JP MORGAN CHASE BANK N.A., MUMBAI V. ADDL.D.I.T. (I.T.) RG.3, MUMBAI

ITA 6003/MUM/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 70595 (ITAT-MUMBAI)
• Duration Of Justice: 43 year(s) 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-08-2013
• Appeal Filed By: Assessee
• Assessment Year: misc
• Appeal Filed On: 01-01-1970
• Court: TRIBUNAL
• Department Lawyers: AJAY SHRIVASTAVA
• Assessee Lawyers: P J PARDIWALLA
• Section: 143(3)

Judgement Text

, IN THE IN IN THE IN IN THE IN IN THE INCOME TAX APPELLATE TRIBUNAL COME TAX APPELLATE TRIBUNAL COME TAX APPELLATE TRIBUNAL COME TAX APPELLATE TRIBUNAL L BENCH, L BENCH, L BENCH, L BENCH, MUMBAI MUMBAI MUMBAI MUMBAI . , !' !' !' !' , . BEFORE BEFORE BEFORE BEFORE SHRI SHRI SHRI SHRI B. R B. R B. R B. RAMAKOTAIAH AMAKOTAIAH AMAKOTAIAH AMAKOTAIAH, AM , AM , AM , AM & && & SHRI SHRI SHRI SHRI VIJAY PAL RAO VIJAY PAL RAO VIJAY PAL RAO VIJAY PAL RAO, ,, , JM JMJM JM ./ I.T.A. N I.T.A. N I.T.A. N I.T.A. NO. O.O. O. 7129/MUM/2010 & 7129/MUM/2010 & 7129/MUM/2010 & 7129/MUM/2010 & ./ I.T.A. NO. I.T.A. NO. I.T.A. NO. I.T.A. NO. 6003/MUM/2012 6003/MUM/2012 6003/MUM/2012 6003/MUM/2012 ( #$ #$ #$ #$ % % % % / ASSESSMENT YEAR : 2006-07) JP MORGAN CHASE BANK, N.A J.P MORGAN TOWER, OFF. CST ROAD, KALINA, SANTACRUZ (E) MUMBAI-400098 $ $ $ $ / VS. ADDITIONAL DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION) RANGE-3, ROOM NO. 102, SCINDIA HOUSE, BALLARD PIER MUMBAI-400038 & ./ '' ./ PAN/GIR NO. : AAACT5545N ( &( / APPELLANT APPELLANT APPELLANT APPELLANT) .. ( )*&( / RESPONDENT RESPONDENT RESPONDENT RESPONDENT) &( &( &( &( + + + + / APPELLANT BY : MR. P.J. PARDIWALLA )*&( )*&( )*&( )*&( , ,, , + + + + /RESPONDENT BY : MR. AJAY SHRIVASTAVA $ $ $ $ , ,, , - - - - / DATE OF HEARING : 1 ST AUGUST 2013 .% .% .% .% , ,, ,- - - - /DATE OF PRONOUNCEMENT: 8 TH AUGUST 2013 / / O R D E R PER : !' , . . / VIJAY PAL RAO, JM THESE TWO APPEALS BY THE ASSESSEE ARE ARISING FROM TWO ASSESSMENT ORDERS DATED 25.2.2010 AND 19.8.2010 PASSED U/S 143 (3) R.W.S 144C(3) U/S 144C(13) RESPECTIVELY FOR THE ASSESSMENT YEAR 2006- 07. 2. THE ASSESSEE HAS FILED TWO APPEALS ARISING FROM THE TWO ASSESSMENT ORDERS. THE APPEAL IN ITA NO. 7129/M/2010 WAS FILED AGAINST THE ASSESSMENT ORDER PASSED U/S 143(3) R.W.S 144C(13) A ND THE ANOTHER APPEAL IN ITA NO. 6003/M/2012 FILED AGAINST THE ORD ER DATED 27.7.2012 OF THE COMMISSIONER OF INCOME TAX(APPEALS) ARISING FRO M ASSESSMENT ORDER DATED 19.8.2010 U/S 143(3) R.W.S 144C(3). ITA NO. 7129/M/2010 & 6003/M/2012 JP MORGAN CHASE BANK 2 3. WE HAVE HEARD THE LD. SENIOR COUNSEL AS WELL AS LD. DR AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE ASS ESSEE IS A BANKING ENTITY INCORPORATED IN UNITED STATES OF AMERICA AND CARRYING ON BANKING ACTIVITY/BUSINESS IN INDIA THROUGH ITS BRANCH. THE LD. SENIOR COUNSEL HAS POINTED OUT THAT IN THE CASE OF THE ASSESSEE A DRAF T ASSESSMENT ORDER ISSUED BY THE AO