Case Law Details
KCL Amrcl joint Venture Vs ITO (ITAT Hyderabad)
In the given case, memebrs of JV decided to form a JV only to secure the orders and execution of the orders was to be done by one of the constituents of the JV. JV was formed for the benefit of the individual members and a business was carried on for the benefit of the businessman. There was no sub-contract relationship existed between JV partners. Accordingly, the work executed by the AMRCL was not in sub-contract. Ground raised by revenue was dismissed.
FULL TEXT OF THE ITAT JUDGMENT
All these appeals are filed by assessee as well as revenue directed against orders of Commissioner (Appeals)-6, Hyderabad. As identical issues are involved in these appeals, they were clubbed and heard together and, therefore, a common order is passed for the sake of convenience.
2. The Brief facts, as taken from KCL AMRCL JV for assessment year 2012-13, are that the assessee is an AOP comprising of two members, Viz., M/s Ketan Constructions Ltd. (KCL) and AMR Constructions Ltd. (AMRCL). It was formed as a Joint Venture for securing the contract of “widening to 2 lane and improvement from Km 50/0 to 84/2000 of Govindapalli-Balimela-Chitrakonda-Sileru Road (SH-47) in Malkarjini District under L.W.E. Scheme” tendered by the Chief Engineer (DPI & Roads), Govt. of Orissa. The return was filed on a total loss of Rs. 30,888. It claimed itself to be a ‘pass through entity’ that had been only formed to obtain the contract work.
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