TaxTMI 
TaxTMI 
2026 (8) TMI 1632
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....It is for all practical purposes a Non-Resident Body Corporate and therefore the due date of filing the Return of Income for Non-Resident Body Corporate is 30th September 2018. 1. (b).On the facts and circumstances of the case and in law, the learned CIT (A) erred in observing and holding that "The claim of the appellant that it is a non-resident body corporate and accordingly the due date of filing of the return of income should be considered as that of a non-resident body corporate for various reasons as is being claimed and does not lie within the purview of the provisions of Section 143 (1) of the Income Tax Act." 2. (a).On the facts and circumstances of the case and in law, the learned CIT (A) erred in thereby not allowing carry forward of short term capital loss of Rs. 2,69,63,893/- claimed by your appellant in the Return of Income by confirming the action of the learned AO (CPC) of considering the due date of the filing of return as 31st July, 2018 applicable to a partnership firm as against the correct due date of 30th September, 2018. 2. (b). On the facts and circumstances of the case and in law, the learned CIT (A) erred in observing that no mis....
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..... According to section 115BBDA, dividend received by a resident assessee company, an individual, HUF and partnership firm has to be taxed, if the amount exceeds Rs. 10,00,000/-. It is claimed by the assessee that it does not fall in any of these categories, but the AO was not convinced. The assessee, thus, was aggrieved as the tax is calculated on dividend, thereby the tax payable is computed at Rs. 15,67,003/-, which has further resulted in consequential levy of interest u/s 234A, 234B and 234C of the Act. 3. The argument of assessee before the First Appellate Authority was that, the intimation issued by the CPC in assessee's case was erroneous. There is no tax payable in the first place, therefore, all the consequential levy like interest, fee u/s 234F of Rs. 1000/- etc. are wrongly charged to the assessee. It is also assailed by the assessee before the Ld. CIT(A), that it had not received the said intimation dated 03.09.2019, which was downloaded from the portal on 18th June, 2020.A rectification petition was also filed against such intimation on 19th June, 2020. 4. The application of assessee u/s 154 was thereafter disposed by the Revenue vide order dated 10th July, 2020,....
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....unds of appeal filed by the appellant were discussed. The appellant was asked to clarify that when the PAN requested by the appellant and allocated to the appellant is under status of Firm, based in which the CPC has prima facie taken the due date of filing of return by the appellant in the status of a firm itself, then in such circumstances how any mistake could be attributed to the stand of the CPC/AO in this regard. The definition of Company as well as Firm are clearly mentioned in section 2 of the Income Tax Act and appellant was required to choose correct status as applicable to it and as is being claimed while applying for PAN and while filing its ITR. It is noted that the PAN of the appellant is AAIFT9163B and hence its status has been recorded as a Firm in the income tax portal, which is as per the own claims made by the appellant at the time of applying for PAN. Further, it is noted that the appellant has itself filed its ITR for AY 2018-19 in Form ITR-5, which is for persons other than (i)Individual (ii) HUF (iii) Company & (iv) persons filling Form ITR-7. Thus. the appellant has itself claimed its status as "firm" and applied and got PAN under the status of "firm" and fu....
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....f the Income Tax Act. Consequently, no mistake could be attributed to the action of the CPC in considering the due date applicable to the Firm as per the status declared by the appellant itself based on which allotment of PAN has been made. Therefore, the claims made regarding incorrect denial of carry forward of short-term capital loss and taxing dividend income by not treating the appellant as a body corporate are not found correct. Based on the above discussion, the claims made by the appellant in its grounds of appeal are not found correct and therefore grounds of appeal Nos. 1, 2 and 3 are being dismissed. 5.4 As a result, the grounds of appeal Nos. 1, 2 and 3 are Dismissed. 6. The ground of appeal no.4 is regarding levying of interest u/s. 234A, u/s. 234B and u/s. 234C of the Act, amounting to Rs. 15,287/-, 2,75,166/- and Rs. 79,135/-, respectively. The ground of appeal no.5 is regarding levying of interest u/s. 234F of the Act. As regards, levy of interest u/s. 234A,234B and u/s. 234C and 234F are concerned the charging of interest is consequential to the assessed income and is mandatory. The levy of interest u/s. 234B of the Act is mandatory and arises as ....
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....ccepted the same and issued the PAN giving the assessee the status of "Firm", whereas the enclosed identity documents of the assessee suggests that the assessee is a Limited Partnership (LP) registered at USA and therefore, cannot be treated as partnership firm in India. 8. Ld. AR also drew our attention to the certificate of Limited Partnership issued to the assessee by the State of Delaware, Secretary of State, Division of Corporations dated 27th August, 2023 (Copy furnished at page 16 of assessee's paper book). 9. To invalidate the findings of revenue, Ld. AR raised various contentions, the first contention is that the assessee is to be treated as a company under the Income Tax Act, 1961. Consequently, the due date of filing of return of income for AY 2018-19 for the company would be 30th September 2018,so the return filed by the assessee on 21st September 2018 was submitted within the prescribed due date. On this aspect, Ld. AR submitted that the assessee is a Limited Partnership Firm under the laws of Delaware State in USA (Delaware Code). The assessee is a body corporate incorporated under the Laws of Country Outside of India (USA) and consequently is a company under th....
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.... ITR-5 applicable for the firms and not ITR-6 applicable to companies. It is submitted that the Ld. CIT(A) has failed to appreciate that the assessee has rightfully made the PAN application in Form 49AA, which is applicable to entities incorporated outside India and ticked the box pertaining to partnership firm, since it was a firm as Limited Partnership in State of Delaware, USA. Even though the USA addressed certificate of Limited Partnership Firm issued by the Secretary State of Delaware was filed along with its PAN application with Income Tax Department, for the reasons best known to the revenue, they have allotted a PAN containing alphabet 'F', which has been done in the case of Indian firms. Consequently, due to 'F' mentioned in PAN, the Income Tax system of the Department did not allow the assessee to file its return of Income in ITR Form-6 applicable to companies. 12. It is submitted that, infact, during the course of hearing, the Ld. DR fairly empathized with the above predicament of the assessee due to technical glitch of Income Tax System of the Department. It was the submission that the aforesaid reasons compelled the assessee to file its return in ITR-5 instead of I....
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....sing the assessment order for AY 2022-23 wherein it is categorically specified by the Ld. AO that the assessee company is non-resident USA entity registered with Security Exchange Board of India (SEBI) as a Foreign Portfolio Investor (FBI). 15. It is also submitted that the assessee has applied for PAN in Form 49AA applicable to entities incorporated outside India which is accepted by the Department. Therefore, as per settled principle of law, the issue/claim which is debatable cannot be disallowed by way of prima facie adjustment in order u/s 143(1)(a) of the Act. To support the aforesaid contention, Ld. AR has placed his reliance on the following decisions: Sr. No. Case Name Citation 1. Bajaj Auto Finance Ltd. v. Commissioner of Income-tax, Pune [2018] 93 taxmann.com 63 (Bombay)/[2018] 404 ITR 564 (Bombay) 2. Khatau Junkar Ltd. v. K.S. Pathania [1992] 61 Taxman 157 (Bombay)/[1992] 196 ITR 55 (Bombay)/[1992] 102 CTR 194 (Bombay) 3. Commissioner of Income-tax v. Orbit Travel & Tours (P.) Ltd. 241 ITR (St) 125 (SC) to 126 and [1999] 238 ITR 931 (Andhra Pradesh)/[2000] 161 CTR 275 (Andhra Pradesh) [SLP dismissed filed by Department in ITC No. 12....
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....r, Exempt [2024] 161 taxmann.com 773 (Kolkata - Trib.) 3. Income-tax Officer (Exemption) v. Camellia Educare Trust [2023] 152 taxmann.com 304 (Kolkata - Trib.) 17. Ground No.4 regarding applicability of tax rate u/s 115BBDA. Since the same has been rectified by the Revenue vide order passed u/s 154 of the Act, consequently, the assessee has not pressed such ground before the Ld. CIT(A). The Ld. CIT(A) has dismissed the ground of assessee, whereas it ought to have been dismissed the same as not pressed being infructuous. 18. Ground No.5 of the assessee pertains to levy of interest u/s 234A, 234B and 234C. It is consequential in nature and can be decided in accordance with the decision of primary grounds raised by the assessee. 19. Ground No.6 of the assessee is general in nature and requires no adjudication. 20. Based on aforesaid submissions, the assessee has prayed as under: "In light of the above facts, submissions and case laws, the appellant most humbly prays, your Honour to kindly allow it the carry forward of the short-term capital loss as claimed by the appellant in its return of income for A.Y. 2018-19 and oblige. The appellant is inde....
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....t source, any advance tax paid, any relief allowable under an agreement under section 90 or section 90A, or any relief allowable under section 91, any rebate allowable under Part A of Chapter VIII, any tax paid on self-assessment and any amount paid otherwise by way of tax or interest; (d) an intimation shall be prepared or generated and sent to the assessee specifying the sum determined to be payable by, or the amount of refund due to, the assessee under clause (c); and (e) the amount of refund due to the assessee in pursuance of the determination under clause (c) shall be granted to the assessee: 22. It is further submitted that provisions of section 143(1)(a) are restricted to make only the aforesaid adjustments. 23. Ld. AR in rebuttal to the aforesaid contentions raised by the Ld. DR, has re-submitted his contentions at length and have also filed a written synopsis before us, which is considered. 24. We have considered the rival submissions, perused the material available on record and the judicial pronouncements relied upon by the parties. Admittedly, the assessee is a limited partnership under Delaware, USA, as per certificate issued by the Secretar....
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....e of the above clauses (i) of section 2(23)of the Act. In our view this preposition alone cannot decide the status of person under India Income Tax Act, it is also required to substantial that the assessee was incorporate as a corporate assessee by Delaware Code. (ii) As per decision of Hon'ble NCLT in the case of Jeevantika Organic Farming LLP vs. India Convention & Culture Center Pvt Ltd (supra) a foreign LLP would be a body corporate, incorporated outside India and thus would be considered as its foreign company in India under the Companies Act, 2013. As discussed hereinabove while dealing with the contentions of the assessee, we noted the decision of Hon'ble NCLT in the aforesaid case according to which an LLP incorporated outside India have been permitted to merge/amalgamate with an Indian company and were to be considered as a foreign company. (iii) On this aspect, the decision of ITAT Delhi in the case of Consulting Engineer Corporation v. JDIT (OSD) would also be relevant wherein the ITAT has observed that as per provisions of the Income Ta Act, anybody corporate, incorporated by or under the laws of any country outside has to be treated as a company. Therefore, they ....
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....imilar nature, provided, however, that (b) in the case of income derived or paid by a partnership, estate, or trust, this term applies only to the extent that the income derived by such partnership, estate, or trust is subject to tax in that State as the income of a resident, either in its hands or in the hands of its partners or beneficiaries. 29. On a thoughtful consideration of the aforesaid clauses of the Indo-US Treaty, a Limited Partnership (LP) established in the USA would be treated a "Company" in India for income tax purpose, only if it satisfies the condition of being "any body corporate or any entity which is treated as a company or body corporate for tax purposes." Further, in the absence of any specific clarification in the Treaty, as to whether an LP should be treated as a "body corporate", and considering that such entities are treated as fiscally transparent for tax purposes under the relevant tax laws, the LP would have to satisfy one more test, namely, whether its income is taxable in the hands of the LP itself or in the hands of its partners. 30. If the LP is taxed as an entity in the USA, it may be treated as a corporate entity for income-tax purp....
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....ich the fourth letter (alphabet) was "F", which means that the assessee was having the status of a firm when the PAN was allotted. Further, the assessee had filed its returns in various years under the status of a 'firm' only. However, since there was no loss in the assessee's business, the assessee remained unaffected. Therefore, the question of treating the assessee as a corporate entity or firm did not arise, as the assessee was not prejudiced by any adverse inference drawn by the Department by way of any addition or disallowance. On this aspect, we cannot find fault with the processing of the assessee's return by the CPC as a firm in India, particularly when the PAN had been issued to the assessee with the status of 'firm', which was never disputed by the assessee, nor was any attempt made by the assessee to have the same corrected before the Revenue Authorities. 32. The CPC is engaged only in processing of the return in accordance with the provisions of section 143(1), having limited and restricted powers within the scope prescribed under section 143(1)(a). The scope of adjustments to be made under the provisions of section 143(1)(a) is limited, as culled out by us hereinab....