RICOH INDIA LTD, V. ITO 3(3)(1),

MA 212/MUM/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 1306 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 5 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-12-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: K
• Next Hearing Date: 13-12-2013
• Assessment Year: 2003-2004
• Appeal Filed On: 14-06-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASOK SURI
• Assessee Lawyers: R SANTHAN AM; SUR ESH MALIK
• Keywords: Opportunity of being heard

Judgement Text

, ,, , , IN THE INCOME TAX APPELLATE TRIBUNAL K BENCH, MUMBAI . , '# '# '# '# $ $$ $ . ' '' ' . %&' %&' %&' %&' , ( ( ( ( )*+ )*+ )*+ )*+ ) ) ) ) BEFORE SHRI D. MANMOHAN, V.P AND SHRI P.M. JAGTAP, AM M.A. NO.211/MUM/2013 (ARISING OUT OF ITA NO. 997/MUM/2006) ASSESSMENT YEAR 2002-03 M.A. NO.212/MUM/2013 (ARISING OUT OF ITA NO. 6274/MUM/2006) ASSESSMENT YEAR 2003-04 M/S RICOH INDIA LTD., 1201, FIRST FLOOR, BUILDING NO.12, SOLITAIRE CORPORATE PARK, ANDHERI- GHATKOPAR LINK ROAD, ANDHERI-EAST, MUMBAI-400093 / VS. INCOME-TAX OFFICER- 3(3)(1), AAYAKR BHAWAN, M.K.ROAD, MUMBAI-400020 +, ( ) ./ PAN : AAACR4151J ( ASSESSEE ) .. ( RESPONDENT ) ASSESSEE BY : SHRI R.SANTHANAM & SHRI SURESH MALIK RESPONDENT BY : SHRI ASOK SURI ) # - '( / DATE OF HEARING : 13/12/2013 ./ - '( / DATE OF PRONOUNCEMENT : 20/12/2013 *0 / O R D E R PER P.M. JAGTAP, A.M. $ . ' . %&' , ( )*+ : BY THESE MISCELLANEOUS APPLICATIONS, THE ASSESSEE I S SEEKING RECTIFICATION OF THE MISTAKE ALLEGED TO HAVE CREPT IN THE COMMON ORDER OF THE TRIBUNAL 10.04.2013 PASSED IN ITA NO.997/MUM/2006 A ND ITA NO.6274/MUM/2006. 2. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ONE OF THE COMMON ISSUES INVOLVED IN THE APPEALS OF THE REVENUE FOR A .Y. 2002-03 AND 2003-04 AS RAISED IN GROUND NO.7 AND 3 WAS RELATING TO THE DELETION BY THE LD. CIT(A) M.A. NOS.211 & 2012/MUM/2013 M/S RICOH INDIA LTD. 2 OF THE ADDITION MADE BY THE AO ON ACCOUNT OF INTERE ST RECEIVABLE ON ADVANCE PAID BY THE ASSESSEE TO M/S CEAT TIRES LTD. HE SUB MITTED THAT THE BENCH AT THE TIME OF HEARING EXPRESSED THE VIEW THAT THE AGR EEMENT BETWEEN THE ASSESSEE AND CEAT LTD. IN REGARD TO THE TERMS AND C ONDITIONS FOR CHARGE OF INTEREST SHOULD BE LOOKED INTO AND AS THE AGREEMENT HAD NOT BEEN SEEN BY THE LOWER AUTHORITIES NOR WAS CALLED FOR/PLACED ON RECORD BY THE AO, THE ISSUE FOR BOTH THE YEARS WOULD REQUIRE NECESSARILY TO BE REMANDED FOR DENOVO DECISION IN ACCORDANCE WITH LAW AFTER PROPER VERIFICATION OF THE TERMS OF THE CONTRACT AND THE FACTUAL AND LEGAL POSITION IN THIS REGARD. HE SUBMITTED THAT BOTH THE SIDES AGREED WITH THIS VIEW OF THE TRIBUNAL FOR REMANDING THE MATTER AND NO MORE ARGUMENTS WERE RAI SED THEREON. HE SUBMITTED THAT THE TRIBUNAL VIDE PARAGRAPH NO. 33 A ND 44 OF ITS ORDER DATED 10.04.2013 (SUPRA), HOWEVER, HAS DECIDED THIS ISSUE AGAINST THE ASSESSEE SETTING ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) AND CONFIRMING THE ADDITION MADE BY THE AO. HE SUBMITTED THAT THERE I S THUS A MISTAKE APPARENT FROM RECORD IN THE ORDER OF THE TRIBUNAL W HICH REQUIRES RECTIFICATION U/S 254(2). HE SUBMITTED THAT THERE WAS IN FACT NO AGREEMENT ENTERED INTO BETWEEN THE ASSESSEE-COMPANY AND CEAT TYRES LTD. AND THE FINDING GIVEN BY THE AO ON THE BASIS OF SO CALLED A GREEMENT IS FACTUALLY INCORRECT. 3. THE LD. DR ON THE OTHER HAND STRONGLY OPPOSED TH ESE MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE. HE SUBMITTED T HAT THE RELEVANT ISSUE HAS BEEN DECIDED BY THE TRIBUNAL BY TAKING SPECIFIC VIE W AFTER CONSIDERING ALL THE ASPECTS OF THE MATTER AND WHAT THE ASSESSEE IS SEEK ING BY WAY OF THESE MISCELLANEOUS APPLICATIONS IS REVIEW OF THE DECISIO N OF THE TRIBUNAL, WHICH IS NOT BEYOND THE SCOPE OF SECTION 254(2). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ALS O PERUSED THE RELEVANT MATERIAL ON RECORD. WE HAVE ALSO SEEN THE RELEVANT NOTINGS MADE IN OUR LOG BOOK AT THE TIME OF HEARING. AS NOTED IN T HE LOG-BOOK, THE SUBMISSION MADE BY THE LD. DR IN SUPPORT OF THE REV ENUES CASE ON THIS ISSUE WAS THAT INTEREST WAS RECEIVABLE BY THE ASSES SEE ON ADVANCE PAID TO M/S CEAT TYRES LTD. AS PER THE AGREEMENT AS HELD B Y THE AO AND THE INCOME ON ACCOUNT OF SUCH INTEREST THEREFORE HAD AC CRUED TO THE ASSESSEE M.A. NOS.211 & 2012/MUM/2013 M/S RICOH INDIA LTD. 3 DURING THE YEAR UNDER CONSIDERATION. HE FURTHER SU BMITTED THAT THERE WAS NOTHING ON RECORD TO SHOW THAT THE INTEREST SO ACCR UED WAS AGREED TO BE WAIVED AND DECISION TO THAT EFFECT WAS TAKEN BY THE ASSESSEE-COMPANY IN THE YEAR UNDER CONSIDERATION. WHEN THE LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT NO OPPORTUNITY WAS GIVEN TO THE ASSESSEE I N THIS REGARD TO ESTABLISH ITS CASE OF SUCH WAIVER, THE BENCH EXPRESSED THE VI EW THAT THE MATTER SHOULD GO BACK TO THE ASSESSING OFFICER TO ASCERTAIN AS TO WHETHER ASSESSEE HAD TAKEN IN A DECISION TO WAIVE THE INTEREST AFTER GIV ING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD. THE TRIBUNAL VIDE PARAG RAPH NO. 33 AND 40 OF ITS ORDER DATED 10.04.2013, HOWEVER, DECIDED THIS ISSUE AGAINST THE ASSESSEE APPARENTLY ON THE BASIS OF CIVIL SUIT FILED BY THE ASSESSEE AGAINST M/S CEAT TYRES LTD. FOR RECOVERY OF THE ADVANCE ALONGWITH IN TEREST AND THIS HAS GIVEN RISE TO A MISTAKE IN THE ORDER OF THE TRIBUNAL WHIC H IS APPARENT FROM RECORD. THERE IS HOWEVER NOTHING ON RECORD INCLUDING THE NO TINGS MADE IN THE LOG- BOOK TO SUGGEST OR INDICATE THAT ANY SUBMISSION WAS MADE ON BEHALF OF THE ASSESSEE AT THE TIME OF HEARING TO THE EFFECT THAT THERE WAS NO AGREEMENT BETWEEN THE ASSESSEE AND M/S CEAT TYRES LTD. AS A MATTER OF FACT, NO SUCH STAND WAS TAKEN ON BEHALF OF THE ASSESSEE EITHER BE FORE THE AO OR BEFORE THE LD. CIT(A). WE THEREFORE RECTIFY THE MISTAKE IN T HE ORDER OF THE TRIBUNAL DATED 10.04.2013 BY DELETING PARAGRAPH NO. 33 AND 4 0 OF THE SAID ORDER AND REPLACING THE SAME WITH THE FOLLOWING 33. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS WELL SETTLED TH AT INCOME TAX IS A LEVY ON INCOME AND INCOME TAX ACT TAKES INTO ACCOUNT POINTS OF TIME AT WHICH THE LIABILITY TO TAX IS ATTRACTED VIZ. THE ACCRUAL OF I NCOME OR ITS RECEIPT. IF THE RIGHT TO RECEIVE A PARTICULAR INCOME IS VESTED IN THE ASSESS EE AS PER THE AGREEMENT OR UNDERSTANDING, THE SAME CAN BE SAID TO HAVE ACCRUED TO THE ASSESSEE IN THE RELEVANT YEAR UNLESS SUCH RIGHT IS WAIVED BY HIM AS A RESULT OF REVISED AGREEMENT OR UNDERSTANDING. IF THERE IS SUCH WAIVER IN THE RELEVANT YEAR, THE INCOME SO WAIVED COULD NOT BE ACCRUED TO THE ASSESS EE IN THAT YEAR AND ACCORDINGLY THE SAME COULD NOT BE ASSESSED TO TAX I N HIS HANDS IN THAT YEAR. AS RIGHTLY SUBMITTED BY THE LD. D.R., NOTHING HAS BEEN BROUGHT ON RECORD IN THE PRESENT CASE EITHER BEFORE THE AUTHORITIES BELOW OR EVEN BEFORE US TO SHOW THAT M.A. NOS.211 & 2012/MUM/2013 M/S RICOH INDIA LTD. 4 INTEREST CHARGEABLE BY IT ON THE ADVANCE TO M/S CEA T TYRES LTD. AS PER THE AGREEMENT WAS ACTUALLY WAIVED IN THE YEAR UNDER CON SIDERATION. THE LD. COUNSEL FOR THE ASSESSEE ON THE OTHER HAND HAS SUBM ITTED THAT NO OPPORTUNITY WAS GIVEN BY THE AUTHORITIES BELOW TO THE ASSESSEE TO ESTABLISH ITS CASE OF SUCH WAIVER. HAVING REGARD OF ALL THE FACTS OF THE CASE , WE ARE OF THE VIEW THAT THIS ISSUE SHOULD BE RESTORED TO THE FILE OF AO TO DECID E THE SAME AFRESH AFTER ASCERTAINING AS TO WHETHER THE INTEREST RECEIVABLE ON ADVANCE PAID TO M/S CEAT TYRES LTD. WAS WAIVED BY THE ASSESSEE DURING THE YE AR UNDER CONSIDERATION. ACCORDINGLY, WE SET-ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) ON THIS ISSUE AND RESTORE THE MATTER TO THE FILE OF AO FOR DECIDI NG THE SAME AFRESH AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD. GROUND NO. 7 OF THE REVENUES APPEAL IS ACCORDINGLY TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 40. AS REGARDS GROUND NO. 3, IT IS OBSERVED THAT THE ISSUE INVOLVED THEREIN RELATING TO THE TAXABILITY OF INTEREST RECEIVABLE B Y THE ASSESSEE ON ADVANCE APPEARING IN THE NAME OF M/S CEAT TYRES LTD. IS ALS O SIMILAR TO THE ONE INVOLVED IN GROUND NO. 7 OF REVENUES APPEAL FOR A. Y. 2002-03 WHICH HAS ALREADY BEEN DECIDED BY US IN THE FOREGOING PORTION OF THIS ORDER. FOLLOWING OUR CONCLUSION DRAWN IN A.Y. 2002-03 ON A SIMILAR ISSUE , WE SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) ON THIS ISSUE AND RESTORE THE MATTER TO THE FILE OF AO FOR DECIDING THE SAME AFRESH AS PER THE SAME DIRECTION AS GIVEN IN A.Y. 2002-03. GROUND NO. 3 OF THE REVENUES APPEAL IS A CCORDINGLY TREATED AS ALLOWED FOR STATISTICAL PURPOSE. 5. IN THE RESULT, THE MISCELLANEOUS APPLICATIONS O F THE ASSESSEE ARE PARTLY ALLOWED AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 20/ 12/2013 SD/- SD/- D. MANMOHAN P.M.JAGTAP (VICE PRESIDENT) (ACCOUNTANT MEMBER) MUMBAI , 1* 1* 1* 1* DATED: .12.2013 M.A. NOS.211 & 2012/MUM/2013 M/S RICOH INDIA LTD. 5 F{X~{T? P.S. *0 - 23'45 65/' / COPY OF THE ORDER FORWARDED TO : (1) 3 78' / THE ASSESSEE; (2) %+# / THE REVENUE; (3) 9() / THE CIT(A); (4) 9 / THE CIT, MUMBAI CITY CONCERNED; (5) 5#<& 23'3 , , / THE DR, ITAT, MUMBAI; (6) &7 = / GUARD FILE. )>5' 23' / TRUE COPY *0 ) / BY ORDER / ) % / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI