SNOWDROP TRADING P. LTD, MUMBAI V. ASST CIT 9(3), MUMBAI

ITA 8219/MUM/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4011 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: L
• Next Hearing Date: 18-04-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 07-12-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AJAY SHRIVASTAVA
• Assessee Lawyers: SANJIV M SHAH
• Keywords: Opportunity of being heard
• Section: 14A

Judgement Text

, , , , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES L, MUMBAI .. , ! ' , # !, $ BEFORE SHRI R.S.SYAL, AM AND SHRI VIVEK VARMA, JM ITA NO.8219/MUM/2011 : ASST. YEAR 2008-2009 M/S SNOWDROP TRADING PVT. LTD. 15/71, ASHRAY MHB COMPLEX, BANDRA RECLAMATION, BANDRA WEST, MUMBAI-400050 PAN-AACCS1605C % % % % / VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX-9(3), AAYAKAR BHAVAN, M.K.RAOD, MUMBAI-400020 ( '( / // / APPELLANT) ( )*'( / RESPONDENT) '( + ++ + , , , , / ASSESSEE BY : SHRI SANJIV M. SHAH )*'( + , + , + , + , / REVENUE BY : SHRI AJAY SHRIVASTAVA % + - / / / / DATE OF HEARING : 15.07.2013 ./0 + - / DATE OF PRONOUNCEMENT : 24.07.2013 !1 !1 !1 !1 / / / / O R D E R PER R.S.SYAL ( AM) : THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASSED BY THE CIT(A) ON 16.09.2011 IN RELATION TO THE A.Y. 2008-09. 2. THE FIRST GROUND IS AGAINST THE CONFIRMATION OF THE ACTION OF THE ASSESSING OFFICER IN MAKING DISALLOWANCE OF RS.4,99,736/- U/S 40(A)(I) OF THE INCOME-TAX ACT, 1 961 (ACT). BRIEFLY STATED THE FACTS OF THIS GROUND THAT THE AS SESSEE CLAIMED DEDUCTION FOR FOREIGN CONSULTANCY AND COMMI SSION CHARGES AMOUNTING TO RS.46.92 LACS. ON THE PERUSAL OF THE ITA NO.8219/MUM/2011 . M/S SNOWDROP TRADING PVT. LTD. . 2 DETAILS IN RESPECT OF TAX DEDUCTED AT SOURCE AS REQ UIRED U/S 195 OF THE ACT, THE ASSESSING OFFICER OBSERVED THAT SUC H EXPENSES INCLUDED PAYMENTS MADE TO FOUR PARTIES RESIDING IN DIFFERENT COUNTRIES. THE ASSESSEE SUBMITTED THESE PAYMENTS W ERE MADE TO THE PERSONS RESIDING IN COUNTRIES WITH WHOM INDI A HAS ENTERED INTO DOUBLE TAXATION AVOIDANCE AGREEMENT. O N GOING THROUGH THESE DETAILS, THE ASSESSING OFFICER NOTICE D THAT IT INCLUDED A PAYMENT OF RS.4,99,736 MADE TO MR. JEFFE RY SMITH, CHINA, WHICH WAS MADE WITHOUT DEDUCTION OF T AX SOURCE. THE ASSESSING OFFICER MADE DISALLOWANCE U/ S 40(A)(I) WHICH CAME TO BE CONFIRMED IN THE FIRST APPEAL. 3. AFTER CONSIDERING THE RIVAL SUBMISSION AND P ERUSING THE RELEVANT MATERIAL ON RECORD, IT IS OBSERVED THAT TH E AUTHORITIES BELOW HAVE COVERED THIS AMOUNT U/S 9(1)(VII) AS, F EES OF TECHNICAL SERVICES IN THE NATURE OF INSPECTION SE RVICES FOR PURCHASE ORDER. THE LD. AR CONTENDED THAT THE AUTH ORITIES HAVE GONE BY THE NOMENCLATURE GIVEN IN THE AGREEMEN T WITHOUT ASCERTAINING CORRECT NATURE OF AMOUNT WHICH WAS SIMPLY IN THE NATURE OF COMMISSION. FROM THE ORDER S OF THE AUTHORITIES BELOW, WE FIND AND THERE IS INSUFFICIEN T DISCUSSION ABOUT THE NATURE OF THE AMOUNT PAID BY THE ASSESSEE . BOTH THE SIDES ARE IN AGREEMENT THAT THE MATTER CAN BE RESTO RED TO THE FILE OF AO FOR AFRESH ADJUDICATION. WE, THEREFORE SET-ASIDE THE ITA NO.8219/MUM/2011 . M/S SNOWDROP TRADING PVT. LTD. . 3 IMPUGNED ORDER AND REMIT THE MATTER TO THE FILE OF THE AO FOR DECIDING THIS ISSUE AFRESH AS PER LAW AFTER ALLOWIN G A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 4. GROUND NO. 2 ABOUT THE CONFIRMATION OF THE DISAL LOWANCE U/S 14A WAS NOT PRESSED BY THE LD AR. THIS GROUND I S, THEREFORE, NOT ALLOWED . 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 24 TH DAY OF JULY, 2013. !1 + ./0 2!%3 24 JULY 2013 / + = SD/- SD/- (VIVEK VARMA) (R.S.SYAL) # ! # ! # ! # ! / JUDICIAL MEMBER ! ! ! ! / ACCOUNTANT MEMBER MUMBAI ; 2!% DATED : 24 TH JULY, 2013. SHEKHAR !1 + )#->' ?'0- !1 + )#->' ?'0- !1 + )#->' ?'0- !1 + )#->' ?'0-/ COPY OF THE ORDER FORWARDED TO : 1. '( / THE APPELLANT 2. )*'( / THE RESPONDENT. 3. @ ( ) / THE CIT- , MUMBAI. 4. @ / CIT(A)- , MUMBAI 5. 'C= )#-#% , , / DR, ITAT, MUMBAI 6. =D E / GUARD FILE. !1% !1% !1% !1% / BY ORDER, *'- )#- //TRUE COPY// F FF F/ // /G G G G H H H H ( DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI