The Asstt. Commissioner of Income Tax, TDS Circle, Ahmedabad V. M/s. Vodafone Mobile Service Ltd. (Formerly known as Vodafone West Ltd.), Ahmedabad

ITA 49/AHD/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1999 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 05-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINOD TALWANI
• Assessee Lawyers: A C SHAH
• Section: 201(1)

Judgement Text

ITA NO. 49/AHD/2017 ACIT VS. VODAFONE MOBILE SERVICE LTD ASSESSMENT YEAR: 2008-09 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: JUSTICE P P BHATT, PRESIDENT AND PRAMOD KUM AR, VICE PRESIDENT] ITA NO. 49/AHD/2017 ASSESSMENT YEAR: 2008-09 ASSTT. COMMISSIONER OF INCOME-TAX ........... .......APPELLANT TDS CIRCLE , AHMEDABAD VS. VODAFONE MOBILE SERVICE LIMITED ............................ RESPONDENT (FORMERLY KNOWN AS VODAFONE WEST LTD.), VODAFONE HOUSE, CORPORATE ROAD, PRAHLADNAGAR, OFF SG ROAD, AHMEDABAD-380051 [PAN : AAACF 1190 P] APPEARANCES BY: VINOD TALWANI, FOR THE APPELLANT A C SHAH, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 31.10.2018 DATE OF PRONOUNCING THE ORDER : 16.11.2018 O R D E R 1. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 24 TH NOVEMBER 2016 PASSED BY THE LEARNED CIT(A)-8, AHME DABAD DELETING THE PENALTY OF RS. 2,85,68,562/-IMPOSED ON THE ASSE SSEE UNDER SECTION 271C R.W.S. 263 OF THE INCOME-TAX ACT, 1961, FOR THE ASSESSMENT YEA R 2008-09. 2. GRIEVANCES RAISED BY THE APPELLANT ASSESSING OFF ICER ARE AS FOLLOWS:- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETING THE PENALTY U/S 271C ALTHOUGH DEMAND RAISED U/S 201(1)/201(1A) OF THE I. T. ACT ON ROAMING CHARGES PAID TO OTHER TELECOM COMPANIES UPHELD BY THE CIT(A ). 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) OUGHT TO HAVE DECIDED THE ISSUE UNDER REFERENCE, IN THE LIGH T OF EVIDENCE OBTAINED BY HIM DURING THE APPELLATE PROCEEDINGS AFTER FOLLOWING TH E DUE PROCEDURE OF LAW. 3. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, LEA RNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE REVISION ORDER DATED 18.03.201 5 PASSED BY THE LEARNED ITA NO. 49/AHD/2017 ACIT VS. VODAFONE MOBILE SERVICE LTD ASSESSMENT YEAR: 2008-09 PAGE 2 OF 3 COMMISSIONER OF INCOME-TAX, AS A RESULT OF WHICH TH E IMPUGNED PENALTY HAS BEEN IMPOSED, STANDS QUASHED BY A CO-ORDINATE BENCH OF T HIS TRIBUNAL VIDE ORDER DATED 21.12.2017. A COPY OF THE SAID ORDER WAS PLACED B EFORE US. LEARNED COUNSEL SUBMITS THAT IT WAS A CASE IN WHICH THOUGH THE ASSESSING OF FICER HAD RAISED TAX WITHHOLDING DEMAND UNDER SECTION 201(1) AND CONSEQUENT INTEREST LEVY UNDER SECTION 201(1A), THE ASSESSING OFFICER HIMSELF HAD DROPPED THE PENALTY P ROCEEDINGS UNDER SECTION 271C. THIS ACTION OF THE ASSESSING OFFICER WAS FOLLOWED B Y LEARNED COMMISSIONERS REVISION ORDER HOLDING THE SAID ACTION TO BE ERRONEOUS AND P REJUDICIAL TO THE INTEREST OF THE REVENUE AND DIRECTING THE ASSESSING OFFICER TO IMPO SE PENALTY UNDER SECTION 271C. HOWEVER, THIS REVISION ORDER, AS POINTED OUT ABOVE, WAS QUASHED BY A CO-ORDINATE BENCH OF THIS TRIBUNAL. IT IS SUBMITTED THAT IN VIE W OF THIS DEVELOPMENT THE VERY FOUNDATION OF IMPUGNED PENALTY CEASES TO BE LEGALLY SUSTAINABLE. IN ANY EVENT, ACCORDING TO LEARNED COUNSEL, EVEN THE TAX WITHHOLD ING DEMAND UNDER SECTION 201(1) AND CONSEQUENT INTEREST LEVY UNDER SECTION 201(1A) HAVE ALSO BEEN DELETED BY ANOTHER CO-ORDINATE BENCH VIDE ORDER DATED 11.07.2017. A C OPY OF THE SAID ORDER IS ALSO PLACED BEFORE US. IT IS POINTED OUT THAT THE CO-ORDINATE B ENCH HAS, INTER ALIA, HELD THAT THE ASSESSEE DID NOT HAVE ANY TAX WITHHOLDING OBLIGATIO NS IN RESPECT OF WHICH THE IMPUGNED PENALTY IS LEVIED. IT IS THUS CONTENDED THAT ON MER ITS ALSO THE ASSESSEE HAS SUCCEEDED IN QUANTUM PROCEEDINGS AND AS SUCH THE IMPUGNED PEN ALTY IS LEGALLY UNSUSTAINABLE FOR THIS REASON ALSO. LEARNED COUNSEL SUBMITS THAT IN VIEW OF ABOVE FACTS THE IMPUGNED PENALTY IS VITIATED IN LAW ON ACCOUNT OF LACK OF JU RISDICTION AS ALSO ON ACCOUNT OF LACK OF MERITS. LEARNED COUNSEL THUS SUBMITS THAT THIS APP EAL IS COVERED, IN FAVOUR OF THE ASSESSEE, BY THE JUDICIAL PRECEDENT CITED ABOVE. 4. LEARNED DEPARTMENTAL REPRESENTATIVE DOES NOT DIS PUTE THE FACTS EMBEDDED IN THE SUBMISSIONS SO MADE BY THE LEARNED COUNSEL, BUT RELIES UPON THE STAND OF THE ASSESSING OFFICER NEVERTHELESS. 5. IN VIEW OF THE ABOVE DISCUSSIONS, WE FIND THAT T HE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE ON THE QUESTION OF JURISDICT ION AS ALSO ON MERITS. WE HAVE NOTED THAT THE TAX WITHHOLDING DEMANDS IN RELATION TO WHI CH THE IMPUGNED PENALTY WAS LEVIED STAND DELETED AND THE REVISION ORDER AS A RESULT OF WHICH THE IMPUGNED PENALTY HAS BEEN LEVIED SANDS QUASHED. THERE IS NO DISPUTE ABO UT THIS FACTUAL POSITION AND, GIVEN THESE FACTS, IT IS NOT REALLY NECESSARY TO EXAMINE THE REASONING ADOPTED BY THE LEARNED ITA NO. 49/AHD/2017 ACIT VS. VODAFONE MOBILE SERVICE LTD ASSESSMENT YEAR: 2008-09 PAGE 3 OF 3 CIT(A). THAT ASPECT OF THE MATTER IS WHOLLY ACADEM IC IN THE PRESENT CASE. SUFFICE TO SAY THAT THE IMPUGNED PENALTY IS DEVOID OF ANY LEGA LLY SUSTAINABLE SUPPORT AND THE LEARNED CIT(A) WAS, THEREFORE, CORRECT IN HIS CONCL USION. WE SEE NO REASON TO INTERFERE IN THE MATTER. 6. IN THE RESULT, THE APPEAL IS DISMISSED. PRONOUN CED IN THE OPEN COURT TODAY ON THE 16 TH NOVEMBER, 2018 SD/- SD/- JUSTICE P P BHATT PRAMOD KUMAR (PRESIDENT) (VICE PRESIDENT) AHMEDABAD, THE 16 TH DAY OF NOVEMBER, 2018 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: .......ATTACHED 3 PAGES DICT ATION PAD 08.11.2018... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .. 08.11.2018..... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: 16.11.2018... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: .16.11.2018.. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : . 16.11.2018. 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : . 8. DATE OF DESPATCH OF THE ORDER: ......