ASSISTANT COMMISSIONER OF INCOME TAX, (IT), CIRCLE-1,, PUNE vs. JOHN DEERE INDIA PVT. LTD,, PUNE

Since identical facts and issues are involved in all these appeals, we proceed to hear these appeals together and disposed of the same vide this common order.

For the sake of clarity and convenience, we would take up the relevant facts stated in for the assessment year 2010-11 for adjudication. ITA No.935/PUN/2019 A.Y.2010-11

The brief facts in this case are that the respondent assessee is a company incorporated under the provisions of Indian Companies Act, 1956. It is engaged in the business of manufacture and sale of agricultural equipment. During financial year 2009-10, the TDS Officer/DCIT(IT)-1, Pune found that the respondent assessee had not deducted the tax at source on the payment to the foreign company as per Section 201(1) & 201(1A) of the Income Tax Act, 1961 (hereinafter referred to as „the Act‟). Then the TDS Officer/ DCIT(IT)-1, Pune had proceeded to issue show cause notice vide letter dated 22nd March, 2017 calling upon the respondent assessee as to why the assessee should not be held as “assessee in default” for not-deducting of tax u/s.201 of the Act on the above payments. In response to the show cause notice, it was submitted by the respondent assessee that the provision of Section 195 of the Act have no application as the respondent assessee purchased off the shelf software product licenses and the same were in the nature of reimbursement of proportionate cost paid by foreign company Deere & Co., USA to Microsoft in respect of the licenses allotted to the assessee company. As there is no profit element embedded in the said payment, the question of TDS does not arise. Similarly, the assessee submitted that it has made payments on account of network access line charges. However, the TDS Officer/ DCIT(IT)-1, Pune placing reliance his own order in assessee‟s own case passed u/s.201(1A) of the Act dated 29.03.2016 in financial year 2008- 09 has rejected the above submissions and proceeded to pass order u/s.201(1) of the Act by holding the assessee, “assessee in default” and levied interest u/s.201(1A) of the Act vide order dated 29.03.2017.

Being aggrieved by the above order, an appeal was preferred before the Ld. CIT(Appeals) who vide impugned order placing reliance on the order of the Tribunal in assessee‟s own case in earlier assessment years 2007-08 & 2008- 09 had quashed the proceedings u/s.201(1) & 201(1A) of the Act. Being further aggrieved, the Revenue is in appeal before us.

When the matter was called on, the Ld. AR for the assessee submitted that in the context of disallowance u/s.40(a)(ia) of the Act for the assessment year 2010-11 in respect of the very same payment, the Tribunal considering the additional evidences filed before it, had remanded the matter to the file of the Assessing Officer for de-novo adjudication. In the light of that fact, the Ld. AR submits before us that the matter be remanded to the file of the Assessing Officer on similar lines for the year under consideration also.

On the other hand, the Ld. Sr. DR did not raise serious objection with regard to the submissions made by the Ld. AR.

We have heard the rival submissions and perused the materials available on record. The issue raised in the present appeal relates to non- deduction of TDS on the payment made to foreign company namely, Deere & Co., USA. The Tribunal in assessment year 2010-11 had remanded the issue to the file of the Assessing Officer for considering certain additional evidences filed by the assessee in the context of disallowance u/s.40(a)(ia) of the Act in respect of the very same payment. In these circumstances, we are of the considered view that in the interest of justice, the matter be remanded to the file of the Assessing Officer for de-novo consideration of the issue raised in appeal considering additional evidences filed before him in the assessment year 2010-11 and adjudicate the same in accordance with law.

In the result, appeal of the Revenue in for the assessment year 2010-11 is allowed for statistical purposes. & 937/PUN/2019 A.Ys. 2010-11 & 2014-15

Both the parties unanimously agreed that identical issues and facts are involved in these two appeals i.e. & 927/PUN/2019 for the assessment years 2010-11 & 2014-15. Therefore, our decision rendered in ITA No.935/PUN/2019 for the assessment year 2010-11 shall mutatis- mutandis apply in ITA Nos. 936 & 937/PUN/2019 for the assessment years 2010-11 & 2014-15 also.

In the result, appeals of the Revenue in & 937/PUN/2019 for the assessment years 2010-11 & 2014-15 are allowed for statistical purposes.

In the combined result, all the appeals of the Revenue are allowed for statistical purposes.