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TMI Blog2021 (12) TMI 394X X X X Extracts X X X X X X X X Extracts X X X X ..... lding that the assessee was not required to deduct tax at source on the remittance to IIRF Holdings XVI Ltd. towards buyback of shares. 1.2 That in the facts and circumstances of the case, and in law, the Ld. CIT(A) erred in holding that the assessee was not required to deduct tax at source on the remittance to IIRF Holdings XVI Ltd. towards buyback of shares, without following the decision of the Hon'ble ITAT (Bangalore) in Fidelity Business Services India Pvt. Ltd. (I.T.(T.P.)A. No.416/Bang/2016), and without considering that the assessee had not established that the price paid per share was the fair market price. 1.3 That in the facts and circumstances of the case, and in law, the Ld. CIT(A) erred in holding that the assessee was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 02 wherein the Hon'ble Supreme Court has quashed the order of the Delhi High Court and held that that Circular No. 79 dated 13.04.2000 is valid and efficacious. * Power of Attorney. 5. The facts of the case are that M/s IIRF Holding XVI Limited, Mauritius [having PAN - AACC17719K] has sold 2495770 fully paid Series A Compulsory Convertible Cumulative Preference Shares of M/s Bhartiya Urban Infrastructure & Land Development Co Pvt. Ltd [BUILDCO] of face value of Rs. 10/- each for an aggregate consideration of INR Rs. 43,42,63,980/- to the assessee company i.e. M/s Bhartiya Realty and Infrastructure Private Limited at a price of Rs. 174/- per share. The seller did not have any PE in India. The assessee was of the opinion that the capital g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT(A) and vehemently contended that the rulings of the AAR relied upon by the Assessing Officer is totally misplaced as in the assessee's case, share holding of Mauritius based company in share capital of the company is just 8.08% and the assessee company has made no distribution of dividend. 8. It was further pointed out to the ld. CIT(A) that the Assessing Officer has not followed the binding Circular of the CBDT Circular No. 3/2016 dated 26.12.2016. 9. After considering the facts and submissions, the ld. CIT(A) observed as under: "5.6 Further, the appellant pointed out that the AO has not followed the CBDT Circular No. 3/2016 dated 26 February 2016. The appellant brought my attention to the fact that the aforesaid circular catego ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aty between India and Mauritius grants the right of taxation to Mauritius if the capital gain arises to resident of Mauritius. The Article 13 of the treaty is reproduced as under : ARTICLE 13 - Capital gains - 1 Gains from the alienation of immovable property, as defined in paragraph (21 of article 6. may be taxed in the Contracting State in which such property is situated. 2. Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore us, the ld. DR strongly supported the findings of the Assessing Officer. 11. Per contra, the ld. counsel for the assessee reiterated what has been stated before the lower authorities. 12. We have carefully considered the orders of the authorities below and have gone through the statement of HSBC placed at PDF page 8 of the paper book. We find that the remittances have been made on 31.05.2013 which conclusively proves that the assessee company remitted the buy-back of equity shares on or before 31.05.2013 which makes the CBDT Circular 3/2016 dated 26.02.2016 squarely applicable as in that Circular, the Board has categorically spelled out that the consideration received on 01.04.2000 to 31.05.2013 would be taxed as capital gains in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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