GIVE W EIGHTAGE TO THOSE WORDS. FURTHER, S. 195 USES THE WORD 'PAYER' AND NO T THE WORD 'ASSESSEE'. THE PAYER IS NOT AN ASSESSEE. THE PAYER BECOMES AN ASSESSEE-IN-DEFAULT ONLY WHEN HE FAILS TO FULFILL T HE STATUTORY OBLIGATION UNDER S. 195(1). IF THE PAYMENT DOES NOT CONTAIN TH E ELEMENT OF INCOME THE PAYER CANNOT BE MADE LIABLE. HE CANNOT BE DECLA RED TO BE AN ASSESSEE-IN-DEFAULT. THE CONTENTION OF THE DEPARTME NT IS BASED ON AN APPREHENSION WHICH IS ILL FOUNDED. THE PAYER IS ALS O AN ASSESSEE UNDER THE ORDINARY PROVISIONS OF THE IT ACT. WHEN THE PAY ER REMITS AN AMOUNT TO A NON-RESIDENT OUT OF INDIA HE CLAIMS DEDUCTION OR ALLOWANCES UNDER THE IT ACT FOR THE SAID SUM AS AN 'EXPENDITURE'. UN DER S. 40(A)(I), INSERTED VIDE FINANCE ACT, 1988 W.E.F. 1ST APRIL, 1 989, PAYMENT IN RESPECT OF ROYALTY, FEES FOR TECHNICAL SERVICES OR OTHER SUMS CHARGEABLE UNDER THE IT ACT WOULD NOT GET THE BENEFIT OF DEDUC TION IF THE ASSESSEE FAILS TO DEDUCT TAX AT SOURCE IN RESPECT OF PAYMENT S OUTSIDE INDIA WHICH ARE CHARGEABLE UNDER THE IT ACT. THIS PROVISION ENS URES EFFECTIVE COMPLIANCE OF S. 195 RELATING TO TDS IN RESPECT OF PAYMENTS OUTSIDE INDIA IN RESPECT OF ROYALTIES, FEES OR OTHER SUMS C HARGEABLE UNDER THE IT ACT. IN A GIVEN CASE WHERE THE PAYER IS AN ASSESSEE HE WILL DEFINITELY CLAIM DEDUCTION UNDER THE IT ACT FOR SUCH REMITTANC E AND ON INQUIRY IF THE AO FINDS THAT THE SUMS REMITTED OUTSIDE INDIA C OMES WITHIN THE DEFINITION OF ROYALTY OR FEES FOR TECHNICAL SERVICE OR OTHER SUMS CHARGEABLE UNDER THE IT ACT THEN IT WOULD BE OPEN T O THE AO TO DISALLOW SUCH CLAIM FOR DEDUCTION. SIMILARLY, VIDE FINANCE A CT, 2008, W.E.F. 1ST APRIL, 2008 SUB-S. (6) HAS BEEN INSERTED IN S. 195 WHICH REQUIRES THE PAYER TO FURNISH INFORMATION RELATING TO PAYMENT OF ANY SUM IN SUCH FORM AND MANNER AS MAY BE PRESCRIBED BY THE BOARD. THEREFORE, THERE ARE ADEQUATE SAFEGUARDS IN THE ACT WHICH WOULD PREV ENT REVENUE LEAKAGE.CIT VS. ELI LILLY & COMPANY (INDIA) (P) LT D. (2009) 223 CTR (SC) 20 : (2009) 21 DTR (SC) 74 : (2009) 312 ITR 22 5 (SC) RELIED ON; TRANSMISSION CORPORATION OF A.P. LTD. VS. CIT (1999) 155 CTR (SC) 489 : (1999) 239 ITR 587 (SC) DISTINGUISHED; CIT VS. SAMSUNG ELECTRONICS CO. LTD. & ORS. (2009) 227 CTR (KAR) 335 : (2009) 31 DTR (KAR) 257 AND CIT (INTERNATIONAL TAXATION) & ANR. VS. SONATA INFORMATION TECHNOLOGY LTD. (2010) 232 CTR (KAR) 20 : (2010) 38 DTR (KAR) 350 SET ASIDE. (PARA 9) ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 46 SINCE THE HIGH COURT DID NOT GO INTO THE MERITS OF THE CASE ON THE QUESTION OF PAYMENT OF ROYALTY, THE IMPUGNED JUDGME NTS OF THE HIGH COURT ARE SET ASIDE AND THESE CASES ARE REMITTED TO THE HIGH COURT FOR DE NOVO CONSIDERATION OF THE CASES ON MERITS. 3.4. IN ANOTHER CASE OF ASIAN VISION HOME ENTERTAINMENT (P.) LTD. (2010) 37 SOT 111 (MUM.), O N IDENTICAL FACTS HELD AS UNDER:- 4. FACTS OF THE CASE, IN BRIEF, ARE THAT THE AO DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS OBSERVED FROM THE P&L A/C AN D THE DETAILS FILED BY THE ASSESSEE THAT THE ASSESSEE HAS INCURRED THE EXPENDITURE ON ROYALTY PAYMENT OF RS. 1,09,09,328 TO M/S COLUMBIA TRISTAR FILMS OF INDIA, CHASE MANHATTAN BANK, 4, CHASE METRO TEX CEN TRE, 6TH FLOOR, BROKLIN, NEW YORK-11245. THE AO ASKED THE ASSESSEE TO SUBMIT THE DETAILS OF TDS DEDUCTED AND PAID FROM THE ABOVE ROY ALTY PAYMENT IN VIEW OF THE PROVISIONS OF S. 40(A) OF THE IT ACT, 1 961 (THE ACT). THE ASSESSEE VIDE ITS LETTER DT. 13TH MARCH, 2006 FILED ITS REPLY, THE RELEVANT PORTION OF THE SUBMISSION OF WHICH HAS BEEN REPRODU CED BY THE AO IN THE BODY OF ASSESSMENT ORDER AND WHICH IS REPRODUCED AS UNDER : 'THE PAYMENT MADE TO ABOVE PARTY WAS FOR AMOUNT PAY ABLE TO THEM FOR THE DISTRIBUTION AND MARKETING OF THEIR CINEMATOGRA PHIC FILM ON DVD AND VCD. THE SAID FEES WERE PAYABLE ON MINIMUM GUARANTE E BASIS AND IS CALCULATED PER PIECE AS FEES ON DISTRIBUTION OF SAI D FILMS. THE GUARANTEED LICENCE FEES WERE PAID IN ADVANCE AND THE SAME WAS ADJUSTED AGAINST SALE OF EACH DVD AND VCD AND AT THE END OF THE PERI OD IF FULL ADVANCE IS ADJUSTED AGAINST MINIMUM GUARANTEE THE FURTHER AMOU NT HAS TO BE PAID TO THEM. ACCORDINGLY, OUT OF THE PAYMENT MADE OF FE ES THE SAME IS CLARIFIED AS EXPENSES FOR THE YEAR AS PER SALE. THE ABOVE PAYMENT IS NOT PER SE ROYALTY AS DEFINED IN THE ACT AS DEFINED IN EXPLN. 2 TO S. 9(1)(VI). IN THE SAID DEFINITION IT STATES THAT TRANSFER OF ALL OR ANY RIGHT (INCLUDING THE GRANTING OF A LICENCE) IN RESPECT OF ANY COPYRI GHT, LITERARY, ARTISTIC OR SCIENTIFIC WORK INCLUDING FILMS OR VIDEO TAPES FOR USE IN CONNECTION WITH TELEVISION OR TAPES FOR USE IN CONNECTION WITH RADI O BROADCASTING, BUT NOT INCLUDING CONSIDERATION FOR SALE, DISTRIBUTION OR E XHIBITION OF CINEMATOGRAPHIC FILMS.' 5. IN SUPPORT OF THE ABOVE CONTENTION THE ASSESSEE AL SO ENCLOSED THE COPY OF THE AGREEMENT BETWEEN THE ASSESSEE-COMPANY AND MR. VINOD MOHINDRA, CHAIRMAN, VDC, VDC HOUSE, SOUTH WAY, WEMB LEY, MIDDLESEX, HA9 OHB, ENGLAND. HOWEVER, THE AO WAS NO T SATISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE. HE OBSERVED THAT ROYALTY PAYMENT MENTIONED ABOVE IS PAYABLE TO M/S COLUMBIA TRISTAR FILMS OF INDIA (CTFI). THE RELEVANCE OF THE COPY OF AGREEMEN T FURNISHED WAS NOT EXPLAINED BY THE ASSESSEE. THEREFORE, THE TERMS AND CONDITIONS AS PER THE AGREEMENT WITH VDC FOR ROYALTY PAYMENT DO NOT F IND PLACE FOR DECIDING THE ALLOWABILITY OF PAYMENT TO M/S CTFI. S INCE THE ASSESSEE DID NOT DEDUCT TDS FROM THE ROYALTY PAYMENT MADE TO M/S CTFI