TaxTMI 
TaxTMI 
TaxTMI 
2018 (2) TMI 593
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....ayment to the persons specified u/s. 40A(2)(b) of the Income Tax Act, 1961. 2. Whether the Ld. CIT(A) was right on facts and in law in stating that JV is merely a pass through entity with minimal expenses, no tax liability can be attributed to JV as AOP. 3. That the appellant craves for the permission to add, delete or amend grounds of appeal before or at the time of hearing of appeal. 2. The brief facts of the case are the assessee has filed the return of income declaring NIL income on 24.9.2013. Later on , the case of the assessee was selected for scrutiny as per CASS cycle and a notice u/s. 143(2) of the Income Tax Act, 1961 (hereinafter referred as the Act) was issued on 05.9.2014. Subsequently, notice u/s. 142(1) of the Act alongw....
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....appeal before the Tribunal. 5. At the time of hearing, Ld. DR relied upon the order passed by the AO and reiterated the contentions raised by the Revenue in the grounds of appeal. 6. On the other hand, Ld. Counsel of the Assessee relied upon the order of the Ld. CIT(A) and reiterated the contentions made before the Ld. CIT(A). He further stated that since the Ld. CIT(A) has passed a well reasoned order which does not need any interference on our part. Hence, the appeal of the Revenue may be dismissed. 7. I have heard both the parties and perused the relevant records available with us, especially the orders of the revenue authorities. I find that Ld. CIT(A) has discussed the issue in dispute elaborately at page no. 6 to 10 vide para no. 4....
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....rroneous conclusion that the JV is a separate entity and that it should have declared some income. The appellant is highly aggrieved by the above order and has filed this appeal before your goodself. All the grounds are pertaining to the contention of the assessee that JV is only a pass-through, entity and does not exists on its own. There is no income of the JV. It has to be assessed at Nil. The brief facts of the case 'are that the appellant is a joint venture. The same was formed so as to apply for the tender raised by South Eastern Railways. Copy of application/bid made to secure the tender is enclosed for your ready reference. This is basically a consortium of two firms joining hands based on their eligibility criteria to bag a....
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....ad Partner's share: 80% Name: M/s Kalindee Rail Nirman (Engineers) Ltd Responsibilities: i) Schedules for part - I (Civil Engineering) ii) Schedule for Part - III (Signaling Works) (Part) iii) Schedule for Part - IV (Telecommunication Works) (Technical, Financial & Other Obligations) b) Other Joint Venture Partner's Share: 20%; i) Schedule for part - II (Electrical Engineering) ii) Schedule for Part - III (Signaling Works) (Part) iii) Project Management iv) Material Management v) Site Management (Technical, Financial & Other Obligations) Therefore from the above it is clear that the scope of each joint venture's task was distinctly outlined right from the inception of the contract. No member of the JV....
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....ncome in the hands of AOPIJV for the work done by AOPIJV where the partners have already been assessed in their individual capacity. The work is done by AOP/JV and it was held that AOP alone is liable to tax on its business income as it alone did the business and incurred the expenditure. Whereas in the appellant's case, as explained above, the complete work is done by the JV partner's independently and they only have incurred all the expenditure. The role of the JV is only to route payments received from railways i. e. client to JV participants. The JV does not have any workforce, funds of its own nor any fixed assets as can be seen from the balance sheet for the year ended 31. 03.2011. 4.2 Based on the above facts, the CIT(A)-....
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....tributed by holding the subject entity JV as AOP. No net profit on % bases can be taxed as has been done in this case. 4.5 In consideration of the settled position of the law and the precedence being in favour of appellant, the grounds of appeal of the appellant are allowed." 8. After perusing the aforesaid finding, I find that the issues in dispute are squarely covered by assessee's own case for the AY 2011-12 as the facts are similar and therefore, the Ld. CIT(A) has followed the same precedence and rightly allowed the appeal of the assessee. I further find that Ld. CIT(A) has also respectfully followed the decision in the case of CIT vs. Oriental Structural Engineers P. Ltd. and KMS Constructions P. Ltd. [2015] 374 ITR 35 (Del) of the....