M/S. ADVANCED CONTAINER LINES PVT. LTD., CHENNAI V. DCIT, INTERNATIONAL TAXATION - 1 (1), CHENNAI

ITTPA 58/CHNY/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4315 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 19 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 24-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2015-2016
• Appeal Filed On: 05-08-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S. RAMAKRISHNAN
• Keywords: Principle of natural justice; Set aside

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , D BENCH, CHENNAI . . . , , BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T(TP).A.NO.58/CHNY/2019 ( [ [ / ASSESSMENT YEAR: 2015-16) M/S. ADVANCE CONTAINER LINES PTE LTD., UNIT 807-809, RAHEJA TOWERS, ANNA SALAI, CHENNAI-600 002. VS THE DEPUTY COMMISSIONER OF INCOME TAX, INTERNATIONAL TAXATION 1(1), CHENNAI 600 006. PAN: AAFCA 1707N ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE / RESPONDENT BY : SHRI S. RAMAKRISHNAN, CIT /DATE OF HEARING : 20.01.2020 /DATE OF PRONOUNCEMENT : 24.02.2020 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE ASSESSING OFFICER CONSEQUENT TO THE DIRECTION OF THE DISPUTE RESOLUTION PANEL DATED 30.05.2019. 2 I.T (TP).A. NO..58/CHNY/2019 2. SHRI S. SRIDHAR, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ONLY ISSUE ARISES FOR CONSIDERATION IS WHETHER ARTICLE 24 WILL OVERRIDE ARTICLE 8 OF THE INDIA-SINGAPORE DOUBLE TAXATION AVOIDANCE AGREEMENT. THE ASSESSING OFFICER AFTER COLLECTING INFORMATION FROM SINGAPORE INCOME TAX AUTHORITIES ISSUED A SHOW-CAUSE NOTICE ON 01.08.2018 CALLING UPON THE ASSESSEE TO EXPLAIN WHY RELIEF AVAILABLE UNDER ARTICLE 8 SHALL NOT BE DENIED TO THE ASSESSEE. THE ASSESSING OFFICER ASKS THE ASSESSEE TO FILE THE REPLY ON OR BEFORE 02.08.2018. THE SHOW CAUSE NOTICE WAS IN FACT RECEIVED ON 01.08.2018 AT 4 P.M. THE ASSESSING OFFICER HAS NOT EVEN GIVEN 24 HOURS TIME FOR THE ASSESSEE TO GIVE ITS REPLY. THEREFORE, THERE WAS A VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE. HENCE, THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE MATTER MAY BE REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. 3. WE HEARD SHRI S. RAMAKRISHNAN, THE LD. DEPARTMENTAL REPRESENTATIVE ALSO. ACCORDING TO THE LD.DR, IT IS A MATTER OF RECORD THAT THE SHOW CAUSE NOTICE WAS ISSUED ON 01.08.2018 CALLING UPON THE ASSESSEE TO FILE ITS EXPLANATION ON OR BEFORE 02.08.2018. THEREFORE, HE HAS NOTHING TO SAY ANYTHING WITH REGARD TO OPPORTUNITY GIVEN TO THE ASSESSEE. 3 I.T (TP).A. NO..58/CHNY/2019 4. HAVING HEARD THE LD.COUNSEL FOR THE ASSESSEE AND THE LD.DR, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE WAS A CLEAR VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. ADMITTEDLY THE SHOW CAUSE NOTICE WAS DATED 01.08.2018 AND SERVED ON THE ASSESSEE AT 4 P.M. ON 01.08.2018 ASKING THE ASSESSEE TO FILE REPLY ON OR BEFORE 02.08.2018 AT 5 P.M. ISSUING SHOW CAUSE NOTICE IS NOT AN EMPTY FORMALITY. SUFFICIENT OPPORTUNITY SHALL BE GIVEN TO THE ASSESSEE TO EXPLAIN THE QUERIES RAISED BY THE ASSESSING OFFICER. WHEN THE ASSESSING OFFICER GOT INFORMATION FROM THE SINGAPORE INCOME TAX AUTHORITIES WITH REGARD RETURN OF INCOME AND CLAIM OF THE ASSESSEE WITH REGARD TO INCOME EARNED IN INDIA, THE SAME SHALL BE PUT TO THE ASSESSEE AND SUFFICIENT OPPORTUNITY SHALL BE GIVEN TO THE ASSESSEE TO EXPLAIN. SINCE, SUCH AN OPPORTUNITY WAS NOT GIVEN, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RE-EXAMINED BY THE ASSESSING OFFICER. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ENTIRE ISSUE RAISED BY THE ASSESSEE IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL GIVE SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO EXPLAIN AND FILE REPLY TO THE SHOW CAUSE NOTICE DATED 01.08.2018 AND THEREAFTER DECIDE THE ISSUE IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OPPORTUNITY. 4 I.T (TP).A. NO..58/CHNY/2019 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 24 TH FEBRUARY, 2020 AT CHENNAI. SD/- SD/- ( ) (RAMIT KOCHAR) /ACCOUNTANT MEMBER ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER /CHENNAI, /DATED, THE 24 TH FEBRUARY, 2020. RSR /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ( )/CIT(A) 4. /CIT 5. /DR 6. [ /GF