TaxTMI 
TaxTMI 
TaxTMI 
2015 (6) TMI 974
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....urt decides that the interest earned on the Nostro account is not taxable, then consequential disallowance under section 14A may be directed. (2) Whether, on the facts and in the circumstances of the case and in law, the hon'ble Income-tax Appellate Tribunal was right in hold ing that the income chargeable at the special rate under section 10(15) would be on gross basis and not on net basis ? (3) Whether, on the facts and in the circumstances of the case and in law, the hon'ble Tribunal was right in holding that the expenses incurred at the head office on behalf of the Indian branch of the assessee are deductible under section 37(1) of the Act without any restrictions contained in section 44C ? (4) Whether, on the facts and in the circumstances of the case and in law, the Income-tax Appellate Tribunal has erred in directing the Assessing Officer to tax the interest received under section 244A at the rate prescribed in article 12 of the DTAA between India and France ? (5) Whether, on the facts and in the circumstances of the case and in law, the Income-tax Appellate Tribunal has justified in holding that interest received by the Indian permanent establishment of the for ....
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....2013. This court by an order dated April 1, 2015 (DIT (International Taxation) v. American Express Bank Ltd. [2015] 5 ITR-OL 153 (Bom)), dismissed the Revenue's appeal on the above issue by following its decision in CIT v. Emirates Commercial Bank Ltd. [2003] 262 ITR 55 (Bom). Accordingly, question No. 3 is not entertained as it does not raise any substantial question of law. 6. Regarding question No. 4 (a) The Tribunal by the impugned order restored the issue of the rate at which interest is to be charged to tax on Income-tax refund received under section 244A of the Act to the Assessing Officer to be decided in the light of the Indo-France DTAA and the decision of the Special Bench of the Tribunal in the matter of Asst. CIT v. Clough Engineering Ltd. [2011] 9 ITR (Trib) 618 (Delhi) [SB] ; [2011] 130 ITD 137. (b) The grievance of the Revenue is with the impugned order fol lowing the decision of the Special Bench in Clough Engineering Ltd. (supra). (c) However, we find that the decision in Clough Engineering (supra) of the Special Bench had been followed by the Tribunal in I. T. A. No. 183/ Mum/2010 (DHL Operations B. V., the Netherlands v. Deputy DIT). The issue before the....
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....em chand v. CIT [1953] 24 ITR 506 (SC). The impugned order of the Tribunal also places reliance upon the Special Bench decision in the case of Sumi tomo Mitsui Banking Corpn. v. Deputy DIT [2012] 16 ITR (Trib) 116 (Mumbai) [SB] ; [2012] 19 taxmann.com 364 (Mum) [SB] to hold that man cannot make profit out of himself and, therefore, the interest received by the assessee from its own head office is not chargeable to tax. (c) So far as the reliance by the Revenue on order dated April 14, 2013, of this court admitting the appeal in Antwerp Diamond Bank N. V. (supra), is concerned, deduction on account of interest paid by the Indian permanent establishment to its head office was in the specific context of articles 7(2) and 7(3) of the Indo-Belgium DTAA. The case of Antwerp Dia mond Bank N. V. (supra) before the Tribunal was a part of the Special Bench decision in Sumitomo Mitsui Banking Corporation. (supra) wherein at paragraph 50, it is held as under (page 149 of 16 ITR (Trib)) : "50. As regards the deduction of interest payable to the head office in the hands of Indian permanent establishment for the purpose of computing profits attributable to the said permanent establishment, ther....
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.... point out that the Tribunal in the impugned order has recorded the fact that the respondent-assessee has admitted before it that to bring about parity, it is not claiming any deduction of interest paid by it to its head office while computing the taxable income. (d) Accordingly, in view of the above settled position that no person can make profit out of itself, the proposed question of law not being sub stantial, is not entertained. 8. However, before we close, we cannot but observe the manner in which this appeal has been filed and prosecuted with regard to the proposed questions Nos. 1, 2 and 3. It was casual and callous, as the following facts would demonstrate : (i) In respect of question No. 1 the Revenue sought to agitate an issue contrary to its stand before the Tribunal. The Revenue's prayer before the Tribunal, was to declare that the interest income earned on the Nostro account is taxable. The impugned order of the Tribunal granted the Revenue's prayer and held that the interest earned on the Nostro account is taxable. Before us, the question framed/agitated was that the Tribunal erred in granting interest on the Nostro account. It is beyond comprehen sion as ....
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....is judgment ; but all through he never forgets what he owes to himself and to others. He will not knowingly misstate the law âEUR" he will not wilfully misstate the facts, though it be to gain the cause for his client. He will ever bear in mind that if he be the advocate of an individual, and retained and remu nerated (often inadequately) for his valuable services, yet he has a prior and perpetual retainer on behalf of truth and justice ; and there is no Crown or other licence which in any case, or for any party or purpose, can discharge him from that primary and paramount retainer." (emphasis supplied) (v) Undoubtedly, an advocate has to fearlessly put forth his client's point of view, however, the same has to be tempered/guided by truth and justice of the dispute. In matters of tax, justice requires that there must be certainty of law which presupposes equal application of law. Thus, where the issue in controversy stands settled by the decisions of this court or the Tribunal in any other case and the Revenue has accepted that decision then in that event the Revenue ought not to agitate the issue further unless there is some cogent justification such as change in law or....