Deputy Commissioner of Income-tax, V. Magna International Inc., Pune

ITA 2098/PUN/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6750 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 24-10-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 09-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VINAY GHANEKAR
• Assessee Lawyers: SANJEEV GHEI
• Keywords: Transfer pricing; Double taxation relief; Prejudicial to interest; Revised return; Bonafide mistake
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , . , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI D. KARUNAKARA RAO , AM . / ITA NO. 2098 /P U N/201 6 / ASSESSMENT YEAR : 20 13 - 14 THE DY. COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION), CIRCLE 1, PUNE . / APPELLANT VS. MAGNA INTERNATIONAL INC., C/O COSMA INTERNATIONAL (INDIA) PVT. LTD., PLOT NO.A - 12, MIDC, TALEGAON INDUSTRIAL AREA, NAVLAKH UMBRE, PUNE 410507 . / RESPONDENT PAN: A AHCM4866C . /CO NO. 54 /PUN/201 8 / ASSESSMENT YEAR : 20 13 - 14 (OUT OF ITA NO. 2098 /PUN/201 6 ) MAGNA INTERNATIONAL INC ., C/O COSMA INTERNATIONAL (INDIA) PVT. LTD., PLOT NO.A - 12, MIDC, TALEGAON INDUSTRIAL AREA, NAVLAKH UMBRE, PUNE 410507 / CROSS OBJECT OR PAN: AAHCM4866C VS. THE DY. COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION), CIRCLE 1, PUN E . / RESPONDENT ASSESSEE BY : S /S HRI KISHORE PHADKE & VINAY GHANEKAR RESPONDENT BY : SHRI SANJEEV GHEI / DATE OF HEARING : 2 4 . 1 0 .201 8 / DATE OF PRONOUNCEMENT: 21 . 0 1 .201 9 ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 2 / ORDER PER SUSHMA CHOWLA, J M : THE APPEAL FILED BY REVENUE IS AGAINST ORDER OF CIT (A) - 13 , PUNE , DATED 0 2 . 0 6 .20 1 6 RELATING TO ASSESSMENT YEAR 20 13 - 14 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . THE ASSESSEE HAS FILED CR OSS OBJECTIONS AGAINST THE APPEAL OF REVENUE. 2. THE APPEAL FILED BY REVENUE AND CROSS OBJECTIONS FILED BY THE ASSESSEE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. THE REVENUE IN ITA NO. 2098 /P UN/201 6 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION ON THE GROUND THE NO DRAFT ORDER IS PASSED U/S 144C(1) IGNORING THE FACT THAT DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS, TH E ASSESSEE OFFERED THE ABOVE INCOME SUE MOTO FOR TAXATION @ 10% AND THAT THE ASSESSEE HAD DISCLOSED OTHER INCOME OF RS.11,75,89,902/ - AND HAD TAXED THE SAME @ 10% AND THAT THE AO HAD APPLIED 25% PLUS SC & EC WHICH WAS APPLICABLE FOR THE RELEVANT PERIOD U/S 115A(1) OF THE ACT. SINCE THE VARIATION IN THE INCOME/LOSS WAS NOT PREJUDICIAL TO THE INTEREST OF THE ASSESSEE AS PRESCRIBED IN SECTION 144C(1), NO DRAFT ASSESSMENT ORDER WAS REQUIRED TO BE PASSED. 2. THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION IGNORING THE FACT THAT IN THIS CASE THE DRAFT ORDER U/S 143(3) R.W.S. 144C(1) WAS NOT REQUIRED TO BE PASSED SINCE THE CRITERIA MENTIONED IN THE PROVISIONS OF SECTION 144C(1) ARE NOT FULFILLED IN THIS CASE. 4. THE ASSESSEE IN CO NO. 54 /PUN/201 8 HAS RAISED THE FOLLOWING GROUNDS OF OBJECTIONS: - 1. THE ASSESSEE CONTENDS THAT THE LEARNED ASSESSING OFFICER ERRED IN APPLYING AN INCORRECT RATE OF TAX AT 25% (PLUS SURCHARGE AND EDUCATION CESS) U/S 115A OF INCOME TAX ACT, 1961 ON THE INCOME OFFERED TO T AX BY THE ASSESSEE, INSTEAD OF THE CORRECT TAX AT THE RATE OF 10% (PLUS APPLICABLE SURCHARGE AND CESS) AS PRESCRIBED UNDER SECTION 115A OF THE ACT APPLICABLE FOR AY 2013 - 14. ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 3 2. ALTERNATELY AND WITHOUT PREJUDICE TO THE ABOVE GROUND, THE ASSESSEE CONTENDS T HAT, THE LEARNED ASSESSING OFFICER ERRED IN NOT APPLYING THE TAX RATE OF 15% PRESCRIBED UNDER THE INDIA - CANADA DOUBLE TAXATION AVOIDANCE AGREEMENT. 5. THE REVENUE IS IN APPEAL AGAINST THE ORDER OF CIT(A) IN HOLDING THAT SINCE NO DRAFT ORDER WAS PASSED UND ER SECTION 144C(1) OF THE ACT, NO ADDITION IS TO BE MADE IN THE HANDS OF ASSESSEE. THE ASSESSEE HAS ALSO FILED CROSS OBJECTIONS AND HAS RAISED THE ISSUE AGAINST THE RATE TO BE APPLIED ON THE INCOME OFFERED TO TAX BY THE ASSESSEE. 6. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE IS FOREIGN COMPANY AND FOR THE YEAR UNDER CONSIDERATION HAD FURNISHED RETURN OF INCOME DECLARING INCOME OF 11,75,89,802/ - . THE ASSESSING OFFICER AT PAGE 2 OF ASSESSMENT ORDER HAS TABULATED THE TRANSACTIONS ENTERED INTO BY THE ASSESSEE DURING THE YEAR WITH SEVERAL CONCERNS. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD PROVIDED CERTAIN AUTOMOTIVE ENGINEERING AND PROJECT RELATED SUPPORT SERVICES TO COSMA INDIA, FOR WHICH IT HAD CHARGED SUM OF 62,12,060/ - . TDS WAS DEDU CTED @ 10.506% ON THE INCOME UNDER THE HEAD ENGINEERING CHARGES. THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS STATED THAT BY AN ERROR, THE SAID INCOME WAS NOT OFFERED TO TAX IN THE RETURN OF INCOME FILED. HOWEVER, THE AMOUNT WAS OFFERED T O TAX DURING ASSESSMENT PROCEEDINGS WHICH WAS AFTER GAP OF APPROXIMATELY THREE YEARS FROM THE END OF FINANCIAL YEAR. THE ASSESSING OFFICER WAS OF THE VIEW THAT SUCH AN OFFER WAS NOT IN GOOD FAITH. THE ASSESSEE HAD NEITHER FILED REVISED RETURN OF INCOME N OR FILED ANY SUBMISSIONS PRIOR TO SELECTION OF CASE. THE ASSESSING OFFICER WA S OF THE VIEW THAT THE ASSESSEE HAD CONCEALED THE INCOME TO THE TUNE OF 62,12,060/ - WHICH WAS ADDED IN THE HANDS OF ASSESSEE. THE ASSESSING OFFICER ALSO NOTED THAT THE ASSESSEE HAD FILED BELATED RETURN ON 25.03.2015 AND HAD OFFERED INCOME TO THE TAX IN INDIA ON GROSS BASIS UNDER SECTION 115A OF THE ACT AND NOT AS PER DTAA ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 4 AT THE PREVAILING RATE OF 10%. THE ASSESSING OFFICER ON VERIFICATION FOUND THAT THE PREVAILING RATE WAS 25% EFFECTIVE FROM 01.04.2014. THE ASSESSEE WAS INFORMED ABOUT THE SAID RATE AN D SUBSEQUENTLY THE INCOME WAS TAXED @ 25% AS PER A OF THE SUB - CLAUSE (B) OF SECTION 115A(1) OF THE ACT ALONG WITH SURCHARGE AND EDUCATION CESS. THUS, THE ASSESSING OFFICER PASSED ASSESSMENT ORDER UNDER SECTION 143(3) OF THE ACT BY MAKING AN ADDITION OF 62,12,060/ - AND BY ASSESSING THE ASSESSEES TOTAL INCOME AT 12,38,01,862/ - 7. THE CIT(A) OBSERVED THAT THE ASSESSEE WAS FOREIGN COMPANY AND HENCE, WAS ELIGIBLE ASSESSEE UNDER SECTION 144C(15)(B)(II) OF THE ACT. THE CIT(A) FURTHER NOTED THAT THE ASS ESSING OFFICER HAD MADE ADDITION OF 62,12,060/ - AND ASSESSED THE INCOME IN THE HANDS OF ASSESSEE AT 12.38 CRORES AND ALONG WITH ASSESSMENT ORDER, HAD ALSO ISSUED DEMAND NOTICE UNDER SECTION 156 OF THE ACT. THE CIT(A) OBSERVED THAT HENCE THE ASSESSMEN T ORDER PASSED BY ASSESSING OFFICER WAS FINAL ASSESSMENT ORDER AND NOT DRAFT ASSESSMENT ORDER. THE CIT(A) WAS OF THE VIEW THAT THE ASSESSING OFFICER OUGHT TO HAVE PASSED DRAFT ASSESSMENT ORDER FIRST, IN ACCORDANCE WITH PROVISIONS OF SECTION 144C(1) OF THE ACT, BEFORE PASSING FINAL ASSESSMENT ORDER. SINCE THE ASSESSING OFFICER HAD FAILED TO DO SO AND HENCE, THE ASSESSEE WAS DENIED THE OPPORTUNITY TO DEFEND AGAINST THE ADDITION MADE BY ASSESSING OFFICER, BEFORE THE DISPUTE RESOLUTION PANEL (DRP). THE ASSES SMENT ORDER PASSED BY THE ASSESSING OFFICER WAS THUS, QUASHED BY THE CIT(A) IN TURN, RELYING ON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF INTERNATIONAL AIR TRANSPORT ASSOCIATION VS. DCIT IN WP (L) NO.351 OF 2016, DATED 18.02.2016. 8. TH E REVENUE IS IN APPEAL AGAINST THE ORDER OF CIT(A). ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 5 9. THE FIRST ISSUE BY WAY OF GROUND OF APPEAL RAISED BY THE REVENUE IS JURISDICTIONAL ISSUE. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE POINTED OUT THAT THE ASSESSEE HIMSELF HAD ADMITTED TH E SAID ADDITIONAL INCOME AND OFFERED IT TO TAX @ 1 0% ++ BUT THE ASSESSING OFFICER TAXED IT AT @ 25% AND NOW BEFORE THE TRIBUNAL THE ASSESSEE ALLEGES THAT SINCE NO DRAFT ASSESSMENT ORDER WAS PASSED, THEN ASSESSMENT MADE IN THE HANDS OF ASSESSEE BE QUASHED. 10. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT BY GENUINE BONAFIDE MISTAKE, THE ASSESSEE HAD FAILED TO OFFER THE SAID INCOME WHICH WAS NOTED BY THE ASSESSING OFFICER AT PARA 5 OF ASSESSMENT ORDER. THEN, HE RELIED ON THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN INTERNATIONAL AIR TRANSPORT ASSOCIATION VS. DCIT (2016) 68 TAXMANN.COM 246 (BOM) FOR THE PROPOSITION THAT WHEN THE MOMENT THERE WAS VARIATION IN THE INCOME TO BE ASSESSED IN THE HANDS OF ASSESSEE, IT WAS INCUM BENT UPON THE ASSESSING OFFICER TO PASS DRAFT ASSESSMENT ORDER AND THEREAFTER, FOLLOW THE PROVISIONS OF THE ACT AND PASS FINAL ASSESSMENT ORDER. 