M/s. Van Oord ACZ Marine Contractors BV, New Delhi V. ADIT, CHENNAI

MA 123/CHNY/2012

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 8952 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-09-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 03-08-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: GURU BHASHYAM IRS
• Assessee Lawyers: URMILA AJAY MAHESHWARI S
• Keywords: Transfer pricing; Double taxation relief; Permanent establishment; Difference of opinion; Change of opinion
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER M.P. NO.123(MDS)/2012 IN ITA NO.1733(MDS)/2011 ASSESSMENT YEAR : 2003-04 M/S. VAN OORD ACZ MARINE CONTRACTORS BV WATERMANWEG 64, 3967GG ROTTERDAM, PO BOX 8574, 3009 AN ROTTERDAM, THE NETHERLANDS. PAN AABVC7075J. VS. THE ASSISTANT DIRECTOR OF INCOME-TAX, INTL. TAXATION-I, CHENNAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AJAY VOH RA & SMT.URMILA AJAY MAHESHWARI, ADVOCATES. RESPONDENT BY : SHRI GURU BHASHYAM , IRS, JCIT DATE OF HEARING : 7 TH SEPTEMBER, 2012 DATE OF PRONOUNCEMENT : 7 TH SEPTEMBER, 2012 O R D E R PER DR.O.K.NARAYANAN, VICE PRESIDENT THIS MISCELLANEOUS PETITION IS FILED BY THE ASSES SEE. THIS IS IN THE NATURE OF RECTIFICATION PETITION. THIS P ETITION IS FILED IN THE CONTEXT OF THE ORDER PASSED BY THE TRIBUNAL IN THE APPEAL FILED BY - - MP NO.123 OF 2012 2 THE ASSESSEE-PETITIONER IN ITA NO.1733(MDS)/2011. THE SAID APPEAL RELATES TO THE ASSESSMENT YEAR 2003-04. THE APPEAL HAS BEEN DISPOSED OF BY THE TRIBUNAL THROUGH THEIR ORDE R DATED 11-5-2012. THE APPEAL IS A TRANSFER PRICING (TP) A PPEAL. THE APPEAL FILED BY THE ASSESSEE HAS BEEN DISMISSED. 2. NOW, IT IS THE CASE OF THE ASSESSEE THAT THERE ARE A FEW MISTAKES APPARENT IN THE ORDER PASSED BY THE TR IBUNAL. 3. THE FIRST MISTAKE POINTED OUT BY THE ASSESSEE I S THAT THE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE REA SSESSMENT PROCEEDINGS ON THE GROUND THAT NO FRESH MATERIALS W ERE AVAILABLE BEFORE THE ASSESSING AUTHORITY, BUT THE TRIBUNAL HA S NOT CONSIDERED THIS GROUND IN ITS CORRECT PERSPECTIVE; INSTEAD, THE TRIBUNAL REFERRED TO THE JUDGMENT OF THE HONBLE SU PREME COURT IN THE CASE OF ACIT VS. RAJESH JHAVERI STOCK BROKER S PVT. LTD., 291 ITR 500, WHERE THE QUESTION CONSIDERED BY THE H ONBLE SUPREME COURT WAS WHETHER A CHANGE OF OPINION COULD BE A GROUND FOR REOPENING OF THE ASSESSMENT OR NOT. IN THE PRESENT CASE IT IS THE CASE OF THE ASSESSEE THAT IT NEVER A RGUED THE CASE ON CHANGE OF OPINION AND ITS ARGUMENT IS BASED ON WHETHER FRESH MATERIALS ARE AVAILABLE OR NOT. - - MP NO.123 OF 2012 3 4. THE SECOND MISTAKE POINTED OUT BY THE ASSESSEE IS THAT THE REOPENING WAS RESORTED TO BY THE ASSESSING OFFICER FOR ONE SET OF REASONS, BUT ADDITIONS WERE MADE ON ANOT HER SET OF REASONS, IN WHICH CASE THE ADDITIONS WOULD NOT SURV IVE, AS HELD BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. JET AIRWAYS INDIA LTD., 195 TAXMAN 117 AND BY THE HONB LE DELHI HIGH COURT IN THE CASE OF RANBAXY LABORATORIES VS. CIT, 336 ITR 136. 5. THE THIRD MISTAKE POINTED OUT BY THE ASSESSEE I S THAT THE TRIBUNAL HAS ERRED IN APPRECIATING THE CON TENTIONS REGARDING FEES FOR TECHNICAL SERVICES. THE TRIBUNA L HAS CONSIDERED THE IMPACT OF COST ALLOCATION AGREEMENT WHILE DECIDING THE ISSUE, WHEREAS, IN FACT, THE PAYMENTS WERE MADE AS REIMBURSEMENT OF ACTUAL EXPENDITURE AND THE REIMBUR SEMENTS WERE NOT MADE EXACTLY ON THE BASIS OF COST ALLOCATI ON AGREEMENT. 6. THE PETITIONER HAS FURTHER POINTED OUT ANOTHER MISTAKE WITH REFERENCE TO THE FINDING ARRIVED AT BY THE TRIBUNAL ON THE QUESTION OF AGENCY PERMANENT ESTABLISHMENT. IT IS THE ARGUMENT OF THE PETITIONER THAT THE RELEVANT FINDIN GS OF THE - - MP NO.123 OF 2012 4 TRIBUNAL HAVE BEEN ARRIVED AT IN THE ABSENCE OF ANY MATERIALS ON RECORD. 7. ANOTHER MISTAKE APPARENT FROM RECORD, AS POINTE D OUT BY THE ASSESSEE-PETITIONER, IS THAT THE IMPACT OF DTAA, EXTENSIVELY ARGUED BY THE ASSESSEE, HAS NOT BEEN CO NSIDERED BY THE TRIBUNAL. 8. THE ASSESSEE HAS ALSO POINTED OUT ANOTHER MISTA KE ON LEVY OF INTEREST UNDER SECTION 234B OF THE ACT. IT IS THE CONTENTION OF THE ASSESSEE-PETITIONER THAT INSTEAD OF REMITTING THE ISSUE BACK TO THE ASSESSING OFFICER, THE TRIBUNAL S HOULD HAVE ADJUDICATED THE ISSUE IN THE LIGHT OF THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS. MADRAS FER TILIZERS LTD., 149 ITR 703. 9. WE HEARD SHRI AJAY VOHRA, THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE-PETITIONER, ALONGWITH MR S. URMILA AJAY MAHESWARI. THE LEARNED COUNSEL INVITED OUR AT TENTION TO THE SPECIFIC MISTAKES POINTED OUT BY THE ASSESSEE IN IT S PETITION AND CO-RELATED THOSE MISTAKES TO THE DETAILED EXPLANATI ONS MADE OUT BY THE ASSESSEE IN THE PAPERBOOKS FILED BEFORE THE TRIBUNAL AND CONSIDERED IN THE COURSE OF HEARING OF THE APPEAL. THE COUNSEL - - MP NO.123 OF 2012 5 ALSO HAS REITERATED THE RATIO OF THE VARIOUS JUDGME NTS RELIED ON BY HIM TO CONVEY THE MESSAGE THAT THE TRIBUNAL WHILE D ISPOSING OF THE APPEAL HAS NOT APPLIED THE BINDING JUDGMENTS, W HEREVER NECESSARY. 10. SHRI GURU BHASHYAM, THE LEARNED JOINT COMMISSIONER OF INCOME-TAX APPEARING FOR THE REVENU E, ON THE OTHER HAND, REFERRED TO THE DIFFERENT PARAGRAPHS OF THE ORDER OF THE TRIBUNAL AND ARGUED THAT ALL THE GROUNDS RAISED BY THE ASSESSEE HAVE BEEN CONSIDERED BY THE TRIBUNAL AND, THEREFORE, IT IS NOT PROPER TO ARGUE THAT THE ISSUES POINTED OUT BY THE ASSESSEE-PETITIONER AS MISTAKES APPARENT ON RECORD ARE RECTIFIABLE UNDER SECTION 254(2) OF THE INCOME-TAX ACT, 1961. 11. THE APPEAL INVOLVED IN THIS CASE HAS BEEN DISP OSED OF BY THE TRIBUNAL AFTER CONSIDERING THE VARIOUS GR OUNDS RAISED BY THE ASSESSEE IN ITS 22 PAGE ORDER. THE ASSESSEE-PE TITIONER HAS NO CASE THAT THE TRIBUNAL HAS NOT REFERRED TO ANY O F THE GROUNDS AND ARGUMENTS RAISED BEFORE IT. THE ASSESSEE-PETIT IONER ALSO HAS NO CASE THAT THE TRIBUNAL HAS NOT REFERRED TO T HE RELEVANT JUDGMENTS RELIED UPON BY THE ASSESSEE. - - MP NO.123 OF 2012 6 12. THE ARGUMENT OF THE ASSESSEE-PETITIONER IS THA T THE TRIBUNAL HAS NOT APPLIED THE BINDING JUDGMENTS WHER EVER IT IS NECESSARY AND ALSO HAS NOT ADJUDICATED CERTAIN GROU NDS AND ALSO HAS NOT CONSIDERED THE RELEVANT EXPLANATIONS PLACED BEFORE IT WHILE ADJUDICATING THE ISSUES. 13. WE HAVE GONE THROUGH THE DETAILED PETITION FIL ED BY THE ASSESSEE, RUNNING TO NINE PAGES, WHEREIN THE AS SESSEE HAS REITERATED ALMOST ALL THE RELEVANT ARGUMENTS RAISED AT THE TIME OF HEARING. 14. THE TRIBUNAL HAS IN FACT CONSIDERED ALL THE GR OUNDS RAISED BY THE ASSESSEE INCLUDING THE RELEVANT CASE LAWS CITED BY THE LEARNED COUNSEL WHO APPEARED FOR THE ASSESSEE A T THE TIME OF HEARING. NOW IF WE PROCEED TO REPLY EVERY PROPO SITION OF MISTAKE POINTED OUT BY THE ASSESSEE-PETITIONER, WHA T IN FACT WE WILL BE DOING IS JUSTIFYING THE ORDER WE HAVE ALREA DY PASSED. A JUDGE IS NOT SUPPOSED TO JUSTIFY HIS ORDER. THEREF ORE, IT IS NOT POSSIBLE FOR US TO FURNISH PARAWISE REPLY TO THE PE TITION FILED BY THE ASSESSEE THROUGH THIS ORDER. 15. FURTHER, CONSIDERATION OF THE RELEVANT CASE LA WS CITED BY THE LEARNED COUNSEL DOES NOT MEAN THAT EAC H AND EVERY - - MP NO.123 OF 2012 7 CASE LAW CITED BY THE COUNSEL MUST BE INDIVIDUALLY DISCUSSED AND EXPRESSLY DISTINGUISHED ON THE FACTS OF THE HEARD C ASE AND ON THE FACTS RELATING TO THOSE CASE LAWS. WHEN THE TRIBUN AL HAS MADE AMPLE REFERENCES TO THE CASE LAWS RELIED ON BY THE COUNSEL, IT IS PRESUMED THAT THE TRIBUNAL HAS APPLIED ITS MIND ON ALL SUCH RELEVANT CITATIONS QUOTED BEFORE IT. 16. A TEN-PAGE ORDER OF THE TRIBUNAL MAY BE THE RE SULT OF A HUNDRED-PAGE ORDER IN ITS THOUGHT PROCESS. TH E ENTIRE THOUGHT PROCESS AND APPLICATION OF MIND CANNOT BE B ROUGHT DOWN SO AS TO REFLECT IN THE ULTIMATE ORDER PASSED BY TH E TRIBUNAL. THE ORDER OF THE TRIBUNAL MEANS AN ORDER PASSED AFTER C ONSIDERING ALL THE RELEVANT FACTS, CIRCUMSTANCES AND APPLYING THE RELEVANT PROVISIONS OF LAW, IN THE LIGHT OF THE PRECEDENTS D ECLARED BY COMPETENT COURTS. 17. IN THESE CIRCUMSTANCES WE ARE OF THE CONSIDERE D OPINION THAT ANY ATTEMPT TO ADDRESS THE PROPOSITION S ADVANCED BY THE LEARNED COUNSEL IN THIS PETITION WILL AMOUNT TO REVIEW OF THE ORDER ALREADY PASSED BY THE TRIBUNAL. REVIEW OF TH E ORDER IS BEYOND OUR JURISDICTION. - - MP NO.123 OF 2012 8 18. IN RESULT, THIS PETITION FILED BY THE ASSESSEE IS DISMISSED. ORDERS PRONOUNCED ON FRIDAY, THE 7 TH OF SEPTEMBER, 2012 AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED, THE 7 TH SEPTEMBER, 2012. V.A.P. COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GF.