DDIT, Intl. Taxation, New Delhi V. M/s MGB Metro Group Buying HK Ltd., New Delhi

ITA 4834/DEL/2012

• Counselvise Citation: 483420114 RSA 2012
• Duration Of Justice: 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2005-2006
• Appeal Filed On: 11-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JASDEEP SINGH SENIOR
• Section: 133A; 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E : NEW DELHI) BEFORE SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER AND SHRI JOGINDER SINGH, JUDICIAL MEMBER ITA NOS.4834 & 4833/DEL./2012 (ASSESSMENT YEARS : 2005-06 & 2006-07) DDIT, CIRCLE 3 (1), VS. M/S. MGB METRO GROUP BUYIN G HK LTD. INTERNATIONAL TAXATION, INDIA LIAISON OFFICE, NEW DELHI. 40, OKHLA INDUSTRIAL ESTATE, PHASE III, NEW DELHI 110 020. (PAN : AAECM3289J) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI JASDEEP SINGH, SENIOR DR ORDER PER JOGINDER SINGH, JUDICIAL MEMBER : THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 22.06.2012, PASSED BY THE LEARNED FIRST APPELLATE AUTHORITY, WH EREIN THE INTEREST LEVIED UNDER SECTION 234B OF THE ACT WAS DELETED. 2. DURING HEARING OF THIS APPEAL, WE HAVE HEARD SHR I JASDEEP SINGH, LD. SENIOR DR WHEREAS NOBODY IS PRESENT FOR THE ASSESSE E. LD. SENIOR DR DEFENDED THE ASSESSMENT ORDER LEVYING THE INTEREST U/S 234B OF THE ACT AND INVITED OUR ATTENTION TO SECTION 209 FOR COMPUTATIO N OF ADVANCE TAX. PLEA WAS ALSO RAISED THAT SECTION 202 OF THE ACT WAS ALSO NO T CONSIDERED BY HON'BLE ITA NOS.4833 & 4834/DEL./2012 2 HIGH COURT WHILE COMING TO A PARTICULAR CONCLUSION. PLEA WAS ALSO RAISED REGARDING AMENDMENT IN SECTION 209 INSERTED BY THE FINANCE ACT, 2012 W.E.F. 1.4.2012. HE ALSO RELIED UPON THE DECISION FROM HO N'BLE APEX COURT IN THE CASE OF CIT VS. ANJUM M.H. GHASWALA 252 ITR 1 (SC ). 3. WE HAVE CONSIDERED THE SUBMISSIONS PUT FORTH BY THE LD. SENIOR DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACT S, IN BRIEF, ARE THAT A SURVEY OPERATION U/S 133A OF THE ACT WAS CONDUCTED AT THE BUSINESS PREMISES OF THE ASSESSEE HAVING LIAISON OFFICE AT OKHLA ON 18.01.20 07. DURING SURVEY, MAINLY COMPUTERS WERE FOUND, PRINTS WERE COLLECTED THEREFR OM, WHICH WERE INVENTORISED. THE CLAIM OF THE ASSESSEE OF EXEMPTI ON U/S 9(1)(I) OF THE ACT WAS REJECTED AND THE ASSESSEES INCOME WAS COMPUTED AS 15.29% MARKUP ON THE TOTAL EXPENSES INCURRED BY THE ASSESSEE. SUCH WORKING WAS CLAIMED TO BE BASED ON RULE 10B(1)(E) OF THE RULES BY CONSIDERING THE TRANSACTIONAL NET MARGIN METHOD. INTEREST U/S 234A, 234B AND 234C WA S ALSO HELD TO BE LEVIABLE BY THE ASSESSING OFFICER. ON APPEAL, THE LD. CIT (A) BY FOLLOWING THE DECISIONS AS CONTAINED AT PAGE 38 OF THE IMPUGN ED ORDER HELD THAT THE INTEREST U/S 234B IS NOT LEVIABLE. AGGRIEVED REVEN UE IS IN APPEAL BEFORE THE TRIBUNAL. SO FAR AS THE CONTENTION OF THE LD. SENI OR DR REGARDING AMENDMENT INSERTED BY THE FINANCE ACT, 2012, WE ARE REPRODUCI NG HEREUNDER THE PROVISO WHICH IS EFFECTIVE FROM 1.4.2012 :- ITA NOS.4833 & 4834/DEL./2012 3 PROVIDED THAT FOR COMPUTING LIABILITY FOR ADVANCE T AX, INCOME- TAX CALCULATED UNDER CLAUSE (A) OR CLAUSE (B) OR CL AUSE (C) SHALL NOT, IN EACH CASE, BE REDUCED BY THE AFORESAID AMOU NT OF INCOME-TAX WHICH WOULD BE DEDUCTIBLE OR COLLECTIBLE AT SOURCE DURING THE SAID FINANCIAL YEAR UNDER ANY PROVISION OF THIS ACT FROM ANY INCOME, IF THE PERSON RESPONSIBLE FOR DEDU CTING TAX HAS PAID OR CREDITED SUCH INCOME WITHOUT DEDUCTION OF TAX OR IT HAS BEEN RECEIVED OR DEBITED BY THE PERSON RESPONSI BLE FOR COLLECTING TAX WITHOUT COLLECTION OF SUCH TAX. WE ARE OF THE VIEW THAT THE AFORESAID PROVISO INSER TED BY THE FINANCE ACT, 2012 IS PROSPECTIVE IN NATURE AND NOT WITH RETROSPE CTIVE EFFECT. THE PROVISO WAS BROUGHT INTO OPERATION W.E.F. 1.4.2012 WHEREAS THE ASSESSMENT YEARS INVOLVED ARE 2005-06 AND 200607, THEREFORE, WE ARE NOT IN AGREEMENT WITH THIS ASSERTION OF THE LD. SENIOR DR BECAUSE THE SAI D PROVISO IS NOT RETROSPECTIVE IN NATURE. EVEN OTHERWISE, THE LANGU AGE USED IN SECTION 209(1) IS REGARDING PAYMENT OF ADVANCE TAX IN THE FINANCIA L YEAR, THEREFORE, THE PROVISO IS NOT ATTRACTED FOR THE IMPUGNED ASSESSMEN T YEAR. SO FAR AS THE RELIANCE BY THE LD. SENIOR DR IN THE CASE OF ANJUM M.H. GHASWALA (SUPRA) IS CONCERNED, WE FIND THAT WHILE COMING TO A PARTICULA R CONCLUSION, THE HON'BLE DELHI HIGH COURT ALSO CONSIDERED THE AFORESAID DECI SION AND THEN REACHED TO A PARTICULAR CONCLUSION, CONSEQUENTLY, THE ASSESSEE W AS HELD TO BE NOT REQUIRED TO DEPOSIT ANY ADVANCE TAX. IN VIEW OF THIS FACT, IT WAS HELD THAT INTEREST U/S 234B IS NOT LEVIABLE. THE HON'BLE DELHI HIGH COURT IN THE CASE OF DIT VS. JACABS CIVIL INCORPORATED / MITSUBISHI CORPORATION (2011) 330 IR 578 (DEL.), ON IDENTICAL ISSUE, HELD THAT SINCE THE ASS ESSEE IS NOT LIABLE FOR ADVANCE ITA NOS.4833 & 4834/DEL./2012 4 TAX, THEREFORE, CANNOT BE CHARGED INTEREST FOR FAIL URE TO PAY ADVANCE TAX. IDENTICAL VIEW WAS EXPRESSED BY HON'BLE UTTARAKHAND HIGH COURT IN THE CASE OF CIT VS. SEDCO FOREX INTERNATIONAL DRILLING CO. L TD. - 264 ITR 320 (UTTARAKHAND). IN VIEW OF THE FACTS STATED IN THE IMPUGNED ORDER AND ALSO IN THE ABSENCE OF ANY ADVERSE MATERIAL BROUGHT ON RECO RD, WE FIND NO INFIRMITY IN THE SAME, THEREFORE, THE STAND OF THE CIT (A) IS AF FIRMED. 4. FINALLY, BOTH THE APPEALS OF THE REVENUE ARE DIS MISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 16.11.2012. SD/- SD/- (S.V. MEHROTRA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 16 TH NOVEMBER, 2012 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-XI, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.