9911796707
TMI Blog2016 (6) TMI 729X X X X Extracts X X X X X X X X Extracts X X X X ..... penditure incurred in respect of seconded employees under the Management Provision Agreement (MPA). 3. Briefly stated, the facts of the case are that the assessee is a Foreign Company incorporated in the USA. General Motors India Ltd. (GMIL) entered into Management Provision Agreement (MPA) with the assessee Company. The assessee Company raised invoices on GMIL on case to case basis, with no mark up and as per Clause 4 of the MPA; GMIL would reimburse the cost of remuneration of the seconded employees to the assessee. In terms of the MPA, the assessee makes available to GMIL executive personnel in the areas relating to development of general management, finance and purchasing, sales, marketing and assembling/manufacturing activities etc. During the course of assessment proceedings, the assessee was asked to furnish details of invoices raised for management fees, which shows total invoices at US $ 622117.58. The assessee vide letter darted 13-03-2004 furnished the details in respect of the expenses incurred for an amount of US $ 471497.93. In regard to the balance expenses, the assessee's representative vide order sheet noting dated 15-03-2004 was requested for the details. But, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er details before the AO. This clearly shows that the assessee has not declared the income to that extent of USD 150,619.75 in the return of income. The AR of the appellant clearly8 stated that there were no more invoices of expenditure to be submitted at the time of assessment. Therefore, the claim made during appellate proceedings is after thought. The appeal order was passed on 7-12-2004, even there the appellant failed to furnish the required supporting evidence. Accordingly, the profit computed was held to be right and justified. Thus, it appears that the claim which is made after the assessment is not correct and lacks supporting evidence. It is also difficult to believe that the assessee has not earned any profit from its Indian operations. 1.4.1 A perusal of the penalty order reveals that the AO has rejected the contentions on the basis that the assessee had admitted in the assessment proceedings that no more invoices were to be submitted. Further, CIT (A) has agreed with the AO that in absence of the documentary evidence it is difficult to accept the claim of the Appellant. The so called invoices purported to have been filed during penal proceedings before the AO were a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te particulars of income liable to attract penalty provisions under section 271 (1) (c) of the Act". Aggrieved against the action of CIT(A), for confirming levy of penalty, the assessee came in second appeal before the Tribunal. 5. We have heard the rival contentions and gone through the facts and circumstances of the case. Before us, the learned Counsel Ms Priyanka Gada for the assessee stated the facts of the case that the assessee almost all invoices (99.5%) raised to GMIL, being reimbursement cost incurred by the assessee were filed either during penalty proceedings or before CIT (A) during appellate proceedings, which in turn was referred to the AO for remand report. It was explained that out of total invoices raised of US $ 622117, the assessee submitted the details of US $ 471497 (approx. 76%) before the AO during the course of assessment proceedings vide submissions dated 13-03-2004 (there is no dispute on the same). The learned Counsel for the assessee explained that the AO disallowed expenses of US $ 150690 equal to amount of Rs. 69,93,275/- for the reason that to this extent the documentary evidences in respect of invoices raised and details of expenses incurred was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssary enquiries (if needed) before submitting the report. You may also provide sufficient opportunity of being heard to the appellant before sending the report. You are requested to submit the report on or before 16- 02-2009. 6. She also referred to the remand report of the AO given vide No. ADIT (IT)-3(1)/Remand Report/2010-11 dated 03-09-2010, wherein it is stated that the notice issued u/s 133(6) of the Act was returned un-served. The relevant part of the remand report reads as under, which is given at page 54-55 of the paper book filed by the assessee,:- "Please find enclosed herewith, a letter No.DDIT (IT)- 3(1)/Remand Report/2010-11 dated 30.04.2010 which was addressed to your office. As per the letter, a notice u/s 133(6) was issued to the concerned party and the reply was yet to be received, hence the remand report could not be submitted. It may be submitted that, a notice u/s 133 (6) was issued to The Principal Officer, North American Operations, General Motors Corporation Disbursement (2613), 16E Judson, Pontiac, MI. Along with the notice document relating to claim of expenses made by General Motors Overseas Corporation to tune of USD 122306 was also sent (copy of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the details of payment and tax paid by the concerned employees in US, as given at page 3 of the assessee's paper book wherein "paid amount" in the last column of the Table is shown as $26,500.00. 8. In view of the above facts, the learned Counsel for the assessee stated that the entire episode happened because the assessee could not lay its hands on the evidences at the right time, while the entire evidences were available with the assessee for claim of deduction of expenses. According to her, it is unfortunate that the assessee's claim in quantum is not contested further. In view of this, the learned Counsel for the assessee stated that there is no iota of concealment or furnishing of inaccurate particulars of income qua this claim of deduction. 9. When these facts were confronted to the learned Sr. DR, he fairly conceded to the position and has not pointed out anything that the facts are wrong. 10. We have heard the rival submission and gone through the facts and circumstances of the case. We find that the learned Counsel for the assessee has explained the case with facts and figures as narrated above and in such circumstances; it is not at all a case for levy of penalty f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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