VARIAN MEDICAL SYSTEMS INDIA P.LTD INDIA BRANCH OFFICE, MUMBAI V. ADDL DIT (IT) RG 2, MUMBAI

ITA 8812/MUM/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3814 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-04-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: L
• Next Hearing Date: 26-03-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 16-12-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NARENDER KUMAR
• Section: 143(3)

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL L BENCH, MUMBAI . .. . . .. . , ,, , ! ! ! ! , ' ' ' ' # $% # $% # $% # $% , ,, , & ! & ! & ! & ! ' ' ' ' BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER . / ITA NO. 8072/MUM./2011 ( &( ) '*) / ASSESSMENT YEAR : 200506 ) . / ITA NO. 8812/MUM./2010 ( &( ) '*) / ASSESSMENT YEAR : 200708 ) VARIAN MEDICAL SYSTEMS INDIA P. LTD. INDIA BRANCH OFFICE, UNIT NO.33 3 RD LEVEL, KALPATRAU SQUARE OFF. SIR M.V. ROAD, ANDHERI (E) MUMBAI 400 059 .. +, / APPELLANT ( V/S ASSTT. DIRECTOR OF INCOME TAX (I.T) RANGE2(2), SCINDIA HOUSE N.M. ROAD, BALLARD ESTATE MUMBAI 400 038 .... -.+, / RESPONDENT !+ . / PERMANENT ACCOUNT NUMBER AAACV9418J &( )0 1 2 / ASSESSEE BY : MR. P.R.V. RAGHAVAN !' 1 2 / REVENUE BY : MR. NARENDER KUMAR (' 1 / DATE OF HEARING 02.04.2013 $ 34* 1 / DATE OF ORDER 10.04.2013 $ $ $ $ / ORDER -. -. -. -. / PER BENCH WE FIRST TAKE UP ASSESSEES APPEAL IN ITA NO.8072/M UM./2011, FOR ASSESSMENT YEAR 200506, WHICH IS PREFERRED AGAINST THE FINAL DRAFT VARIAN MEDICAL SYSTEMS INDIA P. LTD. 2 ASSESSMENT ORDER DATED 29 TH SEPTEMBER 2011, UNDER SECTION 144C(1) R/W 143(3) / 147 OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT ) PASSED IN PURSUANCE OF THE DIRECTIONS GIVEN BY THE DRPII, MU MBAI, UNDER SECTION 144C(5) OF THE ACT. GROUND NO.1, RAISED BY THE ASSE SSEE READS AS UNDER: THE REASSESSMENT ORDER UNDER SECTION 144C(13) R/W 143(3) AND 147 OF THE ACT SERVED ON VARIAN MEDICAL SYSTEM (I) PVT. LTD. INDIAN BRANCH OFFICE ISSUED BY THE DIT (IT) LACKS APPLICAT ION OF MIND. THE A.O. AND THE DISPUTE RESOLUTION PANEL HAS ERRED IN LAW AND ON FACTS IN TAKING THE TOTAL INCOME AS PER ORDER UNDER SECTI ON 143(3) DATED 31.12.2007 AS ` 2,82,04,034. THE DRP HAS ERRED IN LAW AND ON FACTS IN HOLDING AT PARA3.2 OF THEIR DIRECTIONS DATED AUGUST 1, 2011, THAT THERE I S NO CASE FOR A REFERENCE TO THE DRP. THE DRP AND THE ADIT HAVE ERRED IN LAW IN NOT TAKIN G COGNIZANCE OF THE FACT THAT THE ORIGINAL ASSESSMENT ORDER DATED 3 1.12.2007 PASSED BY THE ADIT UNDER SECTION 143(3) ASSESSED TH E INCOME AS ` 2,82,04,034 AND WHEREAS THE LEARNED CIT(A) DELETED THE INCOME AMOUNTING TO ` 2,35,96,277 OUT OF THE ASSESSED INCOME VIDE HIS APPELLATE ORDER DATED JUNE 25, 2009 THE ADIT HAS ERRED IN LAW AND ON FACTS IN NOT CONSI DERING THE FACT THAT IN THE CASE OF YOUR APPELLANTS OWN CASE FOR TH E YEAR A.Y. 200304 THE DEPARTMENTAL APPEAL WAS DISMISSED BY TH E HON'BLE JURISDICTIONAL HIGH COURT ON JUNE 30, 2011 . 2. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE SUB MITTED THAT, IN THE PRESENT CASE, THE ASSESSMENT WAS COMPLETED UNDE R SECTION 143(3), VIDE ORDER DATED 31 ST DECEMBER 2007, AT AN INCOME OF ` 2,82,04,034, WHICH ALSO INCLUDED ADDITION OF ` 2,35,96,277. THIS ADDITION WAS DELETED BY THE LEARNED COMMISSIONER (APPEALS) AND HAS BEEN CON FIRMED BY THE TRIBUNAL IN ITA NO.5178/MUM./2009, VIDE ORDER DATED 2 ND APRIL 2004. THUS, HE SUBMITTED THAT THE ASSESSING OFFICER, WHIL E COMPLETING THE ASSESSMENT UNDER SECTION 147 / 143(3), HAS AGAIN IN CLUDED THE SAID AMOUNT OF ` 2,35,96,277, IN THE COMPUTATION OF INCOME WHICH H AS ALREADY ATTAINED FINALITY AND, HENCE, THE ADDITION OF ` 2,35,96,277, SHOULD BE DELETED. VARIAN MEDICAL SYSTEMS INDIA P. LTD. 3 3. LEARNED DEPARTMENTAL REPRESENTATIVE ALSO FAIRLY CON CEDED THAT THE ISSUE RELATING TO ADDITION OF ` 2,35,96,277, IS COVERED IN FAVOUR OF THE ASSESSEE BY A SERIES OF JUDGMENTS IN ASSESSEES OWN CASE. 4. AFTER CAREFULLY GOING THROUGH THE RELEVANT FINDINGS OF THE LEARNED COMMISSIONER (APPEALS)S ORDER PASSED EARLIER AND A LSO THE IMPUGNED ORDER, WE FIND THAT INSOFAR AS THE ISSUE OF TAXABIL ITY OF ` 2,35,96,277 IS CONCERNED, THE SAME HAS ALREADY BEEN DECIDED BY THE TRIBUNAL, VIDE ORDER DATED 2 ND APRIL 2012 IN ITA NO.5178/MUM./2009, WHEREIN THE T RIBUNAL FOLLOWING THE EARLIER ORDER FOR ASSESSMENT YEAR 200 304 IN ITA NO.4960/MUM./2007, HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. MOREOVER, THE ONLY GRIEVANCE OF THE ASSESSEE SEEMS TO BE THAT THE ASSESSING OFFICER HAS TAKEN THE FIGURE OF ` 2,82,04,034 IN THE COMPUTATION OF INCOME WHILE PASSING THE IMPUGNED ASSESSMENT ORD ER WITHOUT EVEN CONSIDERING THE FACT THAT THE LEARNED COMMISSIONER (APPEALS) HAS ALREADY DELETED THE ADDITION TO THE EXTENT OF ` 2,35,96,277, WHICH HAS ATTAINED FINALITY FROM THE STAGE OF THE TRIBUNAL AS WELL AS THE HIGH COURT. ACCORDINGLY, THE ASSESSING OFFICER IS DIRECTED TO G IVE EFFECT OF THE ORDERS OF THE LEARNED COMMISSIONER (APPEALS) AND THE TRIBUNAL AND THEN COMPUTE THE INCOME. THUS, THE GROUND TAKEN BY THE ASSESSEE IS TREATED AS ALLOWED. 