M/s. Hughes Communication India Ltd., New Delhi v. DCIT, New Delhi

ITA 4778/DEL/2010 | 2004-2005
Pronouncement Date: 17-04-2014 | Result: Dismissed

Appeal Details

RSA Number 477820114 RSA 2010
Assessee PAN AAACH0765L
Bench Delhi
Appeal Number ITA 4778/DEL/2010
Duration Of Justice 3 year(s) 5 month(s) 15 day(s)
Appellant M/s. Hughes Communication India Ltd., New Delhi
Respondent DCIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 17-04-2014
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 17-04-2014
Date Of Final Hearing 28-01-2014
Next Hearing Date 28-01-2014
Assessment Year 2004-2005
Appeal Filed On 02-11-2010
Judgment Text
ITA NOS. 1629/DEL/09 & 4778/DEL/10 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI S. V. MEHROTRA ACCOUNTANT MEM BER AND SHRI CHANDRA MOHAN GARG JUDICIAL MEMBER I.T.A .NO. 1629 /DEL/2009(AY-2 004-05) HUGHES COMMUNICATION INDIA LTD. A SHIVAJI MARG WESTEND GREENS NH 08 NEW DELHI AAACH0765L (APPELLANT) VS CIT ROOM NO. 397 CENTRAL REVENUE BUILDING I.P.ESTATE NEW DELHI (RESPONDENT) ( I.T.A .NO.-4778/DEL/10 (A.Y 2004-05) APPELLANT BY SH. AJAY VOHRA ADV RESPONDENT BY SH. R. S. GILL CIT DR ORDER PER S. V. MEHROTRA AM THESE APPEALS HAVE BEEN FILED BY ASSESSEE FOR A.Y 2004-05. ONE APPEAL BEING ITA NO. 1629/DEL/2009 IS AGAINST THE ORDER U/ S 263 DATED 24 TH MARCH 2009 PASSED BY CIT DELHI IV AND THE OTHER APPEAL BEING ITA NO. 4778/DEL/2010 IS AGAINST LD. CIT(A) XII ORDER DATED 24 TH MARCH 2010 PASSED U/S 143(3) READ WITH SECTION 263. FIRST WE TAKE UP ITA 1629/DEL/2009 HUGHES COMMUNICATION INDIA LTD. 1 SHIVAJI MARG WESTEND GREEN NATIONAL HIGHWAY NO. 8 NEW DELHI AAACH0765L (APPELLANT) VS DCIT CIRCLE-12(1) NEW DELHI (RESPONDENT) ITA NOS. 1629/DEL/09 & 4778/DEL/10 2 2. LD. CIT EXAMINED THE ASSESSMENT RECORDS OF ASSES SEE AND NOTED THAT THE ASSESSEE HAD CLAIMED AND WAS ALLOWED AN EXPENDITURE OF RS.8 18 53 112/- TOWARDS LICENSE FEE. AFTER DETAILED DISCUSSION HE CONCLUDED THAT AN EXPENDITURE ON ACCOUNT OF LICENSE FEE SHOULD HAVE BEEN HELD TO BE CAPITAL EXPENDITURE INCURRED FOR ACQUISITION OF INTANGIBLE ASSET IN FORM OF LICENSE WHICH IS FOR THE TENURE OF 10 TO 20 YEARS AND GIVES ENDURING BENEFIT TO THE ASSESSEE. 3. AT THE OUTSET LD. COUNSEL FOR THE ASSESSEE POINT ED OUT THAT THIS ISSUE IS CONCLUDED IN FAVOUR OF ASSESSEE BY FOLLOWING DECISI ONS:- A) COSMAT MAX VS. DCIT: (2009) 29 SOT 436 B) CIT VS. LUMAX INDUSTRIES LTD: 173 TAXMAN 390. C) VIDESH SANCHAR NIGAM LTD. VS. JCIT: 8 1 ITD 456 D) MAHANAGAR TELEPHONE NIGAM LTD. VS. ADDL. CIT: 1 00 TTJ 1 HE POINTED OUT THAT HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. LUMAX INDUSTRIES LTD. WHEREIN IT HAS BEEN HELD THAT THE P AYMENTS MADE BY THE ASSESSEE TOWARDS LICENSE FEE TO M/S STANDI ELECTRIC COMPANY LTD. (SECL) WAS A REVENUE EXPENDITURE. HE THEREFORE SUBMITTED THAT LD. CIT S ORDER HAS NO LEGS TO STAND. 4. LD. DR RELIED ON THE ORDER OF THE LD. CIT. 5. HAVING HEARD BOTH THE PARTIES WE FIND THAT THER E IS NO DISPUTE THAT THE FACTS OBTAINING IN VARIOUS DECISIONS RELIED BY ASSESSEE I NCLUDING THE DECISION IN THE CASE OF COSMAT MAX LTD (SUPRA) AND LUMAX INDUSTRIES LTD (SUPRA) ARE SIMILAR TO THE FACTS IN THE PRESENT CASE. THE HONBLE DELHI HIGH C OURT IN LUMAX INDUSTRIES LTD HAS INTER-ALIA OBSERVED AS UNDER:- WE DO NOT FIND ANY REASON TO DIFFER WITH THE OPIN ION ON THE FACTS OF THIS CASE AND IT IS QUITE CLEAR THAT THE RATIO OF THE DE CISION OF THE SUPREME COURT IN JONAS WOODHEAD AND SONS (INDIA( LTD. AND EMPIRE JUTE CO. LTD. WERE FULLY APPLICABLE TO THE FACTS OF THIS CASE AND BOTH THE AUTHORITIES WERE RIGHT TIN CONCLUDING THAT THE PAYMENTS MADE BY THE ASSESS EE TOWARDS LICENSE FEE TO SECL WAS A REVENUE EXPENDITURE. 6. WE THEREFORE SET ASIDE THE ORDER PASSED BY LD. CIT AND QUASH THE PROCEEDINGS INITIATED U/S 263 BY LD. CIT. ITA NOS. 1629/DEL/09 & 4778/DEL/10 3 7. IN THE RESULT THE ASSESSEES APPEAL IS ALLOWED. ITA NO. 4778/DEL/2010 8. THIS APPEAL HAS BEEN FILED BY ASSESSEE AGAINST T HE ORDER OF LD. CIT(A) PASSED U/S 143(3) READ WITH SECTION 263. AS WE HAV E QUASHED THE PROCEEDINGS U/S 263 THE APPEAL FILED BY THE ASSESSEE HAS BECOME IN FRUCTUOUS. 9. IN THE RESULT THE ASSESSEES APPEAL IS DISMISSE D AS INFRUCTUOUS. 10. IN SUMMARY THE ASSESSEES APPEAL IN ITA 1629 I S ALLOWED AND ASSESSEES APPEAL IN ITA 4778 IS DISMISSED AS INFRUCTUOUS. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 17 TH OF APRIL 2014. SD/- SD/- (C. M. GARG) (S.V.MEHROTRA) JUDICIAL MEMBER ACCO UNTANT MEMBER DATED: 17/04/2014 *R. NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI