STARTIME COMMUNICATEION PVT. LTD. vs COMM. OF INCOME TAX, CITY-VI, MUM.

Judgment text excerpt

389.03-itxa.docx IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.389 OF 2003 BASAVRAJ M/s. Star Time Communication (I) Pvt. Ltd. ….. Appellant GURAPPA PATIL Digitally signed by Versus BASAVRAJ GURAPPA PATIL Date: 2025.04.22 16:29:46 +0530 The Commissioner of Income Tax, Mumbai City – VI ….. Respondent Mr. B. M. Chatterji, Senior Advocate a/w. Mr. Shreyash J. Shah with Mr. Udyan Mukharjee i/b. Girish Pikale for the appellant Mr. Suresh Kumar for the respondent RESERVED ON : APRIL 17, 2025 PRONOUNCED ON : APRIL 22, 2025 JUDGMENT (PER : CHIEF JUSTICE) 1. This appeal under Section 260A of the Income Tax Act, 1961 (1961 Act), has been filed by the assessee. The subject matter of the appeal pertains to Assessment Year 1993-94. The appeal was admitted on the following substantial question of law: Whether on the facts and circumstances of the case and in law the Income Tax Appellate Tribunal was right in coming to the conclusion that the appellant was entitled to only 5% of the receipts of the appellant and not 5% of the gross advertising bills raised? 2. Facts leading to filing of this appeal, briefly stated, are that the assessee is a company incorporated on 29 th April 1992. The assessee entered into an agreement dated 27 th July 1992 (said agreement) with Prime Time Media Services Pvt. Ltd. Under Basavraj Page|1 389.03-itxa.docx clause-3 of the said agreement, the assessee was required to pay Prime Time Media Services Pvt. 5% of the total receipts from advertising. The assessee filed return of income for the Assessment Year (AY) 1993-94 declaring total income of Rs.7,57,746/-. (Rupees seven lac fifty-seven thousand seven hundred forty-six only). The Assessing Officer, during the course of assessment proceedings, by order d