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TMI Blog2024 (6) TMI 1122X X X X Extracts X X X X X X X X Extracts X X X X ..... s and other management consultancy activity. Further fact of the case are discussed while adjudicating the ground of appeal the assessee and the revenue. Ground No.1: Disallowance u/s 40(a)(ia) year end provision made: 3. During the course assessment the assessing officer noticed that assessee has made year end provisions for F.Y. 2014-15 to the amount of Rs. 141,55,62,737/-. The assessing officer asked the assessee to justify why no tax was deducted on the aforesaid provision and why the same should not be disallowed u/s 40(a)(ia) of the Act. The assessee explained that assessee company's account were finalized in 2nd week of April every year. In order to reflect its expenses in the books of account as per the applicable accounting standard and accounting policy, the company was required who merely provide for the expenses because the bills from the vendors were not received. It was also explained that these provisions were made on reasonable estimate basis and were debited to expense account and credited the provision account. It was also explained that no account of any vendor was credited for such provision, therefore, no tax was deducted. However, the AO has not agreed with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es which are reversed in the subsequent year are not liable for deduction of tax at source as such provisions are made only for the purpose of preparation of annual financial statements in accordance with applicable accounting principles/standards 16. I first take up the part I on the matter of disallowance u/s 40(a)(ia). The Assessing Officer called for explanation of the assessee who stated inter alia that a. Entry concerned is made as per accounting standards and policy b. The person concerned to whom sum is payable is not identifiable from the entry c. Tax deduction at source is effected when the person to whom sum payable is identified and thereafter Form 16A is issued. d. Certain case decision is cited. The Assessing Officer overruled the assessee and reasons recorded by him included the following: A. Even when sum is credited to suspense account tax deduction at source is to be made B. Bangalore ITAT in case of IBM India Pvt Ltd [TS-305-ITAT-2015(Bang] has stated that even when sum is credited to suspense account tax deduction at source is to be effected and this included provision 17. The matter is examined. The primary requirement to effect disallowance u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admissible provisions. The disallowance made sans valid reasons has no locus stand/. The heading of the disallowance and the computation statement mentions the same as disallowance under section 40(a)(i)2 which leaves doubt as to whether there is an unambiguous finding regarding eligibility under section 37. As an emphatic finding which is reason based is not; present in the assessment order, the alternate disallowance under section 37 is also held not in order, 20. Part III of the ground is against adding the same in computation of Book Profit under section 115JB. I had deleted the substantive addition on both counts. Keeping in view this decision, the Assessing Officer is directed to recompute book profit under section 115JB. 21. In view of discussion above, he Assessing Officer is directed to delete the addition of Rs. 2,6551677,983.Parts I, II and III of the ground is disposed of accordingly." 18.2. We find that provision has been made in the books by the assessee as per the standard accounting practices followed by it and that since the accounts of the company are closed within short period after the end of the year, before which the data or invoice from the concerned ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gives details of provision on which TDS was not paid. As per the AR bills for the said expenditure were not received during the year under consideration. As per the AR, the appellant company would make year-end provisions based on services rendered by various lenders/professionals. These provisions represented cost of various activities carried out by the company during the relevant financial period. Since, the company was following the Mercantile system of accounting it was required to account for such expenses, even though the concerned parties had not submitted their bills or such bills were pending for approval based on the internal system. At that point of time, since bills from the contractors had not been raised though that was owed by the company in favour of any specific party. Such a debt would be owed only on receipt of the bills and after it had been passed following the procedure. Only at that point of time relationship of debtor and creditor was established and was also an obligation to pay that would amount within the agreed period of time. The obligation, to deduct tax at source from the account of a specific party arose only at the time the bill was passed not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preme Court in the case of Goetze (I) Ltd. (284 ITR 323) and disallowed the claim of deduction u/s 10AA on the interest income. 8. The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee. 9. During the course of appellate proceedings before us the ld. Counsel submitted that on similar fact and identical issue the ITAT, Mumbai in the case of the assessee for assessment year 2014-15 vide ITA No. 5904/Mum/2019 has decided the issue in favour of the assessee. 