DCIT, New Delhi V. M/s. Aluminium Pechiney, New Delhi

ITA 1902/DEL/2015

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 4962 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 01-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAMES SINGSON SENIOR
• Keywords: Permanent establishment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A : NEW DELHI) BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.1902/DEL./2015 (ASSESSMENT YEAR : 2009-10) DCIT, CIRCLE 1(1)(1), VS. M/S. ALUMINIUM PECHINEY, INTERNATIONAL TAXATION, C/O P. GAMBHIR & ASSOCIATE S (CAS) NEW DELHI. 87-B, MASJID MOTH PHASE III, NEW DELHI 110 048. (PAN : AAICA3338C) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI JAMES SINGSON, SENIOR DR DATE OF HEARING : 23.10.2018 DATE OF ORDER : 24.10.2018 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : THE APPELLANT, DCIT, CIRCLE 1(1)(1), INTERNATIONAL TAXATION, NEW DELHI (HEREINAFTER REFERRED TO AS THE REVENUE) BY FILING THE PRESENT APPEAL, SOUGHT TO SET ASIDE THE IMPUGNED OR DER DATED 13.01.2015 PASSED BY LD. CIT (APPEALS)-42, NEW DELH I QUA THE ASSESSMENT YEAR 2009-10 ON THE GROUND THAT :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . CIT (A) HAS ERRED IN QUASHING THE PENALTY U/S 271(1 )(C) IMPOSED BY THE AO. ITA NO.1902/DEL./2015 2 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICA TION OF THE CONTROVERSY AT HAND ARE : ON THE BASIS OF COMPLETED ASSESSMENT UNDER SECTION 143 (3) OF THE INCOME-TAX ACT, 1961 ( FOR SHORT THE ACT) AT THE INCOME OF RS.1,39,62,22,521/- WITH ADD ITION OF RS.7,40,89,524/- ON ACCOUNT OF AMOUNT PAID BY THE N ATIONAL ALUMINIUM COMPANY LIMITED (NALCO) TO THE ASSESSEE B UT HAS NOT DECLARED IN THE RETURN OF INCOME, PENALTY PROCE EDINGS U/S 271(1)(C) OF THE ACT WERE INITIATED BY ISSUANCE OF NOTICE U/S 274 READ WITH SECTION 271(1)(C) OF THE ACT. DECLINING THE CONTENTIONS RAISED BY THE ASSESSEE THAT THE ASSESSEE HAD DEDUCT ED TDS AND ON RECEIPT OF FRESH CERTIFICATES FROM NALCO HAD VOLUNT ARILY REVISED ITS RECEIPT DURING THE COURSE OF ASSESSMENT PROCEED INGS, THE AO PROCEEDED TO LEVY THE PENALTY TO THE TUNE OF RS.61, 36,880/- @ 100% ON THE GROUND THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF ITS INCOME. 3. ASSESSEE CARRIED THE MATTER BY WAY OF APPEAL BEF ORE THE LD. CIT (A) WHO HAS DELETED THE PENALTY LEVIED BY THE A O BY ACCEPTING THE APPEAL. FEELING AGGRIEVED, THE REVENUE HAS COM E UP BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT APPEAL. 4. ASSESSEE HAS NOT PREFERRED TO PUT IN APPEARANCE DESPITE ISSUANCE OF NOTICE OF HEARING FOR 20.08.2018 AND 23 .10.2018 AND CONSEQUENTLY, WE PROCEEDED TO DECIDE THE PRESENT AP PEAL WITH THE ITA NO.1902/DEL./2015 3 ASSISTANCE OF THE LD. DR AS WELL AS ON THE BASIS OF DOCUMENTS AVAILABLE ON THE FILE. 5. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIV E FOR THE REVENUE TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. UNDISPUTEDLY, DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS REVISED ITS TAX COMPUTATION BY ENHANCI NG ITS FEE FOR TECHNICAL SERVICES (FTS) BY RS.6,04,70,766/- AND CO RRESPONDING TDS CREDIT BY RS.60,47,077/- ON THE SAID RECEIPTS. IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAS CLAIMED SAME AMOUNT O F TAX REFUND AS IT HAD INITIALLY CLAIMED I.E. RS.70,25,596/-. IT I S ALSO NOT IN DISPUTE THAT ON RECEIPT OF TDS CERTIFICATE FROM NALCO REFLE CTING ADDITIONAL AMOUNT, THE ASSESSEE HAD VOLUNTARILY REV ISED ITS COMPUTATION. IT IS ALSO NOT IN DISPUTE THAT THE AS SESSEE IS A FRENCH TAX RESIDENT COMPANY, WHO HAS FILED ITS FIRST BELAT ED TAX RETURN U/S 139(4) IN INDIA VOLUNTARILY ON 29.03.2011 WHICH WAS WITHIN TIME. 7. IN THE BACKDROP OF THE AFORESAID FACTS AND CIRCU MSTANCES OF THE CASE, ORDER PASSED BY THE LOWER REVENUE AUTHORI TIES AND ARGUMENTS ADDRESSED BY THE LD. DR FOR THE REVENUE, THE SOLE QUESTION ARISES FOR DETERMINATION IN THIS CASE IS:- ITA NO.1902/DEL./2015 4 AS TO WHETHER THE ASSESSEE HAS CONCEALED PARTICULA RS OF INCOME OR HAS FURNISHED INACCURATE PARTICULARS OF INCOME DURING ASSESSMENT PROCEEDINGS WHILE INTERPRETING THE PROVISIONS CONTAINED U/S 271(1)(C) OF THE ACT? 8. FROM THE UNDISPUTED FACTS, IT IS PROVED ON RECOR D THAT THE ASSESSEE, A FRENCH TAX RESIDENT COMPANY, IS HAVING NO PERMANENT ESTABLISHMENT (PE) IN INDIA AND AS SUCH IS NOT MAIN TAINING ANY BOOKS OF ACCOUNT OR HAVING ANY BANK ACCOUNT IN INDI A QUA ITS INDIAN OPERATIONS. IT IS NOT IN DISPUTE THAT THE A SSESSEE HAS TO BE DEPENDENT UPON INDIAN PARTIES FOR DECLARING TDS REC EIPTS IN INDIA IN NRIS THROUGH THEIR TDS CERTIFICATES. WHEN THE A SSESSEE HAS FILED ITS RETURN OF INCOME ON THE BASIS OF TDS CERT IFICATES RECEIVED AT THE TIME OF FILING OF RETURN FROM HINDALCO AND N ALCO, IT CANNOT BE FAULTED ON ANY GROUND. MOREOVER WHEN THE ASSESSEE ON RECEIPT OF FTS OF RS.6,04,70,766/- WITH CORRESPONDI NG TDS CREDIT OF RS.60,47,077/-, HAS FILED REVISED TAX COMPUTATIO N, THERE IS NO ELEMENT OF CONCEALMENT OF PARTICULARS OF ITS INCOME . 9. NOT ONLY THIS, WHEN THE NALCO HAD DEDUCTED ADMIS SIBLE TAX AT SOURCE ON ALL THE PAYMENTS MADE BY IT TO THE ASSESSEE, NO BENEFIT HAS BEEN TAKEN BY CONCEALING THE RECEIPTS F ROM THE NALCO AS THE ASSESSEE HAS CONTRACT WITH NALCO FOR NET TAX ES. EVEN THE ASSESSEE HAS NOT CLAIMED ANY REFUND IN RESPECT OF T HE PORTION OF TDS INTIMATED SUBSEQUENTLY BY FILLING REVISED TAX C OMPUTATION. ITA NO.1902/DEL./2015 5 FURTHERMORE, IT IS THE CASE OF THE ASSESSEE THAT UN DER BONAFIDE PLEA THAT SINCE MAKE AVAILABLE CLAUSE IS NOT SATISFIED T HE PAYMENT DO NOT PARTAKE THE CHARACTER OF FTS UNDER INDO FRENCH DTA. 10. SO, IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, W E ARE OF THE CONSIDERED VIEW THAT ANSWER TO THE QUESTION FRAMED IS IN NEGATIVE AND THE LD. CIT (A) HAS PASSED A VALID AND REASONED ORDER BY DELETING THE PENALTY WHICH IS OTHERWISE NOT SUSTAIN ABLE IN THE EYES OF LAW. SO, FINDING NO ILLEGALITY OR PERVERSITY IN THE IMPUGNED ORDER PASSED BY THE LD. CIT (A), PRESENT APPEAL FIL ED BY THE REVENUE IS HEREBY DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THIS 24 TH DAY OF OCTOBER, 2018. SD/- SD/- (R.K. PANDA) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 24 TH DAY OF OCTOBER , 2018 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-42, NEW DELHI 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.