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Income Tax Appellate Tribunal, “B’’BENCH: BANGALORE
Before: SHRI GEORGE GEORGE K. & SHRI B.R. BASKARAN
PER B.R. BASKARAN, ACCOUNTANT MEMBER:
The assessee ha filed this appeal challenging the assessment order dated 22.3.2021 passed by the A.O. for assessment year 2007-08 u/s 143(3) r.w.s. 254 r.w.s. 92CA & 144C of the Income- tax Act,1961 ['the Act' for short].
Though the assessee has raised many grounds of merits of various additions made in the assessment order, the Ld. A.R. submitted that the impugned assessment order is non-est in the eyes of law in view of the decision rendered by the Hon’ble High Court of Karnataka in IT appeal No.506/2018.
IT(IT)A No.166/Bang/2021 Google Ireland Limited, Ireland
3. The Ld. A.R. submitted that the facts relating to his case has been captured by the coordinate bench of Tribunal in S.P. No.54/Bag/2021 dated 3.9.2021 as under:
“2. This case has got a chequered history. The AO had initially passed the assessment order for the year under consideration, in pursuance of directions given by Ld Dispute Resolution Panel (DRP), wherein an income of Rs.93.66 crores was assessed as Royalty. Consequent thereto a demand raised upon the assessee. The assessee challenged the above said assessment order by filing appeal before the ITAT, which was numbered as IT(IT)A No.2845/Bang/2017. The above said appeal was disposed of by the Tribunal along with some other appeals; vide common order dated 11- 05-2018 by restoring all the matters to the file of the AO with the direction to reframe the assessment in the light of observations made by the Tribunal and also in accordance with law. 2.1 Since all the matters were restored to the file of the AO, the assessing officer passed a fresh draft assessment order for the year under consideration on 26.12.2019. The assessee filed its objections before Ld DRP, which gave its directions on 15.2.2021. Accordingly, the assessing officer passed final assessment order on 22.3.2021, wherein he raised a demand of Rs.37.72 crores. The assessee challenged the final assessment order by filing appeal before the Tribunal on 19-04-2021 along with the present Stay application. The said appeal has been numbered as IT(IT)A No.166/Bang/2021.
In the mean time, the assessee challenged the order passed by the Tribunal on 11.05.2018 in IT(IT)A No.2845/Bang/2017 by filing appeal before Hon’ble High Court of Karnataka. The said appeal was numbered as ITA 506/2018. The appeal so filed came to be disposed of by the Hon’ble High Court, vide its common order dated 17th April, 2021 along with other appeals filed by a group company named M/s Google India Private Ltd. The Hon’ble High Court passed following order:- “36. Net result is, 505/2018, 549/2018, 550/2018, 504/2018, 503/2018, 507/2018, 560/2018, 562/2018, 561/2018, 563/2018, 564/2018 and 506/2018 are allowed. The order passed by the Tribunal in the said appeals are set aside and the matters are remanded back to the Tribunal to decide the appeals afresh in accordance with law. The parties will appear before the Tribunal on 3.5.2021 and within a period of 15 days the appellant shall be free to file the documents/additional documents in support of his contentions and the revenue shall also be free to file documents/additional submissions in support of their
IT(IT)A No.166/Bang/2021 Google Ireland Limited, Ireland Page 3 of 5 contentions. In case any other material is being relied upon by the Tribunal, the same shall also be made available to the assessee/appellant as well as to the counsel for revenue before passing a final order. The Tribunal is requested to make all possible endeavour to decide the matters at an earlier date.”
4. The Ld A.R submitted that the assessing officer has passed the impugned assessment order in order to give effect to the order passed by the Tribunal. However, the said order of the Tribunal has since been set side by the Hon’ble High Court of Karnataka. Accordingly, he submitted that the entire tax demand raised on the assessee by the impugned assessment order deserves to be set aside. He submitted that, on this reasoning alone, the assessee deserves full stay of the outstanding demand. He further submitted that the assessee’s appeal deserves to be allowed on merits also.”
The Ld. A.R. submitted that the A.O. has passed the impugned order in order to give effect to the order dated 11.5.2018 passed by the Tribunal and the said order of the Tribunal has since been set aside and restored to the file of the Tribunal by Hon’ble High Court of Karnataka, meaning thereby, the initial appeal filed before the Tribunal against the original assessment order has been revived. Since the order dated 11.5.2018 passed by the Tribunal has been set aside by the Hon’ble High Court of Karnataka, the impugned assessment order passed to give effect to the order dated 11.5.2018 passed by the Tribunal become non-est in the eyes of law. Accordingly, he pleaded that the impugned assessment order should be quashed.
The Ld. D.R. did not object to the factual aspects presented by Ld. A.R. He submitted that the A.O. has brought out many aspects in the impugned assessment order and accordingly submitted that the revenue should not be precluded from presenting those facts/aspects before the Tribunal when the earlier appeal is heard afresh.
IT(IT)A No.166/Bang/2021 Google Ireland Limited, Ireland
Page 4 of 5 6. We heard the rival contentions and perused the record. We find merit in the submissions made by Ld. A.R. It is an admitted fact that the impugned assessment order has been passed by the A.O. in order to give effect to the order dated 11.5.2018 passed by the Tribunal in IT(IT)A No.2845/Bang/2017. The above said order of the Tribunal has since been set aside by the Hon’ble High Court of Karnataka and the entire matters have been restored to the file of the Tribunal to decide the appeal afresh in accordance with law. Hence, the impugned assessment order does not have legs to stand on its own, since it is non-est in the eyes of law.
We notice that the Hon’ble High Court of Karnataka, while restoring the matters to the file of the Tribunal, has made it clear that both the parties are entitled to make fresh submissions and also entitled to file additional documents in support of the contentions. Hence the prayer of Ld D.R has already been addressed by Hon’ble High Court. Accordingly, all the issues are kept open.