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2015 (11) TMI 1273 - ITAT KOLKATA

2015 (11) TMI 1273 - ITAT KOLKATA - TMI - Interest levied u/s 234B - Held that:- As decided in MGB Metro Group Buying HK Ltd. case [2013 (1) TMI 453 - ITAT DELHI] the aforesaid proviso inserted by the Finance Act, 2012 is prospective in nature with no retrospective effect. The proviso was brought into operation w.e.f. 1.4.2012 whereas the AY involved are 2005-06 and 2006-07, therefore not in agreement with the DR because the said proviso is not retrospective in nature.

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vour of assessee. - ITA No.183/Kol/2011, ITA No.235/Kol/2011 - Dated:- 29-9-2015 - Shri, S.V. Mehrotra, 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 .....

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3.2002 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 the Act that in the course of provision u/s. 154 of the Act that it was not noticed that return of income was singed and verified by one Mr. Samuel P. Starr, the tax matters partner. The computation sheet enclosed with the retu .....

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the Act was served on the ground that income to the tune of ₹ 1,95,35,270/- had escaped assessment. The assessee filed fresh return declaring the same total income of ₹ 85,35,230/- and order u/s 144 r.w.s. 147 of the Act was passed raising demand of ₹ 1,15,39,359/- , which was partly confirmed by Ld. CIT(A). However, the said order of Ld. CIT(A) was set aside by this Tribunal B Bench vide order dated 02.04.2008 in ITA No.916/Kol/2007 and ITA No.1191/Kol/2007 directing the AO t .....

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ndustries Ltd. by assessee. (d) It was submitted that the scope and the objective of the engagement was to provide professional service to RIL in connection with systems and procedures documented in appropriate manuals and also providing training plans in commercial areas. (e) It was further pointed out that the PE is with respect to its service rendered in connection with US GAAP and US Listings and service rendered by PWC LLP was neither same nor similar to the activities for which assessee ha .....

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t, 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% .....

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of the India-US DTAA is applicable to the assessee for deciding taxability or nontaxability of any income. Ld. CIT(A) held that for deciding taxability of the assessee in respect of professional fees received by assessee from different clients in India Article 7 of the Indo US DTAA is not the right provision. He pointed out that Article 7 is applicable in respect of enterprises which are carrying on business activity. Professional services rendered by assessee in India are covered by Article 15( .....

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egated for all types of services rendered by assessee to all its clients. He, accordingly, held that professional fees of ₹ 1,95,35,270/- received by the assessee from RPL will be taxable in the hands of the assessee. He did not agree with the AO's contention regarding the gross receipt. As regards charging of interest u/s. 234B and 234C of the Act, he decided the issue in favour of assessee. 2.3 Being aggrieved, both assessee and Department are in appeal before the Tribunal. 3. First .....

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sessing Officer is bad in law, void ab initio and is liable to be cancelled and accordingly the order u/s. 143(3)/147 rws 254 of the Act dated 29.12.2010 was also void ab initio. 3. That the Ld. CIT(A) failed to appreciate the 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 fac .....

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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 considering the contention of the appellant that the services rendered by the appellant to RIL viz., financ .....

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Tribunal confirms that the income of the appellant is to be taxed in India as per the provisions of Article 15 of the India-USA tax treaty, the Assessing Officer may be directed to compute the tax at the prescribed rate of 20% since the appellant did not have a fixed base in India 4. At the time of hearing Ld. Counsel for assessee did not press ground nos. 1 to 8, implying that the issue of taxability of income is not disputed. 5. Now the only issue remains regarding rate of taxation of the inc .....

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in the Hon ble High Court held that Unless tax is deducted at source, the payee cannot claim the benefit of such deduction while filing the estimate of advance tax and while computing the advance tax payable, the tax deductible at source on the gross amount of income which is subject to such deduction and which has been taken into account in computing the total income will be set off against the tax calculated on the income subject to advance tax and the balance will be advance tax payable . (b) .....

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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 assesse .....

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r assessee filed a copy of Tribunal s order in the case of DCIT v. MGB Metro Group Buying HK Ltd. (2014) 146 ITD 343 (Delhi Trib.) wherein the Tribunal has held that the proviso in Sec. 209(1) inserted by Finance Act 2012 with effect from 1.4.2012 is retrospective in nature observing as under:- So far as the contention of the ld. Senior DR regarding amendment inserted by the Finance Act, 2012, we are reproducing hereunder the proviso which is effective from 1.4.2012:- Provided that for computing .....

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of such tax. We are of the view that the aforesaid proviso inserted by the Finance Act, 2012 is prospective in nature and noted with retrospective effect. The proviso was brought into operation w.e.f. .4.2012 whereas the Assessment Years involved are 2005-06 and 2006-07, therefore, we are not in agreement with this assertion of the ld. Senior DR because the said proviso is not retrospective in nature. Even otherwise, the language used in section 209(1) is regarding payment of advance tax in the .....

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