Lopamudra Misra, Cuttack V. ACIT, Circle-2(2), Cuttack, Cuttack

ITA 233/CTK/2013

• Counselvise Citation: 23322114 RSA 2013
• Duration Of Justice: 1 year(s) 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 25-05-2015
• Assessment Year: 2001-2002
• Appeal Filed On: 10-04-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Keywords: Source of fund
• Section: 244A

Judgement Text

I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI S .V. MEHROTRA (ACCOUNTANT MEMBER) , AND SHRI GEORGE MATHAN (JUDICIAL MEMBER) I.T.A. NO. 233 / CTK / 20 1 3 ASSESSMENT YEAR : 20 0 1 - 20 02 LOPAMUDRA MISHRA,............................ .. ...... .. .APP ELL ANT CUTTACK, 33, BHAWANI BUILDINGS, SECTOR - 6, C.D.A., CUTTACK - 753 014 [PAN : AGSPM 8462 C] - VS. - ASSISTANT COMMISSIONER OF INCOME TAX, ............. RESPONDENT CIRCLE - 2(2), BHUBANESWAR APPEARANCES BY: NONE (WRITTEN SUBMISSIONS FILED) , FOR THE ASSESSEE SHRI S.C. MOHANTY, D.R, FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : OCTOBER 21 , 2 01 4 DATE OF PRONOUNCING THE ORDER : OCTOBER 22 , 201 4 O R D E R PER GEORGE MATHAN : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) , CUTTACK, ODISHA IN I.T. APPEAL NO. 0 235 / 2011 - 1 2 DATED 1 8 . 0 1 .20 1 3 FOR THE ASSESSMENT YEAR 20 0 1 - 02 . 2. THE APPEAL HAD COME UP FOR HEARING ON 14.10.2014 ON WHICH DATE THE ASSESSEES FATHER ONE SHRI BASA NTA KUMAR MISRA HAD APPEARED. SHRI BASANTA KUMAR MISRA HAD MENTIONED THAT THE ASSESSEE WAS ENTITLED TO INTEREST @ 12% PER ANNUM ON THE REFUND AMOUNT OF THE TAX PAID FROM THE NOTICE DATE OF 16.01.2001. ON 14.10.2014 , SHRI BASANTA KUMAR MISRA FILED A PAPER B OOK CONTAINING 70 PAGES. BENCH HAD REQUESTED SHRI BASANTA KUMAR MISRA TO FILE THE COPY OF THE RETURN FILED BY THE ASSESSEE SO THAT THE BENCH COULD UNDERSTAND THE METHOD OF CALCULATION OF THE TAX PAID AND I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 2 OF 7 THE SOURCES OF INCOME ON WHICH THE TAX WAS PAID AS T HE TOTAL INCOME DECLARE IS NEARLY RS.16 LACS. AT THIS POINT SHRI BASANTA KUMAR MISRA INFORMED THE BENCH THAT THE HONBLE JURISDICTIONAL HIGH COURT OF CUTTACK HAD ALREADY HELD THE RETURN OF INCOME TO BE NON - EST AND CONSEQUENTLY HE WAS UNABLE TO PROVIDE THE TRIBUNAL WITH THE COPY OF THE RETURN. AT THIS POINT, THE BENCH REQUESTED SHRI BASANTA KUMAR MISRA TO PROVIDE THE COPY OF THE PAPER BOOK TO THE LD. DR AND ALSO PROVIDE THE COPY OF THE RETURN, WHICH HAS BEEN TREATED AS NON - EST BY THE HONBLE JURISDICTIONAL H IGH COURT. IT WAS INFORMED TO SHRI BASANTA KUMAR MISRA THAT THE TRIBUNAL BEING THE HIGHEST