FOX TELEVISION STUDIOS INIDA P. LTD, MUMBAI V. ASST CIT 11(1), MUMBAI

ITA 7668/MUM/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83761 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 9 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 20-01-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 14-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK BATRA; RAJESH R PRASAD
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'F' BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B.R. BASKARAN, ACCOUNTANT MEMBER ITA NO. 7668/MUM/2011 (ASSESSMENT YEAR: 2008-09) FOX TELEVISION STUDIOS INDIA P. LTD. VS. A C I T - 11(1) C/O JKB LEGAL, ATTORNEYS 401/A, 4TH FLOOR, FORT CHAMBERS AMBALAL DOSHI MARG, FORT MUMBAI 400023 ROOM NO. 467, 4TH FLOOR AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 PAN - AABCF0513B APPELLANT RESPONDENT APPELLANT BY: SHRI PORUS KAKA & SHRI MANISH KANTH RESPONDENT BY: SHRI RAJESH R. PRASAD & SHRI VIVEK B ATRA DATE OF HEARING: 19.08.2014 DATE OF PRONOUNCEMENT: 10.09.2014 O R D E R PER D. MANMOHAN, V.P. THIS APPEAL BY THE ASSESSEE COMPANY IS DIRECTED AGA INST THE ORDER PASSED BY THE CIT(A)-3, MUMBAI AND IT PERTAINS TO A Y 2008-09. 2. THE ADDITION MADE BY THE AO UNDER SECTION 68 OF THE ACT, HAVING BEEN CONFIRMED BY THE CIT(A), ASSESSEE COMPANY IS IN APP EAL BEFORE US. 3. FACTS NECESSARY FOR DISPOSAL OF THE APPEAL ARE STAT ED IN BRIEF. THE ASSESSEE COMPANY WAS INCORPORATED IN INDIA AND WAS CARRYING ON THE BUSINESS OF PRODUCING AND/OR BUYING CONTENT FOR TEL ECAST ON TELEVISION CHANNELS AND OTHER DISTRIBUTION PLATFORMS. DURING T HE YEAR UNDER CONSIDERATION THE ASSESSEE HAS ALLOTTED SHARES TO G OLD BID LTD, MAURITIUS (HEREINAFTER REFERRED TO AS GBLM) AT THE FACE VALUE OF ` 10/- PER SHARE AND RECEIVED A SUM OF ` 7.5 CRORES. THE AR SUBMITTED THE FOREIGN INWARD REMITTANCE CERTIFICATE OF THE RBI TO PROVE THE CRED ITWORTHINESS, GENUINENESS AND IDENTITY OF THE SAID COMPANY WHICH HAS INVESTED IN THE SHARES OF THE ASSESSEE COMPANY. THE AO WAS, HOWEVER, OF THE OPINI ON THAT THE ASSESSEE FAILED TO PROVE THE IDENTITY, CAPACITY AND GENUINEN ESS OF THE TRANSACTIONS. HE ITA NO. 7668/MUM/2011 FOX TELEVISION STUDIOS INDIA P. LTD. 2 FURTHER OBSERVED THAT EVEN THE NAME OF THE AFOREMEN TIONED COMPANY IS NOT AVAILABLE ON THE WEBSITE AND HENCE DOUBTED THE GENU INENESS OF THE AVAILABILITY OF THE SAID COMPANY AND ACCORDINGLY IN VOKED PROVISIONS OF SECTION 68. 4. BEFORE THE LEARNED CIT(A) THE ASSESSEE CONTENDED TH AT THE AO MERELY CALLED FOR THE BASIC DETAILS WHICH WERE ALREADY FUR NISHED AND WITHOUT GIVING FURTHER OPPORTUNITY THE AO ASSUMED THAT THE IDENTIT Y IS NOT PROVED. THUS THE ADDITION MADE BY THE AO IS BASED ON ASSUMPTIONS AND PRESUMPTIONS, WHICH IS NOT PERMISSIBLE UNDER LAW. BEFORE THE CIT( A) THE ASSESSEE FURNISHED DETAILED MATERIAL TO PROVE THE GENUINENESS, IDENTIT Y AND CREDITWORTHINESS OF GBLM. THE LEARNED CIT(A) OBSERVED THAT THE SAID MAT ERIAL WAS NOT FILED BEFORE THE AO AND HENCE THE ASSESSEE COMPANY IS NOT ENTITLED TO SUBMIT FRESH EVIDENCE AT THIS STAGE. WITH THIS OBSERVATION THE ADDITION MADE BY THE AO WAS CONFIRMED. FURTHER AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE US. 5. THE LEARNED COUNSEL FOR THE ASSESSEE FILED BEFORE U S NUMBER OF PAPER BOOKS AND IN PARTICULAR ADVERTED OUR ATTENTION TO P APER BOOK NO. 1, PAGES 1 TO 11 TO SUBMIT THAT DURING THE COURSE OF ASSESSMEN T PROCEEDINGS THE AO NEVER DISCUSSED ABOUT THE ADDITION, WHICH IS SOUGHT TO BE MADE, AND MERELY CALLED FOR THE BASIC PARTICULARS IN RESPONSE TO WHI CH THE ASSESSEE FURNISHED THE DETAILS. RECEIPT OF FUNDS FROM GBLM WAS ALSO RE PORTED TO THE RBI (FOREIGN EXCHANGE DEPARTMENT). IT IS ALSO SUBMITTED THAT GBLM IS A LIMITED LIABILITY COMPANY INCORPORATED AND DOMICILED IN MAU RITIUS. IT HOLDS A CATEGORY-1 GLOBAL BUSINESS LICENSE AND IT IS A PART OF FOX GROUP, A FORTUNE 500 COMPANY; ASSESSEE HEREIN RECEIVED FUNDS FROM IT S PARENT COMPANY TO MEET ITS WORKING CAPITAL REQUIREMENTS AND IN FACT I T ALLOTTED EQUITY SHARES AGAINST THE FUNDS RECEIVED FROM ITS PARENT COMPANY . THUS THE ASSESSEE HAS DISCHARGED ITS OBLIGATION BY NOT ONLY EXPLAINING T HE NATURE AND SOURCE BUT ALSO THE CAPACITY OF THE INVESTOR WHEREAS THE AO WR ONGLY INVOKED PROVISIONS OF SECTION 68. 6. ON THE OTHER HAND, THE LEARNED D.R. RELIED UPON THE ORDERS PASSED BY THE TAX AUTHORITIES. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY P ERUSED THE RECORD. HAVING REGARD TO THE PECULIAR CIRCUMSTANCES OF THE CASE WE ARE OF THE VIEW ITA NO. 7668/MUM/2011 FOX TELEVISION STUDIOS INDIA P. LTD. 3 THAT IN THE INTEREST OF SUBSTANTIAL JUSTICE THE MAT TER DESERVES TO BE SET ASIDE TO THE AO WITH A DIRECTION TO HIM TO RECONSIDER THE MA TTER AFRESH BY TAKING INTO CONSIDERATION THE EVIDENCES FILED BEFORE THE CIT(A) . WE ORDER ACCORDINGLY. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH SEPTEMBER, 2014. SD/- SD/- ( B.R. BASKARAN ) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATED: 10 TH SEPTEMBER, 2014 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 3, MUMBAI 4. THE CIT 11, MUMBAI CITY 5. THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.