Idiada Automotive Technology, S.A., ... vs Assessee

Idiada Automotive Technology, S.A., vs DDIT, International Taxation, S. Kalyanasundaram, Circle 3(2), New Delhi. 1A, 240 N.S.C. Bose Rod, Kolkata (PAN: AABCI5985Q) (Appellant) (Respondent) Appellant by: Shri S. Kalyanasundaram, Respondent by : Shri Binod Kumar, CIT DR Date of Hearing: 10.3.2015 Date of pronouncement:13.03.2015 ORDER

PER CHANDRA MOHAN GARG, JUDICIAL MEMBER

The above appeal has been preferred by the assessee against the order of

the AO dated 25.4.2013 passed u/s 154 of the Income Tax Act, 1961 (for short

the Act) in respect of the order u/s 143(3)/144C of the Act in pursuance of

direction of Dispute Resolution Panel (DRP) for AY 2009-10.

2. We have heard arguments of both the sides and carefully perused the

relevant material placed on record. Ld. Assessee's representative pointed out

that the AO completed assessment u/s 143(3) of the Act at the income of

1 ITA NO.3912/Del/2013 Asstt.Year: 2009-10

Rs.1,05,82,486 and raised a demand of Rs.63,90,663 and the assessee received

this order on 30.10.2012. Ld. DR further pointed out that the assessee filed an

application for rectification u/s 154 of the Act on 6.11.2012 which was partly

allowed by the AO but the AO did not properly adjudicate the issue raised by

the assessee in its application u/s 154 of the Act raised in point no. 6 and 7

therein. Ld. AR also pointed out that in the impugned order of rectification

dated 25.4.2013, the AO has given deduction of Rs.11,17,616 towards TDS but

the total claim of TDS was Rs.45,41,322 as per reconciliation of income and

TDS for AY 2009-10.

3. Ld. DR replied that he is unable to explain the amount of Rs.1117616 as

mentioned in the impugned order of rectification passed u/s 154 of the Act.

However, ld. DR fairly accepted that with regard to the issues raised by the

assessee at point no. 6 and 7 of the rectification application filed u/s 154 of the

Act, the AO has not paid any heed while adjudicating the application of the

assessee for rectification. Ld. DR finally submitted that the department has no

serious objection if the disputes emerging from point no.6 and 7 of rectification

application of the assessee are directed to be adjudicated by the AO after

affording due opportunity of hearing for the assessee.

4. On careful consideration of above submissions, we note that in the

rectification application filed by the assessee u/s 154 of the Act on 6.11.2012,

the issue of tax computation in regard to rate of taxation and TDS has been

2 ITA NO.3912/Del/2013 Asstt.Year: 2009-10

raised by the assessee in para no. 6 and 7 of the rectification application which

read as under:-

"Refer tax computation served along with Notice of Demand u/s 156: In the said calculation, the rate of taxation that has been applied for FTS (INR 89,78,850/-) is 40% instead of 10%. Similarly, the rate of taxation applied on interest income (INR 4,07,849/-) is 40% instead of 15%. Note that in the case of interest and FTS, there will be no surcharge on taxes in terms of the DTAA between India and Spain because the term "taxes "includes any surcharges. Note further that as per ruling of Hon'ble ITAT Kolkata in DIC Asia Pacific Pte Ltd. vs ADIT International Taxation (1) Kolkta, the term "taxes" in DTAA also include E-cess. Therefore, no E-Cess/SHE Cess may be charged either.

7. Refer tax computation served along with Notice of Demand: Credit for TDS has not been given although TDS Certificates had been submitted. In any event, they are attached herewith for a total of INR 45,41,322/-."

5. On vigilant perusal of the impugned rectification order passed by the AO

u/s 154 of the Act, we note that the AO has given credit of Rs.1117616 to the

assessee and we are unable to understand the basis and source of this figure.

However, ld. AR has filed a statement showing reconciliation of income and

TDS claimed for AY 2009-10 which is also in accordance with point no. 7

which was raised in the rectification application. Ld. AR has also drawn our

attention towards detailed synopsis and Instruction no. 04/2013 of CBDT dated

5.7.2013 to support his contentions. From bare reading of the impugned

rectification order, we clearly observe that the AO has not addressed and

adjudicated the issue raised by the assessee in point no. 6 and 7 of the

3 ITA NO.3912/Del/2013 Asstt.Year: 2009-10

rectification application. This fact has also been conceded by the ld. DR during

the arguments placed before us.

6. Hence, we are of the considered opinion that the issues raised by the

assessee at point no. 6 and 7 in the rectification application require proper

adjudication by the AO, therefore, we restore these issues to the file of the AO

for proper adjudication after affording due opportunity of hearing for the

assessee.

7. In the result, the appeal of the assessee is deemed to be allowed for

statistical purposes in the manner as indicated above.

Order pronounced in the open court on 13.03.2015.

Sd/- Sd/-

(S. V. MEHROTRA) (CHANDRAMOHAN GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER

DT. 13th MARCH 2015 'GS' Copy forwarded to:-

1. Appellant 2. Respondent 3. C.I.T.(A) 4. C.I.T. 5. DR By Order

Asstt.Registrar

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