TaxTMI 
TaxTMI 
2022 (8) TMI 897
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....ing of material handling equipments, industrial gears coupling and Wind Turbine Generator. For the assessment year 2013-14, the assessee filed its Return of Income declaring total income of Rs. 36,21,68,510/-. On 29.11.2013 the same was processed u/s. 143(1) of the Act then selected for scrutiny assessment. The assessee was issued notices u/s. 143(2) and 142(1) on various dates and called for various information from the assessee. After detailed discussion, the assessment was framed u/s. 143(3) dated 22.03.2016 wherein additions made on (i) Disallowance of excess claim of depreciation on motor car (ii) Excessive claim of depreciation on Energy Saving Device and Wind Turbine Generators and (iii) Disallowance u/s. 14A of the Act. 4. This assessment was revised by the Ld. PCIT by issuing a show cause notice u/s. 263 dated 09.03.2018 as follows: Sir, Sub: show cause notice u/s. 263 of the Income-Tax Act in the case of Elecon Engineering Company Ltd. A.Y.2013-14 Please refer to the assessment order u/s. 143(3) of the Act passed on 22.03.2016 in your case for A.Y. 2013-14 It is observed that in AY 2013-14, consequent upon ....
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.... and merged with the assessee Elecon Engineering Co. Ltd. This was implemented is with effect from 1st April, 2012. As per the scheme of arrangement Emtici Engineering Ltd. has transferred income of commission earned on Gear and MHE business to the respective companies. Break up of commission income transferred is as follows: Break up of commission income transferred by Emtici Engineering Ltd. Commission of Gear business transferred to Elecon Engineering Co. Ltd. A 25,19,38,366 Total commission income of MHE business from Elecon EPC Projects Ltd. and Prayas Engineering Ltd. B 24,86,42,464 Less: Commission of MHE business of Prayas Engineering Ltd. C 1,78,35,662 Net commission income of MHE business of Elecon EPC Projects Ltd. D (B-C) 23,08,06,802 23,08,06,802 Total commission income of Gear and MHE business of Elecon Engineering Co. Ltd. and Elecon EPC Projects Ltd. E (A+D) 48,27,45,168 Add: Service tax at the rate of 12.36% F 5,96,67,303 Total commission income including service tax on which TDS has been deducted G (E+F) 54,24,12,471 5.1. Thus the tot....
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....53 5,472,973,676 5,863,830,877 7. One more allegation of the Ld. PCIT is that the assessing officer failed to follow section 199 of the Act and Rule 37BA do not provide for any exception in the case of mergers/demergers. Thus, the assessing officer has not made proper enquiry and verification. Therefore invoking Expalantion-2 to section 263 of the Act, this impugned revision order has been passed. 8. The ld. A.R. Mr. Mehul K. Patel submitted this finding of the PCIT is totally baseless. The assessing officer before passing the assessment order and made thorough enquiry of the transaction and also availed an Indemnity Bond from the assessee dated 21.03.2016 which is available at page no. 38 & 39 of the Paper Book. 8.1. As per Clause (iii) of Rule 37BA the deductor shall issue the certificate for deduction of tax at source in the name of the person in whose name credit is shown in the information relating to deduction of tax referred to in sub-rule(1) and shall keep the declaration in his safe custody. 8.2. As per Sub-rule (ii) of Rule 37BA is that the declaration filed by the deductee under clause (i) shall contain the name, address, permanent account number of the....
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....r the revenue supports the order of the Ld. PCIT and pleaded to uphold the same. 10. We have given our thoughtful consideration and perused the materials available on record including the Paper Book filed by the assessee. The only reason for revising the assessment order dated 22.03.2016 passed by the assessing officer is that pursuant to the scheme of arrangement sanctioned by the Hon'ble High Court of Gujarat, M/s. Emtici Engineering Ltd. had transferred its income of Rs. 54,24,12,511/- and corresponding TDS credit of Rs. 3,28,13,759/- to the assessee for the Assessment Year 2013-14. Similarly, Emtici Engineering Ltd. transferred its income of Rs. 24,86,42,464/- with TDS of credit of Rs. 1,59,01,794/- to Elecon EPC Project Ltd. for the Assessment Year 2013-14. As against the net income of Rs. 29,37,70,047/- i.e. (Rs. 54.24 crores - Rs. 24.86 crores) received by the assessee on account of transfer from Emtici Engineering Ltd. and transfer to Elecon EPC Project Ltd., the assessee had offered income of Rs. 25,19,38,366/- for taxation and claimed not TDS credit of Rs. 1,69,11,965/- in the return of income for the Assessment Year 2013-14. Thus there is a difference of income of Rs.....