TMI Blog2015 (11) TMI 932X X X X Extracts X X X X X X X X Extracts X X X X ..... it procured 27 acres of land. The amount paid to VEEPL was duly reflected by Finian in its purchases and the closing stock and no sales had been made during the year in question. The payment of 2% of the sale amount to VEEPL as consideration for transferring VEEPL's rights in the land was in terms of Clause 3.2 of the MoU and it had not been shown that such payment was not a fair compensation. Payment made to VEEPL which was corrected as ₹ 1,24,33,326. It was held that "this amount is related to payment of service charge for effecting consolidation of land and is a revenue expense to (be) separately debited to the Profit & Loss account." With the Revenue having accepted the decision of the ITAT in the case of Finian, and with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o two appeals of the Assessees both of which were allowed by the ITAT, the Revenue has filed an appeal only in respect of one of the Assessees i.e. ZREPL. 3. In ITA No. 257 of 2015, the question sought to be urged by the Revenue is whether the ITAT has erred in holding that ZREPL was not required to deduct tax at source under Section 194H of the Income Tax Act, 1961 ('Act') with regard to the payment made by it to Vikram Electric Equipment Pvt. Ltd. ('VEEPL') and in deleting the proportionate disallowance of the amount ordered by the Assessing Officer ('AO'), as confirmed by the Commissioner of Income Tax (Appeals) ['CIT (A)'], under Section 40(a)(ia) of the Act. 4. ITA No. 270 of 2015 is directed again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 and ITA No. 507 of 2013 (CIT v. DLF Commercial Project Corporation). As a result, the decision of the ITAT in ITO v. Finian Estates Developers P. Ltd., including its decision on the payment to VEEPL attained finality. 7. Nevertheless, the attempt by the Revenue in both these appeals is to show that the facts of the present cases are different from the facts in ITO v. Finian Estates Developers P. Ltd. and, therefore, notwithstanding the fact that the decision of the ITAT in ITO v. Finian Estates Developers P. Ltd. has attained finality, the Court should nevertheless entertain these appeals. 8. In order to examine the above contention, the Court has perused the orders of the AO, the CIT (A) as well as the ITAT in the case of ITO v. Fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d against Finian both by the AO and the CIT (A). The appeal by Finian before the ITAT on the said aspect being ITA No. 1953/Del/2011 came to be allowed in its favour by the order dated 5th October 2011 of the ITAT. The precise question in the appeal by Finian was whether the CIT (A) had erred in upholding the order of the AO disallowing a sum of ₹ 1,24,33,326 paid by Finian to VEEPL for transfer of rights under Section 40(a)(ia) of the Act. The corresponding question was whether Finian was required to deduct TDS from that sum under Section 149H of the Act. 11. In its order dated 5th October 2011, the ITAT examined the nature of the MoU between Finian and VEEPL with particular reference to the clauses therein and concluded that Fini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ZREPL and VEEPL when compared to the MoU between Finian and VEEPL. In the circumstances, the Court is unable to appreciate on what basis it could be said that the arrangement between ZREPL and VEEPL was not on a 'principal to principal' basis. With the Revenue having accepted the decision of the ITAT in the case of ITO v. Finian Estates Developers P. Ltd., and with there being nothing to distinguish it in relation to the case of ZREPL, the Court is not inclined to interfere with the impugned order of the ITAT which, in the opinion of the Court, has rightly relied upon its earlier decision in the case of Finian. 14. Turning to ITA No. 270 of 2015 being the Revenue's appeal in the case of PBDPL, an earnest effort was made by M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Loss account. The CIT (A)) upheld the order of the AO. 15. In the appeal filed by the Revenue before this Court, there is no averment that the ITAT erred in relying on its own decision in Finian. There is no averment that the clauses of the MoU entered into between Finian and VEEPL are different from the MoU between PBDPL and VEEPL. There is no plea that the earlier decision of the ITAT in Finian is in any manner distinguishable in relation to the facts of PBDPL. 16. Having considered at length the submissions of learned counsel for the Revenue, the pleadings and the documents not only in the case of PBDPL but also in the case of Finian, the Court is unable to find any distinction between the two cases as far as the clauses in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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