TaxTMI 
TaxTMI 
2023 (9) TMI 548
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.... 2013-14. 2. The grounds of appeal raised by the assessee read as under: "1. That on the facts and circumstances of the case, the CIT(A) erred in law in upholding the assessment made by the assessing officer ("AO") under section 143(3) of the Income-tax Act, 1961 ("the Act") at an income of Rs. 1,59,62,193 as against loss of Rs. 1,79,51,014 returned by the Appellant. 2. That on the facts and circumstances of the case, the CIT(A) erred in law in allegedly holding that the documents furnished by the Appellant, viz., (1) Agreements entered into by the Appellant with the non-resident group companies, and (2) No Permanent Establishment Certificates were additional evidences and in absence of application under Rule 46A of the Income-tax Rule....
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....be engaged in the business of risk management, risk analysis, mitigation consultant and to provide solutions related to crisis management etc. The assessee filed return of income digitally declaring loss of Rs. 1,79,51,014/- for the Assessment Year 2013-14 in question. The return filed by the assessee was subjected to scrutiny assessment under Section 143(3) of the Act. In the course of assessment proceedings, the Assessing Officer inter alia observed that during the relevant assessment year, the assessee had inter alia made payment on account of intercompany fees, i.e., payment in consideration for outsourced risk consultancy services and commission being payment for reference of work to overseas group companies located at Singapore, UK, U....
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....ithholding tax under Section 195 on an aggregate sum of Rs. 3,39,13,207/- towards such expenses intercompany fee and commissions attributable to Non-Resident entities. 4. Aggrieved the assessee preferred appeal before the CIT(A). The CIT(A) confirmed the action of the Assessing Officer and refused to admit additional evidences filed by the assessee in the form of 'no PE certificate' from certain entities, 'Tax Residency Certificate' (TRC) etc. on the ground that no formal application has been moved under Rule 46A explaining the reasons why such evidences were not submitted in the course of assessment proceedings. The CIT(A) thus ignored the additional evidences and refused to entertain the relief claimed by the assessee. 5. Further aggrie....
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....e to withholding tax as per the scheme of the Act and when the provisions of the Act and the appropriate Articles of the DTAA are read in conjunction. The ld. counsel contends that the payments have been made to non resident entities who have no permanent establishment in India and the payment made do not confirm the requirement of 'make available condition' under DTAA provisions. In continuance, the ld. counsel submits that the TRC and certificate showing presence of PE of non resident entities in India are vital for the determination of the obligation of the assessee under Section 195 of the Act. The ld. counsel contends that merely because some technical mistake might have occurred in the proceedings before the CIT(A), the CIT(A) was not....
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....is-a-vis technical considerations. The breach of sacrosanct principles of natural justice is fundamental and goes to the root of process of framing assessment. Needless to say that the spirit of Rule 46A of IT Rules enabling the assessee to place additional evidences before the CIT(A) are founded on the doctrine of legitimate expectation and principles of natural justice. It is indeed the sacrosanct obligation of the first appellate authority to have ensured that any effective opportunity is granted to the assessee for presenting its case and all evidences are taken into account while determining the issue. The powers of the CIT(A) are not fettered or circumscribed by Rule 46A for admission of additional evidences. In view of mandate of pro....