John Deere India Private Limited, Pune V. Assistant Commissioner of Income Tax, Pune

ITA 692/PUN/2024

• Counselvise Citation: [2024] 100 COUNSELVISE.COM (IT) 0858 (ITAT-PUNE)
• Duration Of Justice: 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-07-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Appeal Filed On: 04-04-2024
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Double taxation relief; TDS
• Section: 90; 143(3); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND MS ASTHA CHANDRA, JUDICIAL MEMBER ITA No.692/PUN/2024 Assessment Year : 2016-17 John Deere India Pvt. Ltd., Tower.No.14, Magarpatta City, Cyber City, Hadapsar,I.E.S.O., Pune – 411013 Vs. ACIT , Pune PAN: AAACJ4233B (Appellant) (Respondent) Assessee by : Shri Nikhil Pathak Department by : Shri Ramnath P. Murkunde Date of hearing : 16-07-2024 Date of pronouncement : 22-07-2024 O R D E R PER R.K. PANDA, VP : This appeal filed by the assessee is directed against the order dated 15.02.2024 of the CIT(A)-13, Pune relating to assessment year 2016-17. 2. The only grounds raised by the assessee are as under. “1. The CIT(A) erred in rejecting the claim of refund of excess DDT paid of Rs.2,88,31,272/-. 2. Learned CIT(A) erred in not appreciating that on the dividend declared by assessee, the dividend distribution tax has been paid @ 20.36% as against the rate of 10% provided in the DTAA between India and Singapore and accordingly, the said rate as per the DTAA 2 ITA No.692/PUN/2024 should be applied for the payment of dividend distribution tax and accordingly, the excess tax paid should be refunded. 3. The appellant craves leave to add, alter, amend or delete the above grounds of appeal.” 3. Facts of the case in brief that the assessee is engaged in manufacturing of tractors, agricultural equipments and spare parts. Also it has technology centre which is primarily involved into catering of information technology and engineering services to Deer Associates. It filed its return of income on 29.11.2016 declaring total income of Rs.775,75,65,910/- . The Assessing Officer completed the assessment u/s. 143(3) r.w.s.144C(3) of the Income Tax Act, 1961, determining the taxable income of the assessee at Rs.779,48,85,800/- wherein he made an addition of Rs.3,73,19,882/- by making disallowance u/s. 14A of the Act. 4. Before the CIT(A) the assessee through an additional ground challenged the order of the Assessing Officer in not granting the credit of the excess Dividend Distribution Tax of Rs.2,88,31,272/- paid by the assessee. It was submitted that in respect of the dividend declared by it, the dividend distribution tax has been paid @ 20.36% as against the rate of 10% provided in the DTAA between India and Singapore and therefore the said rate as per the DTAA should be applied for the payment of dividend distribution tax and the excess tax should be refunded. 3 ITA No.692/PUN/2024 5. However, the ld.CIT(A) did not accept the contention of the assessee and rejected the same by the relying on the decision of the Special Bench of the Tribunal in the case of Total Oil India Pvt. Ltd. & Oth Vs DCIT vide ITA No. 6997/Mum/2019 dt.20.04.2023. The relevant para of the CIT(A)’s order reads as under : “8.3 I have carefully considered the facts of the case and submission filed by the appellant. The issue is regarding claim of refund of excess dividend distribution tax paid by the appellant u/s 115-O on repatriation of dividend income to its holding company viz. John Deere Asia (Singapore) Private Limited. Briefly, the appellant company distributed dividend of Rs.27,83,57,353 to JD Singapore during AY 2016-17. The appellant company deducted TDS on this as per section 115-O of the Act amounting to Rs.5,66,67,007. The appellant has claimed that instead of Tax deducted @ 20.36% (grossed up), the TDS should have been restricted @10% as per Article 10(2) of India-Singapore Double Taxation Avoidance Agreement („the DTAA‟ or „the tax treaty‟) read with section 90(2) of the Act. The appellant has referred to section 90 of the Income Tax Act and stated that it overrides provision of section 115-O. It is seen that section 90 is under Chapter IX of the Income Tax Act which is on double taxation relief. This primarily deals with non-resident assesses and section 90(2) states the principle for granting relief of tax for non-resident assesses for avoidance of double taxation. It is not furnished how the dividends have been taxed in both India and Singapore for the non-resident parent entity. In the instant case, the appellant is as resident and not a non-resident and the discussion under section 90 is not appropriate.” 6. Aggrieved with such order of the CIT(A) the assessee filed an appeal before the Tribunal. 4 ITA No.692/PUN/2024 7. Both the sides fairly conceded that the issue stands decided against the assessee by the decision of the Special bench of the Tribunal in the case of Total Oil India Pvt. Ltd. & Oth Vs DCIT supra, which has been followed on by the ld. CIT(A). Since the ld. CIT(A) while deciding the issue against the assessee followed the decision of Special bench of the Tribunal cited (supra) therefore, in absence of any contrary material brought to our notice, the order of the CIT(A) is upheld and the grounds raised by the assesse are dismissed. 8. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open Court on 22 nd July, 2024. Sd/- Sd/- \S SSd/- Sd/- (ASTHA CHANDRA) (R. K. PANDA) JUDICIAL MEMBER VICE PRESIDENT प ु णे Pune; दिन ांक Dated : 22 nd July, 2024 Ashwini आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपीलार्थी / The Appellant; 2. प्रत्यर्थी / The Respondent 3. 4. DR, ITAT, ‘A’ Bench, Pune गार्ड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अधिकरण ,पुणे / ITAT, Pune 5 ITA No.692/PUN/2024 S.No. Details Date Initials Designation 1 Draft dictated on 16.07.2024 Sr. PS/PS 2 Draft placed before author 19.07.2024 Sr. PS/PS 3 Draft proposed & placed before the Second Member JM/AM 4 Draft discussed/approved by Second Member AM/AM 5 Approved Draft comes to the Sr. PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr. PS/PS 7 Date of uploading of Order Sr. PS/PS 8 File sent to Bench Clerk Sr. PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R. 11 Date of Dispatch of order