ANHEUSER BUSCH INBEV INDIA LIMITED,MUMBAI vs. DCIT CIRCLE 9(1)(2), MUMBAI

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ITA 7396/MUM/2018Status: DisposedITAT Mumbai24 February 2022AY 2014-154 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the issue to the Assessing Officer for denovo adjudication, considering the additional evidence of reversal of provision and utilization for other expenses. The Assessing Officer was directed to ensure no double taxation occurs.

What were the facts?

The assessee challenged the disallowance of commission expenses for non-deduction of tax at source. The assessee provided details of TDS certificates and submitted that the provision for commission was reversed in a subsequent financial year and utilized for other expenses.

What were the issues?

Whether commission expenses are disallowable for non-deduction of TDS when the provision was reversed and utilized for other expenses in a subsequent year, leading to potential double taxation.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘K ‘ BENCH

Before: SHRI VIKAS AWASTHY & SHRI M.BALAGANESH

For Appellant: Shri Rajan R. Vora / Shri Hemen
For Respondent: Dr. Yogesh Kamat
Hearing: 10/02/2022Pronounced: 24/02/2022

आदेश / O R D E R PER M. BALAGANESH (A.M):

1.

This appeal in A.Y.2014-15 preferred by the assessee against the final assessment order passed by the Assessing Officer dated 25/10/2018 u/s.143(3) r.w.s. 144C(13) of the Income Tax Act, hereinafter referred to as Act, pursuant to the directions

M/s. Anheuser Busch InBev India Limited of the ld. Dispute Resolution Panel-1 (West Zone) (DRP in short) u/s.144C(1) of the Act dated 18/09/2018 respectively for the A.Y.2014- 15.

2.

The Ground Nos.2-2.1 and 3 – 3.5 raised by the assessee for A.Y.2014- 15 are identical with Ground Nos.3-3.4 raised by the assessee for A.Y. 2012-13 and the decision rendered hereinabove for A.Y.2012-13 shall apply with equal force for this assessment year also except with variance in figures.

3.

The Ground Nos.4.1-4.4 raised by the assessee for A.Y.2014-15 are identical to Ground No.4- 4.4 raised for A.Y.2012-13 and the decision rendered for A.Y.2012-13 shall apply with equal force for this assessment year also except with variance in figures.

4.

The Ground Nos. 5.1 to 5.4 raised by the assessee for A.Y.2014-15 are identical to Ground Nos. 6- 6.4 raised by the assessee for A.Y.2012-13 and the decision rendered there on would apply with equal force for this assessment year also except with variance in figures.

5.

The Ground Nos. 6.1 – 6.4 raised by the assessee are challenging the disallowance of commission expenses of Rs.1,04,44,122/- u/s.40(a)(ia) of the Act for non-deduction of tax at source. During the course of assessment proceedings, the ld. AO asked the assessee to submit details of tax deducted in respect of the commission paid to agents. In this regard, the assessee submitted a party-wise list of commission paid to the agents amounting to Rs 39,02,11,468/- along with copies of TDS certificates and sample Form I6A issued to substantiate that appropriate

M/s. Anheuser Busch InBev India Limited taxes have been deducted by the assessee during the year under consideration. Further, the assessee submitted that the total amount of Rs.39,02,11,468/- recorded in the profit and loss account for the year comprises of commission of Rs.37,97,67,346/- for the year and the balance amount comprises of year end accrual of Rs.31,20,024/- on account of commission liability towards unidentified parties and Rs.73,24,098/- on account of disputed commission.

6.

Though assessee had filed additional evidences before the ld. DRP by stating that the entire provision amounting to Rs. 1,04,44,122/- has been reversed by the assessee during the F.Y.2016-17 and the provision has been utilized for certain expenses in the nature and distributor leakage claims, sedimentation claims and transit breakage claims. The assessee also submitted that it had duly deducted applicable taxes on the expenditure in the year in which these provisions were actually utilized and had deposited the TDS to the account of the Central Government. These facts were not appreciated by the lower authorities. Hence, we deem it fit to restore this issue to the file of the ld. AO for denovo adjudication in accordance with law and also in the light of additional evidences furnished by the assessee. The ld. AO should ensure that there is no double taxation in this regard. If a particular sum has been already reversed by the assessee in the subsequent assessment year then, disallowing the same sum in the year under consideration would result in double taxation. This aspect has to be looked into by the ld. AO while dealing with this issue in the set aside proceedings. Accordingly, the Ground Nos. 6.1 – 6.4 raised by the assessee are allowed for statistical purposes.

M/s. Anheuser Busch InBev India Limited

7.

In the result, the appeal of the assessee in A.Y.2014-15 is partly allowed for statistical purposes.

Order pronounced on 24/02/2022 by way of proper mentioning in the notice board.

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