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE IS A FOREIGN COMPANY. FOR THE Y EAR UNDER CONSIDERATION, THE ASSESSEE HAD FURNISHED RETURN OF INCOME DECLARING TOTAL INCOME AT 11,75,89,802/ - ON 25.03.2015. THE SAID FACT IS MENTIONED IN THE STATEMENT OF FACTS FILED BY THE ASSESSEE BEFORE THE CIT(A). ON THE OTHER HAND, THE ASSESSING OFFICER STARTS ASSESSMENT ORDER WITH A REMARK THAT THE ASSESSEE HAD FURNISHED THE RETURN OF INCOME AT NIL, WHICH IS INCORRECT. THE ASSESSEE BEING A NON - RESIDENT HAD OFFERED THE SAID INCOME TO TAX UNDER SECTION 115A OF THE ACT ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 6 AT 10% (PLUS SURCHARGE AND C ESS), WHICH WAS APPLICABLE FOR THE YEAR UNDER CONSIDERATION. THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS DISCOVERED THAT SUM OF 62,12,060/ - WAS INADVERTENTLY NOT OFFERED TO TAX IN THE INCOME TAX RETURN SO FILED. TDS WAS DEDUCTED ON THE SAME @ 10% ++ . THE SAID INCOME RELATED TO CERTAIN ENGINEERING SERVICES RENDERED TO AN INDIAN SUBSIDIARY I.E. COSMA INTERNATIONAL (INDIA) PVT. LT D. THE ASSESSEE OFFERED THE SAME TO TAX VIDE WRITTEN SUBMISSIONS FILED ON 11.01.2016 DURING ASSESSMENT PROCEEDINGS. THE CASE OF ASSESSEE BEFORE US IS THAT THE SAID INCOME WAS OFFERED BEFORE ANY QUESTIONNAIRE SEEKING INFORMATION WAS ISSUED. THE ASSESSING OFFICER ISSUED THE QUESTIONNAIRE ON 01.03.2016, FOR WHICH REPLY WAS FILED ON 08.03.2016. THE ASSESSING OFFICER THEN INFORMED THE ASSESSEE THAT SINCE RETURN OF INCOME WAS FILED ON 25.03.2015, THE RATE OF INCOME WAS AMENDED IN THE ACT FROM 10% TO 25% W.E.F . 01.04.2014 AND HENCE, THE INCOME IS TO BE ASSESSED @ 25% PLUS SURCHARGE AND CESS. THE PLEA OF ASSESSEE BEFORE THE ASSESSING OFFICER WAS THAT THE AMENDMENT INCREASING TAX RATE TO 25% WOULD APPLY ONLY TO ASSESSMENT YEAR 2015 - 16 AND SUBSEQUENT ASSESSMENT Y EARS; WHEREAS THE APPEAL UNDER ASSESSMENT WAS ASSESSMENT YEAR 2013 - 14. AS THE ASSESSEE WAS RESIDENT OF CANADA AND AS PER THE BENEFITS UNDER CANADA - INDIA INCOME TAX CONVENTION (TREATY), THE RATE WHICH PRESCRIBED WAS 15%. HOWEVER, THE ASSESSING OFFICER REJ ECTING THE PLEA OF ASSESSEE ISSUED ASSESSMENT ORDER AND APPLIED RATE OF 25% TO THE INCOME OF ASSESSEE INSTEAD OF 10%. THE ASSESSMENT ORDER WAS PASSED INCLUDING ADDITIONAL INCOME VOLUNTARILY OFFERED BY THE ASSESSEE AT 62,12,060/ - . THE CIT(A) HELD THAT SINCE THE ASSESSING OFFICER HAD NOT PASSED ANY DRAFT ASSESSMENT ORDER AND HAD ONLY PASSED FINAL ASSESSMENT ORDER, HE HAD VIOLATED THE PROVISIONS OF SECTION 144C(1) OF THE ACT AND APPLYING THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN INTERNATIONA L AIR TRANSPORT ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 