TaxTMI 
TaxTMI 
2017 (8) TMI 122
X X X X Extracts X X X X
X X X X Extracts X X X X
....warded the contracts in the field of water resources planning in their respective States. The entire liability of Indian Income-tax was undertaken to be borne and paid by the respective Departments of the State Government. At the time of entering into the contracts, double taxation avoidance treaty between the Government of India and Israel did not exist. Both the State Governments, deposited Income-tax on the technical services fees paid to the assessee who is a foreign company. The assessee furnished its return of income offering the tax at concessional rate of 10 per cent. prescribed under the double taxation avoidance agreement which came into force on May 15, 1996. The assessee appended notes to the statement of total income of Indian operations of the assessee which was filed with the return of income showing income from other sources for the period ended March 31, 1997. 3. While admitting the matter this court has framed the following issues : "(i) Whether the Income-tax Appellate Tribunal was justified in law in having refused to rectify its earlier order dated July 31, 2002 in the peculiar facts and circumstances of the case ? (ii) Whether the Income-t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd Tahal Consulting Engineers Ltd. has not preferred any appeal. The present appellant/petitioner has accepted the order of the Assessing Officer. In that view of the matter in view of the principle of acquiescence and waiver the matter is finally concluded and he cannot be allowed to reopen it and the Tribunal has found that the original assessee Tahal Consulting Engineers Ltd. is entitled for the relief. This is a case where rule of inconvenience is referred therefore, the present appeal and writ petition have been preferred. He has also taken us to the provision of section 161 and contended that rival contentions which are raised in reply to the writ petition reads as under : "1. That the contents of para 1 of the preliminary objection are admitted to the extent that a miscellaneous application was filed by the petitioner before the learned Income-tax Appellate Tribunal claiming itself to be a representative assessee of M/s. Tahal Consultancy Engineers Limited (hereinafter for the sake of brevity referred to as TCL) and for rectification of the order dated July 31, 2002 and the same was dismissed by the learned Income-tax Appellate Tribunal vide its order dated May 19, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....esident or non- resident, has acquired by means of a transfer, a capital asset in India.' A bare perusal of the aforesaid sections clearly provides that every representative-assessee must be deemed to be an assessee for all the purpose of Income-tax. 1.3. It is further submitted that the Department had vide Circular No. 707, dated July 11, 1995 ([1995] 214 ITR (St.) 129 ), recognised that the employer, employing a non-resident can claim the refund. The text of the said circular is reproduced hereunder for ready reference : 'Under the provisions of this section, any person from or through whom the non-resident is in receipt of any income, whether directly or indirectly, can be regarded as an agent in relation to the non-resident. Accordingly, the company itself employing a non-resident who has left India without claiming refund of taxes borne by the employer can file the return and can be assessed in its own name in respect of that income under section 161(1) and claim the refund'. 1.4. It is further stated that an appeal has already been filed by the humble petitioner under section 260A of the Income-tax Act, 1961 against the impugned....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... accepted by the Department, it will be unjust and they will be entitled for the collection of tax which they are otherwise not entitled to. 9. We have heard learned counsel for the parties. 10. Before proceeding with the matter, it will not be out of place to mention what is the locus of the present appellant/petitioner. The present appellant/petitioner is entitled to enter into contract with a foreign firm Tahal Consulting Engineers Ltd. and assessment of earlier year was made in the name of the Tahal Consulting Engineers Ltd. and proceedings were initiated by Tahal Consulting Engineers Ltd. and it was concluded in the name of Tahal Consulting Engineers Ltd. Now to say after three years that he wants to substitute for the Tahal Consulting Engineers Ltd. under the Income-tax Act is not permissible inasmuch as precedent of previous year is required to be accepted. Therefore, on the first principle of the Income- tax Act, the Department is bound by the earlier precedent year and same thing will apply on the assessee namely Tahal Consulting Engineers Ltd. The present appellant/petitioner was never a party to the earlier proceedings therefore, this principle will apply in the ca....