F ACT F INDING B ODY WOULD HAVE TO INCORPORATE ALL THE FACTUAL ASPECTS IN ITS ORDER WHEN DECIDING THE ISSUE. WITH THIS DIRECTION, THE CASE WAS ADJOURNED. ON 15.10.2014, SHRI BASANTA KUMAR MISRA REQUESTED FOR A COPY OF THE ORDER - SHEET NOTING WHICH WAS ALSO PROVIDED TO HIM ON THE SAME DATE. SHRI BASANTA KUMAR MISRA FURTHER ON 19.10.2014 SENT AN E - MAIL TO THE HONBLE PRESIDENT, INCOME TAX APPELLATE TRIBUNAL INFORMING HIM AS FOLLOWS: - TO THE HONBLE PRESIDENT, ITAT, MUMBAI BEING THIS IS A SERIOUS MATTER, I PRAY THE HONBLE PRESIDENT TO DIRECT THE HEAD CLERK OF ITAT, CUTTACK TO PLACE THE WRITTEN SUBMISSION BEFORE THE HONBLE MEMBERS OF THE BENCH IMMEDIATELY. ALSO THE HONBLE IS PRAYED TO ISSUE AN ORDER FOR THE ENQUIRY OFTHIS MATTER ALONGWITH THE MATTER OF THE APPELLANT BEFORE THE ITAT, CUTTACK BENCH, AS THE AR OF THE APPELLANT FEELS, WILFULLY ON THE REQUEST OF THE INCOME TAX OFFICERS, AGAINST WHOM THE AR HAS MADE COMPLAINS BEF ORE THE HONBLE MINISTER OF FINANCE AND CVC WERE MADE, THE MEMBERS OF THE CUTTACK BENCH ARE DELAYING THE PROCESS OF JUSTICE, ONLY TO PROTECT THE CORRUPT INCOME TAX OFFICIALS. PLEASE TREAT THIS TO BE MOST URGENT AND PLEASE TAKE NECESSARY ACTION AT THE EARLI EST AND INFORM THE PETITIONER PER E - MAIL OF PER MOBILE NO. 9237367492, AS THE PETITIONER IS NOW IN HYDERABAD. WITH REGARDS, BASANTA KUMAR MISRA, FLATNO. 302, SUDHINI RESIDENCY, PLOT NO. 321/93, PATRIKA NAGAR, MADHUPUR, HYDERABAD - 500 033 MOBILE NO. 92373674 92 I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 3 OF 7 THE HONBLE PRESIDENT, INCOME TAX APPELLATE TRIBUNAL HAS DIRECTED THE SENIOR MEMBER SHRI S.V. MEHROTRA ON 20.10.2014 TO LOOK INTO THE MATTER AND DO THE NEEDFUL. ON 16.10.2014 , SHRI BASANTA KUMAR MISRA FILED AN ANOTHER LETTER MAKING SUBSTANTIAL ALLEG ATIONS AGAINST THE MEMBERS AND THE DEPARTMENTAL OFFICERS REQUESTING THAT THE ADJOURNMENT BE RE - CALLED AND THE APPEAL BE DISPOSED OF ON MERITS BASED ON THE WRITTEN SUBMISSIONS. A GAIN ON 19.10.2014 HAS SENT AGAIN ANOTHER LETTER REQUESTING FOR NECESSARY ORDER S TO BE PASSED ON THE WRITTEN SUBMISSIONS. 3. CONSEQUENTLY THE WRITTEN SUBMISSIONS FILED ON 16.10.2014 BY SHRI BASANTA KUMAR MISRA IS CONSIDERED AND THE TRIBUNAL BY EXERCISE OF ITS SUO MOTO POWER HOLDS THAT THE APP EAL OF THE ASSESSEE BE POSTED FOR HEARING ON 21.10.2014. ON 21.10.2014, I.E. TODAY WHEN THE MATTER CAME UP FOR HEARING THE WRITTEN SUBMISSIONS WERE CONSIDERED ALONGWITH THE OBJECTIONS OF THE LD. D.R. 4. AFTER CONSIDERING THE SUBMISSIONS OF SHRI BASANTA KUMAR MISRA ON BEHALF OF LOPAMUDRA MISRA A ND THE