ASST CIT 4(2), V. SSJ HOLDINGS P. LTD,

MA 595/MUM/2011

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 9055 (ITAT-MUMBAI)
• Duration Of Justice: 8 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 31-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Assessment Year: 2006-2007
• Appeal Filed On: 20-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PITAMBAR DAS
• Keywords: Bonafide belief

Judgement Text

MA NO.595 OF 2011 SSJ HOLDINGS PVT. LTD MUMBAI J BEN CH PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL 'J' BENCH, MUMBAI BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER M.A.NO.595/MUM/2011 (ARISING OUT OF ITA NO.2751/MUM/2011 (ASSESSMENT YEAR: 2006-07) ACIT CIRCLE-4(2) ROOM NO.642, 6 TH FLOOR, AAYAKAR BHAVAN, MK ROAD, MUMBAI 400020 VS. M/S SSJ HOLDINGS PVT. LTD, SURYA MAHAL, 1 ST FLOOR, BURJORJI BHARUCHA MARG, FORT MUMBAI 400001 PAN: AAECS 6349 F (APPELLANT) (RESPONDENT) DEPARTMENT BY: SHRI PITAMBAR DAS, DR ASSESSEE BY: MS. VINITA SHAH DATE OF HEARING: 24/8/2012 DATE OF PRONOUNCEMENT: 31/8/2012 O R D E R PER B. RAMAKOTAIAH, A.M. THIS IS A REVENUE APPLICATION UNDER SECTION 254(2) AGAINST THE ORDER OF THE ITAT IN ITA NO.2751/MUM/2010 DATED 27.07.2011. 2. BRIEFLY STATED, AO MADE DISALLOWANCE INVOKING THE P ROVISIONS OF SECTION 40(A)(IA) ON VSAT/LEASE LINE CHARGES AND TRANSACTION CHARGES PAID BY ASSESSEE ON THE REASON THAT TDS WAS NOT MADE. THE CIT (A) FOLLOWING THE ORDER OF THE ITAT IN KOTA K SECURITIES LTD DATED 28/08/2008 DELETED THE SAME. FOLLOWING THE CO ORDINATE BENCH DECISION, ITAT AFFIRMED THE ORDER OF THE CIT (A), DISMISSED THE REVENUE GROUNDS. 3. CONSEQUENT TO THE DECISION OF THE HON'BLE BOMBAY HI GH COURT IN THE SAME CASE, WHEREIN TRANSACTION CHARGES WERE HELD TO BE COVERED BY THE PROVISIONS OF TDS, THE REVENUE NOW P REFERRED M.A. MA NO.595 OF 2011 SSJ HOLDINGS PVT. LTD MUMBAI J BEN CH PAGE 2 OF 3 ON THE SAID ORDER OF THE ITAT. (REVENUE DID NOT CON TEST VSAT/ LEASE LINE CHARGES BEFORE HONBLE HIGH COURT.) 4. WE HAVE HEARD THE LEARNED DR AND THE LEARNED COUNSE L IN THIS REGARD. IT WAS THE SUBMISSION OF THE LEARNED C OUNSEL THAT IN THE CASE OF M/S HRIM FINANCE & SECURITIES (P) LTD ( FORMERLY KNOWN AS PELF INVESTMENT (P) LTD) IN M.A. NO.554/MUM/2011 , THE ITAT DISMISSED THE M.A ON SIMILAR LINES AND FURTHER SUBM ITTED THAT THIS BEING FIRST YEAR OF DISALLOWANCE, THERE IS A BONAFI DE BELIEF ON THE PART OF ASSESSEE NOT TO DEDUCT TAX. 5. WE HAVE CONSIDERED THE ISSUE. IT IS A FACT THAT THE ITAT C BENCH IN THE CASE OF M/S HRIM FINANCE & SECURITIES (P) LTD (FORMERLY KNOWN AS PELF INVESTMENT (P) LTD) IN M.A. NO.554/MUM/2011 HAD REJECTED THE M.A. AS REVENUE DI D NOT CONTEST THE DISALLOWANCES ON TRANSACTION CHARGES IN ITS GROUND OF APPEAL, BUT ONLY CONTESTED VSAT AND LEASE LINE CHAR GES. ON THE FACTS OF THE CASE IT WAS HELD THAT THE M.A. DOES NO T ARISE AS THE ISSUE WAS NOT RAISED IN APPEAL. HOWEVER, VIDE PARA 6 IN THE ABOVE ORDER, IT IS OBSERVED AS UNDER: 6 MOREOVER, THE HON'BLE JURISDICTIONAL HIGH COURT HAS WHILE ACCEPTING THAT THE TRANSACTION CHARGES PAID B Y ASSESSEE CONSTITUTE FEES FOR TECHNICAL SERVICES COV ERED UNDER SECTION 194J HOWEVER, DID NOT CONFIRM THE DISALLOWANCE ON THE REASON THAT THE REVENUE ITSELF HAS PROCEEDED ON THE FOOTING THAT ASSESSEE IS NOT LIABL E TO DEDUCT TAX. THESE FACTS ARE ALSO APPLICABLE TO THE PRESENT CASE AS THE ISSUE WAS FOR THE FIRST TIME RAISED IN ASSESSMENT YEAR 2005-06 BY AO, BY WHICH TIME ASSESSEE HAS ALREADY FILED THE RETURN FOR THE ASSES SMENT YEAR 2006-07. BE THAT AS IT MAY, SINCE THE REVENUE HAS NOT CONTESTED THE ISSUE OF TRANSACTION CHARGES, THE RE IS NO NEED FOR REVIEW OF THE ORDER AT PRESENT. FOR THE SE REASONS, WE DISMISS THE REVENUE APPEAL . REVENUE COULD NOT BRING ON RECORD ANYTHING THAT SIM ILAR ISSUE WAS TAKEN UP IN EARLIER YEARS. IT WAS THE SUBMISSION OF THE LEARNED COUNSEL THAT ASSESSMENT YEAR 2006-07 IS THE VERY FI RST YEAR IN MA NO.595 OF 2011 SSJ HOLDINGS PVT. LTD MUMBAI J BEN CH PAGE 3 OF 3 WHICH AO HAS RAISED THE ISSUE AND SUBMITTED THAT IT IS A BONAFIDE BELIEF ON THE PART OF ASSESSEE, AS WAS CONSIDERED B Y THE HON'BLE BOMBAY HIGH COURT IN THE ABOVE SAID CASE. RESPECTFU LLY FOLLOWING THE OBSERVATIONS OF THE HON'BLE BOMBAY HIGH COURT, WE ARE OF THE OPINION THAT THERE IS NO NEED TO REVIEW THE ORDER P ASSED ALREADY IN THIS REGARD. MISCELLANEOUS APPLICATION IS DISMISSED . 6. IN THE RESULT M.A. FILED BY THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST AUGUST, 2012. SD/- SD/- (VIVEK VARMA) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 31 ST AUGUST, 2012. VNODAN/SPS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, J BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI