ACIT 10(1), MUMBAI V. INDIAN OIL CORPORATION LTD, MUMBAI

ITA 1949/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55386 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2011
• Appeal Filed By: Department
• Bench Allotted: I
• Next Hearing Date: 22-09-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 11-03-2010
• Court: TRIBUNAL
• Department Lawyers: SANJIV DUTT
• Assessee Lawyers: URVI SHAH; R L PATIL
• Keywords: Retrospective amendment; Question of law
• Section: 244A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I BEFORE SHRI J SUDHAKAR REDDY (AM) & SHRI VIJAY PAL RAO (JM) I.T.A.NO. 1949/MUM/2010 (ASSESSMENT YEAR : 2003-04) ACIT RANGE 10(1) ROOM NO. 455 AAYAKAR BHAVAN M.K. ROAD MUMBAI-400 020. VS. M/S. INDIAN OIL CORPORATION LTD. G-9, INDIAN OIL BHAVAN ALI YAVAR JUNG MARG BANDRA EAST MUMBAI-400 051. PAN/GIR NO. : AABCV 0613J ASSESSEE BY : SHRI R.L. PATIL & URVI SHAH DEPARTMENT BY : SHRI SANJIV DUTT DATE OF HEARING : 22.9.2011 DATE OF PRONOUNCEMENT : 30.9.2011 ORDER PER J. SUDHAKAR REDDY, (AM) :- THIS IS AN APPEAL FILED BY THE REVENUE DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-21, MUMBAI FOR A.Y.2002-03 ON THE F OLLOWING GROUNDS : 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, LEARNED CIT(A) ERRED IN HOLDING THAT INTEREST U/S. 234D OF THE ACT IS CHARGEABLE FROM A.Y. 2004-05 ONLY AND IT COULD NOT BE CHARGED FOR EARLIER ASSESSMENT YEARS, EVEN T HOUGH REGULAR ASSESSMENT FOR SUCH ASSESSMENT YEARS ARE FR AMED AFTER 01.06.2003. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, LEARNED CIT(A) ERRED IN DIRECTING TO GRANT INTEREST U/S. 244A(1)(B) OF THE ACT ON THE EXCESS SELF ASSESSMENT TAX PAID WITHOUT APPRECIATING THAT EXPLANATION TO SECTION 24 4A(1)(B) PROVIDES FOR THE PURPOSES OF THIS CLAUSE, DATE OF PAYMENT OF TAX OR PENALTY MEANS THE DATE ON AND FROM WHICH TH E AMOUNT OF TAX OR PENALTY SPECIFIED IN THE NOTICE OF DEMAND ISSUED UNDER SECTION 156 IS PAID IN EXCESS OF SUCH DEMAND AND SELF ASSESSMENT TAX IS NOT PAID AGAINST NOTIC E OF DEMAND U/S. 156. 3. THE APPELLANT PRAYS THAT THE ORDER OF LEARNED CI T(A) ON THE ABOVE GROUND BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. M/S. INDIAN OIL CORPORATION LTD. 2 2. WE HAVE HEARD SHRI SANJIV DUTT, LEARNED DEPARTME NTAL REPRESENTATIVE ON BEHALF OF THE REVENUE AND SHRI R. L. PATIL ALONG WITH MISS. URVI SHAH ON BEHALF OF THE ASSESSEE. 3. AFTER HEARING RIVAL CONTENTION, WE FIND THAT THE UNDISPUTED FACT IS THAT THE ASSESSEE HAS BEEN GRANTED REFUND ON 29.3.2 003 WHICH IS BEFORE 1.6.2003. THE ISSUE IS WHETHER INTEREST U/S. 234D C AN BE CHARGED. 4. JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. BAJAJ HINDUSTAN LTD., INCOME TAX APPEAL NO. 198 OF 2009 DATED 15.4. 2009 HAVE CONSIDERED THE FOLLOWING SUBSTANTIAL QUESTION OF LA W :- D) WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE C ASE AND IN LAW THE ITAT WAS RIGHT IN HOLDING THAT THE INTEREST U/S. 234D CANNOT BE CHARGED IN RESPECT OF REFUNDS GRANTE D PRIOR TO 1.6.2003. AT PARGRAPH 5 OF THE JUDGEMENT HON'BLE COURT ANSWER ED THE QUESTION AS FOLLOWS :- SO FAR AS THE LAST QUESTION IS CONCERNED, IT IS SE EN THAT THE SUBJECT PROVISION CAME ON STATUE BOOK W.E.F. 1.6.20 03. IF THAT BE SO, THE SAID PROVISION DOES NOT HAVE RETROSPECTIVE EFFECT. IN THIS VIEW OF THE MATTER, WE DO NOT SEE APPEAL GIVING RIS E TO ANY SUBSTANTIAL QUESTION OF LAW. APPEAL IS, THEREFORE, DISMISSED IN LIMINE WITH NO ORDER AS TO COSTS. 5. LEARNED DEPARTMENTAL REPRESENTATIVE RELIED ON TH E JUDGMENT OF HON'BLE KERALA HIGH COURT IN THE CASE OF CIT VS. KE RALA CHEMICALS & PROTEINS LTD., 323 ITR 584, WHEREIN IT IS HELD THAT INTEREST IS CHARGEABLE FOR THE PERIOD FROM 1 ST JUNE 2003, TILL THE COMPLETION OF REGULAR ASSESSMENT. 6. AS JURISDICTIONAL HIGH COURT HAS CATEGORICALLY H ELD THAT INTEREST CANNOT BE CHARGED U/S. 234D, IF THE REFUND WAS GRAN TED PRIOR TO 1.6.2003, WE UPHOLD THE ORDER OF THE FIRST APPELLAT E AUTHORITY ON THIS ISSUE AND DISMISS GROUND NO. 1. 7. COMING TO GROUND NO. 2 WHICH IS REGARDING GRANT OF INTEREST U/S. 244A (1)(B) ON THE EXCESS SELF ASSESSMENT TAX, WE F IND THAT HON'BLE DELHI M/S. INDIAN OIL CORPORATION LTD. 3 HIGH COURT IN THE CASE OF CIT VS. SUTLEJ INDUSTRIES LTD., 325 ITR 331 (DEL) HAS DEALT WITH THIS ISSUE AND AT PAGE 339 HEL D AS FOLLOWS :- THEREFORE, IN OUR VIEW WHERE THE SELF-ASSESSMNET T AX PAID BY THE ASSESSEE UNDER SECTION 140A IS REFUNDED, THE ASSESS EE SHOULD BE, ON PRINCIPLE ENTITLED TO INTEREST THEREON SINCE THE SELF-ASSESSMENT TAX FALLS WITHIN THE EXPRESSION REFUND OF ANY AMOU NT. THE COMPUTATION OF INTEREST ON SELF-ASSESSMENT TAX HAS TO BE IN TERMS OF SECTION 244A(1)(B), I.E., FROM THE DATE OF PAYME NT OF SUCH AMOUNT UP TO THE DATE ON WHICH REFUND IS ACTUALLY G RANTED. WE FIND SUPPORT FOR THIS CONCLUSION FROM THE DECISION OF THE MADRAS HIGH COURT IN CHOLAMANDALAM INVESTMENT AND FINANCE CO. LTD. (2007) 294 ITR 438, THE SPECIAL LEAVE PETITION AGAI NST WHICH ORDER WAS DISMISSED BY THE SUPREME COURT . EVEN OTHERWISE , IT IS TRITE LAW THAT WHEREVER THE ASSESSEE IS ENTITLED TO REFUN D, THERE IS STATUTORY LIABILITY ON THE REVENUE TO PAY THE INTER EST ON SUCH REFUND ON GENERAL PRINCIPLES TO PAY THE INTEREST ON SUMS WRONGFULLY RETAINED (SANDVIK ASIA LTD. SUPRA). SIMILAR IS THE VIEW OF THE MUMBAI B BENCH OF THE TRIBUNAL IN THE CASE OF ADDL.CIT, SPECIAL RANGE 23 VS. GRINDWELL NORTON LTD ., 100 ITD 245 (MUM). LEARNED DEPARTMENTAL REPRESENTATIVE RELIED ON THE ORDER OF THE DELHI E BENCH OF THE TRIBUNAL IN THE CASE OF SUTL EJ INDUSTRIES LTD. VS. ACIT, 86 ITD 335 (DEL). AS THIS DECISION HAS BEEN OVERRULED BY THE JUDGEMENT OF HON'BLE DELHI HIGH COURT IN THE CASE O F SUTLEJ INDUSTRIES LTD. (SUPRA), WE RESPECTFULLY FOLLOW THE SAME AND U PHOLD THE ORDER OF LEARNED CIT(A) AND DISMISS GROUND NO. 2 OF THE REVE NUE. 8. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER HAS BEEN PRONOUNCED ON 30 TH DAY OF SEPTEMBER, 2011. SD/- (VIJAY PAL RAO) JUDICIAL MEMBER SD/- (J.SUDHAKAR REDDY) ACCOUNTANT MEMBER DATED : 30 TH SEPTEMBER, 2011. COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A)-CONCERNED. 4. THE CIT, CONCERNED. 5. THE DR CONCERNED, MUMBAI 6. GUARD FILE BY ORDER TRUE COPY ASSTT. REGISTRAR, ITAT, MUMBAI PS