DEPUTY COMMISSIONER OF INCOME TAX, Jaipur V. RAJASTHAN RAJYA VIDYUT PRASARAN NIGAM LTD., Jaipur

ITA 1010/JPR/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2051 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2001-2002
• Appeal Filed On: 21-12-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: P C PARWAL CA DHK
• Section: 244A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH HKKXPAN] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA-@ ITA NO. 1010/JP/2017 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2001-02 DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-6, JAIPUR. CUKE VS. M/S RAJASTHAN RAJYA VIDYUT PRASARAN NIGAM LTD., VIDYUT BHAWAN, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABCR 8312 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SMT. RICHA KHODA (CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 27/02/2018 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 27/02/2018 VKNS'K@ ORDER PER: BENCH THIS IS THE APPEAL FILED BY THE REVENUE EMANATES FR OM THE ORDER OF THE LD. CIT(A), BIKANER DATED 29/09/2017 FOR THE A.Y . 2001-02, WHEREIN THE REVENUE HAS TAKEN FOLLOWING GROUNDS OF APPEAL: (I) WHETHER ON THE FACTS IN THE CIRCUMSTANCES OF T HE CASE AND IN LAW THE ID. CIT(A) IS JUSTIFIED IN APPLYING THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF SANDVIK ASIA LTD. VS CIT (280 ITR 643) DATED 27/01/2006 FOR ALLOWING INTEREST ON INTEREST, DESPI TE THE FACT THAT THE SAID JUDGMENT HAS BEEN REVISED BY THE HON'BLE S UPREME COURT ON 18/09/2013 IN THE CASE OF M/S GUJRAT FLUORO CHEM ICALS (SLP)(C) ITA 1010/JP/2017_ DCIT VS. RAJASTHAN RAJYA VIDYUT PRASARAN NIGAM LTD. 2 NO. 11406/2008, WHEREIN IT HAS HELD THAT ONLY STATU TORY INTEREST U/S 244A IS ADMISSIBLE AND NOT INTEREST ON INTEREST. 2. WHILE PLEADING ON BEHALF OF THE REVENUE, THE LD CIT DR HAS SUBMITTED THAT THIS ISSUE HAS BEEN DECIDED BY THE H ON'BLE SUPREME COURT IN THE CASE OF M/S GUJARAT FLUORO CHEMICALS WH ILE DECIDING SLP (C) NO. 11406/2008 IN ITS ORDER DATED 18 TH SEPTEMBER, 2013 WHEREIN THE HONBLE APEX COURT HAS CATEGORICALLY DECIDED THE IS SUE AS UNDER: 6. IN OUR CONSIDERED VIEW, THE AFORESAID JUDGMENT HAS BEEN MISQUOTED AND MISINTERPRETED BY THE ASSESSEES AND ALSO BY THE REVENUE. THEY ARE OF THE VIEW THAT IN SANDVIK CASE (SUPRA) THIS COURT HAD DIRECTED THE REVENUE TO PAY INTEREST ON THE STATUTORY INTEREST I N CASE OF DELAY IN THE PAYMENT. IN OTHER WORDS, THE INTERPRETATION PLACED IS THAT THE REVENUE IS OBLIGED TO PAY AN INTEREST ON INTEREST IN THE EV ENT OF ITS FAILURE TO REFUND THE INTEREST PAYABLE WITHIN THE STATUTORY PE RIOD. 7. AS WE HAVE ALREADY NOTICED, IN SANDVIK CASE (SUP RA) THIS COURT WAS CONSIDERING THE ISSUE WHETHER AN ASSESSEE WHO IS MA DE TO WAIT FOR REFUND OF INTEREST FOR DECADES BE COMPENSATED FOR T HE GREAT PREJUDICE CAUSED TO IT DUE TO THE DELAY IN ITS PAYMENT AFTER THE LAPSE OF STATUTORY PERIOD. IN THE FACTS OF THAT CASE, THIS COURT HAD C OME TO THE CONCLUSION THAT THERE WAS AN INORDINATE DELAY ON THE PART OF T HE REVENUE IN REFUNDING CERTAIN AMOUNT WHICH INCLUDED THE STATUTO RY INTEREST AND THEREFORE, DIRECTED THE REVENUE TO PAY COMPENSATION FOR THE SAME NOT AN INTEREST ON INTEREST. 8. FURTHER IT IS BROUGHT TO OUR NOTICE THAT THE LEG ISLATURE BY THE ACT NO. 4 OF 1988(W.E.F. 01.04.1989) HAS INSERTED SECTION 244 A TO THE ACT WHICH PROVIDES FOR INTEREST ON REFUNDS UNDER VARIOUS CONT INGENCIES. WE CLARIFY ITA 1010/JP/2017_ DCIT VS. RAJASTHAN RAJYA VIDYUT PRASARAN NIGAM LTD. 3 THAT IT IS ONLY THAT INTEREST PROVIDED FOR UNDER THE STATUTE WHICH MAY BE CLAIMED BY AN ASSESSEE FROM THE REVENUE AND NO OTHE R INTEREST ON SUCH STATUTORY INTEREST. 3. ON THE OTHER HAND, THE LD AR OF THE ASSESSEE HAS RELIED ON THE ORDER OF THE LD. CIT(A) AND PLEADED THAT THE DECISIO N OF THE HON'BLE SUPREME COURT RELIED UPON BY THE LD. CIT(A) SHOULD B E APPLIED IN THE ASSESSEES CASE. 4. THE BENCH HAVE HEARD BOTH THE SIDES ON THIS ISSUE . THE BENCH HAVE CONSIDERED THE CASE LAWS RELIED UPON. THE HON'BL E SUPREME COURT IN THE CASE OF CIT VS GUJARAT VS GUJARAT FLUORO CHEM ICALS (SUPRA) HAS CLARIFIED THAT IT IS ONLY THAT INTEREST PROVIDED FO R UNDER THE STATUTE, WHICH MAY BE CLAIMED BY THE ASSESSEE FROM THE REVENUE AND NO INTEREST ON SUCH STATUTORY INTEREST. THE RATIO LAID DOWN IN THE C ASE OF SANDVIK ASIA LIMITED VS CIT & ORS. (2006) 2 SCC 508 IS NOT AT ALL APPLICABLE TO THE FACTS OF THE ASSESSEES CASE. IN THAT CASE, THE HON 'BLE SUPREME COURT DIRECTED THE REVENUE TO PAY COMPENSATION FOR AN INO RDINATE DELAY ON THE PART OF REVENUE IN REFUNDING THE AMOUNT WHICH INCLUD ES THE STATUTORY INTEREST BUT IN ASSESSEES CASE NO SUCH FACTS EXIST S WHEREIN THE REVENUE CAN BE SAID TO BE AT FAULT FOR DELAY. SINCE THE ISS UE HAS BEEN CLARIFIED AND CATEGORICALLY DECIDED BY THE HON'BLE SUPREME CO URT IN THE CASE OF ITA 1010/JP/2017_ DCIT VS. RAJASTHAN RAJYA VIDYUT PRASARAN NIGAM LTD. 4 CIT VS GUJARAT VS GUJARAT FLUORO CHEMICALS (SUPRA) W HICH IN LAW OF THE LAND, HENCE WE SET ASIDE THE ORDER OF THE LD. CIT(A) ON THIS ISSUE. 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27/02/2018. SD/- SD/- FOT; IKY JKO FOT; IKY JKO FOT; IKY JKO FOT; IKY JKO HKKXPAN HKKXPAN HKKXPAN HKKXPAN (VIJAY PAL RAO) (BHAGCHAND) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 27 TH FEBRUARY, 2018 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE DCIT, CIRCLE-6, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- M/S RAJASTHAN RAJYA VIDYUT PRASARAN NIGAM LTD., JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 1010/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR