Commissioner of Income-Tax v. SMSL-UANRCL (JV)
[Citation -2015-LL-0302]

Citation 2015-LL-0302
Appellant Name Commissioner of Income-Tax
Respondent Name SMSL-UANRCL (JV)
Court HIGH COURT OF BOMBAY
Relevant Act Income-tax
Date of Order 02/03/2015
Judgment View Judgment
Keyword Tags tds certificate • contract work
Bot Summary: Efforts of the advocate, Shri Anand Parchure, is to demonstrate that the contract was entered by the joint venture, the joint venture has received the consideration and then parted with part of the work in favour of one of its constituents, namely, SMS Infrastructure Ltd. By inviting our attention to change in the legal position in view of the amendment to section 3 of the Act of 1961 as compared to the Act of 1922, he submits that the assessment ought to have been done of the assessee-joint venture company for the entire sum and, thereafter, for part of it paid to SMS Infrastructure Ltd. of the constituent. The assessee-joint venture had filed return of income of Rs. 2,19,990 and claimed TDS of Rs. 30,14,718. When a query was raised by the Assessing Officer about the receipts for the project work in respect of TDS certificate or its non-mention in the profit and loss account of the joint ventureassessee, it submitted that due to oversight and inadvertently the credit of TDS was shown by it. If leave to withdraw was being sought with some ulterior motive, the income would have been reflected in the account of the joint venture-assessee. Of the contract value at the hands of the joint venture-assessee. There is no finding of receipt of any income by the joint venture- assessee on account of the said contract. The finding of fact reached by the Commissioner of Incometax-I, Nagpur (the CIT(A and sustained by the Income-tax Appellate Tribunal cannot be said to be perverse.


JUDGMENT judgment of court was delivered by B. P. Dharmadhikari J.-Heard advocate, Shri Anand Parchure, for appellant and advocate, Shri N. S. Bhattad, for respondent. following two questions are sought to be urged by appellant: "(1) Whether, in facts of case and in law, hon'ble Income-tax Appellate Tribunal was correct in holding that entire income earned by joint venture company is liable to be taxed in hands of one of members of assessee-company without appreciating fact that contract was awarded to assessee-company and not to individual member of assessee-company? (2) Whether, on facts of case and in law, hon'ble Income-tax Appellate Tribunal was correct in not applying principle laid down by Supreme Court in case of C. H. Atchaiah [1996] 218 ITR 239 (SC) and Madras High Court in case of Murugesa Naicker Mansion reported in [2000] 244 ITR 461 (Mad) wherein it was held that Assessing Officer is not precluded from taxing right person merely on ground that wrong person is taxable?" Income-tax Appellate Tribunal, Nagpur ("the ITAT"), has as matter of fact found that assessee-joint venture did not execute contract work and said work was done by one of its constituents, namely, SMS Infrastructure Ltd. It is also found that receipts for said project work are reflected in books of account of SMS Infrastructure Ltd. and in return, said SMS Infrastructure Ltd. has disclosed that income. said return was accepted by Assessing Officer in assessment made under section 153A read with section 143(3) of Income-tax Act, 1961. It found that, therefore, same income could not have been taxed again in hands of joint venture- assessee. Efforts of advocate, Shri Anand Parchure, is to demonstrate that contract was entered by joint venture, joint venture has received consideration and then parted with part of work in favour of one of its constituents, namely, SMS Infrastructure Ltd. By inviting our attention to change in legal position in view of amendment to section 3 of Act of 1961 as compared to Act of 1922, he submits that assessment, therefore, ought to have been done of assessee-joint venture company for entire sum and, thereafter, for part of it paid to SMS Infrastructure Ltd. of constituent. He also states that Assessing Officer cannot refuse to tax right person because wrong person has been taxed. He submits that otherwise there was no reason for assessee to show TDS. Advocate, Shri N. S. Bhattad, relies upon findings recorded by Income-tax Appellate Tribunal in paragraph 7 to urge those findings are concurrent findings of fact and are not perverse. assessee-joint venture had filed return of income of Rs. 2,19,990 and claimed TDS of Rs. 30,14,718. When query was raised by Assessing Officer about receipts for project work in respect of TDS certificate or its non-mention in profit and loss account of joint ventureassessee, it submitted that due to oversight and inadvertently credit of TDS was shown by it. It requested and sought leave to withdraw claim of TDS. If TDS claim was not erroneous, income could have been shown in account of joint venture-assessee. If leave to withdraw was being sought with some ulterior motive, income would have been reflected in account of joint venture-assessee. consideration either by Assessing Officer or appellate authorities does not show this position. On other hand, Assessing Officer has worked out income-tax at 3 per cent. of contract value at hands of joint venture-assessee. Such guess work would not have been essential, had assessee actually received amounts and those amounts would have been reflected in books of account. Department would have procured some material to show receipts by assessee towards contract. There is no finding of receipt of any income by joint venture- assessee on account of said contract. finding of fact, therefore, reached by Commissioner of Incometax (Appeals)-I, Nagpur ("the CIT(A)") and sustained by Income-tax Appellate Tribunal cannot be said to be perverse. In light of this discussion, we find that abovementioned questions which ignore this finding of fact does not arise for determination and cannot be said to be substantial questions of law arising out of impugned order. income-tax appeal is, accordingly, rejected. No costs. *** Commissioner of Income-Tax v. SMSL-UANRCL (JV)
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