LD. D.R., WE HAVE GONE THROUGH THE VARIOUS PAPERS FILED BY THE ASSESSEE. ADMITTEDLY THE HONBLE JURISDICTIONAL HIGH COURT HAS HELD THE RETURN FILED BY THE ASSESSEE TO BE NON - EST . HONBLE JURISDICTIONAL HIGH COURT HAS CATEGORICALLY HELD THAT THE ASSE SSEE DOES NOT HAVE THE LIABILITY TO PAY INCOME - TAX IN VIEW OF THE PROVISIONS OF SECTION 4(1) OF THE ACT. THE TRIBUNAL HAD VIDE AN ORDER DATED 30.04.2009 HAD HELD THAT THE PRIZE MONEY RECEIVED BY THE ASSESSEE FROM THE TELEVISION GAME SHOW CANNOT BE ASSESSED AS INCOME OF THE ASSESSEE AND THE ASSESSEE IS ENTITLED TO GET THE REFUND OF RS.7,50,500/ - WRONGLY ALONGWITH THE INTEREST AS PROVIDED UNDER THE ACT. THE HONBLE JURISDICTIONAL HIGH COURT HAD TAKEN SERIOUS NOTE OF THE FACT THAT THE ASSESSING OFFICER HAD GON E BEYOND HIS JURISDICTION IN TREATING THE INCOME OF THE ASSESSEE AS INCOME FROM OTHER SOURCES ESPECIALLY WHEN THE TRIBUNAL HAD HELD THAT THE INCOME WAS NOT ASSESSABLE AS SUCH IN IT S ORDER. I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 4 OF 7 5. NOW THE MAIN CONTENTION OF THE LD. A.R. IS THAT ON 16.01.2001 L D. ACIT, CIRCLE - 2, CUTTACK HAD MENTIONED THAT THE EXCESS TAX , IF ANY , WILL BE REFUNDED ALONGWITH INTEREST @ 12% PER ANNUM. IN PARA 21 OF THE JURISDICTIONAL HIGH COURTS ORDER , THE HONBLE HIGH COURT HAS COME DOWN HEAVILY ON THE PRACTICE OF THE AUTHORITIES ACTING ON BEHALF OF THE REVENUE IN THE MATTER OF COLLECTION OF TAX. THE HONBLE HIGH COURT HAS LAID DOWN DIRECTION SPECIFICALLY THAT EVERY ACTION OF THE STATE AND ITS INSTRUMENTALIT Y SHOULD BE FAIR, LEGITIMATE AND ABOVE BOARD AND WITHOUT ANY AFFECTION OR A VERSION. KEEPING IN MIND THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT AND ALSO KEEPING IN MIND THAT THE INCOME TAX APPELLATE TRIBUNAL IS A CREATURE OF THE STATUTE. W E HAVE GONE THROUGH THE COMPUTATION OF INTEREST AND THE REFUND THEREON AS MADE BY THE ASSESSING OFFICER WHEN GIVING EFFECT TO THE ORDER OF THE HONBLE JURISDICTIONAL HIGH COURT VIDE AN ORDER DATED 07.09.2011. 6. IN THE SAID ORDER GIVING EFFECT TO THE ORDER OF THE HONBLE JURISDICTIONAL HIGH COURT I.E. THE ORDER DATED 07.09.2011 , IT IS NOTICED THAT THE ASSESSING OFFICER HAS PROVIDED FOR INTEREST UNDER SECTION 244A OF THE ACT. A PERUSAL OF THE PROVISIONS OF SECTION 244A SHOWS THAT WHERE ANY REFUND OF ANY AMOUNT BECOMES DUE TO THE ASSESSEE UNDER THIS ACT THEN IN ADDITION TO THE SAID AMOUN T SIMPLE INTEREST THEREON IS DUE TO THE ASSESSEE AND THE RATE OF INTEREST IS ALSO SPECIFICALLY PROVIDED FOR. T HE RATE OF INTEREST VARIES IN ACCORDANCE WITH THE TAXATION LAW AMENDMENT ACT. BEFORE 01.06.2002, THE RATE OF INTEREST WAS 1% PER MONTH AND W.E.F . 01.06.2002 T HE RATE CAME DOWN TO %. WITH EFFECT FROM 08.09.2003, IT CAME DOWN TO 2/3%. WE MAY ALSO MENTION HERE THAT BEFORE 01.10.1991, THE RATE WAS 1% AND %. IN THE LETTER OF THE ASSESSING OFFICER DATED 16.01.2001, HE MENTIONS THAT THE REFUND ALONGWIT H INTEREST @ 12% PER ANNUM CANNOT BE FOLLOWED. THIS IS BECAUSE WHEN THIS LETTER WAS ISSUED TO THE ASSESSEE, THE RATE OF INTEREST PRESCRIBED UNDER THE ACT WAS 12% OR MORE SO 1% PER MONTH BUT WHEN THE REFUND BECAME DUE TO THE ASSESSEE, THE RATE CHANGED FROM 0.75% AND IT CAME DOWN TO 0.66% AND THEN TO 0.5% I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 5 OF 7 PER MONTH. NOW IN THE LETTER OF THE LD. AR DATED 16.10.2014, THE LD. AR HAS PROVIDED CALCULATION OF INTEREST AND REFUND. A PERUSAL OF THE SAID CALCULATION SHOWS THAT HE HAS COMPUTED THE INTEREST AT 9% PER AN NUM FROM 30.10.2001 TO 31.01.2014. THIS IS NOT THE RATE OF INTEREST AVAILABLE AND THE INTEREST CANNOT BE CHARGED FOR 13 YEARS AND 9 MONTHS. THE FIRST REFUND WAS ISSUED ON 04.11.2009 AND THE SECOND RE FUND WAS ISSUED ON 21.06.2011. THEREFORE, THIS CALCULATIO N TILL 31.12.2014 WOULD BE ABSOLUTELY ERRONEOUS. NOW AFTER ARRIVING AT THIS INTEREST AT 9% PER ANNUM, THE LD. AR ON BEHALF OF THE ASSESSEE HAS APPLIED 12% RATE PER ANNUM AS A LLEGEDLY AGREED BY THE ASSESSING OFFICER VIDE A LETTER DATED 16.01.2001 FOR 166 MO NTHS AND HE HAS COMPUTED THE INTEREST OF NEARLY RS.31 LAKHS. THIS SECOND PORTION OF THE INTEREST WHICH IS BEING COMPUTED IS CLEARLY AN INTEREST ON THE INTEREST WHICH IS ABSOLUTELY NOT GRANTABLE IN ANY CASE BY AN APPELLATE AUTHORITY AS ALSO THE DECISIONS OF THE HONBLE SUPREME COURT IN THE CASE OF GUJARAT FLURO CHEMICALS REPORTED IN 358 ITR 291 (SC) . THERE IS NO PROVISION UNDER THE INCOME TAX ACT WHERE AN APPELLATE AUTHORITY CAN IN EXERCISE OF ITS APPELLATE POWERS ENHANCED THE LEVY OF INTEREST BEYOND SUCH PR ESCRIBED UNDER THE ACT. THIS IS WHY WE HAVE MENTIONED EARLIER THAT INCOME TAX APPELLATE TRIBUNAL IS A CREATURE OF THE STATUTE . A PERUSAL OF THE ORDER OF THE ASSESSING OFFICER PASSED ON 07.09.2011 CLEARLY SHOWS THAT THE ASSESSING OFFICER HAS RIGHTLY APPLIED THE RATES OF INTEREST FOR GRANTING THE REFUND. IN THESE CIRCUMSTANCES, WE FIND NO ERROR IN THE ORDER OF THE LOWER AUTHORITIES IN SO FAR AS EVEN THE LD. CIT(APPEALS) IS ALSO AN APPELLATE AUTHORITY AND EVEN HE CANNOT ENHANCED THE RATE OF INTEREST AS PRESCRI BED BY THE ACT. WE MAY ALSO MENTION HERE THAT EVEN THE HONBLE JURISDICTIONAL HIGH COURT HAD NO POINT OF TIME DIRECTED THE REVENUE TO PROVIDE INTEREST @ 12% PER ANNUM. THE HONBLE JURISDICTIONAL HIGH COURT HAS ONLY DECLINED THE ASSESSING OFFICER FOR EXCEED IN G HIS JURISDICTION WHEN PASSING THE ORDER GIVING EFFECT TO THE ORDER OF THE TRIBUNAL AS ALSO IN REGARD TO THE METHODOLOGY ADOPTED FOR THE COLLECTION OF THE TAXES. WE MAY EXTRACT THE ORDER OF THE HONBLE I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 6 OF 7 JURISDICTIONAL HIGH COURT AT PAGE PARA 21 & 22 OF T HE ORDER FOR BETTER UNDERSTANDING : 21. BEFORE PARTING WITH THE JUDGMENT, WE FEEL IT NECESSARY TO OBSERVE THAT IN VIEW OF THE VARIOUS COMMUNICATIONS MADE BY THE ASSESSING OFFICER TO THE PETITIONER WHICH HAVE BEEN QUOTED IN THE BODY OF THE WRIT PETITION, I T IS DIFFICULT TO DISBELIEVE THE CONTENTIONS TAKEN BY THE ASSESSEE IN PARAGRAPH 4 OF THE WRIT PETITION THAT BEING SCARED OF INITIATION OF PROSECUTION AND IMPOSITION OF 300% PENALTY ANDON THE ASSURANCE OF REFUND OF THE AMOUNT PAID AS ADVANCE TAX ALONGWITH I NTEREST @ 12% PER ANNUM, THE ASSESSEE PAID ADVANCE TAX OF RS.7,55,500/ - ON 30.03.2008 AS DIRECTED BY THE ASSESSING OFFICER AND FINALLY FILED THE RETURN ON 14.02.2002. THE LETTER OF THE ASST. COMMISSIONER, INCOME TAX SHOWS THAT HE DEPUTED ONE A. KARIM FOR T HE PURPOSE OF MAKING FULL PAYMENT OF ADVANCE TAX BY THE ASSESSEE. THIS IS CERTAINLY NOT A HEALTHY PRACTICE ON THE PART OF THE AUTHORITIES ACTING ON BEHALF OF THE REVENUE IN THE MATTER OF COLLECTION OF TAX. IN ORDER TO GAIN FAITH OF THE ASSESSEE AND CREATE CONFIDENCE IN THE MINDS OF THE TAX PAYERS AND FOR SMOOTH ADMINISTRATION OF TAX LAW, THE REVENUE AUTHORITIES MUST ACT IN A FAIR AND LEGAL MANNER. 22. LAW IS WELL SETTLED THAT EVERY ACTION OF THE STATE AND ITS INSTRUMENTALITY SHOULD BE FAIR, LEGIGIMATE AND ABOVE BOARD AND WITHOUT ANY AFFECTION OR AVERSION. (HAJI T.M. HASSAN RAWTHER VS. - KERALA FINANCE CORPORATIOIN, AIR 1988 SC 157; E.P. ROYAPPA VS. - STATE OF TAMIL NADU, AIR 1974 SC 555 AND STATE OF ANDHRA PRADESH & ANR., - VS. - NALLA RAJA REDDY, AIR 1967 SC 1458) . 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND OCTOBER , 2014. SD/ - SD/ - S .V. MEHROTRA GEORGE MATHAN ( ACCOUNTANT MEMBER) ( JUDICIAL MEMB ER) KOLKATA, THE 22 ND D AY OF OCTO BER , 201 4 I.T.A. NO. 233 / CTK ./20 1 3 ASSESSMENT YEAR: 20 0 1 - 20 02 PAGE 7 OF 7 COPIES TO : (1) THE ASSESSEE (2) THE DEPARTMENT (3) COMMISSIONER OF INCOME - TAX (APPEALS) (4) COMMISSIONER OF INCOME TAX ( 5 ) THE DEPARTMENTAL REPRESENTATIVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL CUTTACK B ENCH, CUTTACK LAHA/SR. P.S.