10. Heard both the sides and perused the material on record. We have perused the decision of ITAT in the above referred case wherein identical issue on similar fact the issue has been decided in favour of the assessee. The relevant operating part of the decision is reproduced as under: "19. We heard the parties and perused the material on record. The lower authorities have denied the benefit of deduction under section 10AA on the interest income earned by the assessee for the reason that the claim is not made through filing the revised return. In Goetze (India) Ltd.(supra) the Hon'ble Supreme Court held that the assessee can make a claim for deduction, which has not bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uctions under Chapter VI-A in Sections 80-HH, 80-HHC, 80-IB, etc from the "Gross Total Income of the Undertaking", which may arise from different specified activities in these provisions and other incomes may exclude interest income from the ambit of Deductions under these provisions, but exemption under Section 10-A and 10- B of the Act encompasses the entire income derived from the business of export of such eligible Undertakings including interest income derived from the temporary parking of funds by such Undertakings in Banks or even Staff loans. The dedicated nature of business or their special geographical locations in STPI or SEZs. etc. makes them a special category of assessees entitled to the incentive in the form of 100% Deduction under Section 10-A or 10-B of the Act, rather than it being a special character of income entitled to Deduction from Gross Total Income under Chapter VI-A under Section 80-HH, etc. The computation of income entitled to exemption under Section 10-A or 10-B of the Act is done at the prior stage of computation of Income from Profits and Gains of Business as per Sections 28 to 44 under Part-D of Chapter IV before "Gross Total Income" as defined unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p.690], the Hon'ble Apex Court has held as under:- "8. Another rule of equal importance is that laws relating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, religion etc. It has been said by no less a person than Holmes, J., that the legislature should be allowed some play in the joints, because it has to deal with complex problems which do not admit of solution through any doctrinaire or strait-jacket formula and this is particularly true in case of legislation dealing with economic matters, where, having regard to the nature of the problems required to be dealt with, greater play in the joints has to be allowed to the legislature. The court should feel more inclined to give judicial deference to legislative judgment in the field of economic regulation than in other areas where fundamental human rights are involved. Nowhere has this admonition been more felicitously expressed than in Morey v. Doud [351 US 457 : 1 L Ed 2d 1485 (1957)] where Frankfurter, J., said in his inimitable style: "In the utilities, tax and economic regulation cases, there are good reasons for judicial self-restraint if not judicial d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore affirm and agree with the view expressed by the first Division Bench of this Court in the case of M/s. Motorola India Electronics (P) Ltd.(supra) and we do not agree with the view taken by the subsequent Division Bench on 10/04/2014 in the present case. 23. We further notice that a similar view is expressed by the Jurisdictional High Court in the case of Symantee Software India P Ltd (supra) while considering the deduction under section 10A of the Act. It is relevant to mention here that the manner of computing deduction under section 10A as per the provisions of subsection (4) of the said section is similar to subsection (7) of section 10AA and therefore the ratio of the above decisions rendered in the context of deduction under section 10A would equally be applicable to deduction claimed under section 10AA. Accordingly respectfully following the above decision of the jurisdictional High Court and also the Full Bench of the Hon'ble Karnataka High Court, we hold that interest income is also to be considered for the purpose of arriving at the profits eligible for deduction under section 10AA. The Assessing Officer is directed to re-compute the deduction under section 10AA a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ite price with regular internet access for which no particular software or hardware is required. He also stated that the fees was payable even if no services was utilised. He also referred the decision of Hon'ble Bombay High Court in the case of DIT (IT) Vs. Dun & Bradstreet Information Services India (P) Ltd. (2012) 20 taxman.com 695 (Bombay). On the other hand, the ld. D.R supported the order of lower authorities. 14. Heard both the sides and perused the material on record. We have perused the decision of Hon'ble Bombay High Court in the case of Dun & Bradstreet Information Services India Pvt. Ltd. as referred supra by the ld. Counsel wherein held that payment to non-resident for import of business information reports from an American company were not liable to deduction of tax at source u/s 195 of the Act. 15. We have also perused the decision of ITAT in the case of American Chemical Society Vs. DCIT (IT) wherein held that subscription fees received by assessee, a corporation based in USA from providing access to its online chemistry database and online authorise the independent customers would not qualify as royalty in terms of Sec. 9(1)(vi) and Article 12(3) of India USA DT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AT in the case of assessee itself for assessment year 2007-08 to 2013-14. He also submitted that foreign tax credit should be provided for taxes paid in overseas jurisdiction in respect of Sec. 10A(10AA) eligible income in India, as per the tax credit provisions of respective DTAA. He also submitted that even under MAT computation the assessee should be allowed full credit for tax paid overseas in respect of 10A/10AA income. 