TETRA PAK INDIA PVT. LTD.,PUNE vs. DEPUTY DIRECTOR OF INCOME-TAX,

आदेश / ORDER

PER VIKAS AWASTHY, JM

These cross appeals by the Revenue and the assessee are directed

against the order of Commissioner of Income Tax(Appeals)-IT/TP, Pune dated 28.07.2014 for the assessment year 2007-08.

assessee-company is engaged in manufacturing and supply of carton

packages based on aseptic technology. During the period relevant to the assessment year under appeal, the assessee made foreign remittances for

acquiring software license, IT support services and for certain other

transactions. The Assessing Officer issued notice to the assessee on

18.09.2012 for furnishing details of foreign remittances made during Financial Year 2005-06 to 2011-12. The assessee vide communication dated

21.09.2012 complied with the directions of Assessing Officer and furnished

requisite details of foreign remittances. The Assessing Officer vide order

dated 30.03.2013 passed u/s.201(1) and 201(1A) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) held that the overseas payments

made by the assessee were taxable under the provision of the Act, as well as

under India’s Double Taxation Avoidance Agreement (DTAA) with respective

countries. The assessee ought to have deducted tax at source on such payments made to the parties abroad. Accordingly, the Assessing Officer

raised demand of Rs.70,19,865/- for assessment year 2007-08 towards tax

and interest.

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filed appeal before the Commissioner of Income Tax (Appeals) inter-alia

challenging validity of the said order on the ground of limitation. The

Commissioner of Income Tax (Appeals) rejected the ground raised by the

assessee challenging validity of order passed u/s.201(1) of the Act. However,

on merits, part relief was granted to the assessee. Hence, the present cross

appeals by the Revenue and assessee.

the outset that before examining the issue on merits, it would be necessary

to first adjudicate the issue of validity of order passed by the Assessing

Officer u/s.201(1) of the Act. The ld. AR of the assessee submitted that the

Assessing Officer has passed order u/s.201(1) and 201(1A) of the Act on

30.03.2013 for the assessment year 2007-08. The provision of sub-section

(3) to section 201(1) as they were applicable prior to the amendment by

Finance No. (2) Act, 2014 w.e.f. 01.10.2014 provides that the Assessing

Officer should have passed order for Financial Year commencing on or before

1st April, 2007 any time on or before 31st March, 2011. Whereas, in the

present case, the order has been passed after the date specified under the

Act. Thus, the order passed by the Assessing Officer beyond period of

limitation as mandated under sub section (3) to section 201 is not

sustainable. The ld. AR in support of his contentions placed reliance on the

decision of Co-ordinate Bench of the Tribunal in the case of Sandvik Asia

Private Limited Vs. DDIT, International Taxation-II, Pune in ITA No.

1515/PUN/2014 for assessment year 2007-08 decided on 11.01.2019.

vehemently defended the validity of order passed u/s.201(1) of the Act.

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and have perused the orders of Authorities below. Before adverting to the

merits of the addition, it is imperative to first adjudicate the validity or

otherwise of the order passed u/s. 201(1) and 201(1A) of the Act vide which

the assessee is held to be assessee ‘in default’ and demand has been raised.

Sub-section (3) to section 201 was inserted by Finance No. (2) Act, 2009

w.e.f. 01.04.2010. Thereafter, it was amended by the Finance Act, 2012 with

retrospective effect from 01.04.2010. The provisions of sub-section (3) as

they were applicable to assessment year 2007-08 reads as under:

“(3) No order shall be made under sub-section (1) deeming a person to be an assessee in default for failure to deduct the whole or any part of the tax from a person resident in India, at any time after the expiry of- (i) two years from the end of the financial year in which the statements is filed in a case where the statement referred to in section 200 has been filed; (ii) six years from the end of the financial year in which payment is made or credit is given, in any other case: Provided that such order for a financial year commencing on or before the 1st day of April, 2007 may be passed at any time on or before the 31st day of March, 2011.”

A bare perusal of the proviso to sub section (3) would show that any

order for Financial Year commencing on or before 1st April, 2007 is to be

passed at any time on or before 31.03.2011. In the present case, the order

relating to Financial Year 2006-07 (relevant to assessment year 2007-08) has

been passed on 30.03.2013 i.e. much beyond the date of 31.03.2011

specified in proviso to sub section (3) to section 201(1) of the Act. Therefore,

the order is barred by limitation and hence, the same is non-est.

of Tribunal in the case of Sandvik Asia Private Limited Vs. DDIT,

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International Taxation-II, Pune (supra.) where the Co-ordinate Bench of the Tribunal after considering the facts and proviso to sub section (3) to section 201 held that the orders passed on 25.03.2013 u/s.201(1) and 201(1A) for the assessment year 2007-08 are in-valid and unsustainable.

Sd/- Sd/- (डी. क�णाकरा राव/D. KARUNAKARA RAO) (�वकास अव�थी /VIKAS AWASTHY) लेखा सद�य/ACCOUNTANT MEMBER �या�यक सद�य/JUDICIAL MEMBER

पुणे / Pune; �दनांक / Dated : 3rd June, 2019. SB आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeals)-13, Pune. 4. The Pr. CIT-5, Pune. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “ए” ब�च, 5. पुणे / DR, ITAT, “A” Bench, Pune. गाड� फ़ाइल / Guard File. 6.

// True Copy// आदेशानुसार / BY ORDER,

�नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.

6 ITA No. 1856/PUN/2014 ITA No.1863/PUN/2014 A.Y.2007-08

Date 1 Draft dictated on 06.03.2019 Sr.PS/PS 2 Draft placed before author 29.05.2019 Sr.PS/PS 3 Draft proposed and placed JM/AM before the second Member 4 Draft discussed/approved by AM/JM second Member 5 Approved draft comes to the Sr.PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr.PS/PS 7 Date of uploading of order Sr.PS/PS 8 File sent to Bench Clerk Sr.PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R 11 Date of dispatch of order