PR. COMMISSIONER OF INCOME TAX-09 vs. VALVOLINE CUMMINS LTD

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ITA/1031/2015HC DelhiDLHC01552511201531 July 2017Bench: HON'BLE DR. JUSTICE S.MURALIDHAR,HON'BLE MS. JUSTICE PRATHIBA M. SINGH2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that no substantial question of law arose for consideration in the present appeal. The Court noted that the Assessee's appeal against the same impugned order had been allowed by a separate order on the same day. In that order, the Court had agreed with the Assessee that the Revenue had failed to establish the existence of an international transaction between the Assessee and its Associated Enterprise involving AMP expenses. Given this context and the fact that the Supreme Court's decision in the Sony Ericsson case was awaited without any stay, the High Court found no basis to entertain the Revenue's appeal. Therefore, the appeal was dismissed. The operative direction was the dismissal of the appeal.

What were the facts?

The Pr. Commissioner of Income Tax-9 (Appellant/Revenue) filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 31st March, 2015, passed by the Income Tax Appellate Tribunal (ITAT) in ITA No. 608/Del/2015 for Assessment Year 2010-11. The Revenue's appeal was based on the fact that it had challenged a prior decision of the Delhi High Court in Sony Ericsson Mobile Communications India Pvt. Ltd. v Commissioner of Income Tax-III (2015) 276 CTR (Del) 97 before the Supreme Court. The Supreme Court's decision in the Sony Ericsson case was awaited, and no stay had been granted. The High Court noted that it had decided several cases following the Sony Ericsson decision, and in the present case, the Assessee's appeal against the same impugned order had been allowed by a separate order on the same day.

What were the issues?

1. Whether a substantial question of law arises for consideration in the appeal filed by the Revenue, given that the Supreme Court's decision in the case of Sony Ericsson Mobile Communications India Pvt. Ltd. v Commissioner of Income Tax-III (2015) 276 CTR (Del) 97, which the Revenue had challenged, was still awaited and no stay had been granted. Assessee's Contention: The Assessee's appeal against the same impugned order had been allowed by a separate order on the same day, agreeing with the Assessee that the Revenue had failed to establish the existence of an international transaction between the Assessee and its Associated Enterprise (AE) involving Advertisement and Marketing Promotion (AMP) expenses. Revenue's Contention: The Revenue's appeal was predicated on its challenge to the Delhi High Court's decision in the Sony Ericsson case before the Supreme Court. The Revenue implicitly argued that the present appeal should be considered in light of the pending Supreme Court decision.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

ITA 1031/2015

Page 1 of 2

$~8 * IN THE HIGH COURT OF DELHI AT NEW DELHI

ITA No. 1031/2015

PR. COMMISSIONER OF INCOME TAX-9

..... Appellant

Through: Mr. Ruchir Bhatia, Senior Standing

Counsel.

versus

VALVOLINE CUMMINS LTD.

..... Respondent

Through: Mr. Ajay Vohra, Senior Advocate with

Mr. Neeraj Jain & Mr. Aniket D.

Agrawal, Advocates.

CORAM: JUSTICE S. MURALIDHAR JUSTICE PRATHIBA M. SINGH

O R D E R %

31.07.2017

1.

This appeal, under Section 260A of the Income Tax Act, 1961 (‘Act’), is directed against an order dated 31st March, 2015 passed by the Income Tax Appellate Tribunal (‘ITAT’) in ITA No. 608/Del/2015 for the Assessment Year (‘AY’) 2010-11.

2.

The ground on which the Revenue has come in appeal is that the Revenue has already challenged the decision of this Court in Sony Ericsson Mobile Communications India Pvt. Ltd. v Commissioner of Income Tax-III (2015) 276 CTR (Del) 97 before the Supreme Court.

3.

The decision of the Supreme Court in the appeals filed by the

ITA 1031/2015

Page 2 of 2

Revenue in Sony Ericsson Mobile Communications India Pvt. Ltd., is awaited. There has been no stay of the said decision by the Supreme Court.

4.

Meanwhile, following the said decision, this Court has, in several cases, decided the issues that have come before it in the appeals filed either by the Assessee or the Revenue. In the present case itself, against the same impugned order, the Assessee’s appeal has been allowed today by a separate order. The Court has agreed with the Assessee that the Revenue has failed to establish the existence of international transaction between the Assessee and the AE involving AMP expenses.

5.

In that view of the matter, no substantial question of law arises. The appeal is dismissed.

S. MURALIDHAR, J.

PRATHIBA M. SINGH, J. JULY 31, 2017 b’nesh

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