ACIT, CHENNAI V. West Asia Maritime Limited, CHENNAI

ITA 934/CHNY/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6251 (ITAT-CHENNAI)
• Duration Of Justice: 4 year(s) 3 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 29-06-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 09-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N GOPI KRISHNA
• Assessee Lawyers: G BASKAR
• Keywords: Earning of tax free income; Retrospective amendment; Permanent establishment; Advance ruling
• Section: 5(2); 37

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: CHENNAI , # , ' ( BEFORE SHRI SANJAY ARORA, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER ./ ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 '# # /ASSESSMENT YEARS: 2007-08 & 2005-06 THE ASST. COMMISSIONER OF INCOME- TAX, COMPANY CIRCLE III(3), NEW BLOCK, 4 TH FLOOR, 121, MAHATMA GANDHI ROAD, NUNGAMBAKKAM, CHENNAI-600 034. VS. M/S.WEST ASIA MARITIME LTD., BUHARI TOWERS, 6 TH FLOOR, NO.4, MOORES ROAD, CHENNAI-600 006. [PAN: AAAC W 1023 E ] ( * /APPELLANT) ( +,* /RESPONDENT) DEPARTMENT BY : MR.N.GOPIKRISHNA, JCIT ASSESSEE BY : MR.G.BASKAR, ADV. 1 /DATE OF HEARING : 07.09.2017 1 /DATE OF PRONOUNCEMENT : 08.09.2017 / O R D E R PER GEORGE MATHAN , JUDICIAL MEMBER : ITA NO.934/MDS/2013 IS AN APPEAL FILED BY THE REVE NUE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-III, CHENNAI, IN ITA NO.467/09-10/A-III DATED 22.01.2013 FOR THE AY 2007 -08 & ITA NO.1545/MDS/2014 IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-III, CHENNAI, IN ITA NO.886/2013- 14 DATED 20.03.2014 FOR THE AY 2005-06. ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 2 -: 2. SHRI N.GOPIKRISHNA, JCIT, REPRESENTED ON BEHALF OF THE REVENUE AND SHRI G.BASKAR, ADV., REPRESENTED ON BEHALF OF THE A SSESSEE. 3. BOTH THE APPEALS RELATE TO THE SAME ASSESSEE AND ARE HAVING IDENTICAL ISSUES AND HENCE BOTH THE APPEALS ARE DIS POSED OFF BY THIS COMMON ORDER. 4. THE GROUNDS RAISED BY THE REVENUE IN ITA NO.934/ MDS/2013 ARE 1. THE ORDER OF THE LEARNED CIT(A) IS CONTRARY TO LAW AND FACTS AND CIRCUMSTANCES OF THE CASE. 2.1 THE CIT(A) ERRED IN HOLDING THAT THE ASSESSEE IS E NTITLED FOR THE BENEFIT OF TONNAGE TAX SCHEME PROVIDED UNDER CHAPTER XII C OF THE IT ACT, 1961. 2.2 THE CIT(A) FAILED TO APPRECIATE THE FACT THAT THE MAIN ACTIVITY OF THE SHIP M.V.GEM OF ENNORE (IN WHICH THE ASSESSEE COMPANY OW NS 20% SHARE) IS TO TRANSPORT THERMAL COAL FROM ONE LOCATION TO ANOTHER LOCATION WITHIN THE COUNTRY AND ALL THE PORTS WHICH ARE CONNECTED BY SHIP MV GE M OF ENNORE ARE LOCATED WITHIN THE SAME COUNTRY AND ARE WELL CONNECTED BY R OAD/RAIL. 2.3 THE CIT(A) OUGHT TO HAVE APPRECIATED THAT MOVEMENT OF COAL BETWEEN THESE PORTS CAN NORMALLY BE ROUTED THROUGH LAND BY MEANS OF EITHER ROAD TRANSPORT OR RAIL TRANSPORT. 