DELTA AIR LINES, INC., V. ASST DIT (IT) RG 1(2),

MA 194/MUM/2015

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4325 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 28 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 22-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: L
• Assessment Year: 2010-2011
• Appeal Filed On: 25-08-2015
• Court: TRIBUNAL
• Department Lawyers: ANU KRISHNA AGGARWAL
• Keywords: Principle of natural justice

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL L , BENCH MUMBAI BEFORE SHRI R. C. SHARMA , JM & SHRI AMARJIT SINGH , J M MISCELLANEOUS APPLICATION NO S . 194 / MUM/20 1 5 (ARISING OUT OF ITA NO . 1256 /M UM/201 4 ) ( / ASSESSMENT YEAR : 201 0 - 201 1 ) DELTA AIR LINES, INC., C/O BMR AND ASSOCIATES LLP, 36 - B, DR. R.K.SHIRODKAR MARG, PAREL (EAST), MUMBAI - 400012 VS. ADIT(INTERNATIONAL TAXATION) MUMBAI - 400038 ./ ./ PAN/GIR NO. : AA A CD 4092 N /ASSESSEE BY : SHRI KANCHAN KAUSHAL & SHRI DHANESH BAFNA /REVENUE BY : SMT. ANU KRISHNA AGGARWAL / DATE OF HEARING : 04 / 12 /201 5 / DATE OF PRONOUNCEMENT : 22/04 / 2016 / O R D E R PER R.C.SHARMA ( A .M.) : TH IS MISCELLANEOUS APPLICATION AROSE OUT OF THE ORDER D TD . 29 - 4 - 2015 , PASSED BY THE TRIBUNAL IN ITA NO. 1256 /MUM/201 4 . 2 . THROUGH THIS MISCELLANEOUS APPLICATION, IT WAS CONTENDED BY LD . AR THAT D URING THE COURSE OF THE HEARING BEFORE THE TRIBUNAL, THE ASSESSEE WAS NOT ASKED TO ESTABLISH LINKAGE. HOWEVER, THE TRIBUNAL IN ITS ORDER HELD THAT THE ASSESSEE HAS NOT PLACED ANYTHING ON RECORD IN SUPPORT OF ITS CONTENTION THAT TRANSPORTATION TH ROUGH THIRD PARTY CARRIERS UNDER CODE SHARING ARRANGEMENTS WAS ONLY UPTO AN INTERIM DESTINATION. FURTHER, THE TRIBUNAL ALSO HELD THAT BASED ON THE FACTS RECORDED BY THE LOWER AUTHORITIES, IT IS FOUND THAT THE COMPLETE TRANSPORTATION UNDER THE CODESHARING A RRANGEMENT TOOK PLACE FROM ORIGIN TO FINAL DESTINATION IN A SINGLE STRETCH AND NOTHING WAS PLACED ON RECORD TO SHOW THAT SUCH DESTINATIONS WE RE ONLY INTERIM DESTINATION . M A NO. 194 / 20 15 2 3. WITHOUT PREJUDICE TO THE ABOVE CLAIM OF THE ASSESSEE , IT WAS CONTENDED BY LD. AR TH AT IF THE TRIBUNAL IS OF THE VIEW THAT LINKAGE IS A CONDITION PRECEDENT TO ADJUDICATE UPON THE ISSUE INVOLVED IN GROUND 1 OF THE ASSESSEES APPEAL, THE ASSESSEE WOULD LIKE TO REITERATE THAT IT WAS NEVER ASKED BY THE LOWER AUTHORITIES TO ESTABLISH LINKAGE. IN FACT, IT WAS ACCEPTED THAT THERE IS LINKAGE BETWEEN THE TWO LEGS OF THE JOURNEY. THEREFORE, THE PRINCIPLE OF NATURAL JUSTICE WARRANTS THAT THE ASSESSEE SHOULD BE GIVEN AN OPPORTUNITY TO ESTABLISH LINKAG E. 4. IT WAS FURTHER SUBMITTED THAT WHILE THE LIMI TED QUESTION BEFORE THE BENCH WAS WHETHER THE EXPENSES DISALLOWED WHILE COMPUTING THE GLOBAL PROFITABILITY RATE OF THE ASSESSEE , ARE OPERATING / ORDINARY IN NATURE AND THEREFORE THE SAME COULD NOT HAVE BEEN DISALLOWED FOR THE PURPOSE OF COMPUTING GLOBAL PR OFITABILITY RATE AS PER RULE 10 OF THE INCOME TAX RULES, 1962. HOWEVER, THE BENCH RESTORED THE MATTER BACK TO THE FILES OF THE ASSESSING OFFICER TO CONSIDER THE EXPEND ITURE WHICH CAN BE ATTRIBUTABLE TO THE BRANCH IN INDIA AS PER ARTICLE 7(2) OF THE INDIA U S TAX TREATY. 