Case Number: ITA 5884/DEL/2019
Appellant: ACIT Circle-9(2), New Delhi
Respondent: Frigoglass India Private Ltd., New Delhi
Assessment Year: 2015-16
Case Filed On: 2019-07-05
Order Type: Final Tribunal Order
Date of Order: 2023-02-20
Pronounced On: 2023-02-20
Summary:
The case of ACIT Circle-9(2) vs Frigoglass India Private Ltd. pertains to the disallowance of royalty expenses for the assessment year 2015-16. The appellant, ACIT Circle-9(2), contested the allowance of royalty expenses made by the Assessing Officer (AO) and upheld by the Commissioner of Income Tax (Appeals)-34, New Delhi. The case was subsequently brought before the Income Tax Appellate Tribunal (ITAT) for resolution.
Background:
Frigoglass India Private Ltd., located at E-20, 1st and 2nd Floor, Main Market, Hauz Khas, New Delhi, filed an appeal against the order of the CIT(A)-34, New Delhi, dated 16th April 2019. The primary issue was the disallowance of royalty expenses amounting to Rs. 6,72,85,014/-, which the appellant sought to dispute through the legal process. The AO had disallowed these expenses, leading to the appeal.
Grounds of Appeal:
Tribunal Proceedings:
During the virtual hearing, the appellant was represented by Sh. Shatanik Chakrabarty, Advocate, while the respondent was represented by Sh. Sajay Kumar, Senior Departmental Representative (Sr. DR). The tribunal decided to proceed based on the available records and after hearing the submissions from both parties.
The CIT(A) had followed the findings of the Tribunal in the assessee’s own case for the assessment year 2010-11 to delete the addition made by the AO. It was observed that the Hon’ble Delhi High Court had dismissed the appeal of the department on this issue. The AO had noted that the department had filed a Special Leave Petition (SLP) in regard to issues for the assessment year 2010-11. However, the SLP was dismissed, and the CIT(A) took note of this in its order.
The tribunal found that there was no substance in the ground raised on behalf of the revenue, as the issues had already been settled in favor of the assessee in previous years and upheld by higher judicial authorities. Therefore, the appeal by the revenue was dismissed.
Conclusion:
In conclusion, the tribunal dismissed the appeal filed by ACIT Circle-9(2) as the disallowance of royalty expenses was not substantiated. This case highlights the importance of consistency in judicial decisions and the significance of higher court rulings in similar matters.
Order Pronouncement:
Order was pronounced in the open court on 20th February 2023, following the virtual hearing.
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(N. K. BILLAIYA)
ACCOUNTANT MEMBER
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(ANUBHAV SHARMA)
JUDICIAL MEMBER
ACIT Circle-9(2) vs Frigoglass India Private Ltd. – Case Filed Due to Royalty Expense Disallowance
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