9911796707
TMI Blog2018 (8) TMI 1856X X X X Extracts X X X X X X X X Extracts X X X X ..... he rival submissions and perused the material available on record. In view of the above, we are reproducing hereunder, the order of the Tribunal for Assessment Year 2010-11 in ITA No.1182/Mum/2015, order dated 16/10/2017 (Page-83 of the paper book filed by the assessee) for ready reference and analysis:- " Challenging the orders dated 27/11/2014 of CIT(A)-55, Mumbai the assessee and the Assessing Officer (A.O.) are in appeal for the above mentioned assessment year (A.Y). Assessee, engaged in banking operations, having head office in France, filed its return of income on 15/10/2010 declared total income at Rs. 37.14 crores. The case was selected for scrutiny upon service of notice u/s. 143(2) dated 07/09/2011. The A.O completed assessment u/s. 143(3) r.w.s. 144C(3) of the Act vide order dated 30/04/2014 and determined the total income at Rs. 38.45 crores. 2.During the course of hearing before us, the Authorised Representative (AR) and the Departmental Representative (DR) fairly conceded that issue raised by the assessee as well as the AO have been dealt with and decided by the Tribunal while adjudicating the appeals for the earlier years. ITA/1182/Mum/2015: 3.The s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge-76) and for Assessment Year 2010-11 (reproduced hereinabove), the Tribunal has decided this against the assessee and fairly agreed by the ld. counsel for the assessee. No contrary decision was brought to our notice, therefore, respectfully following the aforesaid order of the Tribunal, this issue is decided against the assessee, accordingly, dismissed. 3. The next ground raised by the assessee pertains to taxability of interest paid by Indian Branch Office of the assessee to its head office, subject to proving the assessee that it made such claim in its return of income filed in original for Assessment Year 2011-12 by way of notes to return that were uploaded with the same return of income. 3.1. During hearing, the ld. counsel for the assessee claimed that this issue has been decided in favour of the assessee by the Tribunal for earlier Assessment Years. The assessee has also filed various orders in its paper book. The Ld. CIT-DR though defended the order of the Ld. Commissioner of Income Tax (Appeal) but did not controvert the factual matrix that the issue has been decided in favour of the assessee by the earlier orders of the Tribunal. 3.2. We have considered the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) has held that the interest received by HO(GE) is not taxable in hands of GE in India under domestic law on principles of mutuality as the interest paid by PE to GE is payment to self. As per learned DR, before the SB, the counsels from both the sides did not dispute the position that such interest payments were covered by principles of mutuality being payment to self, though the revenue argued that for purpose of taxation under domestic laws also the PE and GE should be treated as separate entities. This argument was rejected by ITAT on grounds that under the domestic law there is only one assessable entity i.e. GE and PE is not an independent person and it is part of GE. 4.2 In view of the above, learned CITDR strongly defended the order of the AO on the plea that the decision of SB hinges on the assumption that the impugned transactions are covered by principles of mutuality being payment to self whereas the non applicability of mutuality to such transaction was neither argued by any side nor was any objection raised to such assumption. 4.3 By referring to the decision of the Hon'ble Supreme Court in the case of Bangalore Club (supra), ld. DR submitted that followin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e profits by dealing with himself is not universally true and that there are situations in which a man could be said to make a profit out of the consumption of his own goods. The Hon'ble Supreme Court in Bangalore club (supra) also bas held that this maxim is not universally applicable. When the business activity of banking by assessee bank comprises of continuous/integrated inflows and outflows of money with several entities including customers, other banks and its own branches, then the profit of the bank's business would depend on net inflows out of all operations and it cannot be said that a part of such transactions are governed by mutuality by disintegrating some of the constituent transactions between BO and HO out of the one composite business of banking and then to say that such transactions are governed by mutuality. When the total profit of a bank represents the resultant aggregation of different items of activity then how could it be said that the profit from each item of activity (including from activity between BO & HO) which makes up that total is only a notional one to the extent it arises from transactions between BO & HO and not the actual or real profit. If the p ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
