DCIT (TDS) - 2(3), MUMBAI V. VODAFONE INDIA LTD. (FORMERLY KNOWN AS VODAFONE ESSAR LTD.), MUMBAI

ITA 6158/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 1258 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2007-2008
• Appeal Filed On: 29-10-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS JAANTAZIMIKVASHAI
• Assessee Lawyers: SHRIKETANVED
• Keywords: TDS
• Section: 194J

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI F BENCH, MUMBAI BEFORE SHRI PRAMOD KUMAR, VICE PRESIDENT& MS. MADHUMITA ROY, JUDICIAL MEMBER ./ I.T.A. NO. 6158/MUM/2018 ( / ASSESSMENT YEAR : 2007-08) THE DY.CIT(TDS)-2(3) MUMBAI SMT. K. G. MITTAL AYURVEDIC HOSPITAL BLDG., ROOM NO. 718, CHARNI ROAD (WEST), MUMBAI 400 002 / VS. M/S. VODAFONE INDIA LTD. PENINSULA CORPORATE PARK, GANPATRAOKADAMMARG, LOWER PAREL, MUMBAI 400013 ./ ./ PAN/GIR NO. : AAACH5332B ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : MRS. JAANTAZIMIKVASHAI, CITDR / RESPONDENTBY: SHRIKETANVED, A.R., SR. D.R. / DATE OF HEARING 09/01/2020 !'# / DATE OF PRONOUNCEMENT 27/05/2020 O R D E R PER MS. MADHUMITA ROY - JM: THE INSTANT APPEAL AT THE INSTANCE OF THE REVENUE I S DIRECTED AGAINST THE ORDER DATED 14.08.2018PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) 60, MUMBAI ARISING OUT OF THE ORDER DATED 26.03.201 3PASSED UNDER SECTION 201(1)/201(1A) R.W.S. 254 OF THE INCOME TAX ACT, 19 61 (HEREINAFTER REFERRED AS TO THE ACT) BY THE INCOME TAX OFFICER (OSD)(TDS) 3(1), MUMBAI FOR ASSESSMENT YEAR 2007-08. ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 2 2. THE SHORT POINT INVOLVED IN THIS PARTICULAR APPE AL IS THAT AS TO WHETHER THE INTERCONNECTION USAGES CHARGES (IUC) IS IN THE NATU RE OF FEES FOR TECHNICAL SERVICES AND WHETHER THE ASSESSEE IS LIABLE FOR TDS UNDER S.194J OF THE ACT. AT THE TIME OF HEARING THE INSTANT APPEAL, LEARNED COU NSEL APPEARING FOR THE ASSESSEE SUBMITTED BEFORE US THAT THE ISSUE IS SQUARELY COVE RED BY AND UNDER JUDGMENT PASSED BY THE AHMEDABAD TRIBUNAL IN CASE OF ACIT VS. M/S. BHARTIAIRTEL LTD. IN ITA NOS. 2195 & 2196/AHD/2016AYS. 2008-09 & 2009-10 ORDER DATED 28.02.2019 ; A COPY OF THE SAID ORDER HAS ALSO BEEN PROVIDED B EFORE US BY THE LEARNED AR. HE THEREFORE PRAYS FOR SIMILAR RELIEF BEFORE US. 3. THE LEARNED DR, HOWEVER, HAS FAILED TO CONTROVER T SUCH CONTENTIONS MADE BY THE LEARNED AR. 4. HEARD THE RESPECTIVE PARTIES. WE HAVE ALSO PERU SED THE RELEVANT MATERIALS AVAILABLE ON RECORD AND ALSO ORDER PASSED BY THE AH MEDABAD TRIBUNAL IN ITA NOS. 2195 & 2196/AHD/2016 . WE FIND IN THE IDENTICAL SITUATION THE LEARNED TRIBUNAL HAS BEEN PLEASED TO PASS ORDERS IN REVENUE S APPEAL HOLDING THAT THE ROAMING CHARGES PAID BY THE APPELLANT TO OTHER TELE COM COMPANIES ARE NOT COVERED UNDER FEES FOR TECHNICAL SERVICES AND OUT O F THE PURVIEW OF TDS PROVISION OF 194J OF THE ACT. THE RELEVANT PORTION WHEREOF IS AS FOLLOWS: 7. HEARD THE LEARNED REPRESENTATIVE OF THE RESPECT IVE PARTIES, PERUSED THE RELEVANT MATERIALS AVAILABLE ON RECORD. WE FIND FROM DIFFERE NT JUDGMENTS PLACED BEFORE US THAT THE ISSUE INVOLVED IN THE MATTER AS TO WHETHER