9911796707
TMI Blog2017 (2) TMI 1432X X X X Extracts X X X X X X X X Extracts X X X X ..... sment proceedings, the Assessing Officer noticed that there was a joint venture agreement between M/s KEC International Ltd. and M/s Sidharth Construction and Trading Pvt. Ltd. executed on 26th October, 2010 with certain terms and conditions for carrying out the work allocated to JV through Tender No.1 of 10-11 by Eastern Railways (Construction Division), Kolkata vide office letter no.CAO/Con/WT/8545 dated 02nd September, 2010 for Patuli-Katwa in the state of West Bengal. He further noticed that another joint venture agreement executed between M/s KEC International Ltd. and M/s Sidharth Construction and Trading Pvt. Ltd. on 09th December, 2010 with certain terms and conditions for work contract awarded by South Eastern Central Railway ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mental rule of taxation is that unless otherwise expressly provided, income cannot be taxed twice. This principle is well settled and the Supreme Court has reiterated the same in its decision in the case of ITO v. Bachu Lal Kapoor Kewal Ram [1966] 60 ITR 74 , the Supreme Court said that "the Act does not envisage taxation of the same income twice ."This view was again reiterated by the Supreme Court in the case of Laxmipat Singhania v. CIT[1969] 72 ITR 291, where it has said that it is fundamental rule of the law of taxation that unless otherwise expressly provided, income cannot be taxed twice and because the KEC has already returned the same income in the same financial year the income can be taxed in the hand of the assessee. 2. Becau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... normally complete the regular assessments of the partners by including their share from the firm unless the assessment of the firm has already been made. The income tax Officers assessing the firms must give priority to the disposal of the firms' assessment. They should realize that if they delay the assessments of the firms, they would be responsible for the assessments of all the partners being held up. In an exceptional case if the income tax Officer assessing the firm feels that the assessment of the firm is likely to be delayed so that there would be unnecessary delay in the assessment of the partners, he may consider the firm's claim for registration and pass a suitable order under section 26A of the 1922 Act/sections 184 and 185 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the SLP filed against the order of the High Court of Delhi in the case of Linde. The SLP was dismissed by the Supreme court as the CBDT had withdrawn the case filed against the Linde Order of Delhi High Court. The dismissal order was reported in 2016] 73 taxmann.com 212 (SC)/ [2016] 242 Taxman 371 (SC). The copy of the order enclosed. The Delhi High Court was reported in [2014] 44 taxmann.com 244 (Delhi) 5. Because the learned CIT (A) has failed to appreciate the that the appellant facts were like the case of CIT Vs Oriental structures as reported in 374 ITR 35 wherein it was held by the Honourable Delhi High court that the consortium of the two or more companies which has come together for the specific purpose of bidding the infrastruc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant in support of its contentions. It is evident from the facts discussed above that the appellant JV was awarded work contracts amounting to more than Rs. 29 crores by the Railway authorities during the year. Such contract amount has the element of profit embedded in it which is normally 4-12% of the contract value. The appellant was rightly entitled to these profits after having secured the tenders. The appellant, however, opted to share the profits with a related party. It is evident from the documents filed by the appellant that the liability to start the work within stipulated time was with the appellant. It is also evident from the facts that all the liabilities and accountability with regard to the execution of the work contracts for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cting. At this stage, it is relevant to note the prescription of the relevant part of Section 40A(2), which is as under :- Rs. 40A(2)(a) Where the assessee incurs any expenditure in respect of which payment has been or is to be made to any person referred to in clause (b) of this sub-section, and the Assessing Officer is of opinion that such expenditure is excessive or unreasonable having regard to the fair market value of the goods, services or facilities for which the payment is made or the legitimate needs of the business or profession of the assessee or the benefit derived by or accruing to him therefrom, so much of the expenditure as is so considered by him to be excessive or unreasonable shall not be allowed as a deduction.' 6. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
