9911796707
TMI Blog2021 (2) TMI 1062X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.13% in the equity share capital of the Applicant. The Applicant has paid dividend to its shareholders, including Signify Holding B.V., Netherlands, during the F.Y. 2016-17 and 2017-18 and has discharged its liability towards Dividend Distribution Tax (DDT) under the provision of Section 115-O of the Income-Tax Act and proposes to declare such dividend in the future years as well. The Applicant has filed the present application on 29/03/2019 for advance ruling u/s 245Q of the Act on the following questions: 1. Based on the facts and circumstances of the case and in law, whether the beneficial provisions of the India-Hungary Tax Treaty could be invoked by the applicant on payment of dividend to Signify Holding B. V. by virtue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urned income of the assessee was accepted. Moreover, the assessee has filed its return of income for the A.Y. 2018-19 on 30.11.2018 declaring total income of Rs. 308,08,15,555/-. The assessment proceedings u/s 143(3) is under progress for the A.Y. 2018-19. Thus, the issue raised by the applicant is pending before the AO in scrutiny assessment for AY 2018-19. The case is selected under CASS for complete scrutiny as such the issues involved in pending assessment proceedings also relate to the questions raised by the Applicant in its application u/s 245Q. Therefore, Proviso (i) to section 245R(2) is applicable in this case. On the issue of the transaction prima-facie designed for avoidance of tax, the Ld. DR for the Revenue has contended that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lders which cannot be said to have been designed prima-facie for avoidance of tax. Further, the company was discharging its obligation for payment of DDT u/s 115-O of the Act. The question raised in the present application was purely on interpretation of law which cannot be construed as designed for avoidance of tax. The applicant has placed reliance on the following rulings:- 1) Mushtaq Ahmed, (163 Taxmann 638), AAR, New Delhi. 2) Star Television Entertainment Limited, (188 Taxmann 206), AAR, New Delhi. The applicant has also disputed the contention of revenue that DDT was the tax on the company and not the shareholder. 4. We have considered rival submissions of the Applicant and the Revenue and also considered the facts and ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n raised in advance ruling application will be considered as pending for adjudication before Income tax Authorities, only when issues are shown in return and notice under section 143(2) is issued and, thus, an application for advance ruling is to be admitted which is filed prior to issue of notice under section 143(2). In the present case also the application for advance ruling was filed prior to the issue of notice u/s 143(2) of the Act. Therefore, the questions raised by the applicant in the present case were not already pending before the Income-tax Authorities and the clause (i) of proviso to section 245R(2) is not found attracted. 6. The Revenue has also contended that clause (iii) of Proviso of Section 245R (2) was attracted as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the domestic company was designed for the avoidance of tax is far-fetched. In fact the basic issue to be decided in this case is whether the provisions of section 90 of the IT Act can be invoked in respect of liability of the Applicant u/s 115-O of the Act. Merely because the applicant has raised a question regarding availing the tax treaty benefit to minimize its tax liability u/s 115-O of the Act, it cannot be considered as a "transaction designed to avoid the tax". Accordingly, the objection of the revenue in this regard is overruled. 8. The Applicant vide submission dated 4th December 2020 has raised fresh set of five questions to be decided in the present application. The Ld. AR submitted that first three revised questions were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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