TaxTMI 
TaxTMI 
2013 (9) TMI 3
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....collection from India was shown at Rs. 3,055,714,746/-. It was claimed that the assessee being a tax resident of Netherlands, the profit derived from the operation of ships in international traffic was taxable only in Netherlands in accordance with Article 8-A(2) of the agreement for Avoidance of the Double Taxation between India and Netherlands and accordingly the income received in India from the operation of ships was exempt from tax in India. It was also claimed that the import freight was not taxable even under Article 8-A of the said agreement. Accordingly, 'nil' income was declared by the assessee in the return of income filed for the year under consideration in India. 3. During the course of assessment proceedings, the A.O. examined the claim of the assessee for exemption on account of income received in India from the operation of ships. On such examination, he found that the partnership firm PONP formed in UK was not registered in the said country as there was no such requirement. He held that the said partnership, however, was a valid partnership as per the provisions of Indian Partnership Act and was qualified as "Person" u/s 2(32) of the Income Tax Act, 1961. He fou....
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....ations in India to tax in the hands of the assessee u/s 172(2) of the Act at Rs. 24,12,09,632/- being 7.5% of the gross receipts of Rs. 321,61,28,297/-. 4. Aggrieved by the order of the A.O., appeal was preferred by the assessee before the ld. CIT(A) and elaborate submissions were made on behalf of the assessee before him in support of its case. After considering the said submissions as well as the relevant material available on record, the ld. CIT(A) agreed with the conclusion of the A.O. that although the Indian Partnership is a person for the purposes of Indo-UK DTAA, the U.K. partnership was not a person for the purposes of the said DTAA as per Article 3(1) and Article 3(2) and the UK Partnership firm not being a person under the Indo UK DTAA, no benefit of the Treaty could be extended to such person. He did not agree with the contention of the assessee that if UK partnership firm is not a person under Indo-UK DTAA Treaty, the said partnership cannot be a person even as per Section 2(31) of the Income Tax Act and consequently no assessment of the said firm can be made in India. He held that the contents of the partnership deed were sufficient to establish that it was a gener....
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....ed by the Act. The ld. CIT(A) thus held that the share profit of the assessee from the partnership firm of PONP was exempt from tax in India as per section 10(2A) of the Act as the said firm was chargeable to tax in India in respect of its income. Against the order of the ld. CIT(A), the assessee has preferred this appeal before the Tribunal. 5. At the time of hearing of this appeal, the ld. D.R. raised a preliminary objection that this appeal filed by the assessee before the Tribunal is not maintainable as the assessee cannot be said to be aggrieved by the order of the ld. CIT(A) impugned in the said appeal. He submitted that the ld. CIT(A) vide his impugned order has in fact allowed full relief to the assessee by holding that the income of the assessee from the partnership firm of PONP from the shipping operations in India is exempt u/s 10(2A) of the Indian Income Tax Act being share of profit from the partnership firm. He contended that no tax thus is payable by the assessee in India as a result of the order of the ld. CIT(A) and it cannot be said that the assessee is aggrieved by the said order. He contended that the present appeal filed by the assessee against the order of ....
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.... appeal to the Tribunal. There can be no quarrel with the proposition put forth by the ld. counsel for the assessee, which is also supported by the judicial pronouncements cited by him, that if the partnership firm is assessed, partners can be called upon to pay the tax of the partnership firm. Section 188-A of the Act also provides that the partners are jointly and severally liable to pay the firm's tax. The question in the present case, however, is whether any income has been assessed in the hands of the partnership firm as a result of the order of the ld. CIT(A) which is impugned by the assessee in the present appeal and the answer to this question is clearly negative. It is no doubt true that the ld. CIT(A) in the said order has agreed with the A.O. that the UK partnership firm being fiscally transparent in UK is not taxable in that country but is taxable in India being a "person" under the Indian Income Tax Act. However, this decision of the ld. CIT(A) is given while deciding the case of the assessee and not that of the partnership firm. As a matter of fact, the case of the partnership firm was not before the ld. CIT(A) at all and the decision of the ld. CIT(A) rendered while ....
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....view that subsisting demand was essential for maintainability of appeal before the Tribunal. The issue involved before the Hon'ble Allahabad High Court in the case of J&T Jain (supra) as well as the relevant facts involved thus were altogether different than that of the present case and the reliance of the ld. counsel for the assessee on the said decision, in our opinion, is completely misplaced. 9. The ld. Counsel for the assessee has also relied on the decision of Hon'ble Bombay High Court in the case of Kikabhai Abdulali (supra) in support of assessee's case. In the said case, a firm by name Gokaldas Dayalji was assessed to tax as an unregistered firm and Gokaldas appealed to the AAC contending that the assessment should have been on himself as an individual and not on the firm. This contention was based on his allegation that the firm was a proprietary concern and not a partnership firm. The appeal preferred by Gokaldas was dismissed. Thereafter the property of the petitioner (who had filed the petition before the Hon'ble Bombay High Court) was attached as his name was appearing as a partner along with Gokaldas and others in a partnership deed to recover the firm's tax. The ....
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....the case of Kikabhai Abdulali (supra) shows that the term "assessee aggrieved" used in section 253(1), is interpreted and explained as any person by whom income tax or any other sum of money is payable as a result of the order which is sought to be appealed against. In the case of CIT vs. Ambala Flour Mills (1970) 78 ITR 256, the Hon'ble Supreme Court ruled that if a person is fastened with the liability to tax, he has a right of appeal so as to challenge the liability with which he is sought to be fastened. In the case of CIT vs. N. Ch. R. Row and Co. (1983) 144 ITR 557, the Hon'ble Calcutta High Court held that the right to appeal by the Tribunal from an order passed by the AAC was not confined technically to the party who was a party to the appeal but is a much wider right which might be exercised by any person who was liable to pay tax by any order against which the appeal was preferred. 11. In the case of MICO Employees Association vs. ACIT (2007) 292 ITR 567 (Karn) there was a dispute between MICO Employees Association and the Department regarding TDS vis-à-vis service of employees and the appeal filed by the Employees Association was held to be not maintainable by ....