2.4 THE CIT(A) ERRED IN NOT APPRECIATING THE FACT THAT AS PER SEC. 115VD(I), IF ANY SEA GOING SHIP OR VESSEL TRANSPORTS ANY GOODS OR SE RVICES OF A KIND NORMALLY PROVIDED ON LAND, THEN IT IS NOT A QUALIFIED SHIP F OR THE PURPOSE OF COMPUTATION OF TONNAGE INCOME AND OUGHT TO HAVE UPHELD THE DISA LLOWANCE MADE BY THE ASSESSING OFFICER. 2.5 THE CIT(A) OUGHT TO HAVE APPRECIATED THAT WHENEVER THE LANGUAGE OF THE STATUTORY PROVISIONS ARE PLAIN AND SIMPLE THEY SHOU LD BE GIVEN THE NATURAL MEANING. ACCORDINGLY, AS THERE IS NO AMBIGUITY IN T HE LANGUAGE EMPLOYED IN CLAUSE (I) OF SECTION 115VD, THE PROVISIONS OF SECT ION 115VD HAVE TO BE GIVEN EFFECT TO AS THEY ARE, IRRESPECTIVE OF THE CONSEQUE NCES. 2.6 IT IS SUBMITTED THAT THE RELIED UPON DECISION OF T HE ITAT FOR THE ASST. YEAR 2006-07 IN ASSESSEES OWN CASE ON AN IDENTICAL ISSU E HAS NOT BEEN ACCEPTED BY THE REVENUE AND AN APPEAL HAS BEEN PREFERRED U/S .260A BEFORE THE HONBLE HIGH COURT OF MADRAS AGAINST THE SAME. 3.1 THE CIT(A) ERRED IN DELETING THE DISALLOWANCE U/S. 40(A)(I) IN RESPECT OF BROKERAGE PAID ON SALE OF SHIPS, WITHOUT DEDUCTING TDS. ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 3 -: 3.2 THE CIT(A) FAILED TO APPRECIATE THAT THE PURPOSE B EHIND MAKING SUCH PAYMENT OF BROKERAGE TO SOMEONE WHO POSSESS TECHNICAL EXPER TISE ABOUT SHIPS SHALL BE CONSIDERED ONLY AS THE PAYMENT MADE FOR FEES FOR TE CHNICAL SERVICES WHICH WOULD CLEARLY FALL UNDER EXPLANATION 2 SECTION 9(1) (VII). 3.3 THE CIT(A) OUGHT TO HAVE APPRECIATED THAT AS PER T HE EXPLANATION INSERTED TO SEC.9(2) BY THE FINANCE ACT 2010 WITH RETROSPECTIVE EFFECT FROM 01.06.1976, PAYMENTS OF FEES FOR TECHNICAL SERVICES ARE TAXABLE IN INDIA IRRESPECTIVE OF PERMANENT ESTABLISHMENT OF THE NON-RESIDENT AND ALS O THE PLACE IN WHICH THE SERVICE WAS RENDERED. 3.4 THE CIT(A) OUGHT TO HAVE FOLLOWED THE DECISION OF AUTHORITY ON ADVANCE RULINGS IN THE CASE OF STEFFEN, ROBERTSON AND KIRST EN CONSULTING ENGINEERS AND SCIENTISTS VS. CIT. 230 ITR 206 WHERE IT WAS HELD T HAT AN EXPENDITURE SHALL BE CONSIDERED FOR TDS U/S.195 IF THE BENEFITS DERIVED OUT OF THE ABOVE EXPENDITURE IS UTILIZED IN INDIA. 3.5 THE CIT(A) ERRED IN NOT HOLDING THAT THE ASSESSEE OUGHT TO HAVE DEDUCTED TAX AT SOURCE ON THE BROKERAGE PAID TO THE NON-RESIDENT S AND IN ANY CASE, IT WAS NOT OPEN FOR THE ASSESSEE TO CONCLUDE SUO-MOTO THAT THE PAYMENTS MADE TO NON-RESIDENTS ARE NOT CHARGEABLE TO TAX AS THE PROP ER COURSE FOR THE ASSESSEE WOULD BE TO MAKE AN APPLICATION U/S.195(2) TO THE C ONCERNED ASSESSING OFFICER, IN THE ABSENCE OF WHICH THE ASSESSEE OUGHT TO HAVE DEDUCTED TAX AT APPLICABLE RATES. 4.1 THE CIT(A) ERRED IN DISMISSING THE ASSESSEES APPE AL ON THE ISSUE OF DISALLOWANCE TOWARDS OFFICE BUILDING REPAIRS AND MA INTENANCE AS INFRUCTUOUS. 4.2 THE CIT(A) FAILED TO APPRECIATE THE FACT THAT AS P ER GROUND NOS.2.1 TO 2.5 CITED ABOVE, THE ASSESSEE IS NOT ENTITLED TO TONNAGE TAX SCHEME AND OUGHT TO HAVE DEALT WITH THE ISSUE ON MERITS. 5.1 THE CIT(A) ERRED IN HOLDING THAT THE ASSESSEE IS E LIGIBLE FOR TONNAGE TAX SCHEME AND FURTHER DISALLOWANCE U/S.14A CANNOT BE M ADE. 5.2 THE CIT(A) FAILED TO APPRECIATE THE FACT THAT AS P ER GROUND NOS.2.1 TO 2.5 CITED ABOVE, THE ASSESSEE IS NOT ENTITLED TO TONNAGE TAX SCHEME AND OUGHT TO HAVE UPHELD THE DISALLOWANCE MADE BY THE ASSESSING OFFIC ER U/S.14A. 5.3 THE CIT(A), FAILED TO APPRECIATE THAT THE EXPENDIT URE RELATING TO EXEMPT INCOME IS BASICALLY NOT ALLOWABLE AS PER THE PROVIS IONS OF SECTION 37 OF THE ACT AND OUGHT TO HAVE UPHELD THE QUANTIFICATION OF THE DISALLOWANCE AS PER THE PROVISIONS OF THE SECTION 14A. 5.4 THE CIT(A) OUGHT TO HAVE APPRECIATED THAT SECTION 14A(2) PROVIDES THAT THE DISALLOWANCE MAY BE DETERMINED IN ACCORDANCE WITH SUCH RULES AS MAY BE PRESCRIBED, WHICH LEADS TO THE LOGICAL CONCLUSION THAT THE DISALLOWANCE U/S.14A SHALL BE MADE IN ACCORDANCE WITH THE METHOD PRESCRI BED UNDER RULE 8D. 1. FOR THESE AND OTHER GROUNDS THAT MAY BE ADDUCED AT THE TIME OF HEARING, IT IS PRAYED THAT, THE ORDER OF THE LEARNED CIT(A) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER RESTORED. 5. THE GROUNDS RAISED BY THE REVENUE IN ITA NO.1545 /MDS/2014 ARE ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 4 -: 1. THE ORDER OF THE LEARNED CIT(A) IS CONTRARY TO LAW AND FACTS AND CIRCUMSTANCES OF THE CASE. 2.1 THE CIT(A) ERRED IN DELETING THE DISALLOWANCE U/S.4 0(A)(I) IN RESPECT OF BROKERAGE PAID ON SALE OF SHIPS, WITHOUT DEDUCTING TDS. 2.2 THE CIT(A) FAILED TO APPRECIATE THAT THE PURPOSE BE HIND MAKING SUCH PAYMENT OF BROKERAGE TO SOMEONE WHO POSSESS TECHNIC AL EXPERTISE ABOUT SHIPS SHALL BE CONSIDERED ONLY AS THE PAYMENT MADE FOR FEES FOR TECHNICAL SERVICES, WHICH WOULD CLEARLY FALL UNDER EXPLANATIO N 2 SECTION 9(1)(VII). 2.3 THE CIT(A) OUGHT TO HAVE APPRECIATED THAT AS PER TH E EXPLANATION INSERTED TO SEC.9(2) BY THE FINANCE ACT 2010 WITH RETROSPECT IVE EFFECT FROM 01.06.1976, PAYMENTS OF FEES FOR TECHNICAL SERVICES ARE TAXABLE IN INDIA IRRESPECTIVE OF PERMANENT ESTABLISHMENT OF THE NON- RESIDENT AND ALSO THE PLACE IN WHICH THE SERVICE WAS RENDERED. 2.4 THE CIT(A) OUGHT TO HAVE FOLLOWED THE DECISION OF A UTHORITY ON ADVANCE RULINGS IN THE CASE OF STEFFEN, ROBERTSON AND KIRST EN CONSULTING ENGINEERS AND SCIENTISTS VS. CIT. 230 ITR 206 WHERE IT WAS HE LD THAT AN EXPENDITURE SHALL BE CONSIDERED FOR TDS U/S.195 IF THE BENEFITS DERIVED OUT OF THE ABOVE EXPENDITURE IS UTILIZED IN INDIA. 2.5 THE CIT(A) ERRED IN NOT HOLDING THAT THE ASSESSEE O UGHT TO HAVE DEDUCTED TAX AT SOURCE ON THE BROKERAGE PAID TO THE NON-RESI DENTS AND IN ANY CASE, IT WAS NOT OPEN FOR THE ASSESSEE TO CONCLUDE SUO-MO TO THAT THE PAYMENTS MADE TO NON-RESIDENTS ARE NOT CHARGEABLE TO TAX AS THE PROPER COURSE FOR THE ASSESSEE WOULD BE TO MAKE AN APPLICATION U/S.19 5(2) TO THE CONCERNED ASSESSING OFFICER, IN THE ABSENCE OF WHICH THE ASSE SSEE OUGHT TO HAVE DEDUCTED TAX AT APPLICABLE RATES. 2.6 IT IS SUBMITTED THAT THE RELIED UPON ORDER OF THE C IT(A) IN ASSESSEES OWN CASE FOR THE ASST. YEAR 2007-08 HAS NOT BEEN ACCEPT ED BY THE DEPARTMENT AND AN APPEAL HAS BEEN PREFERRED AGAINST THE SAME B EFORE THE ITAT. 3 FOR THESE AND OTHER GROUNDS THAT MAY BE ADDUCED AT THE TIME OF HEARING, IT IS PRAYED THAT THE ORDER OF THE LEARNED CIT(A) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER RESTORED. 6. IT WAS FAIRLY GREED BY BOTH THE SIDES THAT THE G ROUNDS RAISED BY THE REVENUE IN ITA NO.1545/MDS/2014 IN GROUND NOS.2.1 T O 2.6 WERE IDENTICAL TO THE ISSUES RAISED IN THE REVENUE APPEA L IN ITA NO.934/MDS/2013 IN GROUND NOS.3.1 TO 3.5. 7. THE APPEALS ARE BEING DISPOSED OFF ON MERITS IN SERIATIM. ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 5 -: ITA NO.934/MDS/2013 FOR THE AY 2007-08 8. GROUND NO.1 IS GENERAL IN NATURE. 8.1 IN REGARD TO GROUND NOS.2.1 TO 2.6, IT WAS SUBM ITTED THAT THE ISSUE WAS AS TO WHETHER THE SHIP M.V.GEM OF ENNORE WAS A QUALIFYING SHIP FOR TONNAGE TAX SCHEME. IT WAS A SUBMISSION THAT FOR TH E AY 2007-08, THE ASSESSEE HAD FILED ITS RETURN OF INCOME APPLYING TH E PROVISIONS OF SEC.115VG OF THE INCOME TAX ACT, 1961. IT WAS A SUB MISSION THAT THE TONNAGE TAX SCHEME HAS BEEN PRESCRIBED IN SEC.115VG . IT WAS A SUBMISSION THAT THE AO COMPLETED ASSESSMENT TAKING A VIEW THAT THE SHIP M.V.GEM OF ENNORE WAS NOT A QUALIFYING SHIP FOR TON NAGE TAX LEVY U/S.115VD. IT WAS A SUBMISSION THAT CONSEQUENTLY T HE AO HAD RE-WORKED THE TOTAL INCOME OF THE ASSESSEE BY APPLYING THE PR OVISIONS OF SEC.115V- I(6). AT THE TIME OF HEARING, IT WAS FAIRLY AGREED BY BOTH THE SIDES THAT THE ISSUE WAS SQUARELY COVERED IN FAVOUR OF THE ASS ESSEE BY THE DECISION OF THE THIRD MEMBER IN 143 TTJ 0129 AND OTHER SUBSE QUENT ORDERS OF THE TRIBUNAL. THE LD.AR PLACED BEFORE US COPIES OF THE ORDERS OF THE TRIBUNAL FOR THE AYS 2008-09, 2009-10, 2010-11, 2011-12 & 20 12-13 WHEREIN THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN ITA NO.935/MD S/2013 DATED 13.06.2014 FOR THE AY 2008-09 IN THE ASSESSEES OWN CASE HELD AS FOLLOWS: 2. THE FIRST ISSUE IN THE APPEAL OF THE REVENUE IS THA T COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDING THAT ASSESSEE IS ENT ITLED FOR BENEFIT OF TONNAGE TAX SCHEME PROVIDED UNDER CHAPTER XII C OF THE ACT. ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 6 -: 3. COUNSEL FOR THE ASSESSEE SUBMITS THAT THIS ISSUE HA S BEEN DECIDED BY THE CO- ORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN C ASE FOR THE ASSESSMENT YEAR 2006-07 IN ITA NO.1195/MDS/2010 DATED 1.7.2011 WHER EIN THIRD MEMBER AGREED WITH THE VIEW OF THE ACCOUNTANT MEMBER AND H ELD THAT SHIP OPERATED BY THE ASSESSEE M.V.GEM OF ENNORE TRANSPORTING THER MAL COAL FROM ONE LOCATION TO ANOTHER LOCATION WITHIN THE COUNTRY IS A QUALIFYING SHIP UNDER SECTION 115VD OF THE INCOME TAX ACT, 1961 AND THE A SSESSEE IS ENTITLED FOR THE BENEFIT OF TONNAGE TAX SCHEME PROVIDED UNDER SECTIO N XII C OF THE ACT. 4. WE HAVE PERUSED THE ABOVE ORDER OF THE THIRD MEMBER AND FIND THAT THE ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEE HOLDING THAT S HIP OPERATED BY THE ASSESSEE M.V.GEM OF ENNORE TRANSPORTING THERMAL COAL FROM ON E LOCATION TO ANOTHER LOCATION WITHIN THE COUNTRY IS A QUALIFYING SHIP UN DER SECTION 115VD OF THE INCOME TAX ACT, 1961 AND THE ASSESSES IS ENTITLED F OR THE BENEFIT OF TONNAGE TAX SCHEME PROVIDED UNDER SECTION XII C OF THE ACT. RESPECTFULLY FOLLOWING THE ORDER OF THE THIRD MEMBER, WE REJECT THE GROUNDS RA ISED BY THE REVENUE ON THIS ISSUE. 8.2 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS I T IS NOTICED THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF THE CO -ORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE AY 2008 -09 REFERRED TO SUPRA, THE FINDINGS OF THE LD.CIT(A) ON THIS ISSUE STANDS CONFIRMED. 8.3 IN REGARD TO GROUND NOS.3.1 TO 3.5, WHICH IS SI MILAR TO GROUND NOS.2.1 TO 2.6 OF THE REVENUES APPEAL IN ITA NO.15 45/MDS/2014. IT WAS SUBMITTED BY THE LD.DR THAT THE AO HAD INVOKED THE PROVISIONS OF SEC.40(A)(I) IN RESPECT OF BROKERAGE PAID BY THE AS SESSEE TO THE NON- RESIDENT IN RESPECT OF SALE OF TWO SHIPS. IT WAS A SUBMISSION THAT THE TDS U/S.195 HAD NOT BEEN MADE ON THE BROKERAGE PAID TO THE NON-RESIDENT. IT WAS A SUBMISSION THAT THE BROKERAGE PAID, WAS IN TH E NATURE OF THE FEES FOR TECHNICAL SERVICES, CONSEQUENTLY, THE TDS WAS L IABLE TO BE MADE. ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 7 -: 8.4 IN REPLY, THE LD.AR SUBMITTED THAT IN RESPECT O F THE ASSESSMENT YEAR 2007-08, AS THE ASSESSEE WAS FILING HIS RETURN BY A PPLYING THE PROVISIONS OF SEC.115VG, THE QUESTION OF DISALLOWANCE BY INVOK ING THE PROVISIONS OF SEC.40(A)(I) WOULD NOT ARISE AS NO EXPENDITURE HAS BEEN CLAIMED SEPARATELY IN RESPECT OF THE BROKERAGE. IT WAS A F URTHER SUBMISSION THAT IN RESPECT OF THE ASSESSMENT YEAR 2005-06 ALSO NO DISA LLOWANCE COULD BE MADE IN SO FAR AS THE BROKERAGE IS NOT IN THE NATUR E OF FEE FOR TECHNICAL SERVICES AND THE PAYMENT HAS BEEN MADE TO A NON-RES IDENT WHO DOES NOT HAVE INCOME LIABLE TO TAX IN INDIA. IT WAS A SUBMI SSION THAT THE ORDER OF THE LD.CIT(A) WAS LIABLE TO BE UPHELD. 8.5 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PE RUSAL OF THE ORDER OF THE LD.CIT(A) SHOWS THAT THE LD.CIT(A) DELETED THE ADDITION ON THE GROUND THAT THE ASSESSEE HAS OFFERED THE INCOME FOR THE AY 2007-08 BY APPLYING TONNAGE TAX BASIS. ADMITTEDLY, ONCE TONNAGE TAX BA SIS IS APPLIED AS PER THE PROVISIONS OF SEC.115VG THEN THERE WAS NO SCOPE FOR MAKING ANY DISALLOWANCE OF ANY EXPENSES AS NO SPECIFIC EXPENDI TURE ITSELF IS SEPARATELY CLAIMED. 8.6. IN RESPECT OF THE AY 2005-06, ADMITTEDLY THE P AYMENT HAD BEEN MADE TO NON-RESIDENT AND BROKERAGE BY NO STRETCH OF IMAGINATION CAN BE CONSIDERED UNDER FEE FOR TECHNICAL SERVICES. IN FA CT, A PERUSAL OF THE ORDER OF THE AO EXPLAINING THE NATURE OF THE BROKERAGE PA ID WHICH IN EFFECT IS THE REPLY FILED BY THE ASSESSEE BEFORE THE AO AND EXTRA CTED PARA NOS.2.3 & ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 8 -: 2.4 OF THE ASSESSMENT ORDER WOULD CLEARLY SHOWS THA T THE BROKERAGE IS NOT IN ANY WAY FEE FOR TECHNICAL SERVICES. CONSEQUENTL Y, WE ARE OF THE VIEW THAT THE SAME IS NOT HIT BY THE PROVISIONS OF SEC.1 95 AS ALSO SEC.40(A)(I). IN THESE CIRCUMSTANCES, THE FINDINGS OF THE LD.CIT( A) ON THIS ISSUE STANDS CONFIRMED. 9. IN REGARD TO GROUND NOS.4.1 TO 4.2, IT WAS SUBMI TTED THAT THE ISSUE WAS AGAINST THE ACTION OF THE LD.CIT(A) IN DELETING THE DISALLOWANCE OF THE OFFICE BUILDING REPAIRS AND MAINTENANCE. 9.1 IN REPLY, TO A SPECIFIC QUERY FROM BENCH, AS TO WHETHER THE ASSESSEE HAS CLAIMED THE EXPENSES IN RESPECT OF THE OFFICE B UILDING REPAIRS AND MAINTENANCE, THE LD.DR FAIRLY REPLIED NO. IN REP LY, THE LD.AR SUBMITTED THAT THE ASSESSEE IS FOLLOWING THE TONNAGE TAX PROV ISIONS FOR FILING HIS RETURNS FOR THE AY 2007-08 HAS NOT CLAIMED ANY EXPE NSES SEPARATELY AND CONSEQUENTLY NO DISALLOWANCE COULD BE MADE. HE VEH EMENTLY SUPPORTED THE ORDER OF THE LD.CIT(A). 9.2 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. ADMIT TEDLY, THE ASSESSEE HAS APPLIED THE TONNAGE TAX PROVISIONS WHEN FILING ITS RETURN FOR THE AY 2007-08 AND CONSEQUENTLY THERE WAS NO PROVISION FOR CLAIMING ANY FURTHER EXPENSES. IN THE ABSENCE OF CLAIMING ANY EXPENSES, THERE WAS NO CASE FOR DISALLOWING ANY EXPENSES ALSO. IN THESE CIRCUMSTAN CES, WE ARE OF THE VIEW ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 9 -: THAT THE FINDING OF THE LD.CIT(A) IS ON A RIGHT FOO TING AND DOES NOT CALL FOR ANY INTERFERENCE. 10. IN REGARD TO GROUND NOS.5.1 TO 5.4, IT WAS SUBM ITTED BY THE LD.DR THAT THE ISSUE AGAINST THE ACTION OF THE LD.CIT(A) IN DELETING THE DISALLOWANCE U/S.14A HAS MADE BY THE AO. IT WAS A SUBMISSION THAT THE ARGUMENTS BY BOTH THE SIDES WERE IDENTICAL TO THE A RGUMENTS IN RESPECT OF THE GROUND NOS.4.1 TO 4.2 IN THE REVENUES APPEAL. 10.1 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE H AVE ALREADY HELD IN GROUND NOS.4.1 & 4.2 THAT THE ASSESSEE HAS APPLIED THE TONNAGE TAX PROVISIONS WHEN FILING HIS RETURN FOR THE AY 2007-0 8 AND CONSEQUENTLY NO EXPENSES HAVING BEEN CLAIMED WHEN FILING THE RETURN THERE WAS NO PROVISIONS FOR DISALLOWING ANY PART OF THE EXPENDIT URE. CONSEQUENTLY, THE FINDING OF THE LD.CIT(A) ON THIS ISSUE STANDS CONFI RMED. 11. GROUND NO.6 IS GENERAL IN NATURE. 12. CONSEQUENTLY THE APPEAL FILED BY THE REVENUE IN ITA NO.934/MDS/2013 STANDS DISMISSED. ITA NO.1545/MDS/2014 FOR THE AY 2005-06 13. IN ITA NO.1545/MDS/2014, GROUND NO.1 IS GENERAL IN NATURE. ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 :- 10 -: 14. GROUND NOS.2.1 TO 2.6 ARE IDENTICAL TO GROUND N OS.3.1 TO 3.5 OF THE REVENUES APPEAL IN 934/MDS/2013 AND OUR FINDINGS T HERE, APPLY TO THESE GROUNDS ALSO. 15. GROUND NO.3 IS GENERAL IN NATURE. 16. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IN ITA NO.934/MDS/2013 & ITA NO.1545/MDS/2014 STANDS DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON SEPTEMBER 08 , 2017, AT CHENNAI. SD/- SD/- ( ) ( SANJAY ARORA ) /ACCOUNTANT MEMBER ( # ) (GEORGE MATHAN) ' /JUDICIAL MEMBER /CHENNAI, 5 /DATED: SEPTEMBER 08, 2017. TLN 1 +'67 87 /COPY TO: 1. * /APPELLANT 4. 9 /CIT 2. +,* /RESPONDENT 5. 7 +'' /DR 3. 9 ( ) /CIT(A) 6. # /GF