Makemytrip (India) P. Ltd. vs Joint Commissioner Of Income Tax

ORDER

Grounds No. 1: General ground

1.

That on the facts and circumstances of the case and in law, the Ld. PCIT(Appeals) has erred in confirming and upholding the order dated March 31, 2021, passed by the Ld. Joint Commissioner of Income tax (OSD), Circle 75(1), New Delhi (‘Ld. AO’) under Section 201/201(1A) holding the Appellant as ‘assessee in default’ under section 201 of the Act for alleged short deduction of taxes and consequently raising a demand of Rs. 85,40,481 for the subject AY.

Grounds No. 2 and 3: Faceless proceedings – lack of jurisdiction

2.

That on the facts and circumstances of the case, the impugned proceedings and the consequential Order passed by the Ld. PCIT (Appeals) are without jurisdiction, being in violation of the Faceless Appeal Scheme, 2020, notified vide CBDT Notification S.O. 3296(E) dated 25 September 2020, which mandates that all appellate proceedings before the CIT(A) be conducted exclusively through the faceless mechanism.

3.

That on the facts and circumstances of the case, the Ld. PCIT (Appeals) has grossly erred in treating the appellate proceedings as “non-faceless”, even though the notices initiating the appellate proceedings were duly issued through the NFAC/ITBA portal, thereby acting contrary to the statutory scheme and rendering the Order untenable.

Grounds No. 4: Violation of principles of natural justice

4.

That on the facts and circumstances of the case, Ld. PCIT (Appeals) erred in alleging non-attendance on part of the Appellant even though no notice of hearing issued by Ld. PCIT (Appeals) required personal and/ or authorized representation and requested written submissions were duly filed, rendering the very basis or foundation of the impugned Order invalid and is against the principle of natural justice.

Grounds No. 5: Non-speaking order passed without application of mind

5.

That on the facts and circumstances of the case, Ld. PCIT (Appeals) has erred in law in rendering a non-speaking order mechanically, without adjudicating the grounds of appeal raised by the Appellant, and without considering detailed submissions already placed on record, thereby violating the principles of natural justice and rendering the Order unsustainable in law.

Grounds No. 6: Proceedings are barred by limitation

6.

That on the facts and circumstances of the case and in law, the proceedings initiated under section 201 were without jurisdiction, as the statutory period of limitation prescribed under section 201(3), as applicable at the time of the alleged TDS deduction, had already expired for the relevant assessment year. Consequently, the order passed by the Ld. AO, as well as the appellate Order of the Ld. PCIT (Appeals) affirming it, are barred by limitation and therefore void ab initio.

Ground No. 7 to 11: Short deduction of taxes on payments to Google India Private Limited (‘Google India’) towards online advertisement –

(tax demand of Rs. 44,85,880)

7.

That on the facts and circumstances of the case and in law, Ld. PCIT (Appeals) failed to consider the detailed submissions regarding payments made to Google India and, without any discussion or independent reasoning, mechanically affirmed additions, thereby rendering the Order unsustainable in law.

8.

That on the facts and circumstances of the case and in law, the Ld. AO erred in treating the Appellant as an “assessee in default” for alleged short-deduction of tax on payments made to Google India for online advertisements, ignoring that such payments do not constitute “royalty” or “fees for technical services” under section 194J of the Act.

9.

That on the facts and circumstances of the case and in law, the Ld. AO erred in treating payments made to Google India for online advertisements as “royalty” under section 194J of the Act, failing to appreciate that such payments were for availing a standard facility available to the general public and do not involve the use of, or any right in, trademark or intellectual property.

10.

That on the facts and circumstances of the case and in law, the Ld. AO erred in relying on the decision of Google India (P.) Ltd. v. Additional Commissioner of Income-tax, Range-11, Bengaluru, [2017] 86 taxmann.com 237 (Bengaluru – Trib) while concluding payments made by Appellant to Google India as ‘royalty’ under section 194J of the Act, without appreciating that:

•

The facts of case and issue involved therein are distinguishable and cannot be equated with the facts of Appellant’s case.

•

That above decision stood set-aside pursuant to directions of Hon’ble High Court of Karnataka vide order dated April 17, 2021. Further, in remand back proceedings, the Hon’ble Tribunal in the case of Google India (P.) Ltd. v. Deputy Commissioner of Income-tax (International Taxation) [2022] 143 taxmann.com 302 (Bangalore - Trib.), vide its order dated October 19, 2022, held the issue in favor of Google India and hence the original decision in case of Google India cannot form the basis of treating the payments made by Appellant to Google India as ‘royalty’.

•

That on the facts and circumstances of the case and in law, the ratio laid down in case of Google India (P) Ltd. (supra) stands negated by the decision of Hon’ble Apex Court in case of Engineering Analysis Centre of Excellence Private Limited vs. CIT (Civil Appeal Nos. 8733-8734 of 2018), and the very basis and foundation on which Ld. AO seeks to consider payments made by Appellant to Google India as ‘royalty’ has been abrogated and rendered nugatory.

Ground No. 13 to 15: Short deduction of taxes on payments to Khajrana Ganesh Properties (‘Khajarana’) towards Common Area Maintenance

(‘CAM’) charges – (tax demand of Rs. 35,05,080)

11.

On the facts and circumstances of the case and in law, the Ld. AO has erred in holding the Appellant as ‘assessee in default’ for alleged short deduction of taxes on payments made to Khajrana towards CAM charges, without appreciating that such payments falls within the ambit of section 194C of the Act and not section 194-I of the Act. The Ld. PCIT(Appeals) has merely upheld the Ld. AO’s view without any discussion or finding on this issue.

12.

On the facts and circumstances of the case and in law, the Ld. PCIT (Appeals) erred in not following the judgement of Hon’ble Apex Court in the case of Commissioner of Income Tax (TDS)-1 v. Liberty Retail Revolutions Ltd., SLP (Civil) Diary No. 62377/2025 (2025).

13.

That the Ld. AO wrongly alleged non-furnishing of Form 26A for Khajrana, despite the same being duly filed. The Ld. PCIT (Appeals) mechanically confirmed the demand without verifying the record and without adjudicating this ground. Interest computation under section 201(1A) is also excessive and contrary to law.

Ground No. 16 to 18: Short deduction of taxes on payments towards Annual Maintenance and other charges (‘AMC’) (Rs. 5,49,521)

14.

On the facts and circumstances of the case and in law, the Ld.AO has erred in holding the Appellant as ‘assessee in default’ for alleged short deduction of taxes on payments made to M/s Hewlett Packard India Sales Pvt. Ltd towards routine AMC, without appreciating that such payments fall within the ambit of section 194C of the Act and not section 194J of the Act. The Ld. PCIT(Appeals) failed to render any finding and merely adopted the Ld. AO’s reasoning.

The above grounds are independent and without prejudice to each other.

The Appellant craves leave to withdraw, amend and/or forego any or all the above grounds of appeal or add any further grounds of appeal whether before or during the appellate proceedings in the interest of natural justice.”