The ADIT(Intl.Taxn.), Ahmedabad V. Chemoli Adani Pvt.Ltd., Ahmedabad

ITA 824/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1896 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 11-04-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 13-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Assessee Lawyers: P M MEHTA
• Keywords: Double taxation relief; Retrospective amendment; Tax effect

Judgement Text

, A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER ./ ITA NO.824/AHD/2012 WITH CO NO.110/AHD/2012 / ASSTT.YEAR: 2010-2011] ADIT (INTL.TAXN.) AHMEDABAD. VS CHEMOIL ADANI PVT. LTD. ADANI HOUSE NR.MITHAKHALI CIRCLE NAVRANGPURA AHMEDABAD 380 009. PAN : AADCC 3765 G ( APPLICANT ) (RESPONDENT) REVENUE BY : SHRI DINESH SINGH, SR.DR ASSESSEE BY : SHRI P.M. MEHTA, AR / DATE OF HEARING : 11/04/2016 / DATE OF PRONOUNCEMENT: 11/04/2016 *+/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE REVENUE IS IN APPEAL BEFORE US AGAINST THE ORDE R OF THE LD.CIT(A), GANDHINAGAR DATED 12.01.2012 PASSED FOR THE ASSTT.Y EAR 2010-11. AFTER RECEIPT OF NOTICE ON APPEAL OF THE REVENUE, THE ASSESSEE FILED CROSS OBJECTION BEARING NO.110/AHD/2012. 2. THE ONLY GRIEVANCE OF THE REVENUE IS THAT THE LD .CIT(A) HAS ERRED IN ACCEPTING THE CONTENTION OF THE ASSESSEE THAT THE R EMITTANCE TOWARDS SHIP HIRE CHARGES ENGAGED IN THE OPERATION OF INTERNATIONAL T RAFFIC IS COVERED UNDER ARTICLE-8 OF THE INDIA-SINGAPORE DTAA AND HENCE NOT TAXABLE I N INDIA AND THAT THE ASSESSEE WAS RIGHT IN NOT DEDUCTING TDS UNDER SECTION 195 OF THE I.T. ACT FROM THE REMITTANCE MADE TO OVERSEAS PARTY. ITA NO.824/AHD/2012 WITH CO 2 3. THE LD.COUNSEL FOR THE ASSESSEE, AT THE OUTSET C ONTENDED THAT THE APPEAL FILED BY THE REVENUE IS NOT ADMISSIBLE, AS THE SAME IS FI LED BY THE REVENUE IN VIOLATION OF CBDT CIRCULAR NO.21/2015 DATED 10.12.2015. BY VIRT UE OF THIS INSTRUCTION, THE BOARD HAS RESTRAINED THE DEPARTMENT NOT TO FILE APP EAL BEFORE THE TRIBUNAL WHERE THE TAX EFFECT IS BELOW RS.10 LAKHS. HE SUBMITTED THAT THE NON-DEDUCTION OF TDS AT THER ATE OF 10% FROM PAYMENT OF RS.57,63,515/- TREATED A S ROYAL AFTER GROSSING UP COMES TO RS.6,40,309/-, AND ADDING INTEREST UNDER SECTION 201(1A) OF RS.83,240/-, THE TOTAL TAX EFFECT WOULD BE RS.7,23,550/- WHICH IS LESS THA N RS.10,00,000/- AND THEREFORE, APPEAL OF THE ASSESSEE LIABLE TO BE DISMISSED IN LIMINE . THE LD.DR COULD NOT CONTROVERT TO THIS SUBMISSION OF THE LD. COUNSEL FO R THE ASSESSEE. 4. WE FIND THAT THE ASSESSEE HAS FILED ITS APPEAL ON 13.4.2012. ON 10.12.2015 THE CBDT HAS ISSUED INSTRUCTIONS BEARING NO. 21/201 5 PROHIBITING ITS SUBORDINATE AUTHORITIES FROM FILING OF THE APPEAL TO THE TRIBUN AL AGAINST THE ORDER OF THE CIT(A) WHERE THE TAX EFFECT BY VIRTUE OF THE RELIEF GIVEN BY THE CIT(A) IS LESS THAN RS.10 LAKHS. THE INSTRUCTIONS HAVE BEEN MADE APPLICABLE WITH RETROSPECTIVE EFFECT, MEANING THEREBY, THESE INSTRUCTIONS ARE APPLICABLE ON PENDING APPEALS ALSO. IN THE PRESENT CASE, ISSUE AGITATED BY THE REVENUE IS NON- DEDUCTION OF TDS UNDER SECTION 195 PAID TO THE OVERSEAS PARTY. THE TAX EFFECT FOR THE SAME WOULD BE RS.7,23,550/- INCLUDING THE INTEREST, AND THEREFORE, TAX EFFECT W OULD BE LESS THAN RS.10 LAKHS. THUS, THE PRESENT APPEAL DESERVES TO BE DISMISSED B EING TREATED TO BE FILED IN VIOLATION OF CBDT INSTRUCTIONS. IT IS FURTHER OBSE RVED THAT SINCE, WHILE HEARING THE APPEAL, SUCH FACTORS COULD NOT BE CROSS-VERIFIED, T HEREFORE, IN CASE, ON RE-VERIFICATION AT THE END OF THE AO, IT CAME TO THE NOTICE THAT TH E TAX EFFECT IS MORE OR IT FALLS WITHIN THE AMBIT OF EXCEPTIONS PROVIDED IN THE INST RUCTION, THEN THE DEPARTMENT WILL BE AT LIBERTY TO APPROACH THE TRIBUNAL FOR RECALL O F THIS ORDER. SUCH APPLICATION SHOULD BE FILED WITHIN LIMITATION PRESCRIBED UNDER THE LAW. IN VIEW OF THE ABOVE, THE APPEAL OF THE REVENUE IS DISMISSED. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ITA NO.824/AHD/2012 WITH CO 3 6. SINCE APPEAL OF THE REVENUE HAS BEEN DISMISSED A S NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR, THE CO FILED BY THE ASSESSEE BECO MES INFRUCTOUS, AND THE SAME IS ACCORDINGLY DISMISSED. 7. IN THE RESULT, BOTH THE APPEAL OF THE REVENUE AN D THE CO OF ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH APRIL, 2016 AT AHMEDABAD. SD/- SD/- ( ANIL CHATURVEDI) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 11/04/2016