Shell Global Solutions International BV, Ahmedabad V. The Deputy Director of Income Tax (Int. Taxn.)-1, Ahmedabad

MA 44/AHD/2017

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 5479 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 month(s) 10 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 13-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Assessment Year: 2008-2009
• Appeal Filed On: 02-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Initiation of penalty proceedings
• Section: 234B

Judgement Text

M.A. NOS. 43 TO 46/AHD/2017 ASSESSMENT YEAR : 2007-08 TO 2010-11 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR, AM AND S.S. GODARA, JM] M.A. NOS.43 TO 46/AHD/2017 (IN ITA NOS.2933/AHD/2011, 2841/AHD/2012, 486/AHD/2 014 & 273/AHD/2015 RESPECTIVELY) ASSESSMENT YEAR: 2007-08 TO 2010-11 RESPECTIVELY SHELL GLOBAL SOLUTIONS INTERNATIONAL B.V. ....................APPLICANT C/O. BSR & ASSOCIATES LLP, 902 & 903, COMMERCE HOUSE V, NEAR VODAFONE HOUSE, PRAHLAD NAGAR, CORPORATE ROAD, AHMEDABAD-380051 [PAN : AAICS 3589 H] VS. DEPUTY DIRECTOR OF INCOME-TAX .......... . RESPONDENT INTERNATIONAL TAXATION-I, AHMEDABAD APPEARANCES BY: SN SOPARKAR & PARIN SHAH FOR THE APPLICANT RP MAURYA FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 12.09.2017 DATE OF PRONOUNCING THE ORDER : 13.09.2017 O R D E R PER PRAMOD KUMAR, AM: 1. BY WAY OF THESE APPLICATIONS, THE ASSESSEE-APPLI CANT HAS POINTED OUT CERTAIN ERRORS IN THE ORDER DATED 17.11.2016 PASSED BY THE TRIBUNAL. 2. LEARNED SENIOR COUNSEL FOR THE ASSESSEE POINTS O UT THAT WHILE THE MAIN GRIEVANCE IN THE APPEAL FOR ASSESSMENT YEARS 2007-0 8 TO 2010-11 WAS DISPOSED OF BY THE TRIBUNAL, THERE WERE CERTAIN OTHER SMALL GROUND S OF APPEAL WHICH HAVE BEEN INADVERTENTLY LEFT OUT. HIS SHORT PRAYER IS THAT T HE ORDER DATED 17.11.2016 BE RECALLED FOR THE LIMITED PURPOSE OF DISPOSING OF THESE GROUNDS A LSO. THE GROUNDS, WHICH HAVE REMAINED TO BE DISPOSED OF, ARE SAID TO BE AS FOLLO WS:- M.A. NOS. 43 TO 46/AHD/2017 ASSESSMENT YEAR : 2007-08 TO 2010-11 PAGE 2 OF 4 AY : 2007-08 GROUND NO.1.1. REIMBURSEMENT OF EXPENSES AMOUNTIN G TO INR 49,28,754 THE APPELLANT SUBMITTED TO THE HONBLE TRIBUNAL THAT TH E EXPENSES WERE MERE REIMBURSEMENTS IN RELATION TO TRAVEL AND STAY EXPEN SES AND RELYING ON VARIOUS JUDICIAL PRECEDENTS THE SAME WERE NOT TAXABLE IN INDIA. THE RELEVANT SUBMISSION IN RELATION TO THE REIMBURSEMENT OF EXPENSES FILED DURING THE HEAR ING IS ENCLOSED AT PAGE NO.17 TO 24. GROUND NO. 1.2 - LEVY OF INTEREST UNDER SECTION 234 B OF THE ACT - THIS GROUND PERTAINS TO LEVY OF INTEREST U/S 234B OF THE ACT WHICH WAS H EARD BY THE HON'BLE TRIBUNAL IN APPELLANT'S OWN CASE AY 2004-05. 2005-06 AND 2009-1 0 AND THE LEARNED COUNSEL RELIED ON THE SAME. FURTHER, THE APPELLANT IS VERY THANKFU L TO THE HON'BLE MEMBERS FOR ALLOWING THE SIMILAR GROUND IN THE APPEAL NO. 2554/A/2014, 2 555/A/2014 AND 2556/A/20I4. RELEVANT ORDER ATTACHED FOR YOUR REFERENCE AT PAGE NO. 25 TO 31. GROUND NO. 3 - INITIATION OF PENALTY PROCEEDINGS UN DER SECTION 271(1)(C) OF THE ACT - THIS GROUND PERTAINS TO INITIATION OF PENALTY PROCEEDING S U/S 271(1)(C) OF THE ACT, THE APPELLANT PRAYS BEFORE THE HON'BLE TRIBUNAL TO PASS DIRECTIONS AS PER THEIR DISCRETION. AY : 2008-09 GROUND NO.5 INITIATION OF PENALTY PROCEEDINGS UND ER SECTION 271(1)(C) OF THE ACT THIS GROUND PERTAINS TO INITIATION OF PENALTY PROCE EDINGS U/S 271(1)(C) OF THE ACT, THE APPELLANT PRAYS BEFORE THE HONBLE TRIBUNAL TO PASS DIRECTIONS AS PER THEIR DISCRETION. AY : 2009-10 GROUND NO.2 PROFIT ATTRIBUTION TO THE PROJECT OFF ICE AMOUNTING TO RS.45,80,841/- - THIS GROUND PERTAINS TO THE PROFIT ATTRIBUTION TO THE PR OJECT OFFICE FOR WHICH THE APPELLANT HAD USED THREE YEARS MARGINS TO ARRIVE AT THE ARMS LEN GTH. THE LEARNED COUNSEL DISCUSSED THIS GROUND DURING THE COURSE OF HEARING AND REQUES TED THE HONBLE MEMBERS TO DECIDE THE ISSUE ON THE MERITS OF THE CASE. GROUND NO. 4 - INITIATION OF PENALTY PROCEEDINGS UN DER SECTION 271(1)(C) OF THE ACT - THIS GROUND PERTAINS TO INITIATION OF PENALTY PROCEEDING S U/S 271(1)(C) OF THE ACT, THE APPELLANT PRAYS BEFORE THE HON'BLE TRIBUNAL TO PASS DIRECTIONS AS PER THEIR DISCRETION. AY : 2010-11 GROUND NO.2 WHETHER THE SOFTWARE PROVIDED BY THE APPELLANT IS TAXABLE AS ROYALTY IN INDIA THIS GROUND PERTAINS TO THE ADJUSTMENT MADE IN RELATION TO THE PAYMENTS FOR SOFTWARE ROYALTY. THE APPELLANT TREATED THE SAID A MOUNTS AS NON-TAXABLE UNDER ARTICLE 12 OF THE INDIA-NETHERLANDS TAX TREATY. THE RELEVA NT SUBMISSION IN RELATION TO SOFTWARE ROYALTY FILED DURING THE HEARING IS ENCLOSED AT PAG E NO.17 TO 31. GROUND NO. 3 - LEVY OF INTEREST UNDER SECTION 234B OF THE ACT -THE THIRD GROUND NOT ADJUDICATED BY THE HON'BLE TRIBUNAL PERTAINS TO LEV Y OF INTEREST U/S 234B WHICH WAS HEARD BY THE HON'BLE BENCH IN APPELLANT'S OWN CASE AY 2004-05, 2005-06 AND 2009-10 AND THE LEARNED COUNSEL RELIED ON THE SAME. FURTHER , THE APPELLANT IS VERY THANKFUL TO THE HON'BLE MEMBERS FOR ALLOWING THE SIMILAR GROUND IN THE APPEAL NO. 2554/A/2014, 2555/A/2014 AND 2556/A/2014. RELEVANT ORDER ATTACHE D FOR YOUR REFERENCE AT PAGE NO.32 TO 38 M.A. NOS. 43 TO 46/AHD/2017 ASSESSMENT YEAR : 2007-08 TO 2010-11 PAGE 3 OF 4 GROUND NO. 4 - INITIATION OF PENALTY PROCEEDINGS UN DER SECTION 271(1)(C) OF THE ACT - THE FOURTH GROUND NOT ADJUDICATED BY THE HON'BLE TRIBUN AL PERTAINS TO INITIATION OF PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT, THE APPELLANT PRAYS BEFORE THE HON'BLE TRIBUNAL TO PASS DIRECTIONS AS PER THEIR DISCRETION. 3. LEARNED DEPARTMENTAL REPRESENTATIVE DOES NOT DIS PUTE THE SUBMISSIONS SO MADE BY THE LEARNED COUNSEL AND AGREES THAT THESE G ROUNDS OF APPEAL HAVE NOT ACTUALLY BEEN DISPOSED OF BY THE TRIBUNAL IN ITS OR DER DATED 17.11.2016 (SUPRA). 4. IN VIEW OF THE ABOVE DISCUSSION, IT IS NOTICED T HAT AN INADVERTENT ERROR, BY NOT DISPOSING OF CERTAIN GROUNDS OF APPEAL, HAS ACTUALL Y CREPT IN. THEREFORE, WE DEEM IT APPROPRIATE TO RECALL THE IMPUGNED ORDER DATED 17.1 1.2016 FOR THE LIMITED PURPOSE OF DISPOSING OF THESE GROUNDS OF APPEAL AS SET OUT ABO VE. WE FURTHER DIRECTED THE REGISTRY TO POST THE MATTERS FOR HEARING ON 20 TH SEPTEMBER 2017. AS THIS DATE HAS BEEN PRONOUNCED IN THE OPEN COURT AND HAS BEEN FIXED AS AGREED TO BY THE PARTIES, THERE IS NO NEED TO ISSUE NOTICE IN THIS REGARD. 5. IN THE RESULT, MISCELLANEOUS APPLICATIONS FILED BY THE ASSESSEE ARE ALLOWED. PRONOUNCED IN THE OPEN COURT TODAY ON THE 13 TH DAY OF SEPTEMBER, 2017. SD/- SD/- S.S. GODARA PRAMOD KU MAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD, THE 13 TH DAY OF SEPTEMBER, 2017 BT* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD