M/S. Ansaldo Energia Spa v. The Assistant Director Of Income Tax, International Taxation

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 21.12.2016 C O R A M THE HON'BLE MR. JUSTICE HULUVADI G. RAMESHANDTHE HON'BLE Dr. JUSTICE ANITA SUMANTH Tax Case Appeal No.819 of 2016andC.M.P.No.18801 of 2016 M/s. Ansaldo Energia SPA.C/o.S.R.Batliboi and Co., TPL House, 2nd Floor,No.3, Cenotaph Road,Chennai 600 018 ... AppellantVs The Assistant Director of Income Tax,International Taxation,121, Nungambakkam High Road,Chennai 600 034. ... Respondent Prayer:- Appeal filed under Section 260A of the Income Tax,1961, against the Order of the Income Tax Appellate Tribunal,Chennai 'A' Bench, dated 5.6.2009, in I.T.A.No.411/Mds/2006. against the order of this commissioner of Income Tax(Appeals)XIChennai,dt.16.12.2005andmadeinRTA.No.9210/2004-05/CIT(A) XI against the order of this Assistant Director of Income Tax (Inernational Taxation), Chennai dt.27.02.2004 and made inPAN/GIR-No.AACCA41511/3-A for the Assistant year 2000-01. For Appellant : Mr.N.V.Balaji for Mr. R. KarthikeyanFor Respondent : Mr.Arun Kurian Joseph for Mr.T.Ravikumar, Standing Counsel J U D G M E N T (Judgment of the Court was delivered by Dr.Anita Sumanth, J.,)This Tax Case Appeal arises against an order of the IncomeTax Appellate Tribunal, Chennai ('Tribunal') dated 5.6.2009.2. The issue lies within a narrow compass. The main https://hcservices.ecourts.gov.in/hcservices/ grievance of the appellant relates to the violation of theprinciples of natural justice. 3. The appellant had preferred an appeal before this courtchallenging an order of the Tribunal dated 11.5.2007. Theappeal was rejected vide order dated 12.2.2009 on the questionof law raised but remanded to the file of the Tribunal on thelimited question of computation of a proper percentage ofprofit to be brought to tax in the following terms:- '41. As regards the second question it is purely aquestion of fact. The Tribunal held that only 25%of the profits of Contract No.I can be said to havearisen off-shore and outside the taxable territory.The Tribunal did not take note of and could nothave taken note of the fact that 20% of the profitsof Contract No.I has been offered to tax, sincethat is an event that took place subsequent to theorder of the Tribunal. We find in paragraph No.51in the order of the Tribunal, that the Tribunal hadasked the assessee to give certain figures. Butthe assessee did not do so. The Tribunal thenconfirmed the conclusion of CIT(Appeals) that 75%of the profits of Contract I is taxable. No personhas been given for fixing the percentage. So weare remitting the matter to the Tribunal to assessthe percentage of taxable profit properly, bearingin mind the findings we have confirmed. Both theparties may be heard and documents received for thelimited purpose of enabling the Tribunal to workout the percentage. The Tribunal after hearing thesubmissions shall fix the percentage and givereasons therefore and pass appropriate orders, onany date, within a period of 4 weeks from the dateof receipt of a copy of this order.' 4. It appears that the matter was posted for hearing by theTribunal on 25.3.2009 when it stood adjourned to 24.4.2009 asthe original file had not been received back from the HighCourt. On 24.4.2009, an adjournment was sought for by theappellant mainly on the ground that it had sought an extensionof time from this court for disposal of the matter by theTribunal. The request was, however, rejected and the Tribunalproceeded to confirm its earlier estimation of profit. 4. It appears that the matter was posted for hearing by theTribunal on 25.3.2009 when it stood adjourned to 24.4.2009 asthe original file had not been received back from the HighCourt. On 24.4.2009, an adjournment was sought for by theappellant mainly on the ground that it had sought an extensionof time from this court for disposal of the matter by theTribunal. The request was, however, rejected and the Tribunalproceeded to confirm its earlier estimation of profit. 5. We do not believe that the matter has been considered inthe proper or correct perspective. The order of remand by thiscourt has been specifically for the reason that the Tribunalhad, on the earlier occasion, not adduced any rationale whileconfirming the estimate of profit arrived at by the Commissionerof Income Tax (Appeals). Seen in this light, there is nojustification whatsoever for the Tribunal to have merelyreiterated its earlier order. It would, thus, have beenappropriate for the Tribunal to consider the request for adjournment favourably and grant opportunity to the assessee torepresent its case to give full effect to the directions ofthis court in its order dated 12.1.2009. The matter, thus,stands remanded once again to the Tribunal to carry out thedirections of this court extracted above. The exercise shall becompleted within a period of six weeks from the date of receiptof this order. The Tax Case (Appeal) is allowed in the aboveterms. No costs. The connected miscellaneous petition isclosed. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrarssk.ToThe Assistant Director of Income Tax,International Taxation,121, Nungambakkam High Road,Chennai 600 034. +1cc to Mr.R. Karthikeyan, Advocate, S.R.No.74823sv(CO)md(27/02/2017)T.C.A.No.819 of 2016