DDIT (IT) 2(1), MUMBAI V. SAMNE DEUTZ FAHR GROUP SPA, MUMBAI

ITA 1291/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92820 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2015
• Appeal Filed By: Department
• Bench Allotted: E
• Next Hearing Date: 01-06-2015
• Assessment Year: 2011-2012
• Appeal Filed On: 14-02-2013
• Court: TRIBUNAL
• Keywords: Revised return
• Section: 234B

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E , BENCH MUMBAI . . , , BEFORE SHRI R.C.SHARMA , A M & MS. SUSHMA CHOWLA , J M ./ I TA NO. 12 91 / MUM/20 1 3 ( / ASSESSMENT YEAR : 20 11 - 12 ) DDIT(IT) - 2(1), MUMBAI VS. M/S SAME DEUTZ FAHR GROUP SPA, SRBC & ASSOCIATES, 14 TH FLOOR, THE RUBY, SENAPATI BAPAT MARG, DADAR(W), MUMBAI - 400028 ./ ./ PAN/GIR NO. : A A BC S 1680 A ( / APPELLANT ) .. ( / RESPONDENT ) /REVENUE BY : SHRI NEIL PHILIP /ASSESSEE BY : NONE / DATE OF HEARING : 0 2 /0 6 / 2015 / DATE OF PRONOUNCEMENT 10/06 /2015 / O R D E R PER R.C.SHARMA (A.M) : TH IS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) - 1 1 , MUMBAI , DATED 27 - 11 - 2012 FOR THE ASSESSMENT YEAR 20 11 - 12 , IN THE MATTER OF ORDER PASSED U/S.143(3) OF THE I.T. ACT, WHEREIN THE RE VENUE HAS TAKEN FOLLOWING GROUNDS : - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ID. CIT(A) ERRED IN DELETING THE INTEREST CHARGED UNDER SECTION 234 - B OF THE INCOME - TAX ACT, 1961 WITHOUT APPRECIATING THE FACT THAT EXPLANATION 1(I) OF THE SECTION 234B OF THE INCOME - TAX ACT, 1961 USED THE EXPRESSION 'INCOME DEDUCTED OR COLLECTED AT SOURCE'. ACCORDINGLY, MATERIAL IS WHETHER THE TAX AT SOURCE WAS DEDUCTED OR COLLECTED AND IF IT ITA NO. 12 91 /1 3 2 WAS NOT ACTUALLY COLLECTED OR DEDUCTED, THE LIABILITY TO P AY INTEREST ARISES IN THE INSTANT CASE. 2. ON THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) ERRED IN GIVING RELIEF TO THE ASSESSEE ON THE ISSUE OF CHARGEABILITY OF INTEREST UNDER SECTION 234B, WHEN THE ASSESSEE HAS ITSELF, IN THE RETURN O F INCOME FILED, COMPUTED & INCLUDED THE INTEREST U/S 234B & 234C WHILE COMPUTING THE TAX LIABILITY & FURTHER, THE ASSESSEE HAS ALSO NOT FILED ANY REVISED RETURN FOR THE YEAR UNDER CONSIDERATION FOR CLAIMING THIS RELIEF. 3. THE APPELLANT PRAYS THAT THE O RDER OF THE ID. CIT(A) BE SET ASIDE ON THE ABOVE GROUNDS AND THAT OF THE ASSESSING OFFICER BE RESTORED. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED . FACTS IN BRIEF ARE THAT THE ASSESSEE COMPANY IS ESTABLISHED AND REGISTERED UNDER THE LAWS OF I TALY HAVING ITS REGISTERED OFFICE AT 14, VIALE FRANCESCO CASSANI TREVIGELIO - ITALY). THE ASSESSEE, A NON - RESIDENT AS PER THE IT ACT ENTERED INTO A ROYALTY AGREEMENT DATED 1 - 4 - 2008 WITH SAME DEUZ FAHR INDIA PVT. LTD., A COMPANY INCORPORATED UNDER INDIAN COM PANIES ACT, 1956, FOR THE USE OF THE TRADE MARK DEUTZ FAHR BY SAME INDIA, PURSUANT TO WHICH THE ASSESSEE RECEIVES ROYALTY INCOME FROM SAME INDIA. FOR THE ASSESSMENT YEAR 2011 - 2012 UNDER CONSIDERATION , THE ROYALTY INCOME WAS THE ONLY SOURCE OF INCOME FROM INDIA FOR THE ASSESSEE AS PER THE ACT. 3. THE ISSUE OF CHARGING INTEREST U/S.234B&234C W H ERE INCOME IS SUBJECT TO TDS, IS COVERED BY THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF NGC ASIA NETWORKS LLC, 313 ITR 187 , WHEREIN IT WAS HELD T HAT NO INTEREST IS LEVIABLE U/S.234B&234C WHERE THE INCOME IS SUBJECT TO TDS. IN THE INSTANT CASE BEFORE US, SINCE THE ALLEGED INCOME WAS LIABLE TO TAX DEDUCTION AT SOURCE U/S.195, THERE WAS NO LIABILITY TO PAY ADVANCE TAX UNDER SECTION 208 OF THE ACT AND IN ABSENCE OF ANY LIABILITY TO ITA NO. 12 91 /1 3 3 PAY ADVANCE TAX, THE PROVISIONS OF SECTION 234B AND 23C OF THE ACT IS NOT APPLICABLE. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING THE INTEREST U/S.234B&234C OF THE ACT BY FOLLOWING THE DECISI ON OF HONBLE BOMBAY HIGH COURT IN THE CASE OF NGC ASIA NETWORKS LLC (SUPRA) . 4 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED . O RDER PRONOUNCED IN THE OPEN COURT ON THIS 10/06 / 201 5 . SD/ - SD/ - ( ) ( SUSHMA CHOWLA ) ( . . ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 10/06 /201 5 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRU E COPY/