5. GROUND NO.2, READS AS UNDER: THE ADIT HAS ERRED IN LAW AND ON FACTS IN NOT CONSI DERING THE FOLLOWING CREDITS FOR THE TDSIT, ADVANCE / SELF AS SESSMENT TAX AND TAX PAID ON REGULAR ASSESSMENT: TDSIT ` 3,72,129 ADVANCE TAX ` 8,26,888 TAX PAID ON REGULAR ASSESSMENT ` 15,00,000 THE ADIT HAS ERRED IN LAW AND ON FACTS IN NOT CONSI DREING THE ABOVE TAX CREDITS IN SPITE OF THE FACT THAT THE ORIGINAL ASSESSMENT ORDER DATED DEC. 31, 2007, THE TDSIT AMOUNT OF ` 3,72,129 AND ADVANCE TAX PAYMENT OF ` 8,26,888 WERE GIVEN PROPER CREDITS. THE HONBLE DRP HAS ERRED IN LAW AND ON FACTS IN HO LDING AT PARA4 AT PAGE6 OF THEIR DIRECTION DATED AUGUST 01, 2011, THAT THERE IS NO CAUSE FOR A REFERENCE TO THE DRP. VARIAN MEDICAL SYSTEMS INDIA P. LTD. 4 6. AFTER HEARING BOTH THE PARTIES, WE DIRECT THE ASSES SING OFFICER TO VERIFY THE CONTENTIONS OF THE ASSESSEE AND GIVE CRE DIT FOR THE TDS AND ADVANCE TAX AND TAX PAID ON REGULAR ASSESSMENT. CON SEQUENTLY, GROUND NO., IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES . 7. AT THE OUTSET, THE LEARNED COUNSEL SUBMITTED THAT G ROUND NO.3, IS NOT PRESSED. ACCORDINGLY, THE SAID GROUND IS TREATE D AS DISMISSED AS NOT PRESSED . 8. 0 6 &( )0 1 71 89: # #$ !' ; ( <= > 8. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLO WED FOR STATISTICAL PURPOSES. WE NOW TAKE UP ASSESSEES APPEAL IN ITA NO.8812/MU M./2010, FOR ASSESSMENT YEAR 200708. 9. REGARDING GROUNDS NO.1, 3 AND 4, THE LEARNED COUNSE L SUBMITTED THAT THESE GROUNDS ARE NOT PRESSED. LEARNED DEPARTM ENTAL REPRESENTATIVE ALSO DID NOT OBJECT TO THE SAID CONTENTIONS. CONSEQ UENTLY, THESE GROUNDS ARE TREATED AS NOT PRESSED . 10. IN GROUND NO.2, THE ASSESSEE HAS MAINLY CHALLENGED THAT VMSIPL CANNOT BE TREAED AS P.E. IN INDIA FOR THE SALE OF E QUIPMENTS BY THE PARENT GROUND COMPANIES AND BRING IT TO TAX IN INDIA PROPO RTIONATE AMOUNT OF INCOME ATTRIBUTABLE TO SO CALLED P.E. IN INDIA. 11. BEFORE US, THE LEARNED COUNSEL SUBMITTED THAT THIS ISSUE STANDS COVERED IN FAVOUR OF THE ASSESSEE BY A SERIES OF TR IBUNAL ORDERS WHICH HAVE BEEN CONFIRMED BY THE HIGH COURT ALSO. HE PLACED A COMPILATION OF SUCH DECISIONS OF THE TRIBUNAL IN ASSESSEES OWN CASE AN D ALSO THE JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN ASSESSEES OWN CASE ON THIS SCORE. 12. LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE ISSUE INVOLVED IS SQUARELY COVERED BY THE DECISION OF THE TRIBUNAL AND ALSO CONFIRMED BY THE HIGH COURT. VARIAN MEDICAL SYSTEMS INDIA P. LTD. 5 13. AFTER HEARING BOTH THE PARTIES AND ALSO ON A PERUSA L OF VARIOUS TRIBUNAL ORDERS AND HIGH COURT JUDGMENTS, WE FIND T HAT THE ISSUE INVOLVED STANDS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE B Y A SERIES OF JUDGMENT GIVEN BY THE TRIBUNAL IN EARLIER YEARS WHICH HAS AL SO BEEN CONFIRMED BY THE HIGH COURT. THE TRIBUNAL, VIDE ORDER DATED 25 TH JULY 2012, PASSED IN ITA NO.5911/MUM./2009, FOR ASSESSMENT YEAR 200405, HAS OBSERVED AND HELD AS UNDER: 4. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECOR D. WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT ON IDENTICAL FACTS, THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO. 4960/M/2007 FOR A.Y. 2003-04 ORDER DTD. 13-8-20 09 WHILE WHILE FOLLOWING THE DECISION OF HONBLE JURISDICTIO NAL HIGH COURT IN SET SATELLITE (SINGAPORE) PTE. LTD. VS. DY. DIRECTO R OF INCOME TAX (IT) & ANR. (2008) 307 ITR 205 (BOM) HAS HELD THAT WE ARE NOT AGREEABLE WITH ITA 4 5911/M/2009 THE CONTENTION RAI SED ON BEHALF OF THE REVENUE AND ACCORDINGLY DISMISSED THE R EVENUES APPEAL. WE FURTHER FIND THAT THE HONBLE JURISDICTI ONAL HIGH COURT IN INCOME TAX APPEAL NO. 3174 OF 2010 DTD. 30-6-2011 O N SIMILAR ISSUE HAS DISMISSED THE REVENUES APPEAL. WE FURTHE R FIND THAT THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO. 5178/MUM /2009 FOR A.Y. 2005-06 DTD. 2-4-2012 AFTER CONSIDERING ITS ORDER D TD. 13-8-2009 (SUPRA) AND THE DECISION OF THE HONBLE JURISDICTIO NAL HIGH COURT IN ASSESSEES OWN CASE (SUPRA) HAS DISMISSED THE REVEN UES APPEAL. 5. IN ABSENCE OF ANY DISTINGUISHING FEATURE BROUGHT ON RECORD BY THE REVENUE, WE RESPECTFULLY FOLLOWING THE CONSISTE NT VIEW OF THE TRIBUNAL AND THE DECISION OF THE HONBLE JURISDICTI ONAL HIGH COURT (SUPRA) HOLD THAT THE ADDITION OF RS. 1,48,45,862/- MADE BY THE A.O. IS NOT SUSTAINABLE IN LAW AND ACCORDINGLY WE D ECLINE TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A) O N THIS ACCOUNT. THE GROUNDS TAKEN BY THE REVENUE ARE, THEREFORE, RE JECTED . 14. THE JURISDICTIONAL HIGH COURT ALSO IN ITA NO.1261 O F 2012, VIDE JUDGMENT DATED 9 TH JANUARY 2013, ITA NO.2082 OF 2012, JUDGMENT DATED 22 ND FEBRUARY 2013, HAVE DISMISSED THE APPEAL PREFERRED BY THE DEPARTMENT ON THIS ISSUE. THUS, RESPECTFULLY FOLLOW ING THE JUDICIAL PRECEDENCE IN THE EARLIER YEARS, WHICH HAS BEEN CON FIRMED BY THE JURISDICTIONAL HIGH COURT, WE SET ASIDE THE IMPUGNE D ORDER PASSED BY THE LEARNED COMMISSIONER (APPEALS) AND ALLOW THE GROUND RAISED BY THE ASSESSEE. VARIAN MEDICAL SYSTEMS INDIA P. LTD. 6 15. 0 6 &( )0 1 #$ !' ; ( <= > 17. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS PARTLY ALLOWED. $ 1 4* A B (6 10 TH APRIL 2013 4 1 > ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH APRIL 2013 SD/- . .. . . .. . ! ! ! ! P.M. JAGTAP ACCOUNTANT MEMBER SD/- # # # # $% $% $% $% & ! & ! & ! & ! AMIT SHUKLA JUDICIAL MEMBER MUMBAI, B ( B ( B ( B ( DATED: 10 TH APRIL 2013 $ 1 -&#C DC* / COPY OF THE ORDER FORWARDED TO : (1) &( )0 / THE ASSESSEE; (2) !' / THE REVENUE; (3) E () / THE CIT(A); (4) E / THE CIT, MUMBAI CITY CONCERNED; (5) C'H -&&( , , / THE DR, ITAT, MUMBAI; (6) I) J / GUARD FILE. .C -& / TRUE COPY $( / BY ORDER - . KL / PRADEEP J. CHOWDHURY '0M &( K' / SR. PRIVATE SECRETARY 8 / < / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI