DCIT, New Delhi V. M/s. McDonald's India Pvt. Ltd., New Delhi

ITA 2765/DEL/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8691 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2005-2006
• Appeal Filed On: 04-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Double taxation relief
• Section: 271(1)(c); 90

Judgement Text

1 THE INCOME TAX APPELLATE TRIBUNAL, DELHI I-1 BENC H, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI SUDHANSHU SRIVASTAVA, JUDI CIAL MEMBER ITA NO. 2765/DEL/2017 [ASSESSMENT YEAR: 2005-06] THE DY. C.I.T VS. MCDONALDS INDIA PVT LTD CIRCLE 16(2) 202-206, TOLSTOY HOUSE, NEW DELHI 15, TOLSTOY MARG NEW DELHI PAN: AAACK 5968 [APPELLANT] [RESPONDENT] DATE OF HEARING : 14.01.2020 DATE OF PRONOUNCEMENT : 16.01.2020 ASSESSEE BY : SHRI RAVI SHARMA, ADV REVENUE BY : SHRI SURENDRA PAL, CIT- DR ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) 19, NEW DELHI DATED 30.02.201 PERTAINI NG TO ASSESSMENT YEAR 2005-06. 2 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE AS SESSEE IS THAT THE TPO ERRED IN DELETING THE PENALTY OF RS . 3,32,02,933/- LEVIED U/S 271(1)(C) OF THE INCOME-TA X ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT']. 3. AT THE VERY OUTSET, LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE COMPETENT AUTHORITIES OF INDIA AND USA HAVE AGR EED TO RESOLVE THE ISSUE OF DOUBLE TAXATION ARISING DUE TO THE TP ADJU STMENTS MADE BY INDIAN TAX AUTHORITIES AND PURSUANT TO THE AGREEMEN T BETWEEN THE COMPETENT AUTHORITIES, THE ASSESSEE ACCEPTED THE MA P RESOLUTION. THE SAID ACCEPTANCE IS PLACED AT PAGE 96 OF THE PAPER B OOK. THE LD. COUNSEL FOR THE ASSESSEE FURTHER POINTED OUT THAT W HILE GIVING EFFECT TO THE ORDER OF THE MAP RESOLUTION DATED 03.08.2017, T HE ASSESSEE FILED AN APPLICATION FOR WITHDRAWAL OF THE APPEALS BEFORE TH E TRIBUNAL. 4. VIDE NOTICE DATED 07.06.2018, THE ASSESSING OFFI CER ONCE AGAIN INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT ON THE TOTAL TAXABLE INCOME POST MAP EFFECT ORDER U/S 90 R.W. IN DIA US DTAA. THE LD. COUNSEL FOR THE ASSESSEE CONCLUDED BY SAYING TH AT IN THE LIGHT OF THESE FACTS, THE PRESENT APPEAL BY THE REVENUE BECO MES INFRUCTUOUS. 3 5. THE LD. DR FAIRLY CONCEDED TO THIS. 6. WE HAVE CAREFULLY CONSIDERED THE RELEVANT EVIDEN CES BROUGHT ON RECORD IN THE FORM OF PAPER BOOK. EXHIB ITS 91 TO 95 OF THE PAPER BOOK ARE EXTRACTS OF MAP RESOLUTION REACHED BY INDIA AND US COMPETENT AUTHORITIES AND EXHIBIT A T PAGES 96-97 OF THE PAPER BOOK IS LETTER DATED 16.10.2017 FILED BY THE ASSESSEE FOR ACCEPTANCE OF MAP RESOLUTION AND E XHIBIT 98 TO 102 IS THE ORDER DATED 03.11.2017 PASSED BY THE ASSESSING OFFICER GIVING EFFECT TO THE MAP RESOLUTION AND EXH IBIT 106 IS PENALTY SHOW CAUSE NOTICE DATED 07.06.2018. 7. SINCE THE ASSESSING OFFICER HAS INITIATED FRESH PENALTY PROCEEDINGS SUBSEQUENT TO ORDER GIVING EFFECT TO MA P RESOLUTION, WE ARE OF THE CONSIDERED VIEW THAT PENA LTY LEVIED ON THE BASIS OF PREVIOUS ORDER, WHICH WAS DELETED B Y THE LD. CIT(A) AND AGAINST WHICH THE REVENUE IS IN APPEAL B EFORE US, BECOMES INFRUCTOUS. 4 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 16.0 1.2020. SD/- SD/- [SUDHANSHU SRIVASTAVA ] [N.K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 16 TH JANUARY, 2020. VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT ASST. REGISTRAR 4. CIT(A) ITAT, NEW DELHI 5. DR 5 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P S/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER