The Director Of Income Tax v. Prudential Shipping Agencies

IN THE HIGH COURT OF JDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.2325 OF 2010ININCOME TAX APPEAL NO.551 OF 2010 The Director of Income Tax ....AppellantInternational Taxation, Mumbai Vs. Prudential Shipping Agencies ....RespondentPvt. Ltd., Mumbai Mr. Suresh Kumar, Advocate for Appellant. None for respondent. CORAM : J.P. DEVADHAR &SMT. R.P. SONDURBALDOTA, JJ. DATE : 15th June, 2011. P.C. 1.None for respondent. 2.For the reasons stated in the affidavit-in-support of Notice of Motion, the delay is condoned. Notice of Motion is made absolute in terms of prayer clause (a). ( SMT. R.P. SONDURBALDOTA, J. ) (J.P. DEVADHAR, J.) IN THE HIGH COURT OF JDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.551 OF 2010 The Director of Income Tax ....AppellantInternational Taxation, Mumbai Vs. Prudential Shipping Agencies ....RespondentPvt. Ltd., Mumbai Mr. Suresh Kumar, Advocate for Appellant. None for respondent. CORAM : J.P. DEVADHAR ANDSMT. R.P. SONDURBALDOTA, JJ.DATE : 15TH JUNE, 2011. P.C. 1.Mentioned. Taken on board. By consent taken up for final hearing. 2.Whether the ITAT was justified in setting aside the order passed by the C.I.T. under Section 263 Income Tax Act, 1961 is the question raised in this appeal. 3.In the original assessment order passed for Assessment Year 1998-1999, the benefit under the double taxation avoidance Agreement between India and U.A.E. was denied to the assessee as the assessee could not produce tax residence certificate issued in the name of the non resident of which the assessee was the agent. The tax residency certificate was however, produced in the appellate proceedings and the C.I.T.(A) by his order dated 22[nd] April 2002 held that the assessee is entitled to relief under the DTAA between India and U.A.E.. 3.In the meantime, the Assessing Officer, on the basis of the tax residency certificate produced by the assessee allowed the clam of the assessee by invoking his powers under Section 154 Income Tax Act, 1961. By the impugned order passed under Section 263 Income Tax Act, the C.I.T. was of the opinion that the Assessing officer could not have allowed the relief by invoking his powers under Section 154 of the Income Tax Act. The order of the C.I.T. under Section 263 of the Act was set aside by the Tribunal in view of the fact that the C.I.T. (A), by his order dated 22[nd] April 2002 has allowed the claim of the assessee. In these circumstances, in our opinion no fault can be found with the decision of the Tribunal. The appeal is dismissed with no orders as to costs. (Smt. R.P. SondurBaldota, J.) ( J.P. Devadhar, J.)