7 ASSOCIATION VS. DCIT (SUPRA) HAD QUASHED THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER. 12. THE RELEVANT PROVISIONS OF THE ACT ARE IN SECTION 144C(1) OF THE ACT, WHICH PROVIDE THAT THE ASSESSING OFFICER IN THE FIRST INSTANCE FORWARD A DRAFT OF THE PROPOSED ORDER OF ASSESSMENT TO THE ELIGIBLE ASSESSEE IF HE PROPOSES TO MAKE ANY VARIATION IN THE INCOME OR LOSS RETURNED, WHICH IS PREJUDICIAL TO THE INTEREST OF SUCH ASSESSEE. THE TERM ELIGIBLE ASSESSEE IS DEFINED UNDER SECTION 144C( 15)(B) OF THE ACT. AS PER DEFINITION, ELIGIBLE ASSESSEE MEANS ANY PERSON (I) IN WHOSE CASE VARIATION REFERRED TO IN SUB - SECTION (1) ARISES AS A CONSEQUENCE OF THE ORDER OF TRANSFER PRICING OFFICER PASSED UNDER SECTION 92CA(3) ; AND (II) IN FOREIGN COMPAN Y. 13. THE ISSUE WHICH ARISES BEFORE US IS WHETHER IN THE PRESENT SET OF FACTS IS THERE ANY VARIATION IN THE INCOME OR LOSS RETURNED BY THE ASSESSEE AND THE ASSESSING OFFICER NOT HAVING PASSED DRAFT ASSESSMENT ORDER HA D VIOLATED THE PROVISIONS OF SECTION 144C(1) OF THE ACT. ADMITTEDLY, THE ASSESSEE IS A FOREIGN COMPANY AND IS ELIGIBLE ASSESSEE. AS POINTED OUT IN THE PARAS HEREINABOVE, T HE ASSESSEE HAD FILED THE RETURN OF INCOME DECLARING TOTAL RECEIPTS OF 11.76 CRORES (APPROX.) IN THE RETURN OF INCOME FILED ON 25.03.2015. THEREAFTER, ON ITS OWN MOTION THE ASSESSEE HAD OFFERED ADDITIONAL INCOME OF 62,12,060/ - I.E. ON ACCOUNT OF RECEIPTS WHICH WERE RECEIVED BY THE ASSESSEE DURING THE YEAR BUT BY AN INADV ERTENT ERROR, WERE NOT OFFERED IN THE RETURN OF INCOME. WE HAVE ALREADY REFERRED TO THE STATEMENT OF FACTS IN THE PARAS ABOVE ; THE ASSESSEE SUO MOTU AND IN GOOD FAITH CLAIMS TO HAVE OFFERED ADDITIONAL INCOME TO TAX AT THE BEGINNING OF ASSESSMENT PROCEEDIN GS ITSELF. THE ASSESSEE CLAIMS THAT THE SAID OFFER WAS MADE EVEN BEFORE THE QUESTIONNAIRE WAS RAISED. IN SUCH SCENARIO, ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 8 WHEN THE ASSESSING OFFICER PASSES THE ORDER AFTER INCLUDING SUM OF 62,12,060/ - TO THE RECEIPTS OFFERED IN THE RETURN OF INCOME, THEN INCOME TOTALS TO 12,38,01,862/ - . THE ASSESSING OFFICER HAS ASSESSED THE AFORESAID INCOME IN THE HANDS OF ASSESSEE UNDER SECTION 143(3) OF THE ACT. IN SUCH FACTS AND CIRCUMSTANCES, VARI ATION IN THE INCOME IS NOT ON ACCOUNT OF ANY ADDITION MADE BY THE ASSESSING OFFICER BUT IS ON ACCOUNT OF VOLUNTARY OFFER OF ADDITIONAL INCOME BY THE ASSESSEE AND IT CANNOT BE SAID THAT THE ASSESSING OFFICER HAS MADE VARIATION IN THE INCOME RETURNED, WHICH IS PREJUDICIAL TO THE INTEREST OF SUCH ASSESSEE. THE VARIATION IN THE INCOME IS QUALIFIED BY THE WORDS WHICH IS PREJUDICIAL TO THE INTEREST OF SUCH ASSESSEE. 14. IN THE FACTS OF PRESENT CASE, ADDITION, IF ANY IS MADE TO THE RETURNED INCOME IS ON ACCOUN T OF SUO MOTU OFFER BY THE ASSESSEE OF THE RECEIPTS RECEIVED BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION FROM AN INDIAN ENTITY AND BY AN INADVERTENT ERROR, THE SAME WERE NOT OFFERED IN THE RETURN OF INCOME. SO, IT DOES FAIL THE TEST OF PREJUDICIAL TO INTEREST OF ASSESSEE. HENCE, THERE IS NO MERIT IN THE ORDER OF CIT(A) IN QUASHING THE ASSESSMENT ORDER. THE SAME IS THUS, REVERSED. THE GROUNDS OF APPEAL RAISED BY THE REVENUE ARE THUS, ALLOWED. 15. NOW, COMING TO THE NEXT ASPECT OF THE ISSUE WHICH IS RAISED BY WAY OF CROSS OBJECTIONS BY THE ASSESSEE I.E. THE RATE TO BE APPLIED AT THE RELEVANT TIME UNDER SECTION 115A(BB) OF THE ACT. THE AMOUNT OF INCOME TAX CALCULATED ON THE INCOME BY WAY OF FEES FOR TECHNICAL SERVICES, IF ANY, INCLUDED IN THE TOTA L INCOME WERE TO BE TAXED @ 10%. THE YEAR UNDER APPEAL IS ASSESSMENT YEAR 2013 - 14. ON THE OTHER HAND, THE ASSESSING OFFICER REFERS TO AN AMENDMENT TO THE ACT WHICH IS W.E.F. ASSESSMENT YEAR 2014 - 15, UNDER WHICH TAX IS TO BE ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 9 CHARGED @ 25%. THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE RETURN OF INCOME WAS FILED ON 25.03.2015, THEN RATES WHICH ARE PRESCRIBED W.E.F. 01.04.2015, THE SAME ARE APPLICABLE. FIRST OF ALL, WE HOLD THAT THERE IS NO MERIT IN THE ORDER OF ASSESSING OFFICER IN NOT APPLYING THE RATE OF 10% TO THE INCOME RETURNED BY THE ASSESSEE UNDER SPECIFIC PROVISIONS OF SECTION 115A(BB) OF THE ACT FOR THE RELEVANT YEAR. IT MAY BE POINTED OUT HEREIN ITSELF THAT THE FINANCE ACT, 2015 W.E.F. 01.04.2016 HAD RE - SUBSTITUTED THE RATE OF TAX @ 10% A S AGAINST 25%. ACCORDINGLY, WE FIND NO MERIT IN THE ORDER OF ASSESSING OFFICER IN APPLYING RATE OF TAX @ 25% . WITHOUT PREJUDICE TO THE SAME, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE HAS POINTED OUT THAT THE RATE AS PER DTAA IS 15% TO SUCH R ECEIPTS AND IN VIEW OF PROVISIONS OF SECTION 90(2) OF THE ACT , BENEFICI AL PROVISIONS ARE TO BE APPLIED ; SO AT BEST THE RATE WHICH COULD BE APPLIED WAS 15%. ACCORDINGLY, WE ALLOW THE PLEA OF ASSESSEE AND DIRECT THE ASSESSING OFFICER TO APPLY THE RATE OF TA X AT 10% PLUS SURCHARGE AND CESS AS PRESCRIBED UNDER SECTION 115A OF THE ACT. THE GROUNDS OF OBJECTIONS RAISED BY ASSESSEE ARE THUS, ALLOWED. 16 . IN THE RESULT, APPEAL OF REVENUE AND CROSS OBJECTIONS OF ASSESSEE ARE ALLOWED. ORDER PRONOUNCED ON THIS 21 ST DAY OF JANUARY , 201 9 . SD/ - SD/ - ( D.KARUNAKARA RAO ) (SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 21 ST JANUARY , 201 9 . GCVSR ITA NO. 2098 /P U N/20 1 6 CO NO. 54 /PUN/201 8 MAGNA INTERNATIONAL INC. 10 / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 13 , PUNE ; 4. T HE CI T (IT/TP) , PUNE ; 5. 6. , , / DR A , ITAT, PUNE ; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE