TaxTMI 
TaxTMI 
2024 (7) TMI 225
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....tails called for by the notice. 3. The Assessment Order under Section 143 (3) of the IT Act, came to be passed on 13.03.2013 determining the income of the Respondent at Ra. 596,87,21,240/-inter alia making the following additions/ disallowances: (a) STCCG treated as business income Rs. 191,11,60,784/-; (b) Disallowance under Section 14A r/w 8D.. Rs. 105,21,316/-; (c) Disallowance of expenditure incurred abroad on account of supervision charges amounting to Rs. 117,09,419/- and incurred abroad on professional & consultancy fees amounting to Rs. 5,77,23,014/-; (d) Disallowance of exchange loss of Rs. 8,65,74,413/- being conversion of US Dollar currencies to Indian currency; (e) Disallowance of Rs. 31,92,000/- being expenditure incurred on the purchase of two ambulances and donation of Rs. 20,00,000/-; (f) Disallowance of Rs. 81,16,257/- being expenditure incurred on repair & renovation of two temples; (g) Disallowance of Rs. 30,28,002/- being enhancement of value of closing stock. 4. Aggrieved by the order dated 13.03.2013, the Respondent preferred appeal before the Commissioner of Income Tax (Appeals). The Commissi....
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.... ground of contribution/donation towards the construction of the school building was allowed. The Revenue's appeal on the issue of exchange loss was dismissed. 7. According to Ms Susan Linhares, learned counsel for the Revenue, the order dated 12.09.2022 passed by the Tribunal is contrary to the provisions of the IT Act. The present appeal is therefore preferred under Section 260A of the IT Act, 1961 on the following substantial questions of law: 1. Whether on the fact and in the circumstances of the case and in law, the Hon'ble ITAT erred in deleting the addition of Rs. 6,94,32,433/- made on account of disallowance under Section 40 (a) (ia) of the IT Act, 1961 as the applicability of the amendment is retrospective in nature and the legislative intent from the beginning, much before the explanation to Sec. 9 (1) (vii) introduced in the Finance Act, 2010 was that the income of a non-resident shall be deemed to accrue or arise in India and shall be included in his total income. 2. Whether on the fact and in the circumstances of the case and in law, the Hon'ble ITAT erred in deleting the addition of Rs. 81,16,257/- made on disallowance of expenditure o....
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.... no substantial question of law arises in the present appeal. Reliance is placed on the decision of the Supreme Court in Engineering Analysis Centre of Excellence (P.) Ltd., Vs Commissioner of Income Tax [2021] 125 Taxmann.com 42 (SC) to contend that the Respondent cannot be obligated to do the impossible i.e. to apply a provision of a statute when it was not actually and factually in the statute book. Reliance is also placed on the decision of this Court in Principal Commissioner of Income Tax, Panaji Goa Vs Ajit Ramakant Phatarpekar [2021] 124 Taxmann.com 124 (Bombay) in support of his submission. It is contended that if in a similar case, the decision has been accepted by the Revenue, then it is not open for the Revenue to lay a challenge to the impugned order on the same question which is squarely answered against the Revenue. 12. Heard the learned counsel for the parties. We have perused the paper book. 13. We find that during the previous year 2009-2010 (relevant to Assessment Year 2010-2011) the Respondent Assessee made payments aggregating Rs. 6,94,32,433/- to the non-residents towards the charges for sampling and analysis of cargo at the destination port as well as f....
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.... President's assent only on 08.05.2010 i.e. after the end of the Financial Year and therefore, Explanation was factually not on the statute when the payments were in fact made during the previous year 2009-2010. It was therefore, urged that expecting the Respondent to deduct tax at source from the payments which were not taxable on the date on which the payments were made, but became taxable by virtue of retrospective amendment would be expecting it to do the impossible. In support of this contention, the Respondent Assessee relied upon the decision of the coordinate Bench of the ITAT in ACIT Vs Ajit Ramakant Phatarpekar [2015] 56 Taxmann.com 357 (Panaji), wherein the Assessee therein had made identical payments during the previous year 2009-2010 and the I TAT held that Assessee could not be expected to deduct tax at source from the payments which became taxable owing to the retrospective amendment. 16. The Tribunal, in so far as the submission that the services were analytical and professional in nature and did not fall within the meaning of the phrase "fees for technical services" agreed with the view expressed by the AO and CIT (A). The alternative plea of the Respondent ....
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....of a certificate to produce evidence by way of electronic record under section 65B of the Evidence Act, 1872 and held that having taken all possible steps to obtain the certificate and yet being unable to obtain it for reasons beyond his control, the respondent in the facts of the case, was relieved of the mandatory obligation to furnish a certificate.... ..... " 19. Their Lordships referred to previous judgments dealing with the doctrine of impossibility in the aforesaid decision. In Paras 82 and 85, the Supreme Court observed thus: "82. As a matter of fact, even under the Income Tax Act, the High Court of Bombay has taken a view, applying the aforestated maxims in the context of the provisions of the relevant DTAAs, to hold that persons are not obligated to do the impossible, i.e., to apply a provision of a statute when it was not actually and factually on the statute book. 85. It is thus clear that the "person" mentioned in section 195 of the Income Tax Act cannot be expected to do the impossible, namely, to apply the expanded definition of "royalty" inserted by explanation 4 to section 9 (1) (vi) of the Income Tax Act, for the assessment years in question, ....
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....oses of the business, the expenditure ought to be allowed. 24. The Tribunal found that as a matter of fact, the expenses were incurred by the Respondent Assessee on schools and temples situated in the villages surrounding the mining area, the expenses were incurred out of business exigencies i.e. when the Assessee has to conduct the mining activity in the deep forest and village areas, the Assessee needs to maintain healthy relations with such villagers and create cordial relations with the villagers residing in the surrounding locality of the mining and business area, so that smooth business and mining activity can be undertaken; and in order to do so, the Assessee was required to incur such expenditure in the locality surrounding the mining and business area of the Assessee. The Tribunal found that no capital asset has been acquired by the Respondent Assessee by incurring the expenditure. The Tribunal, therefore, held that the expenditure was allowable as revenue expenditure. 25. The learned counsel for the Revenue urged that since the quantum of expenditure was huge, therefore, the expenditure ought to be treated as capital in nature and in view of the restriction against ....