ROAMING SERVICES REQUIRE ANY HUMAN INTERVENTION AND THEREBY PAYMENT OF ROAMING CHARGES WHETHER FALL S UNDER THE AMBIT AND PURVIEW OF TDS PROVISIONS U/S 194J OF THE ACT HAS BEEN HELD IN FAV OUR OF THE ASSESSEE HOLDING THAT THERE IS NO MANUAL OR HUMAN INTERVENTION INVOLVED IN THE PRO CESS OF INTERCONNECTION CHARGES. IN FACT IT IS COMMON KNOWLEDGE THAT WHEN ONE OF THE SU BSCRIBERS IN THE ASSESSEE'S CIRCLE TRAVELS TO THE JURISDICTION OF ANOTHER CIRCLE, THE CALLS GE T CONNECTED AUTOMATICALLY WITHOUT ANY HUMAN INTERVENTION AND IT IS FOR THIS, THE ROAMING CHARGES IS PAID BY THE ASSESSEE TO THE VISITING OPERATOR FOR PROVIDING THIS SERVICE. THE I NTERCONNECTION CHARGES PAID BY THE APPELLANT TO OTHER TELECOM OPERATORS ARE THEREFORE, NOT IN THE NATURE OF FEES FOR TECHNICAL SERVICES AND THEREFORE THERE IS NO LIABILITY TO DED UCT TAX THEREON. THE JUDGMENT PASSED BY ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 3 THE MYSORE BENCH RELIED UPON THE ORDER PASSED BY TH E JURISDICTIONAL KARNATAKA HIGH COURT IN THE MATTER OF CIT-VS-VODAFONE SOUTH LTD. REPORTE D IN 290 CTR 436 (KAR) HELD THAT THE PROCESS INVOLVED IN THE ROAMING CONNECTIVITY DOES N OT INVOLVE THE HUMAN INTERVENTION AND THUS THE SERVICES DO NOT FALL WITHIN THE AMBIT OF ' TECHNICAL SERVICES'. THEREFORE, THE ASSESSEE WAS NOT REQUIRED TO DEDUCT TAX AT SOURCE ON SUCH PA YMENT. THE OPERATIVE PORTION WHEREOF IS AS FOLLOWS: '13. AFTER HEARING THE LD STANDING COUNSEL FOR THE REVENUE AND PERUSING MATERIAL ON RECORD, WE FIND THAT THE ISSUE IN THIS PRESENT APPEALS IS COVERED AGAINST THE REVENUE BY THE DECISION OF JURISDICTION AL HIGH COURT IN THE CASE OF CIT VS. VODAFONE SOUTH LTD., VIDE 290 CTR 4 36 (KAR) WHEREIN THE HON'BLE HIGH COURT AFTER REFERRING TO THE TECHNICAL EXPERTISE OF C-DOT ON 29/09.2010 IN RESPECT OF IUC LTD., AND THE TECHNICA L EXPERTS REEXAMINED THE MATTER AND OPINED THAT THE ROAMING SERVICES DOE S NOT REQUIRE ANY HUMAN INTERVENTION AND IT OPERATES AUTOMATICALLY, W HEREIN AT PARAS 7 TO 12 OF THE ORDER IT IS HELD AS UNDER: 'WE HAVE HEARD MR. K.V. ARAVIND, LEARNED COUNSEL AP PEARING FOR THE APPELLANTS - REVENUE IN ALL THE APPEALS. THE LEARNE D COUNSEL RELIED TWO DECISIONS OF THE APEX COURT FOR CANVASSING THE CONT ENTION THAT THE ROAMING CHARGES PAID BY THE ASSESSEE TO THE OTHER SERVICE P ROVIDER CAN BE SAID AS 'TECHNICAL SERVICES'; ONE WAS THE DECISION OF THE A PEX COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX, DELHI VS. BHARTI CELLUL AR LIMITED, REPORTED AT [2010] 193 TAXMAN 97 (SC); AND THE ANOTHER WAS THE DECISION OF THE APEX COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX-A, MUMBAI VS. KOTAK SECURITIES LIMITED, REPORTED AT [2016] 67 TAXMANN.C OM 356 (SC) AND IT WAS SUBMITTED THAT IF THE OBSERVATIONS MADE BY THE APEX COURT IN THE ABOVE REFERRED DECISIONS ARE CONSIDERED, THE DECISION OF THE TRIBUNAL WOULD BE UNSUSTAINABLE AND CONSEQUENTLY, THE QUESTIONS MAY A RISE FAR CONSIDERATION BEFORE THIS COURT IN THE PRESENT APPEALS. 9. WE MAY RECORD THAT IN THE DECISION OF THE APEX C OURT IN THE CASE OF BHARTI CELLULAR LIMITED (SUPRA) THE APEX COURT AFTE R HAVING FOUND THAT WHETHER HUMAN INTERVENTION IS REQUIRED IN UTILIZING ROAMING SERVICES BY ONE TELECOM MOBILE SERVICE PROVIDER COMPANY FROM AN OTHER MOBILE SERVICE PROVIDER COMPANY, IS AN ASPECT WHICH MAY REQUIRE FU RTHER OF THE EVIDENCE AND THEREFORE, THE MATTER WAS REMANDED BACK TO THE ASSESSING OFFICER. FURTHER, IN THE IMPUGNED ORDER OF THE TRIBUNAL, AFT ER CONSIDERING THE ABOVE REFERRED DECISION OF BHARTI CELLULAR LIMITED, THE T RIBUNAL HAS FURTHER NOT ONLY CONSIDERED THE OPINION, BUT FOUND THAT AS PER THE SAID OPINION THE ROAMING PROCESS BETWEEN PARTICIPATING ENTITIES IS F ULLY AUTOMATIC AND DOES NOT REQUIRE ANY HUMAN INTERVENTION. THEREFORE, WE D O NOT FIND THAT THE AFORESAID DECISION IN THE CASE OF BHARTI CELLULAR L IMITED, WOULD BE OF ANY HELP TO THE APPELLANTS - REVENUE. 10. IN THE ANOTHER DECISION OF THE APEX COURT, IN T HE CASE OF KOTAK SECURITIES LIMITED, THE MATTER WAS PERTAINING TO TH E CHARGES OF THE STOCK EXCHANGE AND THE APEX COURT, ULTIMATELY, FOUND THAT NO TDS ON SUCH ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 4 PAYMENT WAS DEDUCTIBLE UNDER SECTION 194J OF THE AC T. BUT THE LEARNED COUNSEL FOR THE APPELLANTS - REVENUE ATTEMPTED TO C ONTEND THAT IN PARAGRAPHS 7 AND 8 OF THE ABOVE REFERRED DECISION O F THE APEX COURT, IT HAS BEEN OBSERVED THAT IF A DISTINGUISHABLE AND IDENTIF IABLE SERVICE IS PROVIDED, THEN IT CAN BE SAID AS A 'TECHNICAL SERVICES '. THEREFORE, HE SUBMITTED THAT IN THE PRESENT ROAMING SERVICES TO BE PROVIDED TO A PARTICULAR MOBILE SUBSCRIBER BY A MOBILE COMPA NY IS A CUSTOMIZE BASED SERVICE AND THEREFORE, DISTINGUISHABLE AND SE PARATELY IDENTIFIABLE AND HENCE, IT CAN BE TERMED AS 'TECHNICAL SERVICES '. 11. IN OUR VIEW, THE CONTENTION IS NOT ONLY MISCONC EIVED, BUT IS ON NON EXISTENT PREMISE, BECAUSE THE. SUBJECT MATTER OF TH E PRESENT APPEALS IS NOT ROAMING SERVICES PROVIDED BY MOBILE SERVICE PROVIDE R TO ITS SUBSCRIBER OR CUSTOMER, BUT THE SUBJECT MATTER IS UTILIZATION OF THE ROAMING FACILITY BY PAYMENT OF ROAMING CHARGES BY ONE MOBILE SERVICE PR OVIDER COMPANY TO ANOTHER MOBILE SERVICE PROVIDER COMPANY. HENCE, WE DO NOT FIND THAT THE OBSERVATIONS MADE ARE OF ANY HELP TO THE REVENUE. 12. AS SUCH, EVEN IF WE CONSIDER THE OBSERVATIONS M ADE BY THE APEX COURT IN THE CASE OF BHARTI CELLULAR LIMITED, SUPRA, WHET HER USE OF ROAMING SERVICE BY ONE MOBILE SERVICE PROVIDER COMPANY FROM ANOTHER MOBILE SERVICE PROVIDER COMPANY, CAN BE TERMED AS TECHNICA L SERVICES' OR NOT, IS ESSENTIALLY A QUESTION OF FACT. THE TRIBUNAL, AFTER CONSIDERING ALL THE MATERIAL PRODUCED BEFORE IT, HAS FOUND THAT ROAMING PROCESS BETWEEN PARTICIPATING ENTITIES IS FULLY AUTOMATIC AND DOES NOT REQUIRE ANY HUMAN INTERVENTION. COUPLED WITH THE ASPECT THAT THE TRIB UNAL HAS RELIED UPON THE DECISION OF THE DELHI HIGH COURT FOR TAKING SUPPORT OF ITS VIEW. 13. IN OUR VIEW, THE TRIBUNAL IS ULTIMATELY FACT FI NDING AUTHORITY AND HAS HELD THAT THE ROAMING PROCESS BETWEEN PARTICIPATING COMPANY CANNOT HE TERMED AS TECHNICAL SERVICES AND, THEREFORE, NO TDS WAS DEDUCTIBLE. WE DO NOT FIND THAT ANY ERROR HAS BEEN COMMITTED BY THE T RIBUNAL IN REACHING TO THE AFORESAID CONCLUSION. APART FROM THE ABOVE, THE QUESTIONS ARE ALREADY COVERED BY THE ABOVE REFERRED DECISION OF THE DELHI HIGH COURT, WHICH HAS BEEN CONSIDERED BY THE TRIBUNAL IN THE IMPUGNED DEC ISION. 14. THUS, FOLLOWING THE DECISION OF HON'BLE JURISD ICTIONAL HIGH COURT WE HOLD THAT THE PROCESS INVOLVED IN THE ROAMING CONNECTIVI TY DOES NOT INVOLVE ANY HUMAN INTERVENTION AND, THEREFORE, THE SERVICES DOES NOT FALL WITHIN THE AMBIT OF 'TECHNICAL SERVICES'. HENCE, IT IS NOT REQUIRED TO DEDUCT TAX AT SOURCE ON SUCH PAYMENTS.' 8. THE ORDER PASSED BY THE LEARNED TRIBUNAL JAIPUR BENCH IN ITA NO.656/JP/2010 HAD ALSO BEEN CAREFULLY CONSIDERED BY US. WHILE PAS SING ORDERS IN FAVOUR OF THE ASSESSEE, THE LEARNED TRIBUNAL OBSERVED AS FOLLOWS: ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 5 '11. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH TH E PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. AFTER GOING THROU GH THE ORDER OF THE ASSESSING OFFICER, LD CIT(A); SUBMISSIONS OF THE ASSESSEE AS WELL AS GOING THROUGH THE PROCESS OF PROVIDING ROAMING SERVICES; EXAMINATION OF TECHNICAL EXPERTS BY THE ACIT TDS, NEW DELHI IN THE CASE OF BHARTI CELLULAR LTD.; THEREAFTER CROSS ITA NOS.2195 & 2196/AHD/2016 THE ACIT VS. M/S. BHARTIAI RTEL LTD.ASST. YEARS - 2008- 09 & 2009-10 EXAMINATION MADE BY M/S BHARTI CELLULA R LTD.; ALSO OPINION OF HON'BLE THE THEN CHIEF JUSTICE OF INDIA MR. S.H. KA PADIA DATED 03/09/2013 AND ALSO VARIOUS JUDGMENTS GIVEN BY THE ITAT AHMADABAD BENCH IN THE CASE OF CANARA BANK ON MICR AND PUNE BENCH DECISION ON DATA LINK S ERVICES. WE FIND THAT FOR INSTALLATION/SETTING UP/REPAIRING/SERVICING/MAINTEN ANCE CAPACITY AUGMENTATION ARE REQUIRE HUMAN INTERVENTION BUT AFTER COMPLETING THI S PROCESS MERE INTERCONNECTION BETWEEN THE OPERATORS IS AUTOMATIC AND DOES NOT REQ UIRE ANY HUMAN INTERVENTION. THE TERM INTER CONNECTING USER CHARGES (IUC) ALSO S IGNIFIES CHARGES FOR CONNECTING TWO ENTITIES. THE COORDINATE BENCH ALSO CONSIDERED THE HON'BLE SUPREME COURT DECISION IN THE CASE OF BHARTI CELLUL AR LTD. IN THE CASE OF I-GATE COMPUTER SYSTEM LTD. AND HELD THAT DATA LINK TRANSF ER DOES NOT REQUIRE ANY HUMAN INTERVENTION AND CHARGES RECEIVED OR PAID ON ACCOUN T OF THIS IS NOT FEES FOR TECHNICAL SERVICES AS ENVISAGED IN SECTION 194J REA D WITH SECTION 9(1)(VII) READ WITH EXPLANATION-2 OF THE ACT. IN CASE BEFORE US, T HE ASSESSEE HAS PAID ROAMING CHARGES I.E. IUC CHARGES TO VARIOUS OPERATORS AT RS . 10,18,92,350/-. RESPECTFULLY FOLLOWING ABOVE JUDICIAL PRECEDENTS, WE HOLD THAT T HESE CHARGES ARE NOT FEES FOR RENDERING ANY TECHNICAL SERVICES AS ENVISAGED IN SE CTION 194J OF THE ACT. THEREFORE, WE REVERSE THE ORDER OF THE LDCIT(A) AND ASSESSEE'S APPEAL IS ALLOWED ON THIS GROUND ALSO.' 9. THE HON'BLE HIGH COURT OF KARNATAKA IN THE MATTE R OF CIT(TDS)-VS-M/S. VODAFONE SOUTH LTD. ALSO HAD TAKEN THE SAME VIEW IN FAVOUR O F THE ASSESSEE. WHILE DOING SO, THE JUDGMENT PASSED BY THE HON'BLE JURISDICTIONAL HIGH COURT IN THE MATTER OF VODAFONE ESSAR GUJARAT LTD-VS-ACIT(TDS) WAS ALSO TAKEN INTO CONSID ERATION. THE RELEVANT PORTION OF THE SAID JUDGMENT IS AS FOLLOWS: '13. IN OUR VIEW, THE TRIBUNAL IS ULTIMATELY FACT F INDING AUTHORITY AND HAS HELD THAT THE ROAMING PROCESS BETWEEN PARTICIPATING COMP ANY CANNOT BE TERMED AS TECHNICAL SERVICES AND, THEREFORE, NO TDS WAS DEDUC TABLE. WE DO NOT FIND THAT ANY ERROR HAS BEEN COMMITTED BY THE TRIBUNAL IN REACHIN G TO THE AFORESAID CONCLUSION. APART FROM THE ABOVE, THE QUESTIONS ARE ALREADY COV ERED BY THE ABOVE REFERRED DECISION OF THE DELHI HIGH COURT, WHICH HAS BEEN CO NSIDERED BY THE TRIBUNAL IN THE IMPUGNED DECISION.' WE FIND FROM THE ORDER PASSED BY THE LEARNED CIT(A) THAT ALL THE JUDGMENTS AS DISCUSSED HEREINABOVE WERE CONSIDERED BY THE LEARNE D CIT(A) WHILE ALLOWING THE CLAIM OF THE APPLICANT IN DELETING THE DEMAND OF RS.71,30,81 0/- & RS.38,07,820/- RAISED U/S 194J FOR A.Y. 2008-09 & 2009-10 RESPECTIVELY WITH THE CONCLU SION THAT THE ROAMING CHARGES PAID BY THE APPELLANT TO OTHER TELECOM COMPANIES ARE NOT CO VERED UNDER 'FEE FOR TECHNICAL SERVICE' AND SUCH PAYMENTS ARE OUT OF THE PURVIEW OF TDS PRO VISION OF 194J OF THE ACT. WE FIND NO INFIRMITY IN THE ORDER PASSED BY THE LEARNED CIT(A) . WE, THEREFORE, DO NOT HESITATE TO CONFIRM THE SAME. THEREFORE, REVENUE'S APPEAL IS DE VOID OF ANY MERIT AND HENCE DISMISSED. ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 6 10. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE IS DISMISSED. 5. RESPECTIVELY RELYING UPON THE ORDER AFORESAID, W E FIND NO OTHER ALTERNATIVE BUT TO DISMISS THE APPEAL PREFERRED BY THE REVENUE SINCE THE SAME IS FOUND TO BE DEVOID OF ANY MERIT ON THE ISSUE WHICH HAS ALSO BEE N SETTLED IN FAVOUR OF THE ASSESSEE AS DISCUSSED ABOVE. 6. IN THE RESULT, REVENUES APPEAL IS DISMISSED. 7. BEFORE PARTING WE WOULD LIKE TO MAKE CERTAIN OBS ERVATION RELATING TO THE ISSUE CROPPED UP UNDER PRESENT SCENARIO OF COVID-19 PANDEMIC AS TO WHETHER WHEN THE HEARING OF THE MATTER WAS CONCLUDED ON 08. 01.2020 THE ORDER CAN BE PRONOUNCED TODAY I.E. ON 19.05.2020. THE ISSUE HAS ALREADY BEEN DISCUSSED BY THE CO-ORDINATE BENCH IN THE CASE OF DCIT VS. JSW L TD. (ITA NOS. 6264 & 6103/MUM/2018) PRONOUNCED ON 14.05.2020 IN THE LIGH T OF WHICH IT IS WELL WITHIN THE TIME LIMIT PERMITTED UNDER RULE 34(5) OF THE APPELLATE TRIBUNAL RULES, 1963 IN VIEW OF THE FOLLOWING OBSERVATIONS MADE THE REIN: 7. HOWEVER, BEFORE WE PART WITH THE MATTER, WE MUS T DEAL WITH ONE PROCEDURAL ISSUE AS WELL. WHILE HEARING OF THESE A PPEALS WAS CONCLUDED ON 8 TH JANUARY 2020, THIS ORDER THEREON IS BEING PRONOUNCE D TODAY ON THE DAY OF 14 TH MAY, 2020, MUCH AFTER THE EXPIRY OF 90 DAYS FROM TH E DATE OF CONCLUSION OF HEARING. WE ARE ALSO ALIVE TO THE FACT THAT RULE 34 (5) OF THE INCOME TAX APPELLATE TRIBUNAL RULES 1963, WHICH DEALS WITH PRONOUNCEMENT OF ORDERS, PROVIDES AS FOLLOWS: (5) THE PRONOUNCEMENT MAY BE IN ANY OF THE FOLLOWIN G MANNERS : (A) THE BENCH MAY PRONOUNCE THE ORDER IM MEDIATELY UPON THE CONCLUSION OF THE HEARING. ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 7 (B) IN CASE WHERE THE ORDER IS NOT PRONO UNCED IMMEDIATELY ON THE CONCLUSION OF THE HEARING, THE BENCH SHALL GIVE A DATE FOR PRONOUNCEM ENT. (C) IN A CASE WHERE NO DATE OF PRONOUNCE MENT IS GIVEN BY THE BENCH, EVERY ENDEAVOUR SHALL BE MADE BY THE BENCH TO PRONOUNCE T HE ORDER WITHIN 60 DAYS FROM THE DATE ON WHICH THE HEARING OF THE CASE WAS CONCLUDED BUT, WHERE IT IS NOT PRACTICABLE SO TO DO ON THE GROUND OF EXCEPTIONAL AND EXTRAORDINARY CIRCUMS TANCES OF THE CASE, THE BENCH SHALL FIX A FUTURE DAY FOR PRONOUNCEMENT OF THE ORDER, AND SUCH DATE SHALL NOT ORDINARILY (EMPHASIS SUPPLIED BY US NOW) BE A DAY BEYOND A FURTHER PERIO D OF 30 DAYS AND DUE NOTICE OF THE DAY SO FIXED SHALL BE GIVEN ON THE NOTICE BOARD. 8. QUITE CLEARLY, ORDINARILY THE ORDER ON AN APPE AL SHOULD BE PRONOUNCED BY THE BENCH WITHIN NO MORE THAN 90 DAYS FROM THE DATE OF CONCLUDING THE HEARING. IT IS, HOWEVER, IMPORTANT TO NOTE THAT THE EXPRESSION ORD INARILY HAS BEEN USED IN THE SAID RULE ITSELF. THIS RULE WAS INSERTED AS A RESULT OF DIRECTIONS OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHIVSAGAR VEG RESTAURANT VS ACIT [(2009) 317 ITR 433 (BOM)] WHEREIN THEIR LORDSHIPS HAD, INTER ALIA, DIRECTED THAT WE, THEREFORE, DIRECT THE PRESIDENT OF THE APPELLATE TRIBUNAL TO F RAME AND LAY DOWN THE GUIDELINES IN THE SIMILAR LINES AS ARE LAID DOWN BY THE APEX COURT IN THE CASE OF ANIL RAI (SUPRA) AND TO ISSUE APPROPRIATE ADMINISTR ATIVE DIRECTIONS TO ALL THE BENCHES OF THE TRIBUNAL IN THAT BEHALF. WE HOPE AN D TRUST THAT SUITABLE GUIDELINES SHALL BE FRAMED AND ISSUED BY THE PRESID ENT OF THE APPELLATE TRIBUNAL WITHIN SHORTEST REASONABLE TIME AND FOLLOW ED STRICTLY BY ALL THE BENCHES OF THE TRIBUNAL. IN THE MEANWHILE (EMPHASIS, BY UNDERLINING, SUPPLIED BY US NOW) , ALL THE REVISIONAL AND APPELLATE AUTHORITIES UNDE R THE INCOME-TAX ACT ARE DIRECTED TO DECIDE MATTERS HEARD BY THEM WITHIN A PERIOD OF THREE MONTHS FROM THE DATE CASE IS CLOSED FOR JUDGMENT . IN THE RULED SO FRAMED, AS A RESULT OF THESE DIRECTIONS, THE EXPRESSION ORDINARILY HAS B EEN INSERTED IN THE REQUIREMENT TO PRONOUNCE THE ORDER WITHIN A PERIOD OF 90 DAYS. THE QUESTION THEN ARISES WHETHER THE PASSING OF THIS ORDER, BEYOND NINETY DAYS, WAS NECE SSITATED BY ANY EXTRAORDINARY CIRCUMSTANCES. ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 8 9. LET US IN THIS LIGHT REVERT TO THE PREVAILING SI TUATION IN THE COUNTRY. ON 24TH MARCH, 2020, HONBLE PRIME MINISTER OF INDIA TOOK T HE BOLD STEP OF IMPOSING A NATIONWIDE LOCKDOWN, FOR 21 DAYS, TO PREVENT SPREAD OF COVID 19 EPIDEMIC, AND THIS LOCKDOWN WAS EXTENDED FROM TIME TO TIME. AS A MATTE R OF FACT, EVEN BEFORE THIS FORMAL NATIONWIDE LOCKDOWN, THE FUNCTIONING OF THE INCOME TAX APPELLATE TRIBUNAL AT MUMBAI WAS SEVERELY RESTRICTED ON ACCOUNT OF LOC KDOWN BY THE MAHARASHTRA GOVERNMENT, AND ON ACCOUNT OF STRICT ENFORCEMENT OF HEALTH ADVISORIES WITH A VIEW OF CHECKING SPREAD OF COVID 19. THE EPIDEMIC SITUAT ION IN MUMBAI BEING GRAVE, THERE WAS NOT MUCH OF A RELAXATION IN SUBSEQUENT LO CKDOWNS ALSO. IN ANY CASE, THERE WAS UNPRECEDENTED DISRUPTION OF JUDICIAL WOK ALL OV ER THE COUNTRY. AS A MATTER OF FACT, IT HAS BEEN SUCH AN UNPRECEDENTED SITUATION, CAUSING DISRUPTION IN THE FUNCTIONING OF JUDICIAL MACHINERY, THAT HONBLE SUP REME COURT OF INDIA, IN AN UNPRECEDENTED ORDER IN THE HISTORY OF INDIA AND VID E ORDER DATED 6.5.2020 READ WITH ORDER DATED 23.3.2020, EXTENDED THE LIMITATION TO E XCLUDE NOT ONLY THIS LOCKDOWN PERIOD BUT ALSO A FEW MORE DAYS PRIOR TO, AND AFTER , THE LOCKDOWN BY OBSERVING THAT IN CASE THE LIMITATION HAS EXPIRED AFTER 15.03.202 0 THEN THE PERIOD FROM 15.03.2020 TILL THE DATE ON WHICH THE LOCKDOWN IS L IFTED IN THE JURISDICTIONAL AREA WHERE THE DISPUTE LIES OR WHERE THE CAUSE OF ACTION ARISES SHALL BE EXTENDED FOR A PERIOD OF 15DAYS AFTER THE LIFTING OF LOCKDOWN . HONBLE BOMBAY HIGH COURT, IN AN ORDER DATED 15TH APRIL 2020, HAS, BESIDES EXTEND ING THE VALIDITY OF ALL INTERIM ORDERS, HAS ALSO OBSERVED THAT, IT IS ALSO CLARIFIED THAT WHILE CALCULATING TIME FO R DISPOSAL OF MATTERS MADE TIME-BOUND BY THIS COURT, THE PERIOD FOR WHICH THE ORDER DATED 26TH MARCH 2020 CONTINUES TO OPERATE SH ALL BE ADDED AND TIME SHALL STAND EXTENDED ACCORDINGLY , AND ALSO OBSERVED THAT ARRANGEMENT CONTINUED BY AN ORDER DATED 26TH MARCH 2020 TILL 30 TH APRIL 2020 SHALL CONTINUE FURTHER TILL 15TH JUNE 2020 . IT HAS BEEN AN UNPRECEDENTED SITUATION NOT ONLY IN INDIA BUT ALL OVER THE WORLD. GOVERNMENT O F INDIA HAS, VIDE NOTIFICATION DATED 19 TH FEBRUARY 2020, TAKEN THE STAND THAT, THE CORONA VI RUS SHOULD BE ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 9 CONSIDERED A CASE OF NATURAL CALAMITY AND FMC ( I.E. FORCE MAJEURE CLAUSE) MAY BE INVOKED, WHEREVER CONSIDERED APPROPRIATE, FOLLOWING THE DUE PROCEDURE. THE TERM FORCE MAJEURE HAS BEEN DEFINED IN BLACKS LAW DICTIONARY, AS AN EVENT OR EFFECT THAT CAN BE NEITHER ANTICIPATED NOR CONTROLL ED WHEN SUCH IS THE POSITION, AND IT IS OFFICIALLY SO NOTIFIED BY THE GOVERNMENT OF INDIA AND THE COVID-19 EPIDEMIC HAS BEEN NOTIFIED AS A DISASTER UNDER THE NATIONAL DISASTER MANAGEMENT ACT, 2005, AND ALSO IN THE LIGHT OF THE DISCUSSIONS ABOVE, THE PERIOD DURING WHICH LOCKDOWN WAS IN FORCE CAN BE ANYTHING BUT AN ORDIN ARY PERIOD. 10. IN THE LIGHT OF THE ABOVE DISCUSSIONS, WE ARE OF THE CONSIDERED VIEW THAT RATHER THAN TAKING A PEDANTIC VIEW OF THE RULE REQU IRING PRONOUNCEMENT OF ORDERS WITHIN 90 DAYS, DISREGARDING THE IMPORTANT FACT THA T THE ENTIRE COUNTRY WAS IN LOCKDOWN, WE SHOULD COMPUTE THE PERIOD OF 90 DAYS B Y EXCLUDING AT LEAST THE PERIOD DURING WHICH THE LOCKDOWN WAS IN FORCE. WE MUST FAC TOR GROUND REALITIES IN MIND WHILE INTERPRETING THE TIME LIMIT FOR THE PRONOUNCE MENT OF THE ORDER. LAW IS NOT BROODING OMNIPOTENCE IN THE SKY. IT IS A PRAGMATIC TOOL OF THE SOCIAL ORDER. THE TENETS OF LAW BEING ENACTED ON THE BASIS OF PRAGMAT ISM, AND THAT IS HOW THE LAW IS REQUIRED TO INTERPRETED. THE INTERPRETATION SO ASSI GNED BY US IS NOT ONLY IN CONSONANCE WITH THE LETTER AND SPIRIT OF RULE 34(5) BUT IS ALSO A PRAGMATIC APPROACH AT A TIME WHEN A DISASTER, NOTIFIED UNDER THE DISASTER MANAGEMENT ACT 2005, IS CAUSING UNPRECEDENTED DISRUPTION IN THE FUNCTIONING OF OUR JUSTICE DELIVERY SYSTEM. UNDOUBTEDLY, IN THE CASE OF OTTERS CLUB VS DIT [(2017) 392 ITR 244 (BOM)] , HONBLE BOMBAY HIGH COURT DID NOT APPROVE AN ORDER BEING PASSED BY THE TRIBUNAL BEYOND A PERIOD OF 90 DAYS, BUT THEN IN THE PRESENT SITUATION HONBLE BOMBAY HIGH COURT ITSELF HAS, VIDE JUDGMENT DATED 15 TH APRIL 2020, HELD THAT DIRECTED WHILE CALCULATING THE TIME FOR DISPOSAL OF MATTERS MADE T IME-BOUND BY THIS COURT, THE PERIOD FOR WHICH THE ORDER DATED 26TH MARCH 2020 CO NTINUES TO OPERATE SHALL BE ADDED AND TIME SHALL STAND EXTENDED ACCORDINGLY . THE EXTRAORDINARY STEPS ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 10 TAKEN SUO MOTU BY HONBLE JURISDICTIONAL HIGH COURT AND HONBLE SU PREME COURT ALSO INDICATE THAT THIS PERIOD OF LOCKDOWN CANNOT B E TREATED AS AN ORDINARY PERIOD DURING WHICH THE NORMAL TIME LIMITS ARE TO REMAIN I N FORCE. IN OUR CONSIDERED VIEW, EVEN WITHOUT THE WORDS ORDINARILY, IN THE LIGHT O F THE ABOVE ANALYSIS OF THE LEGAL POSITION, THE PERIOD DURING WHICH LOCKOUT WAS IN FO RCE IS TO EXCLUDED FOR THE PURPOSE OF TIME LIMITS SET OUT IN RULE 34(5) OF THE APPELLA TE TRIBUNAL RULES, 1963. VIEWED THUS, THE EXCEPTION, TO 90-DAY TIME-LIMIT FOR PRONO UNCEMENT OF ORDERS, INHERENT IN RULE 34(5)(C), WITH RESPECT TO THE PRONOUNCEMENT OF ORDERS WITHIN NINETY DAYS, CLEARLY COMES INTO PLAY IN THE PRESENT CASE. OF COU RSE, THERE IS NO, AND THERE CANNOT BE ANY, BAR ON THE DISCRETION OF THE BENCHES TO REF IX THE MATTERS FOR CLARIFICATIONS BECAUSE OF CONSIDERABLE TIME LAG BETWEEN THE POINT OF TIME WHEN THE HEARING IS CONCLUDED AND THE POINT OF TIME WHEN THE ORDER THER EON IS BEING FINALIZED, BUT THEN, IN OUR CONSIDERED VIEW, NO SUCH EXERCISE WAS REQUIR ED TO BE CARRIED OUT ON THE FACTS OF THIS CASE. 8. ON THE BASIS OF THE OBSERVATION MADE IN THE AFOR ESAID JUDGMENT WE EXCLUDE THE PERIOD OF LOCKDOWN WHILE COMPUTING THE LIMITATI ON PROVIDED UNDER RULE 34(5) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE 1 963. ORDER IS, THUS, PRONOUNCED UNDER RULE 34(4) OF THE SAID RULE BY PLA CING THE DETAILS ON THE NOTICE BOARD. 9. IN THE RESULT, REVENUES APPEAL IS DISMISSED. THIS ORDER PRONOUNCED IN OPEN COURT ON 27/05/2020 SD/- SD/- (PRAMOD KUMAR) (MADHUMITA ROY) VICE PRESIDENT JUDICIAL MEMBER MUMBAI: DATED 27/05/2020 TANMAY TRUE COPY ITA NO.6158/MUM/2018 DCIT(TDS)VS.VODAFONE INDIA LTD. ASST.YEAR 2007-08 - 11 / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. & / ASSESSEE 3. ( )* + / CONCERNED CIT 4. +- / CIT (A) 5. /01 22)*, )*#, 4 ( / DR, ITAT, MUMBAI 6. 167 8 / GUARD FILE. BY ORDER / &9 , :/; , )*#, 4 ( < 1. DATE OF DICTATION ON 04.02.2020 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING MEMBER 04.02.2020 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 19.12.2019 1. OTHER MEMBER 2. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S19.12.2019 3. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT.12.2019 4. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.12.2019 5. DATE ON WHICH THE FIES TO THE BENCH CLERK20.12.2019 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