Webber v. Commissioner Of Income Tax 200 Itr 483

IN THE HIGH COURT OF KERALA AT ERNAKULAMPRESENT THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN & THE HONOURABLE MR. JUSTICE ASHOK MENON FRIDAY ,THE 30TH DAY OF NOVEMBER 2018 / 9TH AGRAHAYANA, 1940 ITA.No. 17 of 2007 AGAINST THE ORDER/JUDGMENT IN ITA 815/2004 ofI.T.A.TRIBUNAL,COCHIN BENCH DATED 28-04-2006 APPELLANT/S: PIERRE THEVERGE, REP. BY AGENT KSEB,AGENT KSEB, PATTOM TRIVANDRUM. BY ADVS.SRI.E.K.NANDAKUMAR (SR.)SRI.ANIL D. NAIR RESPONDENT/S: ASST. COMMISSIONER OF INCOME TAX,CIRCLE I(1), TRIVANDRUM. OTHER PRESENT: SRI RAJA KANNAN, SRI JOSE JOSEPH SC THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 30.11.2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: J U D G M E N T Vinod Chandran, J The petitioner was an employee deputed bythe overseas Consultant, who returned his incomereceived in India and showed the tax component paidby the KSEB as “income from other sources”. TheAssessing Officer added on the tax paid by KSEB,returned as “income from other sources”, to thesalary paid and computed the total salary paid asprovided in Section 195A of the Income Tax Act,1961 ('Act' for short). Tax was determined for thesaid component of salary and deductions were madewith respect to the tax paid by the KSEB. Thebalance was demanded from the assesses, the foreignnational, who was in India by virtue of thecontract between the KSEB and the overseasConsultant. 2. The assesses filed appeals before thefirst Appellate Authority, who, based on Emil -Webber v. Commissioner of Income Tax 200 ITR 483, reversed the order of the Assessing Authority anddirected the tax paid by the KSEB, returned asother income, to be taxed as “income from othersources”. An appeal was taken by the Department tothe Tribunal and cross objections were filed by theassesses. The cross objections were laterwithdrawn. The Tribunal allowed the appeal of theDepartment upholding the order of the AssessingAuthority.3. The questions of law raised are asfollows: 1. Whether the Hon'ble Tribunal was right in law and on facts in holdingthat under Annexure A contract, KSEB wasnot liable to bear the income taxliability on the salary received by theappellant from the consultant company? 2. Whether the Hon'ble Tribunal was right in law and on facts in holdingthat in the instant case the salary andthe tax portions were paid by theforeign consultant Snc-Shawinigan asevidenced by clause 1.9.1 clearlyindicated that the tax portion was to beborne by KSEB? 3. Ought not the Hon'ble AppelateTribunal to have held that insofar asclauses 1.9.1 and 1.9.2 were mutuallycontradictory, the earlier clause 1.9.1Tribunal to have held that insofar asclauses 1.9.1 and 1.9.2 were mutuallycontradictory, the earlier clause 1.9.1 had to prevail and accordingly theliability to bear the tax burden of theappellant was on KSEB and not on SNC-Shawinigan?liability to bear the tax burden of theappellant was on KSEB and not on SNC-Shawinigan? 4.Ought not the Hon'ble appellateTribunal to have held that theprovisions of Section 195A did not haveTribunal to have held that theprovisions of Section 195A did not have any application to the facts and circumstances of the instant case and accordingly, there was no necessity forgrossing up the income of the appellant while determining his tax liability? 4. The issues and questions raised are covered by a judgment of this Court reported in2018(1) KHC 111 [Horace Dansereau v. Assistant Commissioner of Income Tax Circle I(1),Thiruvananthapuram].This Court upheld the order ofassessment on a different reasoning from that ofthe Tribunal. We extract the operative portion ofthe order in paragraph 10 as follows:- “We are of the opinion that the question of law raised has to be answered in any application to the facts and circumstances of the instant case and accordingly, there was no necessity forgrossing up the income of the appellant while determining his tax liability? 4. The issues and questions raised are covered by a judgment of this Court reported in2018(1) KHC 111 [Horace Dansereau v. Assistant Commissioner of Income Tax Circle I(1),Thiruvananthapuram].This Court upheld the order ofassessment on a different reasoning from that ofthe Tribunal. We extract the operative portion ofthe order in paragraph 10 as follows:- “We are of the opinion that the question of law raised has to be answered in favour of the revenue and against theassessee on a different reasoning thanthat given by the Tribunal. We are toldthat in many of the assessment orders thecomputation has not been properly made. The Assessing Officer would, hence, employ Section 195A and compute theamounts properly within a period of twomonths from the date of receipt of the certified copy of this judgment. Theassessees are said to have paid up theamounts already. Only if there is a balance due, the same would have to besatisfied by the assessee or its agent.” The questions have been answered againstthe assessee and in favour of the revenue. The appeal is rejected with the directions as given inthe earlier judgment for computation. There is noorder as to costs. Sd/- K. Vinod Chandran, Judge Sd/-Ashok Menon, Judge