TaxTMI 
TaxTMI 
2025 (7) TMI 1859
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.... in holding that the foreign payment amounting to Rs. 7,28,07,989/- had been made on account of export commission inasmuch as such conclusion had been reached without ascertaining the true nature and purpose of the foreign payments and without appreciating that the said payments were not supported by any evidence including evidence of services rendered, tax residency certificates, PE declaration etc.? (b) Whether the Learned Income Tax Appellate Tribunal has committed substantial error of law by rendering a judgment contrary to the decision rendered by this Hon'ble Court in the case of CIT Vs. Andaman Sea Food Pvt. Ltd. (ITAT No.19 of 2013) ? (c) Whether the Learned Income Tax Appellate Tribunal was justified in law in holding that market to market (MTM) Loss of Rs.99.96 lacs was real in nature and not notional, inasmuch as such conclusion had been reached by the learned Tribunal without considering the CBDT instruction number 3/2010 and without appreciating that, the assessee company itself reversed the notional debit on the immediately succeeding day and that the assessee had itself refrained from offering to tax the MTM gain resulting on other receivable/pa....
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....egistering new patents or registering existing patents in new countries as revenue expenditure without considering the nature of expenditure incurred for acquiring or improving valuable capital asset being intangible asset as defined in Section 2(11) of the Act which would qualify for capital expenditure only? 3. We have heard Mr. Prithu Dudhoria, learned standing Counsel for the appellant/revenue and Mr. J.P. Khaitan, learned Senior Counsel assisted by Ms. Nilanjana Banerjee Pal, learned Advocate for the respondent/assessee and carefully considered the materials placed on record. 4. The assessee filed their return of income for the assessment year under consideration A.Y. 2010-2011 on 30.09.2010 showing the total income of Rs. 61,09,14,46,480/- and book profit under Section 115JB at Rs. 5883,58,39,895/-. Subsequently, the assessee filed revised return on 30.03.2012 showing the total income of Rs. 58,19,55,22,380/- and book profit under Section 115JB at Rs. 59,03,41,20,702/-. The case was selected for scrutiny and notices under Section 143(2) of the Act was issued on 30.08.2011. Subsequently, notice under Section 142(1) was issued along with a questionnaire. 5. The assesse....
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....x (Appeals) 2, Kolkata. The appeal was partly allowed by order dated 27.03.2017. Challenging the said order, the assessee as well as the revenue preferred appeals before the learned tribunal and by the impugned order, the appeals filed by the revenue was dismissed, and the appeal filed by the assessee was partly allowed. The learned tribunal had passed the impugned order in four appeals which were heard analogously for two assessments years i.e. 2010-2011, 2011-2012. The present appeal is against the order passed by the learned tribunal in respect of the assessment year 2010-2011 in ITA No. 1068/Kol/2017 (filed by the assessee) and ITA No. 1222/Kol/2017 (filed by the revenue). 7. The revenue would contend that the learned Tribunal was not justified in holding that the foreign payment amounting to Rs. 7,28,07,989/- had been made on account of export commission inasmuch as such conclusion had been reached without ascertaining the true nature and the purpose of the foreign payment without appreciating that the payments were not supported by any evidence including evidence of services rendered, tax residency certificate, PE declaration etc. The revenue further would contend that the....
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....argeable to tax in India under Section 9(1)(vii). Therefore, the Tribunal rightly distinguished the said decision. Accordingly, the substantial questions of law (a) and (b) are answered against the revenue. 10. Substantial question of law (c) pertains to liability of market to market loss of Rs. 99.96 lacs on forward contracts. We note that this issue is squarely covered in favour of the assessee in the light of the decision of this Court in Principal Commissioner of Income Tax-I, Kolkata vs. M/s. Pricewaterhouse Coopers Pvt. Ltd., in 2021 (12) TMI 1400 (Cal). In the said decision, the Court took into consideration the CBDT Circular dated 23.3.2010 and held that it is not possible for the Board to give any direction to the Assessing Officer as the Board under law cannot issue any positive direction as the settled legal principle is that the Assessing Officer is an independent authority and none can dictate him as to how and in what manner he is to complete the assessment. Conscious of this legal position, the Board in the instruction dated 23.3.2010 had stated that the Assessing Officer may "follow the guidelines given in the instruction", which is also one more indication to sh....
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....sessee towards compensation for sterilization of the profit earning source, not in the ordinary course of their business, in our opinion, was a capital receipt in the hands of the assessee. We are, therefore, in agreement with the opinion recorded by the High Court on questions Nos. (i) and (ii) extracted in paragraph 1 (supra) and hold that the amount of Rs. 8,50,000 received by the assessee from the suppliers of the plant was in the nature of a capital receipt." 12. The Tribunal rightly applied the above legal position and held that the supplier delayed in coming into existence of profit making apparatus and the liquidated damages paid by the supplier for such delay was in capital receipt and not the receipt in the regular course of business and that the liquidated damages were not to be reduced from the cost of the assessee. The finding rendered by the Tribunal reflects the correct position and, accordingly, substantial question of law (d) is decided against the revenue. 13. The next substantial question of law (e) is with regard to disallowance under Section 14A read with Rule 8D to the tune of Rs. 21,16,23,729/-. The Assessing Officer made the disallowance on account of ....
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....e revenue has referred to the clarificatory amendment brought in by insertion of explanation to Section 14A of the Act by Finance Act, 2022. The reference to the explanation inserted in 14A of the Finance Act, 2022 can be of no consequence as the assessee before us has worked out disallowance of Rs. 45,14,500/- with reference to all its investment capable of leading exempt income and not only those which, accordingly, yielded exempt income. Thus, the finding recorded by the learned Tribunal in respect of disallowance under Section 14A read with Rule 8D does not call for any interference. Accordingly, the substantial question of law (e) is answered against the revenue. 15. The next substantial question of law is with regard to advance of Rs. 1,49,00,000/- given to 6256 farmers in earlier years which were written off. In this regard, the CIT granted relief to the assessee after calling for a remand report from the assessing officer, as to support the disallowance only on the ground that the advance was never credited to the profit and loss account and cannot be claimed as deduction upon write off. The CIT(A) held that the advances given were in the nature of trade advances and wer....
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....on of the facts and decide the same. 19. The next question of law suggested is with regard to fresh claim to Employee Stock Option Plan (ESOP) which was raised for the first time before the learned Tribunal. We find there is no question much less substantial question of law arises for consideration on this issue. 20. The last substantial question of law suggested by the revenue is as regards patent registration charges. The revenue cannot dispute the fact that this issue is squarely covered by the decision of the Hon'ble Supreme Court in Commissioner of Income Tax, Bombay Vs. Finlay Mills Limited wherein Supreme Court held as follows:- "By registration, the owner is absolved form the obligation to prove his ownership of the trade mark. It is treated as prima facie proved on production of the registration certificate. It thus merely saves him the trouble of leading evidence, in the event of a suit, in a court of law, to prove his title to the trade mark. It has been said that registration is in the nature of collateral security furnishing the trader with a cheaper and more direct remedy against infringers. Cancel the registration and he has still his right enforceable....