Supermax Personal Care Private Limited Vs. ACIT (ITAT Mumbai)
We find that the FAA has observed that the AO had held that a multi layered holding structure was deliberately created to avoid taxes in India and to conceal the information about the ultimate beneficiaries.Having AE.s outside India in itself cannot be held against an assessee. Because of advancement of technology,the globe has become a villge. So,the nature of business has changed a lot. In our humble opinion, assessees are free to decide the manner in which they want to run their businesses. It is said that a citizen is perfectly entitled to exercise his ingenuity so to arrange his affairs as may make it possible for him legally and lawfully not to pay tax, and if his ingenuity succeeds, however reluctant the Court may be to acknowledge the cleverness of the assessee, the Court must give effect to the letter of the taxation law rather than strain that letter against the assessee. The Hon’ble Supreme Court in Azadi Bachao Andolan (263 ITR 706) has observed as under:
“It is open for assessees to arrange their affairs in such a manner that it would not attract the tax liabilities, so far as it can be managed within the permissible limit of the law. Tax management is permissible, if the law authorises so”.