AND SINCE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 47 THE ASSESSEE DID NOT FURNISH ANY DETAILS OF THESE D OCUMENTS TO ESTABLISH THAT THE PAYMENT MADE TO M/S CTFI DO NOT FALL IN TH E CATEGORY OF PAYMENT THAT IS LIABLE FOR DEDUCTION OF TAX AT SOUR CE AS PER THE PROVISIONS OF S. 40(A) OF THE ACT, THE AO DISALLOWE D THE CLAIM OF ROYALTY PAYMENT MADE TO M/S CTFI AMOUNTING TO RS. 1,09,09,3 28 UNDER S. 40(A) OF THE ACT. 6. IN APPEAL, THE CIT(A) CONFIRMED THE ACTION OF THE AO BY HOLDING AS UNDER : '3.2 I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND TH E MATERIALS ON RECORD. ADMITTEDLY, THE CLAIM WAS IN RELATION TO RO YALTY PAYMENT. THE ONUS WAS SQUARELY ON THE APPELLANT TO ESTABLISH THA T IT WOULD NOT BE SO EVEN THOUGH CLAIMED. FROM THE DISCUSSION IN THE BOD Y OF THE ASSESSMENT ORDER AND NARRATED ABOVE, IT IS SEEN THAT THE AO HA S ALLOWED PROPER OPPORTUNITY TO THE APPELLANT TO EXPLAIN ITS POSITIO N. THE WRITTEN SUBMISSION FILED DURING THE ASSESSMENT HEARING HAS MADE A REFERENCE TO S. 9 (EXPLN. 2) TO STATE THAT IT WAS NOT A CASE OF PAYMENT OF ROYALTY PER SE. THAT MEANS, IT IS OTHERWISE A ROYALTY. FURTHER , THE COPIES OF AGREEMENT FILED DURING ASSESSMENT PROCEEDINGS DID N OT CLEAR THE MATTER. AT THE APPEAL HEARING STAGE, THE CONTENTIONS MADE A T THE ASSESSMENT STAGE WERE REPEATED. UNDER SUCH FACTS AND CIRCUMSTA NCES, I FIND THAT THE APPELLANT HAS ITSELF CLAIMED ROYALTY PAYMENT. L ATER ON, IT BACKTRACKED ON SUCH CLAIM WITHOUT PROPER EXPLANATIO N. UNDER THE FACTS AND CIRCUMSTANCES, THE AO WAS LEFT WITH NO OPTION O THER THAN TO MAKE THE ADDITION. AT THE APPEAL HEARING STAGE ALSO NO M ATERIAL HAS BEEN BROUGHT ON RECORD TO CONTROVERT THE FINDINGS OF THE AO. CONSEQUENTLY, THE ORDER OF THE AO DESERVES TO BE UPHELD.' AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASSESS EE IS IN APPEAL BEFORE US. 7. THE LEARNED COUNSEL FOR THE ASSESSEE DREW THE ATTE NTION OF THE BENCH TO PROVISIONS OF S. 40(A) OF THE ACT AND SUBMITTED THAT AS PER EXPLANATION TO THE SAID PROVISIONS 'ROYALTY' SHALL HAVE THE SAME MEANING AS IN EXPLN. 2 TO CL. (VI) OF SUB-S. (1) OF S. 9 OF THE ACT. REFERRING TO EXPLN. 2 TO S. 9(1)(VI), HE DREW THE A TTENTION OF THE BENCH TO ALL THE CLAUSES AND SUBMITTED THAT THE ASSESSEE DOES NOT FALL UNDER ANY OF THE CLAUSES. REFERRING TO THE COPY OF THE AG REEMENT, HE DREW THE ATTENTION OF THE BENCH TO CLAUSE NOS. 1, 3, 6 AND 1 3 OF THE AGREEMENT AND SUBMITTED THAT IT IS ONLY RENTAL DISTRIBUTION A ND SALE AND NOT FOR TV OR RADIO BROADCASTING. HE SUBMITTED THAT NOBODY HAS CHALLENGED THE COPY OF THE AGREEMENT ALTHOUGH IT WAS PRODUCED BEFO RE THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS. HE SUBMITTED THAT EVEN THOUGH THE ASSESSEE HAS PAID ROYALTY, HOWEVER, TDS IS NOT REQUIRED TO BE DEDUCTED SINCE SUCH PAYMENT IS OUTSIDE THE DEFINITI ON OF 'ROYALTY' AS PER THE PROVISIONS OF S. 40(A) OF THE IT ACT, 1961. HE ACCORDINGLY SUBMITTED THAT THE ORDER OF THE CIT(A) BE SET ASIDE AND THE G ROUNDS RAISED BY THE ASSESSEE BE ALLOWED. 