19. Heard both the sides and perused the material on record. We have perused the decision of ITAT for the assessment year 2009-10 vide ITA No. 5823/Mum/2016. The relevant operating part of the decision is reproduced as under: "31. We have considered rival submissions and perused the material on record. We have also applied our mind to the decisions relied upon. As could be seen, while the Assessing Officer has disallowed assessee's claim of foreign tax credit in respect of income exempt under section 10A/10AA of the Act on the reasoning that only such income which is subjected to tax in both the countries would qualify for tax credit, learned Commissioner (Appeals) has restricted the relief of foreign tax credit only in respect of tax paid in USA even in res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be eligible for tax credit under section 90 of the Act. Like Article 25 of the Indo-USA treaty, treaties with various other countries such as Indo-Denmark, Indo-Hungary, Indo-Norway, Indo-Oman, Indo-US, Indo-Saudi Arabia, Indo-Taiwan also have similar provision providing for benefit of foreign tax credit even in respect of income not subjected to tax in India. However, Indo-Canada and Indo-Finland treaties do not provide for such benefit unless the income is subjected to tax in both the countries. Therefore, the foreign tax credit would be available to the assessee in all cases except the foreign tax paid in Finland and Canada. The Assessing Officer is directed to grant credit accordingly." Following the decision of ITAT as referred above we direct the assessing officer to allow foreign tax credit subject to the terms and conditions as directed in the above referred order of the ITAT therefore, this ground of appeal of the assessee is allowed for statistical purposes. Ground No. 5: Addition of "Provision for Diminution in value of Investment" for computing profit under section 115JB Rs. 2,50,00,000/-: 20. During the course of assessment the AO noticed that assessee had debited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent assets. We find that on perusal of section 115JB of the Act is very clear that appellant company require to added back the book profit set aside as provision for diminution in value of investment under the circumstances what is required to be decided whether the amount of Rs. 46,94,62,365/- debited to Profit & Loss account set aside a provision or has been write off as a loss against the value of assets. The assessee has made investment in mutual fund in March 2008. The intention of the assessee was to hold a short period and accordingly classified the said investment as current investment in balance sheet of the assessee company as on 31.03.2008. The assessee company sold this unit in April, 2008 i.e. within a period of one month. The assessee company required to draw its accounts in accordance with Part II of Schedule VI of the Companies Act as provided in section 211 of the Companies Act, 1956. As per accounting standard the standard for accounting of investment is mandatory in nature classifies different treatment of accounting of current investment and long term investment. The current investment is required to be stated in accounts at lower of cost or fair value as on bal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 2014-15 vide ITA No. 599/Mum/2019. The relevant operating part of the decision is reproduced as under: "32. We heard the parties and perused the materials on record. We notice that the co-ordinate bench has considered similar issue in assessee's own case for A.Y. 2012-13 (supra) wherein it is held that - "6.3. In respect of claim of deduction u/s.10AA of the Act on commercial profit, the ld. AR before us placed reliance on the provisions of Section 80HH of the Act and also argued that the language of Section 80HH and Section 10AA are pari materia in as much as both the sections provide that in computing the total income of the assessee, deduction shall be allowed at certain percentage of profits and gains derived from business. The expression "profits and gains" derived was subject matter of adjudication by the Hon'ble Supreme Court in the case of Vijay Industries Ltd., reported in 103 taxmann.com 454 wherein the Hon'ble Apex Court observed that the profits and gains referred to commercial profits without deducting depreciation and investment allowance as per the Act. Since this aspect was not raised by the assessee before the lower authorities, accordingly, the lower authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee that since in respect of the State taxes paid overseas, the assessee is not eligible to claim relief under section 90 or 91 of the Act, it will not be covered under section 40(a)(ii) of the Act. On a perusal of provisions of sub-section (43) of section 2 of the Act, it becomes clear that the term "tax" has been defined to mean any tax paid under the provisions of the Act. Section 40(a)(ii) of the Act says that any rate or taxes levied on the profits or gain in any business or profession would not be allowable as deduction. Explanation-1 to section 40(a)(ii) of the Act inserted by the Finance Act, 2006, w.e.f. 1st April 2006, further clarifies that any sum eligible for relief of tax either under section 90 or 91 of the Act would not be allowable as deduction under section 40(a)(ii) of the Act. It is the say of the assessee that the tax eligible for relief under section 90 of the Act are only those taxes which are levied by Federal / Central Government and not by any local authority of State, City or County. Thus, it is ineligible for any relief under section 90 of the Act. The aforesaid submissions of leaned Sr. Counsel for the assessee, prima facie, is acceptable if one has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of appeal of the revenue is dismissed. Ground No.2: Disallowance of expenditure on imported software on account of non-deduction of TDS: 30. During the course of assessment the assessee has claimed software expenses to the amount of Rs. 104,72,46,907/- the break-up of the same is given below as under: "(i) software for internal use: Rs. 40,17,05,471/- (ii) Software for trading purpose: Rs. 64,55,41,436/- The assessing officer has treated the software utilized for internal use as being in the nature of capital expenditure and accordingly the amount of Rs. 40,17,05,471/- was disallowed u/s 40(a)(i) of the Act. Regarding imported software from third party sale, the assessing officer concluded that these licenses were in the nature of royalty and since no TDS has been deducted by the assessee u/s 195 of the Act, therefore, same was disallowed u/s 40(a)(i) of the Act. 31. The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has allowed the claim of the assessee after following the decision of ITAT in the case of assessee itself for assessment year 2005-06 vide ITA No. 7513/Mum/2010 dated 23.03.2017. 32. During the course of appellate proceedings before us the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the expenditure incurred on software products acquired for internal use is a capital expenditure, hence, the assessee is entitled to depreciation thereon. However, in respect of payment made towards software products acquired for re-sale / trading purpose, learned Commissioner (Appeals) agreed with the Assessing Officer that it is in the nature of royalty, hence, the assessee was required to deduct tax at source." 7.2. We find that the ld. AR argued that the amendment brought out by the Finance Act, 2012 will not have any retrospective effect based on the principle of "impossibility of performance", since assessee cannot be expected to deduct tax at source in respect of transactions effected in earlier years. This argument has to be dismissed as the year under consideration is A.Y. 2012-13 where amendment has been brought. 7.3. The ld. AR further argued that even under the applicable DTAA, the payment for purchase of software cannot be regarded as "royalty", since the definition of "royalty" under DTAA is narrower than the definition in the Act. The ld. AR without prejudice, in respect of purchase of software for trading purpose, argued that assessee does not obtain any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 14(b) specifically speaks of two sets of acts: the seven ads enumerated in clause (a) and the eighth act of selling or giving on commercial rental or offering for sale or for commercial rental any copy of the computer programme. All the seven acts set out in clause (a) delineate how the exclusive right with the owner of the copyright may be parted with. In essence, such right is referred to as copyright, and includes the right to reproduce the work in any material form, issue copies of the work to the pub tic, perform the work in public or make translations or adaptations of the work. The definition of an "in fringing copy" contained in section 2(m) of the 1957 Act, in relation to a computer programme, i. e., a literary work, means reproduction of the work. Thus, the right to reproduce a computer programme and exploit the reproduction by way of safe, transfer, licence, etc., is at the heart of the exclusive right. Section 14(b)(ii) of the 1957 Act was amended twice, first in 1994 and then again in 1999, with effect from January 15, 2000. What is conspicuous in the provision after the amendment is the absence of the phrase "regardless of whether such copy has been sold or gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder an end-user licence agreement cannot be construed as the licence spoken of in section 30 of the 1957 Act, as such end-user licence agreement only imposes restrictive conditions upon the end-user and does not part with any interest relatable to any rights mentioned in section 14(a) and (b) of the 1957 Act. The ownership of copyright in a work is different from the ownership of the Physical material in which the copyrighted work may happen to be embedded. Any ruling on the more expansive language contained in the Explanations to section 9(vi) of the Income-tax Act, 1961 would have to be ignored if it is wider and less beneficial to the assessee than the definition cont wined in the DTAA, in terms of section 90(2) of the Act read with Explanation 4 there-to.. and article 3(2) of the DTAA Further, the expression copyright" has to be understood in the context of the statute which deals with it, it being acc4Tted that municipal laws which apply in the contracting States must be applie4 unless there is any repugnancy to the terms of the DTAA. By no stretch of imagination, can the payment for such computer software amount to royalty within the meaning of article 12 of the DTA A or s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... read with