ON 29.12.2009 AGAINST WHICH THE AS SESSEE FILED OBJECTIONS BEFORE THE DRP. SUBSEQUENTLY VIDE LETTER DATED 24.2.2010 THE ASSESSEE MADE A REQUEST FOR WITHDRAWAL OF OBJECTION FILED BEFORE THE DRP IN VIEW OF THE CBDT CIRCULAR DATED 20.1.2010. THE A SSESSEE MENTIONED BEFORE THE DRP THAT IT INTENDED TO OPT TO PROCEED T O THE NORMAL APPELLATE AUTHORITY I.E CIT(A). THE DRP ACCORDINGLY DISMISSED THE OBJECTIONS FILED BY THE ASSESSEE AS WITHDRAWN AND DIRECTED THE AO TO CO MPLETE THE ASSESSMENT AS PROPOSED IN THE DRAFT ORDER. IN THE M EAN TIME THE AO PASSED AN ASSESSMENT ORDER U/S 144C(3) DATED 25.2.2 010 AGAINST WHICH THE ASSESSEE FILED APPEAL BEFORE THE CIT(A). SINCE THE AO HAD AGAIN PASSED AN ORDER DATED 19.8.2009 U/S 144C(13) IN PUR SUANCE TO THE ORDER OF THE DRP, THE ASSESSEE HAS ALSO FILED THE APPEAL BEFORE THIS TRIBUNAL AGAINST THE SAID ORDER. THE LD. SENIOR COUNSEL HAS FURTHER SUBMITTED THAT IN VIEW OF FILING THE APPEAL AGAINST THE ORDER PASS ED BY THE CIT(A), THE FIRST APPEAL FILED BY THE ASSESSEE IN ITA NO. 7129/M/2010 BECOMES INFRUCTUOUS. HE HAS THEN SUBMITTED THAT THE CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE ON TECHNICAL GROUND THAT THE AO PASSED AN ORDER DATED 19.8.2010 IN PURSUANCE TO THE DIRECTIONS OF DRP AND THEREFORE THE APPEAL AGAINST SUCH ORDER LIES BEFORE THE INCOME TAX APPEL LATE TRIBUNAL WHICH THE ASSESSEE HAS ALREADY FILED. THEREFORE, THE LD. SENIOR COUNSEL PLEADED ITA NO. 7129/M/2010 & 6003/M/2012 JP MORGAN CHASE BANK 3 THAT THE MATTER MAY BE REMANDED TO THE CIT(A) FOR P ASSING ORDER ON MERITS. 4. ON THE OTHER HAND, THE LD. DR HAS NOT DISPUTED T HE FACTUAL POSITION OF PASSING TWO ORDERS BY AO, ONE U/S 144C(3) AND AN OTHER ASSESSMENT ORDER WAS PASSED BY THE AO IN PURSUANCE OF THE DRP ORDER WHEREBY THE OBJECTIONS FILED BY THE ASSESSEE WERE DISMISSED AS WITHDRAWN AND AO WAS DIRECTED TO COMPLETE ASSESSMENT AS PER DRAFT ORDER. 5. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND CARE FUL PERUSAL OF THE RELEVANT MATERIAL ON RECORD WE FIND THAT THE AO PAS SED THE DRAFT ORDER DATED 29.12.2009 AGAINST WHICH THE ASSESSEE FILED T HE OBJECTION VIDE LETTER DATED 1.2.2010 BEFORE THE DRP. HOWEVER, SUBS EQUENTLY, IN VIEW OF THE CBDT CIRCULAR DATED 20.1.2010 WHEREBY IT WAS MA DE CLEAR THAT THE ASSESSEE HAS THE OPTION TO EITHER FILE OBJECTIONS B EFORE THE DRP OR TO CHALLENGE THE ASSESSMENT FRAMED AS PER THE NORMAL A PPELLATE CHANNEL, THE ASSESSEE WITHDREW THE OBJECTIONS VIDE LETTER DA TED 24.2.2010. THE DRP ACCORDINGLY DISMISSED THE OBJECTIONS OF THE ASS ESSEE AS WITHDRAWN WHILE PASSING THE ORDER DATED 13.7.2010. HOWEVER, I N THE MEAN TIME THE AO PASSED THE ASSESSMENT ORDER DATED 25.2.2010 U/S 144C(3) R.W.S 143(3). THE SAID ASSESSMENT ORDER WAS CHALLENGED BY THE ASSESSEE BEFORE THE CIT(A) BECAUSE THE ASSESSEE OPTED FOR NORMAL AP PELLATE CHANNEL. THE AO AGAIN PASSED AN ASSESSMENT ORDER DATED 19.8.2010 IN PURSUANCE TO THE DIRECTIONS OF THE DRP. THUS, WE FIND THAT THE A SSESSING OFFICER HAS PASSED TWO ORDERS IN THIS CASE ONE U/S 144C(3) DATE D 25.2.2010 AND ANOTHER U/S 144C(13) DATED 19.8.2010. BOTH THESE OR DERS ARE IDENTICAL ITA NO. 7129/M/2010 & 6003/M/2012 JP MORGAN CHASE BANK 4 AND WITH SAME DEMAND OF TAX. THERE IS NO DISPUTE AB OUT THE FACT THAT THE ASSESSEE WITHDREW THE OBJECTIONS FILED BEFORE THE D RP AND EXPRESSED TO EXERCISE THE OPTION OF FILING AN APPEAL BEFORE THE CIT(A). THEREFORE, THE OBJECTIONS FILED BY THE ASSESSEE BEFORE THE DRP AGA INST THE PROPOSED DRAFT ASSESSMENT ORDER BECAME ONENESS ONCE THE SAME WERE PERMITTED BY THE DRP TO WITHDRAW AFTER TAKING NOTE OF THE FACT THAT THE ASSESSEE DESIRED THE EXERCISE THE OPTION TO FILE THE APPEAL BEFORE T HE CIT(A). WHEN THE REQUEST OF THE ASSESSEE FOR WITHDRAWAL OF THE OBJEC TION WAS ACCEPTED BY THE DRP WHILE PASSING THE ORDER/DIRECTIONS DATED 13 .7.2007, NO DIRECTIONS PER-SE WERE PASSED BY THE DRP AS PER SECTION 144C(5 ) OF THE ACT. EVEN OTHERWISE ONCE THE OBJECTIONS WERE WITHDRAWN AND TH E ASSESSEE OPTED TO PROCEED TO FILE THE APPEAL BEFORE THE CIT(A) WHICH WAS ALLOWED BY THE DRP THEN THEY CANNOT BE ANY DIRECTIONS UNDER SUB. SEC. 5 OF SECTION 144C OF THE ACT. HENCE, THE ASSESSMENT ORDER PASSED ON 19.8 .2010 BY THE ASSESSING OFFICER IS WITHOUT ANY JURISDICTION AND U NWARRANTED AND THEREFORE THE SAME IS NOT SUSTAINABLE UNDER LAW. FU RTHER WHEN THE AO HAS ALREADY PASSED AN ORDER DATED 25.2.2010 U/S 144C(3) THEN THERE IS NO QUESTION OF PASSING A FURTHER ORDER U/S 144C(13). 6. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CA SE WE HOLD THAT THE ORDER DATED 19.8.2010 PASSED BY THE AO SUBSEQUENT T O THE DIRECTIONS OF THE DRP IS INVALID AND ACCORDINGLY THE SAME IS QUAS HED. CONSEQUENTLY THE APPEAL FILED AGAINST THE SAID ORDER IN ITA NO. 7129 /M/2010 BECOMES INFRUCTUOUS AND ACCORDINGLY DISMISSED. WE FIND THAT THE CIT(A) HAS DISMISSED THE APPEAL OF THE ASSESSEE FILED AGAINST THE ASSESSMENT ORDER ITA NO. 7129/M/2010 & 6003/M/2012 JP MORGAN CHASE BANK 5 25.2.2010 ON THE GROUNDS THAT THE AO HAS SUBSEQUENT LY PASSED A ORDER U/S 144C(13) DATED 19.8.2010 WHICH WAS CHALLENGED B Y THE ASSESSEE BEFORE THIS TRIBUNAL AND THUS NO FINDING HAS BEEN G IVEN ON MERITS. AS WE HAVE ALREADY QUASHED THE SAID ORDER DATED 19.8.2010 THEREFORE, IN THE INTEREST OF JUSTICE WE SET ASIDE THE IMPUGNED ORDER OF THE CIT(A) DATED 27.7.2012 AND REMIT THE MATTER TO THE RECORD OF THE CIT(A) FOR DECIDING THE APPEAL OF THE ASSESSEE ON MERITS. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN ITA NO. 7129/M/2010 IS DISMISSED AND ANOTHER APPEAL IN ITA NO. 6003/M/2012 IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 8 TH DAY OF AUGUST 2013 / , .% 0 1$2 8 TH 3 - , 3 SD/- SD/- ( . ) (B. RAMAKOTAIAH) ACCOUNTANT MEMBER ( !' ) # (VIJAY PAL RAO) JUDICIAL MEMBER PLACE: MUMBAI : DATED: 8 TH AUGUST 2013 SUBODH COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI