Redington (India) Ltd., CHENNAI V. ACIT, CHENNAI

MA 137/CHNY/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0774 (ITAT-CHENNAI)
• Duration Of Justice: 29 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-09-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 12-08-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Keywords: Depreciation; Non-deduction of tax

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER .. M.P. NO. 137/MDS/2013 (IN I.T.A. NO. 2164/MDS/2010) ASSESSMENT YEAR : 2006-07 M/S REDINGTON (INDIA) LTD., SPL GUINDY HOUSE, 95, MOUNT ROAD, GUINDY, CHENNAI - 600 032. PAN : AABCR 0347 P (PETITIONER) V. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY RANGE V, CHENNAI - 600 034. (RESPONDENT) PETITIONER BY : SH. SAROJ KUMAR PARIDA, ADVOCATE RESPONDENT BY : SH. N. MADHAVA N, JCIT DATE OF HEARING : 30.08.2013 DATE OF PRONOUNCEMENT: 10.09.2013 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : THROUGH THIS MISCELLANEOUS PETITION, ASSESSEE STAT ES THAT THE TRIBUNAL COMMITTED FOLLOWING TWO MISTAKES, WHILE PA SSING ITS ORDER IN I.T.A. NO. 2164/MDS/2010 DATED 2 ND MAY, 2013:- (I) DISALLOWANCE OF CLAIM OF 100% DEPRECIATION ON BUILDIN G / TEMPORARY STRUCTURE WAS CONFIRMED. (II) DISALLOWANCE OF ROYALTY PAYMENTS TO M/S MICROSOFT CORPORATION FOR WANT OF NON-DEDUCTION OF TAX, WAS CONFIRMED. 2 M.P. NO. 137/MDS/13 2. AN ADJOURNMENT PETITION HAS BEEN FILED BY THE CO UNSEL. HOWEVER, SHRI SAROJ KUMAR PARIDA, APPEARING FOR THE ASSESSEE , COULD NOT SUPPORT THE ADJOURNMENT PETITION WITH PROPER REASON. SUFFI CIENT NOTICE FOR HEARING WAS GIVEN TO THE ASSESSEE AND THEREFORE, WE ARE NOT INCLINED TO ACCEPT THE ADJOURNMENT PETITION. THE ADJOURNMENT P ETITION STANDS REJECTED. 3. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT FOR EARLIER YEARS, SIMILAR DISALLOWANCE FOR DEPRECIATION ON TEMPORARY STRUCTURES WAS ALLOWED BY THE ASSESSING OFFICER, WHEN RECONSIDERIN G THE MATTER, BASED ON A SETTING ASIDE ORDER OF THIS TRIBUNAL. THEREFO RE, AS PER LEARNED A.R., THIS TRIBUNAL COMMITTED A MISTAKE IN GIVING DIFFERE NT DIRECTION FOR THE IMPUGNED ASSESSMENT YEAR. 4. INSOFAR AS ROYALTY PAYMENT WAS CONCERNED, LEARNE D A.R. SUBMITTED THAT NON-RESIDENT, NAMELY, MICROSOFT CORPORATION WA S A RESIDENT OF USA AND WHAT WAS RECEIVED BY THE ASSESSEE WAS ONLY COPY RIGHTED ARTICLES. ACCORDING TO HIM, THE ROYALTY WAS NOT FEES FOR TECH NICAL SERVICES PAID TO THE NON-RESIDENT, WHICH WAS TAXABLE IN INDIA. FURT HER, ACCORDING TO HIM, EFFECT OF DOUBLE TAXATION AVOIDANCE AGREEMENT BETWE EN THE TWO COUNTRIES WAS NOT CONSIDERED BY THE TRIBUNAL. 3 M.P. NO. 137/MDS/13 5. PER CONTRA, LEARNED D.R. SUBMITTED THAT THERE WA S NO MISTAKE MUCH LESS ANY MISTAKE APPARENT ON RECORD, IN THE OR DER OF THE TRIBUNAL WARRANTING ANY RECTIFICATION. 6. WE HAVE PERUSED THE ORDER AND HEARD THE RIVAL S UBMISSIONS. INSOFAR AS THE FIRST ISSUE OF DEPRECIATION ON TEMPO RARY STRUCTURES IS CONCERNED, THIS TRIBUNAL HAD GIVEN A CLEAR FINDING THAT THERE WAS NOTHING ON RECORD TO SHOW THAT ERECTIONS WERE OF TEMPORARY NATURE. THE SAID DIRECTIONS WERE GIVEN BY THE TRIBUNAL AFTER CONSIDE RING THE EARLIER ORDER OF THE TRIBUNAL SETTING ASIDE SIMILAR CLAIM FOR ASS ESSMENT YEAR 1999- 2000, 2001-02, 2002-03, 2003-04 AND 2004-05. VIS- -VIS THE DISALLOWANCE OF ROYALTY PAYMENTS FOR WANT OF DEDUCT ION OF TAX AT SOURCE IS CONCERNED, THERE WAS A CLEAR FINDING THAT TAXABI LITY OF SUM PAID TO M/S MICROSOFT CORPORATION IN INDIA WAS NOT IN DISPUTE. ASSESSEE IS NOW ONLY TRYING TO RAKE UP A NEW LINE OF ARGUMENT ON THE ISS UE. PARA 10 OF THE ASSESSEES MISCELLANEOUS PETITION IS VERY RELEVANT, WHICH READS AS UNDER:- 10. THE A.O. HAS DISALLOWED REBATES AND DISCOUNTS AM OUNT TO US$ 1,46,431/- ( ` 64,58,193/-) U/S 40(A)(I). WE FIND ON EXAMINATION THAT THE COMPANY HAS IN FACT DEDUCTED TA X AT SOURCE AT THE APPROPRIATE AMOUNT AND PAID IT TO THE GOVERN MENT. HENCE NO DISALLOWANCE IS REQUIRED TO BE MADE ON THIS AMOU NT. ASSESSEE IN THE MISCELLANEOUS PETITION IS THUS GIVI NG A FINDING THAT NO DISALLOWANCE WAS REQUIRED. IN OTHER WORDS, ASSESSE E IS ITSELF SITTING AS A 4 M.P. NO. 137/MDS/13 COURT OF APPEAL ON THE ORDER OF THE TRIBUNAL. NOT ONLY WE DO NOT FIND ANY MISTAKE, WHICH IS APPARENT ON RECORD, WE ALSO F IND THAT ASSESSEE IS MISUSING A VALUABLE RIGHT GIVEN TO IT UNDER THE ACT FOR FILING A MISCELLANEOUS PETITION, WHERE THERE IS A GLARING MI STAKE COMMITTED BY THE TRIBUNAL. ASSESSEE IS TRYING BY ITSELF TO DECI DE ON THE DISPUTES AND THE ENDEAVOUR IS ONLY TO FORCE SUCH A DECISION ON T HIS TRIBUNAL. THEREFORE, WHILE DISMISSING THE MISCELLANEOUS PETIT ION FILED BY THE ASSESSEE, WE ALSO ORDER COST OF ` 2,000/- TO BE PAID BY THE ASSESSEE TO THE DEPARTMENT. DEPARTMENT SHALL, IF THE AMOUNT IS NOT PAID WITHIN THIRTY DAYS, RECOVER SUCH AMOUNT AS TAX DUE UNDER THE ACT. ORDER WAS PRONOUNCED IN THE COURT ON TUESDAY, THE 1 0 TH SEPTEMBER, 2013, AT CHENNAI. SD/- SD/- (V. DURGA RAO) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 10 TH SEPTEMBER, 2013. KRI. COPY TO: (1) PETITIONER (2) RESPONDENT (3) CIT(A) (4) CIT (5) D.R. (6) GUARD FILE