section 14(a) of the 1957 Act. Indian tax laws use the expression "in respect of" as synonymous with the expression "on" the expression "in respect of", when used in a taxation statute, is only synonymous with the words "on" or "attributable to". This accords with the meaning to be given to the expression "in respect of" contained in Explanation 2(v) to section 9(1)(vi) of the income-tax Act, 1961 and would not in any manner make the expression otiose. STATE OF MADRAS V. SWASTIX TOBACCO FACTORY [1966] AIR 1966 SC 1000; [1966] 3 SCR 79 relied on. While Explanation 2(v) to section 90Xvi) of the Ad, when it speaks of "all of any rights...in respect of copyright" is more expansive than the DTAA provision, which speaks of the "use of or the right to use" any copyright, when it comes Jo the expression "use of, or the right to use", the same position would obtain under Explanation 2(v) to section 9(1)(vi)of the Ad, inasmuch as, there must, under the licence granted or sale made; be a transfer of any of the rights contained in section 14(a) or (b) of the 1957 Act, for Explanation 2(v) to apply. To this extent, there will be no difference in the position between the definiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le Television Networks (Regulation) Act, 1995, much after 1976. For all these reasons, it is clear that Explanation 4 to section 9(1)(vi) of the Act is no clarificatory of the position as of June 1, 1976, but in fact, expands that posit ion to include what is stated therein, by the Finance Act, 2012. Notification No, 21 of 2C'12 dated June 13, 2012 being issued after Explanation 4 was inserted could not be invoked to assert that Explanation 4 clarifies the legal position as it always stood. It is only when the non-resident is liable to pay income-tax in India on income deemed to arise in India and no deduction of tax at Source is made under section 195(1) of the Income-tax Act, 1961 or such person has, after applying section 195(2) of the Act, not deducted such proportion of tax as is required, that the consequences of a failure to deduct and pay, reflected in section 201 of the Act, follow by virtue of which the resident-payee is deemed an "assessee in default", and thus, is made liable to pay tax, interest and penalty thereon. Section 194E of the Act belongs to a set of various provisions which deal with tax deduction at source, without any reference to chargeability to tax u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Persons are not obligated to do the impossible, i.e., to apply a provision of a statute when it was not actually and factually on the statute book. Thus the "person" mentioned in section. 195 of the Act cannot be expected to do the impossible, namely, to apply the expanded definition of "royalty" inserted by Explanation 4 to section 9(1 Xvi) of the Act, Or the assessment years. at a time when such Explanation was not actually and factually in the statute. CIT v. NGC NETWORKS (INDIA) Pvt Ltd, 120211432 ITR 326 (Born) approved. After the 1999 amendment of section 141))(ii) of the 1957 Act, what is conspicuous by its absence is the phrase "regardless of whether such copy has been sold or given on hint on earlier occasions ". This is a statutory recognition of the doctrine of first sale or principle of exhaustion. The doctrine of first sale or principle of exhaustion is dependent, in the first place, upon legislation which either recognises or refuses to recognise the doctrine (thereby continuing to vest distribution rights in the copyright owner, even beyond the first sale of the copyrighted work). The language of section 14(b) of the 1957 Act makes it clear that it is the exclus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oses. Payments in these types of transactions would be dealt with as business profits. From the positions taken by India (in the capacity of an OECD non-member) with regard to article 12 of the OECD Model Tax Convention and the OECD Commentary, which use the language "reserves the right to" and "is of the view that some of the payments referred to may constitute royalties", it is not at all clear what exactly the nature of these positions is. This is in contrast with the categorical language used by India in its positions taken with respect to other aspects ("India does not agree to"). Mere positions taken with respect to the OECD Commentary do not alter the DTAA 's provisions, unless the latter are actually amended by way of bilateral renegotiation. The OECD Commentary on article 12 of the OECD Model Tax Convention incorporated in the DTAM will continue to have persuasive value as to the interpretation of the term "royalties" contained therein, DIT v. NEW SKIES SATELLITE BV 120161382 ITR 114 (Delhi) approved. Persons who deduct tax at source and assessees in the nations governed by a DTAA have a right to know exactly where they stand in respect of the provisions that gov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act; Held, (i) that in all these cases, the licence" that was granted under the enduser licence agreement, was not a licence in terms of section 30 of the 1957 Act, which transferred an interest in all or an of the rights contained in sections 14(a) and 14(b) of the 1957 Act, but a licence" which imposed restrictions or conditions for the use of computer software. Thus, none of the end user licence agreements was referable to section 30 of the 1957 Act, inasmuch as section 30 'that Act spoke of granting an interest in any of the rights mentioned in sections 14(a) and 14(b) of that Act. The end-user licence agreements did not grant any such right or interest, least of all a right or interest to reproduce the computer software, In fact, such reproduction was expressly interdicted, and it was also expressly stated that no vestige of copyright was at all transferred, either to the distributor or to the end-user. What was "licensed" by the foreign, non-resident supplier to the distributor and resold to the resident end-user, or directly supplied to the resident enduser, was in fact the sale of a physical object which contained an embedded computer programme, and was therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. 7.6. In view of the above, the ground No.1 raised by the Revenue is hereby dismissed." Respectfully following the decision of the ITAT in the case of the assessee itself on the similar issue and facts as referred above we don't find any reason to interfere in the decision of ld. CIT(A), therefore, the ground of appeal of the revenue stand dismissed. Ground No. 3: Disallowance u/s 14A of the Act: 34. During the course of assessment the AO noticed that assessee has earned dividend income of Rs. 244,83,29,696/- which was claimed as exempt income u/s 10(34) of the Act. The assessing officer has computed the disallowance in accordance with Sec. 14A r.w.Rule 8D(ii) to the amount of Rs. 280,58,643/-. 35. The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has deleted the addition holding that AO has mechanically applied Rule 8D and made disallowance without giving any reason. 36. During the course of appellate proceeding before us the ld. Counsel submitted on similar issue and identical fact from assessment year 2010-11 to 2014-15 the ITAT has adjudicated in favour of the assessee. 37. Heard both the sides and perused the material on record. We have perused the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that similar issue on identical facts has been adjudicated in the case of the assessee itself by the ITAT for assessment year 2009-10 to 2014-15. 41. Heard both the sides and perused the material on record. We have perused the decision of ITAT in the case of the assessee itself for assessment year 2011-12 vide ITA No. 1650/Mum/2016. The relevant operating part of the decision is reproduced as under: "34. We have considered the rival submissions and perused the material available on record. As it is evident from the details of expenditure mentioned in the aforesaid paragraphs, the expenditures were incurred by the assessee for the purpose of advertisement in newspaper, magazine, events, seminar, conferences, exhibition, advertisement at Airport, etc. We find that on identical issue, the Co-ordinate Bench of the Tribunal vide order dated 30.10.2019, passed in assessee's own case in Tata Consultancy Services Ltd. v/s ACIT, ITA no.5713/Mum/2016, for the assessment year 2009-10, vide Para-23 at Page-22, observed as under:- 23. We have considered rival submissions and perused the material on record. We have also carefully examined the case laws cited before us. On a detailed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal evidences furnished before us, we restore the issue to the Assessing Officer for de novo adjudication after providing reasonable opportunity of being heard to the assessee. We make it clear, our aforesaid direction is only with regard to the experience certainty expenditure of Rs. 5.28 crore. The decision of learned Commissioner (Appeals) on this issue is modified to this extent only. 35. The learned D.R. could not show us any reason to deviate from the aforesaid order and no change in facts and law was alleged in the relevant assessment year. Thus, respectfully following the decision of the Co- ordinate Bench rendered in assessee's own case cited supra, ground no.5, raised in assessee's appeal is allowed with similar directions. This ground is allowed for statistical purpose." Respectfully following the decision of the coordinate bench of the ITAT Mumbai in the case of the assessee itself on similar issue and identical facts as referred above we don't find any merit in the appeal of the revenue, therefore, the same stand dismissed. Ground No.5: Disallowance of payment towards Tata Brand Equity subscription of Rs. 75 crores: 42. During the course of assessment the assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd promotion scheme. The Co-ordinate Bench also noted that department has accepted the decision in Rallis India Ltd. (supra) and no appeal has been filed by the department against the same. Further, in the present case, nothing has been brought on record to suggest that the subscription fee paid by the assessee to Tata Sons Limited under the "Tata Brand Equity and Business Promotion Agreement" is different in nature from the one considered in aforesaid decisions. Thus, respectfully following the judicial precedence in case of sister concerns, we direct the Assessing Officer to delete the disallowance on account of subscription fees paid by the assessee to Tata Sons Limited. Accordingly, ground no. 6 raised in assessee's appeal is allowed." Respectfully following the decision of ITAT on similar issue and identical facts in the case of the assessee itself as referred supra we don't find any merit in the ground of appeal of the Revenue therefore, this ground of appeal of the revenue is dismissed. Ground No.6: Disallowance of expenditure of commission to non-resident is allowable as deduction (disallowance u/s 40(a)(i) on account of non-deduction of TDS) Rs. 397,41,017/-) 46. During ..... X X X X Extracts X X X X X X X X Extracts X X X X
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