DCIT, Circle- 2(1)(2) (International Taxation), New Delhi V. KLM Royal Dutch Airlines, New Delhi

ITA 3870/DEL/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 9587 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 01-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HONBLE DELHI HIGH COURT
• Keywords: Double taxation relief; Question of law

Judgement Text

1 | Page IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “D” BENCH: NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER & SHRI KUL BHARAT, JUDICIAL MEMBER ITA Nos.807 & 3870/Del/2019 [Assessment Years : 2013-14 & 2014-15] DCIT (International Taxation), Circle-2(1)(2), New Delhi. vs KLM Royal Dutch Airlines, LB-46, Prakash Deep Building, 7, Tolstoy Marg, New Delhi-110001. PAN-AABCK3950H APPELLANT RESPONDENT Appellant by Ms. Rashmita Jha, CIT DR Respondent by Shri Salil Aggarwal, Sr.Adv. & Shri Anil Makhija, Adv. Date of Hearing 21.09.2022 Date of Pronouncement 30.09.2022 ORDER PER KUL BHARAT, JM : Both appeals filed by the Revenue against the orders of Ld. CIT(A)-23, New Delhi dated 30.11.2018 and Ld.CIT(A)-43, New Delhi dated 27.02.2019 for the Assessment Years 2013-14 & 2014-15 respectively. Since identical grounds have been raised, both appeals were taken up together for hearing and are being disposed off by way of consolidated order for the sake of brevity. 2. First we take up the Revenue’s appeal in ITA No. 807/Del/2019 pertaining to Assessment Year 2013-14. The Revenue has raised following grounds of appeal:- ITA No.807/Del/2019 [Assessment Year : 2013-14] 1. “Whether the Ld. CIT (A) has erred on facts and in law by deleting the addition of profit of Rs. 35,24,68,933/- of the assessee from providing technical services to other airlines. 2 | Page 2. Whether profit of the assessee from providing technical services to other airlines is covered by Articles 8(1) and 8(4) of the DTAA between India and Germany, and by Articles 8(1) and 8(3) of the DTAA between India and Netherlands. 3. The appellant craves to add, amend, modify or alter any grounds of appeal at the time or before the hearing of the appeal.” 3. At the outset, Ld. Counsel for the assessee submitted that the identical issues were raised before the Tribunal in assessee’s own case in earlier year and the subsequent year. He submitted that the Co-ordinate Bench of the Tribunal in assessee’s own case in ITA Nos.8677 & 8678/Del/2019 for the Assessment Years 2015-16 & 2016-17 vide order dated 01.06.2022 has dismissed the appeals of the Revenue by following the earlier orders. 4. Ld.CIT DR fairly conceded that the issue has been decided by the Co- ordinate Bench of the Tribunal against the assessee. However, the Department has preferred Special Leave Petition before the Hon’ble Supreme Court. 5. We have heard Ld. Authorized Representatives of the parties and considered the material available on record and gone through the orders of the authorities below. We find that the Co-ordinate Bench of this Tribunal in assessee’s own case in ITA Nos.8677 & 8678/Del/2019 for the Assessment Years 2015-16 & 2016-17 (supra) has decided the issue in favour of the assessee by observing as under:- 8. “We have heard both the parties and perused the records. Ld. counsel of the assessee submitted that issue is squarely covered in favour of the assessee by the decision of Hon’ble Delhi High Court in assessee's own case. He submitted that the assessing officer despite being told that the case is covered by Hon’ble Delhi High 3 | Page Court decision in assessee's own case chose to ignore the Hon’ble High Court decision and decide the issue against the assessee. Ld. DR for the Revenue, on the other hand, could not dispute the submission that identical issue has been decided in favour of the assessee by Hon’ble Delhi High Court. 9. Upon careful consideration, we note that Hon’ble Delhi High Court in the case of the assessee for assessment years 2004-05 to 2008-09 by the order dated 25.01.2017 (392 ITR 218) elaborately dealt with the issue. The question considered by the Hon’ble High Court was :- “Whether profits of the assessee from providing technical services to other airlines is covered by Article 8(1) and 8(4) of the Double Taxation Avoidance Agreement between India and Germany and by Article 8(1) and 8(3) of Double Taxation Avoidance Agreement between India and Netherland. 10. After elaborate discussion and analysis, Hon’ble High Court answered the question of law against the Revenue and in favour of the assessee and found no infirmity in the orders of the ITAT. 11. Hon’ble High Court subsequently for assessment years 2009-10, 2010-11, 2011-12 & 2012-13 followed its aforesaid order and decided the issue in favour of assessee. 12. Accordingly, respectfully following the precedent, we uphold the order of ld. CIT (A). 13. Our aforesaid order applies mutatis mutandis to AY 2016-17 also.” 14. In the result, both the appeals filed by the Revenue stand dismissed.” 6. Therefore, taking the consistent view, we do not see any reason to interfere in the findings of Ld.CIT(A), the same is hereby affirmed. Thus, grounds raised by the Revenue in this appeal are rejected. 7. In the result, the appeal of the Revenue is dismissed. 4 | Page ITA No.3870/Del/2019 [Assessment Year : 2014-15] 8. Now, we take up the Revenue’s appeal in ITA No. 3870/Del/2019 pertaining to Assessment Year 2014-15. The Revenue has raised following grounds of appeal:- 1. “Whether the Ld. CIT(A) has erred on facts and in law by deleting the addition of profit of Rs. 38.87,63,486/- of the assessee from providing technical services to other airlines. 2. Whether profit of the assessee from providing technical services to other airlines is covered by Article 8(1) and 8(4) of the DTAA between India and Germany, and by Articles 8(1) and 8(3) of the DTAA between India and Netherlands. 3. The appellant craves to add, amend, modify or alter any grounds of appeal at any time or before the hearing of the appeal.” 9. The facts and grounds are identical as were in ITA No.807/Del/2019 pertaining to Assessment Year 2013-14. The Ld. Representatives of the parties have adopted the same arguments as were in ITA No.807/Del/2019 [Assessment Year 2013-14]. Therefore, taking the consistent view, we do not see any reason to interfere in the findings of Ld.CIT(A), the same is hereby affirmed. Thus, grounds raised by the Revenue are dismissed. 10. In the result, the appeal of the Revenue is dismissed. 11. In the final result, both appeals of the Revenue are dismissed. Order pronounced in the open Court on 30 th September, 2022. Sd/- Sd/- (SHAMIM YAHYA) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER * Amit Kumar * 5 | Page Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI