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Income Tax Appellate Tribunal, MUMBAI BENCHES, ‘A’ MUMBAI
Before: Shri Joginder Singh, & Shri Jason P. Boaz
आदेश / O R D E R Per Joginder Singh (Judicial Member) The instant appeal has been filed by the assessee for Assessment Year 2009-10 against the order of Ld.
M/s ASK Investment Managers Pvt. Ltd.
Commissioner of Income Tax (Appeals)-14, Mumbai dated 11/04/2014.
The grievance of the assessee revolves around question of taxation of investment advisory fees pertaining to different Assessment Years. The grievance relates both with amount of taxability and year of taxability. 2.1. The facts, in brief, are that the assessee is a private limited company who had filed its return of income for impugned assessment year on 30/09/2009. The same was processed u/s 143(3) of the Income Tax Act, vide Ld. Assessing Officer order dated 29/12/2011. Aggrieved, the assessee preferred appeal against the said order before the Ld. Commissioner of Income Tax (Appeals) and the same was disposed off vide order dated 27/02/2014, wherein, inter alia, a new addition of GBP 14,78,484/- was made by Ld. Commissioner of Income Tax (Appeals). This amount was related with advisory fees due from India Value Investment Ltd., which was not credited into the profit & loss account and while going through the documents available on record, the Ld. Commissioner of Income Tax (Appeals) enhanced the assessment to the extent of GBP 14,78,484/-. The second appeal against the instant order of Ld. Assessing Officer was filed before the ITAT, Mumbai Bench, vide ITA No.2394/Mum/2014. The Mumbai Bench of this Tribunal vide order dated 09/01/2015 held as under:- “13. We have heard the parties on this issue and perused the record. According to Ld A.R, the assessee has reached settlement with M/s India Value Investment Ltd with regard to the Investment Advisory fee received from them on 09-04-2009 and the amount due from M/s ASK Investment Managers Pvt. Ltd.
them was settled at GBP 12,14,022. According to Ld A.R, the assessee has offered the rupee equivalent of the above said amount in AY 2010-11. Since the assessee has settled the amount at GBP 12,14,022, we are of the view, of course subject to verification, that the income that should be considered in the hands of the assessee should not exceed the rupee equivalent of GBP 12,14,022 as per the Settlement agreement.
The next question that arises is the year in which the rupee equivalent of GBP 12,14,022 (subject to verification) is required to be assessed, i.e., in Assessment Year 2009-10 (as per Ld CIT(A) or in AY 2010-11 (as per the assessee) or in respective year of accrual (as per the revenue). We have already noticed that the Ld CIT(A) took the view to assess the entire amount of income in AY 2009-10 only for the reason that the assessee has failed to furnish the details. The submissions of the assessee that the settlement was reached on 09- 04-2009 and it has offered the entire amount of rupee equivalent of GBP 12,14,022 in Assessment Year 2010-11 are new facts that were not available before Ld CIT(A). Hence, in our view, the questions of ‘year of accrual’ and/or ‘year of assessment’ are to be considered afresh at the end of the Ld CIT(A) in the light of new facts brought on record by the assessee.
Accordingly, we set aside the order of Ld CIT(A) with regard to the assessment of GBP 14,78,484 or as the case may be GBP 12,14,022 and restore the same to his file with the direction to examine about the assessability of the same afresh, i.e., year of accrual and/or year of assessment, in the light of the facts surrounding the same and accordingly decide the issue in accordance with the law. The assessee is also directed to fully co-operate with the Ld CIT(A) by furnishing all the details that may be required to adjudicate this issue and that may be called for by Ld CIT(A).”
2.2. In the meantime, during the pendency of appeal before the ITAT and consequent to the order of the ld. CIT(A), the assessee filed an application for rectification u/s 154 of the Income Tax Act before the Ld. Commissioner of Income Tax (Appeals) raising following grounds:- i. “The entire disputed Investment Advisory Fees of Rs.10,07,63,267/- has been added in A.Y. 2009-10 and ii. The disputed income of investment Advisory Fees has been offered to tax by the assessee in A.Y. 2010-11 and therefore has requested to issue direction to the A.O. to reduce this income from A.Y. 2010-11.
M/s ASK Investment Managers Pvt. Ltd. iii. It is also stated that the total income received was only GBP of Rs.12,14,022/- on A.Y. 2010-11 and not GBP of Rs.14,78,484/- which has been considered in the appellate order of A.Y. 2009-10. 2.3. The order u/s 154 was passed by the Ld. Commissioner of Income Tax (Appeals) vide its order dated 11/04/2014, wherein, the matter was adjudicated as under:-
“3. From the appellate order it is evident that the enhancement of Rs.10,07,63,268/- has been discussed in detail and also the reasons have been provided as to why the income is considered in the A.Y. 2009-10. The claim of the appellant that the addition should be deleted in A.Y. 2010-11 is outside the purview of this appellate order. It requires fresh investigation of facts which is not within the realm of consideration during the year. Further, the receipt of less income by the appellant than the ascertained amount disclosed in the accounts in the subsequent year also requires fresh investigation of facts and is also outside the purview of consideration for A.Y. 2009-10. The argument of the A.R. that direction to be issued to A.O. to reduce the income in A.Y. 2010-11 is also rejected as its is outside the purview of adjudication of appeal for A.Y. 2010-11.
In view of the aforestated discussion the request of the assessee cannot be considered u/s 154 as this is not mistake apparent from record. Therefore, the rectification application filed by the appellant stands rejected and is dismissed.”
2.4. The present appeal has been filed against this order passed by the Ld. Commissioner of Income Tax (Appeals) u/s 154 of the Act. Before us, the Ld. AR has contended that the Ld. Commissioner of Income Tax (Appeals) be directed to make rectification as per application of the assessee filed u/s 154 of the Act. On the other hand, the ld. DR has supported the order of the Ld. Commissioner of Income Tax (Appeals) and contended that there is no mistake apparent from record and M/s ASK Investment Managers Pvt. Ltd. hence application u/s 154 of the assessee cannot be proceeded with on the issues raised by the assessee.
We have heard both the parties and noticed that the matter in dispute has already been decided by the Tribunal vide its order dated 09/01/2015 in ITA No.2394/Mum/2014. The clear cut direction have been given to the lower authorities as per paragraph nos. 13, 14 and 15 which have already been reproduced above. The order of the ITAT has been passed subsequent to the application of the assessee u/s 154 of the Act. The directions have already been given to examine the assessability of same afresh i.e. year of accrual and/or year of assessment. In view of the crystal clear directions of the ITAT, we need not interfere in the matter, therefore, we find no merit in the appeal of the assessee and the same is dismissed as infructuous. It is needless to say that the same income cannot be taxed twice and the assessee is at liberty to plead his case in this regard before lower authorities during proceedings. Finally, the appeal of the assessee is dismissed. This order was pronounced in the open court in the presence of the ld. representative from both sides at the conclusion of the hearing on 04/07/2016.