TaxTMI 
TaxTMI 
2015 (11) TMI 1273
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....the Act') issued on 31.03.2002 raising a demand of Rs. 46,17,346/- because the challan for self-assessment u/s 140A of the Act and some of the original TDS certificate were not enclosed with the return. The Assessing Officer has observed in his assessment order passed u/s 143(2) r.w.s 147 of the Act that in the course of provision u/s. 154 of the Act that it was not noticed that return of income was singed and verified by one Mr. Samuel P. Starr, the tax matters partner. The computation sheet enclosed with the return was unsigned and it was revealed that a sum of Rs. 1,95,35,270/- (net) received from Reliance Industries Ltd. (RIL for short) was not offered for taxation as per the NOC of the Department. However, copy of NOC was not annexed. It was observed the part -V of the return made for furnishing details of income claimed exempted was marked 'NIL'. The assessee in its submission pointed out that name of the prayer company was Reliance Petroleum Limited instead of RIL. Accordingly, notice u/s 148 of the Act was served on the ground that income to the tune of Rs. 1,95,35,270/- had escaped assessment. The assessee filed fresh return declaring the same total income of Rs. 85,35,230....
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....dded at Rs. 2,79,07,529/-. He also held that assessee was liable for interest u/s. 234B and 234C of the Act as the assessee was liable to pay advance tax. 2.2. Aggrieved, assessee went in appeal before Ld. CIT(A) and Ld. CIT(A) upheld the proceedings u/s. 147 of the Act as regards the addition made by AO, assessee reiterated the submissions made before AO. The assessee, inter alia, submitted that Article 7(1) of the India-US DTAA is applicable to the assessee for deciding taxability or nontaxability of any income. Ld. CIT(A) held that for deciding taxability of the assessee in respect of professional fees received by assessee from different clients in India Article 7 of the Indo US DTAA is not the right provision. He pointed out that Article 7 is applicable in respect of enterprises which are carrying on business activity. Professional services rendered by assessee in India are covered by Article 15(1)(b) given under head "Independent personal service" of the DTAA. He pointed out that it is an admitted fact that for services rendered to clients other than RPL the stay of assessee in India has exceeded 90 days during the relevant previous year. Therefore, it comes under clause 1(....
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....ained from the Assessing Officer in Jamnagar was without jurisdiction. 7. That the Ld. CIT(A) erred in facts as well as in law in holding that the income of the ape was not covered by Article 7 of India- USA tax treaty, thereby not considering the contention of the appellant that the services rendered by the appellant to RIL viz., financial accounting and development of financial manuals did not have direct or indirect co-relation with the scope of service offered by the PE of the appellant in India in connection with US GAAP and US listing and hence not taxable as per said Article 7 of the tax treaty 8. That the ld. CIT(A) erred in holding the entire income from RJL as taxable as per Article 15 of the India-USA tax treaty. 9. Without prejudice to Ground 8 above, even assuming but not admitting that in the event the Hon'ble Tribunal confirms that the income of the appellant is to be taxed in India as per the provisions of Article 15 of the India-USA tax treaty, the Assessing Officer may be directed to compute the tax at the prescribed rate of 20% since the appellant did not have a fixed base in India" 4. At the time of hearing Ld. Counsel for assessee did not press ....
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....ce, interest u/s. 234B and 234C was not chargeable in the case of the assessee. I find that the facts for this assessment year are also similar an therefore I hold that interest u/s. 234B and U/s 234C will not be leviabe in the case of the assessee." 9. Before us Ld. Counsel for assessee filed a copy of Tribunal's order in the case of DCIT v. MGB Metro Group Buying HK Ltd. (2014) 146 ITD 343 (Delhi Trib.) wherein the Tribunal has held that the proviso in Sec. 209(1) inserted by Finance Act 2012 with effect from 1.4.2012 is retrospective in nature observing as under:- "So far as the contention of the ld. Senior DR regarding amendment inserted by the Finance Act, 2012, we are reproducing hereunder the proviso which is effective from 1.4.2012:- 'Provided that for computing liability for advance tax, income-tax calculated under clause (a) or clause (b) or clause (c) shall not, in each case, be reduced by the aforesaid amount of income-tax which would be deductible or collectible at source during the said financial year under any provision of this Act from any income, if the person responsible for deducting tax has paid or credited such income without deduction of tax or ....