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2014 (4) TMI 1194 - HC - Income TaxDeduction u/s 80-IA denied - Revenue contended that the petitioner had commenced business prior to 1st April, 1995 and, therefore, the petitioner was not entitled to the benefit of section 80-IA - alternative stand of the Revenue was that even assuming section 80-IA is applicable, it would operate as it stood on 1st April, 1995, and not as amended in the year 2000 - directing to pay a sum of ₹ 80 crores and to furnish corporate securities for the remaining demand of tax and interest thereon Held that:- DRP observed that the petitioner had filed a copy of the assessment orders of M/s. Hutchison Max Telecom Private Limited whose licence the petitioner had purchased for the assessment years 1995-96 and 1996-1997 wherein it stated that the cellular services were started by the assessee on 16th November, 1995. The DRP also referred to copies of letters from the Ministry of Communication dated 30th October, 1995 and 20th October, 1995, which, according to the DRP, indicate that Hutchison Max Telecom Private Limited could commence operations once final clearance obtained from the DoT has been filed. The DRP held that these facts indicate that the cellular services were started in the assessment year 1996-97 i.e. after 1st April, 1995. The objection in that regard was, therefore, allowed. As we mentioned earlier, the DRP, Delhi has taken a view contrary to the one taken by the DRP in the present case. Mr. Ahuja also relied upon the fact that the petitioner had itself contended that radio paging services is not the same as cellular pagers. The issue regarding appreciation of evidence does arise viz. whether from the sale of pagers, it can be inferred that paging services were in place and had commenced. We do not suggest that the petitioner would be unable to establish it's case. Indeed, the assessment order in respect of the assessment year 2005-06 is strong evidence in favour of the petitioner's case. After examining the facts, the earlier assessment order noted that the petitioner had started providing paging services also only in May, 1995 and cellular services in November, 1995 and accordingly, the question of the petitioner commencing the provision of telecommunication services during the period prior to 1st April, 1995 does not arise. Mr. Ahuja also invited our attention to the fact that an article published in the Indian Express news quoted the Associate Vice President of the petitioner having stated that the paging services were launched in the year 1994. The petitioner's explanation to the same is that he was not its authorized spokesperson and that the term "launch of services" does not imply the commencement of such services. There are also disputed facts which will require consideration by the ITAT. The fact, therefore, remains that this is not an open and shut case. It is indeed a strong prima facie case, but not an open and shut case. There is much to be said in favour of and against both the parties. - Decided in favour of assessee. In Assistant Commissioner of Income-tax v. Vodafone Essar Gujarat Limited [2010 (1) TMI 941 - ITAT, Ahmedabad ], the Tribunal held that the amended provisions of section 80-IA would be available to all undertakings set up after 1st April, 1995, but before 31st March, 2000 and will also include undertakings set up after 31st March, 2000. The Tribunal referred to the circular No.14 of 2001 issued by the CBDT to this effect. Looking at the entire matter before the Tribunal, the scales are definitely tipped in favour of the petitioner. However, there is something to be said about the respondent's case on the first issue. This is especially in view of the directions passed by the DRP in New Delhi. Although these directions are contrary to the order of the DRP, the issue is at large before the Tribunal. In these circumstances, we do not find the impugned order to be unjust or perverse for it requires the petitioner to deposit only about 20% of the tax demanded and accepts a mere corporate guarantee for the balance amount of over ₹ 275 crores.
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