Text Hundred India Pvt. Ld. v. CIT
In the Income Tax Appellate Tribunal
ITA No. 2095 to 2098/Del/2014 and ITA No. 2849 to 2851 & 2852/Del/2014
Before Mr H.S. Sidhu, J.M. and Mr Prashant Maharishi, A.M.
Decided on July 31, 2017
Relevancy of the case: Admissibility of electronic record.
Statutes & Provisions Involved
- The Information Technology Act, 2000 (Section 4)
- The Income Tax Act, 1961 (Section 143, 264)
- The Indian Evidence Act, 1872 (Section 65B)
Relevant Facts of the Case
- The assessee is a wholly-owned subsidiary of a UK company, viz. M/s. Text Hundred International Ltd. The assessee is engaged in the business of public relation service.
- The assessee has placed some documentary evidence on record in electronic form which contains emails exchanged from time to time between the employees of the assessee and the employees of the associated enterprise under the management services agreement entered into by the assessee.
Opinion of the Bench
- A tabulation containing the details and the nature of service rendered, date of rendering of services and the corresponding details of the emails placed in the paper book was sent to the assessing officer for his specific comments.
- Despite being afforded the specific opportunity during the appellate proceedings, the assessing officer in the remand report has not been able to controvert any of the evidence placed on record.
- The assessing officer has in fact not been able to dispute the actual rendering of services by the associated enterprise to the assessee.
- The annexure clearly contains not only details of the persons between whom the relevant emails were exchanged but also the nature of the advice and category of service for which the advice was received.
- As per Section 65B of the Indian Evidence Act, 1872 and Section 4 of the Information Technology Act, 2000, it can easily be concluded that the assessee has placed sufficient, unrebutted, and uncontroverted documentary evidence in support of actual rendering of service by the associated enterprise to the assessee.
- Therefore, there is no basis for the assessing officer to allege that the assessee had merely diverted its income to its foreign associated enterprise in the grab of payment of management service charges.