9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (4) TMI 1512 - AT - Income TaxMaintainability of the appeal before the Tribunal against the order passed u/s 172 - Appealable orders u/s 246 - Appeals to the Appellate Tribunal u/s 253 - provision for filing of the appeal against the order passed by the AO u/s 172 of the Act either before the Commissioner of Income Tax (Appeals) or before the Tribunal - DR had submitted that neither the CIT(A) nor this Tribunal is empowered to adjudicate these appeals against the order passed under section 172 - provisions of DTAA applicability even at the stage of passing order u/s 172(4) of the Act? - HELD THAT - We do not agree with the contention of the ld.DR that the appeals filed by the assessee are not maintainable before us. Accordingly the objection raised by the Revenue about the maintainability of the appeals is dismissed. Further we may point out that the present appeals are filed by the assessee after feeling aggrieved by the separate orders passed by the CIT(A) for non-grant of relief and the ld.CIT(A) has not dismissed the appeals on account of non-maintainability of the appeals before him. Ld.CIT(A) has decided the issue on merit hence the impugned orders passed by the ld.CIT(A) falls within the realm of section 253 of the Income Tax Act against which the assessee had preferred appeal before us. Accordingly the preliminary objection raised by the Revenue is dismissed. Benefit of Article 8 of Double Taxation Avoidance Agreement (hereinafter referred as DTAA ) denied - In the present case as per the undisputed fact for the year under consideration the agent filed an application on behalf of the company for grant of NOC in respect of Vessel MV PAC ALKAID . The vessel departed from Krishnapatnam Port on 09.10.2014 to Houston USA with a cargo of 7302.99 MT of Seamless Pipes. The total freight rate was USD 88 per MT which works out to total USD 642663. However in the proceedings the agent claimed that the entire freight earned by the freight beneficiary is exempt from tax in India in view of DTAA and therefore the necessary benefit be given to the assessee. The agent of the assessee filed return on 07.11.2014 u/s 172(3) of the Act and along with return the copy of the bank account in support of the remittance of freight was also placed on record. For the present controversy it is undoubtedly clear that only the above said amount USD 621169 was remitted to the Singapore bank account and the remaining amount i.e. USD 22493 subject matter of the appeal was not remitted to the Singapore bank account and was allegedly adjusted towards the commission paid to the said Bertling. Therefore in our considered opinion the appellant / assessee is only entitled to the benefit of DTAA for the amount remitted or received. There is no doubt that the actual amount received by the assessee was USD 621169 and the remaining amount was neither received by the assessee nor accounted in its books of account Hence the Assessing Officer and the ld.CIT(A) were right in applying Article 24 r.w. Article 8 and hence we do not find any merit and therefore the appeal of the assessee is required to be rejected. The assessee has not discharged his onus as no document was filled in this regard. In the present case the AO / ld.CIT(A) had already granted the benefit of DTAA to the assessee as it has only restricted the benefit to the extent of the amount received we do not find the judgment in the case of Emirates Shipping Line FZE 2012 (7) TMI 806 - DELHI HIGH COURT is of any use for the purpose of determining the present controversy. No other judgment was cited by the ld.AR before us. Therefore we do not find any merit in this regard. Accordingly the appeal of assessee is dismissed.
Issues Involved:
1. Maintainability of appeals against orders passed under section 172 of the Income Tax Act. 2. Applicability of Article 8 and Article 24 of the Double Taxation Avoidance Agreement (DTAA) between India and Singapore. 3. Determination of tax liability under section 172(4) of the Income Tax Act. Detailed Analysis: 1. Maintainability of Appeals: The primary issue was whether appeals against orders passed under section 172 of the Income Tax Act are maintainable before the Commissioner of Income Tax (Appeals) and subsequently before the Income Tax Appellate Tribunal (ITAT). The appellant argued that there is no provision for filing an appeal against the order passed by the Assessing Officer under section 172 of the Act either before the Commissioner of Income Tax (Appeals) or before the Tribunal. The respondent countered that the appellant could question the order under section 172(4) through section 172(7) and that the Tribunal does not have jurisdiction to adjudicate appeals against orders under section 172. The Tribunal, however, referred to a precedent from the case of MSC Agency (India) (P) Ltd., which established that such appeals are maintainable. The Tribunal concluded that the appeals are maintainable and dismissed the preliminary objection raised by the Revenue. 2. Applicability of Article 8 and Article 24 of DTAA: The appellant contested the tax liability by invoking Article 8 of the India-Singapore DTAA, which states that profits derived from the operation of ships in international traffic shall be taxable only in the state of residence, i.e., Singapore. The Assessing Officer, however, applied Article 24 of the DTAA, which limits relief to the amount remitted to or received in the other contracting state. The Tribunal examined the interplay between Article 8 and Article 24 and concluded that while Article 8 governs the taxation of profits, Article 24 limits the relief to the amount actually remitted or received in Singapore. The Tribunal noted that the appellant did not provide sufficient evidence to show that the entire freight amount was remitted to Singapore, and therefore, only the amount actually remitted was eligible for relief under the DTAA. 3. Determination of Tax Liability under Section 172(4): The Tribunal reviewed the assessment under section 172(4), which allows for summary assessment of tax on freight paid to non-resident ship owners or charterers. The Tribunal noted that the Assessing Officer had applied the provisions of section 172 correctly and that the proceedings under section 172(4) are summary in nature. The Tribunal also referenced the Supreme Court's judgment in A.S. Glittre, which held that section 172(4) proceedings are summary and that the assessee has a right under section 172(7) to opt for a regular assessment. The Tribunal found that the appellant had not exercised this right and therefore could not challenge the applicability of Article 24 at this stage. Conclusion: The Tribunal dismissed all the appeals filed by the appellant, upholding the orders passed by the Assessing Officer under section 172(4) and confirming the application of Article 24 of the DTAA to limit the relief to the amount actually remitted to Singapore. The Tribunal emphasized that the provisions of section 172 and the DTAA were correctly applied, and the appellant's arguments did not warrant any modification of the tax liability determined by the Assessing Officer.
|