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OT HER HAND, SUBMITTED THE AO AND THE CIT(A) HAVE NOT GONE THROU GH THE AGREEMENT PROPERLY. THEREFORE, THE MATTER MAY BE RESTORED BAC K TO THE FILE OF THE AO FOR FRESH ADJUDICATION. ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 48 9. THE LEARNED COUNSEL FOR THE ASSESSEE, IN HIS REJOI NDER, SUBMITTED THAT THE COPY OF THE AGREEMENT WAS FILED BEFORE THE AO D URING THE COURSE OF ASSESSMENT PROCEEDINGS. THEREFORE, IT CAN BE FAIRLY PRESUMED THAT HE HAS GONE THROUGH THE SAME. EVEN NOW ALSO IT IS NOT CONTRADICTED AS TO HOW THE ASSESSEE FALLS UNDER THE TDS PROVISIONS. 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE FIND THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE AS PER THE LICENCE AGREEMENT WITH MR. VINO D MOHINDRA, CHAIRMAN, VDC HAS PAID ROYALTY OF RS. 1,09,09,328 D URING THE YEAR. ACCORDING TO THE REVENUE SINCE THE ASSESSEE HAS NOT DEDUCTED TAX AT SOURCE FROM THE ROYALTY PAYMENT TO M/S CTFI, NEW YO RK, THEREFORE, THE PROVISIONS OF S. 40(A) ARE ATTRACTED AND SUCH PAYME NT OF ROYALTY IS NOT ALLOWED AS A DEDUCTION. HOWEVER, IT IS THE SUBMISSI ON OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE ASSESSEE IS OUT O F DEFINITION OF 'ROYALTY' FOR THE PURPOSE OF TDS. 11. WE FIND AS PER CL. (1) OF THE LICENCE AGREEMENT, T HE PROGRAMMES WHICH ARE SUBJECT OF THE LICENCE AGREEMENT REFER TO THE FEATURE AND NON- FEATURE MOTION PICTURES FOR WHICH THE LICENSOR OWNS OR CONTROLS THE NECESSARY RIGHTS IN THE TERRITORY. AS PER CL. (6) O F THE SAID AGREEMENT, THE LICENSEES SHALL EXPLOIT THE PROGRAMMES FOR RENT AL AND SALE THROUGH DISTRIBUTION. WE FIND CL. 13 OF THE AGREEMENT RELAT ING TO ROYALTY READS AS UNDER : 'ROYALTIES THE LICENSEES SHALL PAY TO THE LICENSORS OR IF REQU IRED BY THE LICENSORS DIRECTLY TO THE ORIGINAL LICENSOR BY WIRE TRANSFER OF THEIR BANKERS CHASE MANHATTAN BANK OF NEW YORK, AS PROVIDED FOR IN PARA 3.1 OF THE STANDARD TERMS AND CONDITIONS, ROYALTIES AS FOLLOWS : '(A) VIDEO CASSETTESFOR RENTAL AND/OR SELL-THROUGH DISTRIBUTION OF VIDEO CASSETTES, ROYALTIES SHALL EQUAL THE GREATER OF TWE NTY PER CENT (20 PER CENT) OF GROSS RECEIPTS (AS DEFINED IN THE STANDARD TERMS AND CONDITIONS) OR EIGHTY US CENTS (US $ 0.80) PER VIDEO CASSETTE. (B) VIDEO CD. (I) FOR RENTAL AND/OR SELL-THROUGH DISTRIBUTION OF SINGLE-DISC VIDEO CDS, ROYALTIES SHALL EQUAL THE GREATER OF TWENTY-FIVE PE R CENT (25 PER CENT) OF GROSS RECEIPTS OF ONE US DOLLAR (US $ 1) PER VIDEO CD SOLD; AND (II) FOR RENTAL AND/OR SELL-THROUGH DISTRIBUTION OF DOUBLE DISC VIDEO CDS, ROYALTIES SHALL EQUAL THE GREATER OF THIRTY PER CEN T (30 PER CENT) OF GROSS RECEIPTS, OR ONE US DOLLAR AND THIRTY CENTS (US $ 1 .30) PER VIDEO CD SOLD.' 12. WE FIND AS PER EXPLANATION TO S. 40(A), ROYALTY SH ALL, HAVE THE SAME MEANING AS IN EXPLN. 2 TO CL. (VI) OF SUB-S. (1) OF S. 9 OF THE ACT. WE FIND EXPLN. 2 TO CL. (VI) OF SUB-S. (1) OF S. 9 READS AS UNDER : ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 49 '(I) THE TRANSFER OF ALL OR ANY RIGHTS (INCLUDING T HE GRANTING OF A LICENCE) IN RESPECT OF A PATENT, INVENTION, MODEL, DESIGN, S ECRET FORMULA OR PROCESS OR TRADE MARK OR SIMILAR PROPERTY; (II) THE IMPARTING OF ANY INFORMATION CONCERNING TH E WORKING OF, OR THE USE OF, A PATENT, INVENTION, MODEL, DESIGN, SECRET FORMULA OR PROCESS OR TRADE MARK OR SIMILAR PROPERTY; (III) THE USE OF ANY PATENT, INVENTION, MODEL, DESI GN, SECRET FORMULA OR PROCESS OR TRADE MARK OR SIMILAR PROPERTY; (IV) THE IMPARTING OF ANY INFORMATION CONCERNING TE CHNICAL, INDUSTRIAL, COMMERCIAL OR SCIENTIFIC KNOWLEDGE, EXPERIENCE OR S KILL; (IVA) THE USE OR RIGHT TO USE ANY INDUSTRIAL, COMME RCIAL OR SCIENTIFIC EQUIPMENT BUT NOT INCLUDING THE AMOUNTS REFERRED TO IN S. 44BB; (V) THE TRANSFER OF ALL OR ANY RIGHTS (INCLUDING TH E GRANTING OF A LICENCE) IN RESPECT OF ANY COPYRIGHT, LITERARY, ARTISTIC OR SCIENTIFIC WORK INCLUDING FILMS OR VIDEO TAPES FOR USE IN CONNECTION WITH TEL EVISION OR TAPES FOR USE IN CONNECTION WITH RADIO BROADCASTING, BUT NOT INCL UDING CONSIDERATION FOR THE SALE, DISTRIBUTION OR EXHIBITION OF CINEMATOGRA PHIC FILMS; OR (VI) THE RENDERING OF ANY SERVICES IN CONNECTION WI TH THE ACTIVITIES REFERRED TO IN SUB-CLS. (I) TO (IV), (IVA) AND (V). ' 13. WE FIND, ADMITTEDLY, ROYALTY HAS NOT BEEN PAID FOR ANY TV OR RADIO BROADCASTING. THE LEARNED DEPARTMENTAL REPRESENTATI VE COULD NOT POINT OUT AS TO UNDER WHICH OF THE CLAUSES OF EXPLN. 2 TO S. 9(1)(VI) OF THE ACT THE PAYMENT OF ROYALTY FALLS SO AS TO BRING IT INTO THE DEFINITION OF ROYALTY. WE, THEREFORE, FIND MERIT IN THE SUBMISSIO N OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT ALTHOUGH ROYALTY HAS BEEN PAID AS PER THE AGREEMENT, HOWEVER, SUCH 'ROYALTY' IS OUTSIDE THE D EFINITION OF ROYALTY AS PER EXPLN. 2 TO SUB-CL. (VI) OF SUB-S. (1) OF S. 9 AND, THEREFORE, PROVISIONS OF S. 40(A) ARE NOT APPLICABLE. FURTHER THE COPY OF THE AGREEMENT WAS ALREADY FURNISHED BEFORE THE AO DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS. WE, THEREFORE, DO NOT FIND ANY MERIT IN THE SUBMISSION OF THE LEARNED DEPARTMENTAL REPRESENTATI VE THAT THE AO OR THE CIT(A) HAVE NOT GONE THROUGH THE AGREEMENT PROP ERLY. IN THIS VIEW OF THE MATTER, WE HOLD THAT THE PAYMENT OF ROYALTY MADE BY THE ASSESSEE IS OUTSIDE THE PURVIEW OF S. 40(A) OF THE IT ACT, 1961, AND, THEREFORE, NO TDS IS REQUIRED TO BE MADE FROM SUCH ROYALTY PAYMENT. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE CIT(A) A ND DIRECT THE AO TO DELETE THE DISALLOWANCE. THE GROUND RAISED BY THE A SSESSEE IS, ACCORDINGLY, ALLOWED. 15. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 3.5. IF THE RELEVANT PROVISION AND EXPLANATION TO SECTION 40(A) OF THE ACT IS ANALYZED WITH EXPLANATION-2 TO CLAUSE (VI) TO ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 50 SUB-SECTION (1) OF SECTION-9 OF THE ACT, WE FIND TH AT EXPLANATION-2 SPEAKS ABOUT TRANSFER OF ALL OR ANY R IGHTS (INCLUDING THE GRANTING OF LICENSE) IN RESPECT OF P ATENT, INVENTION, MODEL, DESIGN, SECRET FORMULA OR PROCESS OR TRADEMARK OR SIMILAR PROPERTY, THEREFORE, ROYALTY H AS NOT BEEN PAID FOR ANY T.V. OR RADIO BROADCASTING, CONSEQUENT LY, WE FIND MERIT IN THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE. SUCH ROYALTY IS OUT OF THE DEFINITION OF ROYALTY AS PER EXPLANATION-2 TO SUB-CLAUSE (VI) OF SUB-SECTION (1) OF SECTION 9, THEREFORE, THE PROVISION OF SECTION 40(A) IS NOT AP PLICABLE TO THE CASE OF THE ASSESSEE. THEREFORE, WE HOLD THAT THE P AYMENT OF ALLEGED ROYALTY IS OUTSIDE THE PREVIEW OF SECTION 4 0(A) OF THE ACT, THEREFORE, NO TDS IS REQUIRED TO BE MADE FROM SUCH PAYMENTS, BECAUSE IT IS OUTSIDE THE PURVIEW OF ROYA LTY AND FURTHER THE DECISION OF THE MUMBAI BENCH OF THE TRI BUNAL IN CHANNEL GUIDE INDIA LTD. (2012) 25 TAXMAN.COM 25(MU M.) DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. THE H ON'BLE APEX COURT IN G.E. INDIA TECHNOLOGY CEN. (P.) LTD. VS CI T (2010) 327 ITR 456 (SC) AND THE RATIO LAID DOWN THEREIN HE LD THAT THE PAYMENT MADE TO NON-RESIDENT, THERE IS NO OBLIGATIO N TO DEDUCT THE TAX AT SOURCE AND SUCH QUESTION ONLY ARI SES THE ITA NO.1135/MUM/2015 SWANSTON MULTIPLEX CINEMAS PVT. LTD. 51 SUM SO PAID IS CHARGEABLE U/S 4, 5 AND 9 OF THE ACT . RESPECTFULLY FOLLOWING THE AFORESAID DECISIONS, THI S GROUND OF THE ASSESSEE IS ALLOWED. FINALLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOW ED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN TH E PRESENCE OF LD. REPRESENTATIVE OF BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 12/09/2017. SD/- (G. MANJUNATHA) SD/- (JOGINDER SINGH) ' # / ACCOUNTANT MEMBER $ # / JUDICIAL MEMBER MUMBAI; , DATED :-03/10/2017 F{X~{T? P.S / -' !%$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. ./01 / THE APPELLANT 2. 2301 / THE RESPONDENT. 3. 4 4 5' ( ./ ) / THE CIT, MUMBAI. 4. 4 4 5' / CIT(A)- , MUMBAI 5. 6'72' , 4 ./*. 8 , / DR, ITAT, MUMBAI 6. 9 : / GUARD FILE. ! / BY ORDER, 36/'2' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI,