Appeal details
Counselvise Citation
[2011] 140 COUNSELVISE.COM (IT) 49169 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
8 month(s) 21 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
22-06-2011
Appeal Filed By
Assessee
Bench Allotted
A
Assessment Year
2005-2006
Appeal Filed On
01-10-2010
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A : MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI R.K.PANDA, ACCOUNTANT MEMBER ITA. NO.6862/MUM/2010 ASSESSMENT YEAR 2005-2006 ATOS ORIGIN IT SERVICES SINGAPORE PTE. LTD. MUMBAI 400 096 PAN AAECA 9266F VS. ASST. DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION) 1 (1) MUMBAI. (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI SHITAL BANDEKAR FOR RESPONDENT : SHRI PKB. MENEN ORDER PER D. MANMOHAN, V.P. 1. PENALTY LEVIED BY THE ASSESSING OFFICER UNDER S ECTION 271 (1) (C) OF THE ACT HAVING BEEN CONFIRMED BY THE LEA RNED CIT(A), ASSESSEE IS IN APPEAL BEFORE US. 2. FACTS IN SHORT ARE THAT THE ASSESSEE, A NON-RES IDENT COMPANY, DECLARED NIL INCOME FOR THE YEAR UNDER CON SIDERATION, WHEREAS THE ASSESSMENT WAS COMPLETED BY DETERMINING THE TOTAL INCOME AT RS.12,92,68,070/-. THE CRUX OF THE ISSUE IS WITH REGARD TO TAXABILITY OF THE PAYMENT RECEIVED BY THE ASSESSEE FROM STANDARD CHARTERED BANK. IT WAS CONTENDED BEFORE THE ASSESSI NG OFFICER THAT THE AMOUNT RECEIVED BY THE ASSESSEE IS NOT ASSESSAB LE TO TAX. ASSESSING OFFICER WAS HOWEVER OF THE OPINION THAT I T HAS TO BE TREATED AS A ROYALTY WITHIN THE MEANING OF SECTION 12 OF DTAA BETWEEN INDIA AND SINGAPORE AND ACCORDINGLY BROUGHT TO TAX THE SA ID SUM. CONSEQUENT TO THE ASSESSMENT MADE BY THE ASSESSING OFFICER, PENALTY WAS LEVIED UNDER SECTION 271 (1) (C) OF THE I.T. AC T. 2 3. AT THE TIME OF HEARING, LEARNED COUNSEL, APPEAR ING ON BEHALF OF THE ASSESSEE, SUBMITTED THAT IN THE QUANT UM PROCEEDINGS THE ADDITION MADE BY THE ASSESSING OFFICER WAS DELETED BY THE L BENCH, MUMBAI (ITA. NO. 2428/MUM/2009 DATED 27-5-2011). IT WAS THUS CONTENDED THAT SINCE THE VERY BASIS ON WHICH PENALT Y WAS LEVIED NO LONGER SUBSISTS, THERE IS NO CASE FOR LEVY OF PENAL TY. 4. LEARNED DR ON THE OTHER HAND RELIED UPON THE OR DERS PASSED BY THE TAX AUTHORITIES. 5. IN OUR CONSIDERED OPINION PENALTY LEVIED BY THE ASSESSING OFFICER DESERVES TO BE DELETED IN THE LIGHT OF DECI SION OF THE ITAT (SUPRA). WE, THEREFORE, SET ASIDE THE ORDERS PASSED BY THE TAX AUTHORITIES AND CANCEL THE PENALTY LEVIED UNDER SEC TION 271 (1) (C) OF THE ACT, AS PRONOUNCED IN THE OPEN COURT IN THE PRE SENCE OF PARTIES. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. SD/- SD/- (R.K.PANDA) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATE 22 ND JUNE, 2011 VBP/- COPY TO 1. ATOS ORIGIN IT SERVICES SINGAPORE PTE. LTD. C/O. ATOS ORIGIN INDIA PVT. LTD. 126/127 SDF-IV, SEEPZ, ANDHERI (EAST) , MUMBAI400 096 PAN AAECA 9266F 2. ASST. DIRECTOR OF INCOME TAX (INTERNATIONAL TAXA TION) 1 (1) MUMBAI. 3. CIT(A)-10, MUMBAI 4. DIT (INTERNATIONAL TAXATION), MUMBAI. 5. DR A BENCH 6. GUARD FILE (TRUE COPY) BY ORDER ASST. REGISTRAR, ITAT, MUMBAI BENCHES MUMBAI.