5. IT WAS FURTHER SUBMITTED BY LD. AR THAT D URING THE COURSE OF HEARING THE COUNSEL FOR THE APPLICANT HAD POINTED OUT THAT THE ISSUE INVOLVED IN THE GROUND STATED ABOVE IS SQUARELY COVERED BY THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN T HE CASE OF NGC NETWORK ASIA LLC (313 ITR 187). FURTHER, THE ASSESSEE ALSO RELIED UPON THE DECISION OF THE HON'BLE MUMBAI TRIBUNAL IN THE CASE OF MISC BERHAD AND FEDERAL EXPRESS CORPORATION (MA 343/MUM/2013 ARISING OUT OF ITA NO 7813/MUM/201O), INVOLVING SI MILAR FACTS AS THAT IN THE CASE OF THE ASSESSEE . THE BENCH IN ITS ORDER ACCEPTED THE PRINCIPLE LAID DOWN IN THE AFOREMENTIONED DECISIONS HOWEVER, THE MATTER WAS RESTORED BACK TO THE FILES OF THE ASSESSING OFFICER TO EXAMINE IF TAX WAS M A NO. 194 / 20 15 3 DEDUCTIBLE ON PAYMENT S RECEIVED BY THE ASSESSEE. IN VIEW OF THE ABOVE, AS PER LD. AR THE ORDER PASSED BY THE TRIBUNAL SUFFERS FROM MISTAKE APPARENT FROM RECORD WHICH IS TO BE RECTIFIED U/S.254(2) OF THE ACT. 6. ON THE OTHER HAND, LD. DR CONTENDED THAT THERE IS NO MISTAKE MUCH LESS AN APPARENT MISTAKE IN THE ORDER OF THE TRIBUNAL, THEREFORE, THERE IS NO SCOPE FOR RECTIFICATION U/S.254(2) OF THE ACT. 7. WE HAVE CONSIDERED RIVAL CONTENTIONS AND GONE THROUGH THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE AS WELL AS THE ORDER PASSED BY THE TRIBUNAL. WE FOUND THAT THE TRIBUNAL HAVE DEALT WITH EACH AND EVERY ISSUE IN GREAT DETAIL GIVING DUE REASONING FOR REACHING TO THE CONCLUSION. A DETAILED MISCELLANEOUS FILED ALONG WITH THE ANNEXURES ITSELF INDICATES THAT WHATEVER SOUGHT BY TH E LD. AR IS TO CHANGE THE CONCLUSION SO ARRIVED BY THE TRIBUNAL. POWER OF THE TRIBUNAL U/S.254(2) OF THE ACT IS LIMITED TO MISTAKES APPARENT FROM RECORD. WHILE DEALING WITH THE APPLICATION U/S.254(2) THE TRIBUNAL CANNOT AGAIN DEAL WITH THE DEBATABLE ISSUE WHICH REQUIRES LONG REASONING. ACCORDINGLY, WE DO NOT FIND ANY MERIT IN THE MISCELLANEOUS APPLICATION SO FILED BY THE ASSESSEE FOR RECALLING THE ORDER DATED 29 - 4 - 2015 PASSED BY THE TRIBUNAL IN ITA NO. 1256/MUM/2014. 8 . IN THE RESULT, MISCELLANEOUS APPLICATI ON OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22/04 / 201 6 22/04 /201 6 SD/ - SD/ - AMARJIT SINGH R.C.SHARMA JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 22/04 / 201 6 . . /PKM , . / PS M A NO. 194 / 20 15 4 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//