ACIT, CHENNAI V. M/s Nipa Chemicals Limited, CHENNAI

ITA 1398/CHNY/2009

• Counselvise Citation: 139821714 RSA 2009
• Duration Of Justice: 2 year(s) 1 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 05-10-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 04-09-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Opportunity of being heard
• Section: 92A; 92E

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI [BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER] I.T.A NO.1398/MDS/2009 (ASSESSMENT YEAR : 2004-05 ) THE ASST. COMMISSIONER OF INCOME-TAX COMPANY CIRCLE IV(4) CHENNAI VS M/S NIPA CHEMICALS LTD 142-B, TIRUPORUR ROAD PERUNGUDI CHENNAI 600 096 [PAN AAACN1138K] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M.N.MURTHY NAIK, JCIT RESPONDENT BY : NONE DATE OF HEARING : 5.10.2011 DATE OF PRONOUNCEMENT : 24.10.2011 O R D E R PER HARI OM MARATHA, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE, FOR ASSESSMENT YE AR 2004-05, IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A),CHENNA I, DATED 16.07.2008. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS REGARDING THE FINDING THAT THE ASSESSEE AND ITS JAPANESE COLLABO RATOR, M/S NIHON PARKERISING COMPANY LTD., WERE NOT ASSOCIATED CONCE RNS WITHIN THE ITA 1398/09 :- 2 -: DEFINITION OF SECTION 92A OF THE ACT AND HENCE, THE OBLIGATION TO FILE FORM 3CEB COULD NOT BE FASTENED ON THE ASSESSEE, WH ICH RESULTED IN DELETION OF ADDITION OF ` 60,33,001/- MADE BY THE ASSESSING OFFICER. 3. AT THE TIME OF HEARING, DESPITE SERVICE OF DUE NOT ICE, NO REPRESENTATION WAS MADE FROM THE SIDE OF THE RESPO NDENT-ASSESSEE, THEREFORE, THIS APPEAL WAS HEARD EX-PARTE. 4. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE- COMPANY, ENGAGED IN THE BUSINESS OF MANUFACTURING P RE-TREATMENT CHEMICALS, FILED ITS RETURN OF INCOME FOR THE PERIO D UNDER CONSIDERATION ON 1.11.2004. AN AMOUNT OF ` 60,33,001/- PAID AS ROYALTY TO M/S NIHON PARKERISING COMPANY LIMITED, JAPAN, WAS DISAL LOWED ON THE REASONING THAT IN TERMS OF THE PROVISIONS OF SECTIO N 94E OF THE ACT, THE ASSESSEE WAS REQUIRED TO FURNISH A REPORT FROM THE CHARTERED ACCOUNTANT IN FORM 3CEB HAVING ENTERED INTO AN INTE RNATIONAL TRANSACTION WITH AN ASSOCIATED CONCERN. BUT NO SUC H AUDIT REPORT HAD BEEN FILED WITH THE RETURN OF INCOME. BEING AGGRIE VED, THE ASSESSEE- COMPANY FILED FIRST APPEAL AND THE LD. CIT(A) HAS C OME TO THE CONCLUSION THAT SECTION 92E WILL NOT APPLY. ITA 1398/09 :- 3 -: 5. IT HAS BEEN ARGUED BY THE LD.DR THAT IN FACT, THE LD. CIT(A) HAS NOT APPLIED THE PROVISIONS OF SECTION 92(1) OF THE ACT WHICH ARE RELEVANT FOR THE PRESENT QUESTION. IT WAS ARGUED T HAT ONCE IT IS HELD THAT THE ASSESSEE-COMPANY AND THE JAPANESE COLLABOR ATOR ARE ASSOCIATED CONCERNS, AN OBLIGATION TO FILE FORM 3CE B WOULD BE FASTENED ON THE ASSESSEE-COMPANY. SINCE THE FACTS OF THIS ISSUE ARE NOT CLEARLY COMING BEFORE US AND WE, BEING THE FINA L FACT FINDING BODY, IT BECOMES IMPERATIVE FOR US TO RESTORE THE ENTIRE ISSUE TO THE FILE OF THE ASSESSING OFFICER SO THAT HE CAN CULL OUT RELEV ANT FACTS OF THIS ISSUE IN A DEPICTIVE MANNER. ACCORDINGLY, WE RESTORE THI S ISSUE TO THE FILE OF THE ASSESSING OFFICER AND HE SHALL DECIDE THE ISSUE ANEW AFTER GIVING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT O N 24.10.2011. SD/- SD/- (DR. O.K. NARAYANAN) VICE-PRESIDENT (HARI OM MARATHA) JUDICIAL MEMBER DATED: 24 TH OCTOBER, 2011 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR