TMI Blog2015 (11) TMI 1273X X X X Extracts X X X X X X X X Extracts X X X X ..... ehrotra, Accountant Member and Shri Mahavir Singh, Judicial Member For The Assessee : Shri R.N.Bajoria, Senior Advocate For The Respondent : Shri Sachidananda Srivastava, CIT-DR PER S.V.Mehrotra, Accountant Member:- These cross appeals have been filed by assessee and Revenue against the common order of Ld. Commissioner of Income Tax (Appeals)-VI, Kolkata dated 15.11.2010 for the assessment year 2000-01. 2. Brief facts of the case are that assessee is a limited liability partnership firm created under the relevant laws of USA having its registered office in the city of Washington DC United State of America. It filed its return of income in the capacity of non-resident association of persons (AOP) at a total income of ₹ 85,35,230/- under the head income from business profession . Intimation u/s. 1431(1) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) issued on 31.03.2002 raising a demand of ₹ 46,17,346/- because the challan for self-assessment u/s 140A of the Act and some of the original TDS certificate were not enclosed with the return. The Assessing Officer has observed in his assessment order passed u/s 143(2) r.w.s 147 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceptable in view of decision of Hon'ble Supreme Court in the case of Transmission Corporation of India, 239 ITR 587 (SC) wherein it was held that the provision Sections 195(2), 195(3) and 197 dealt with tentative deduction of income tax thereon subject to regular assessment and by the deduction of income tax, the rights of the parties are not, in any manner, adversely affected. Therefore, NOC u/s 197 was not binding in the regular assessment more so, because basic facts and figures of the case and also the nexus between he said NOC and the two invoices relating to receipt of professional fees amounting to ₹ 1,95,35,270/- were not established. He also rejected assessee s plea that service rendered by PE as well as PWCLLP were of different nature. Accordingly, he held that sum of ₹ 1,95,35,270/- was taxable in India @ 30%. Since the payment was received net of tax, the same was grossed up u/s 195A and added at ₹ 2,79,07,529/-. He also held that assessee was liable for interest u/s. 234B and 234C of the Act as the assessee was liable to pay advance tax. 2.2. Aggrieved, assessee went in appeal before Ld. CIT(A) and Ld. CIT(A) upheld the proceedings u/s. 147 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e mere fact that since the NOC issued by the Income Tax Department was not found by the Assessing Officer, it could not have lead the Assessing Officer to have a reason to believe that the appellant had escaped income. 4. That the Ld. CIT(A) failed to appreciate the mere fact that the exempt income from Reliance Petroleum Limited ( RIL ) which was not disclosed in Part-V of the return even though the same was disclosed in the computation sheet attached could not have lead the Assessing Officer to have a reason to believe that the appellant had escaped income. 5. That the Ld.CIT(A) failed to appreciate the fact that since the Income Tax Department after examination of agreement/invoices had already certified that the said income from RIL, is not chargeable to tax in India, there was no reason for the Assessing Officer to believe that such income has escaped assessment. 6. That the Ld.CIT(A) erred in holding that the NOC obtained from the Assessing Officer in Jamnagar was without jurisdiction. 7. That the Ld. CIT(A) erred in facts as well as in law in holding that the income of the ape was not covered by Article 7 of India- USA tax treaty, thereby not consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Ld. C.I.T.(A) erred in directions the Assessing Officer not to charge interest under 234B and 234C without considering statutory provision of Income Tax, 1961. 8. The only dispute is regarding levy of interest u/s 234B and 234C of the Act. We find that Ld. CIT(A) has allowed this issue in his order, which reproduced as under:- I have examined the order of Hon ble ITAT, Kolkata in the case of the assessee for assessment was 2001-02 passed in ITA No. 2183/Kol/2004 dt. 20.1.2006. In this decision Hon ble ITAT has held that since the assessee was a non resident entity which rendered consultancy services to different companies who were required to deduct TDS as per the provisions of Section 195 before making any remittance to the assessee therefore the entire income of the assessee was subjected to TDS. Since the entire income of the assessee was liable for TDs therefore the assessee was not liable to pay advance tax under the provisions of the Act and hence, interest u/s. 234B and 234C was not chargeable in the case of the assessee. I find that the facts for this assessment year are also similar an therefore I hold that interest u/s. 234B and U/s 234C will not be leviabe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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