TCS e-SERVE LTD ( EARLIER KNOWN AS e-SERVE INTERNATIONAL LTD), MUMBAI V. ASST CIT RG 9(1), MUMBAI

ITA 3319/MUM/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6526 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 15-05-2014
• Assessment Year: 2003-2004
• Appeal Filed On: 11-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GIRIJA DAYAL
• Assessee Lawyers: A V SONDE SR
• Section: 244A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI , , BEFORE SHRI SANJAY ARORA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA , JUDICIAL MEM BER . / ITA NO. 3319 / MUM./201 2 ( / ASSESSMENT YEAR : 20 03 04 ) . / ITA NO. 3320 / MUM./201 2 ( / ASSESSMENT YEAR : 20 02 03 ) . / ITA NO. 3321 / MUM./201 2 ( / ASSESSMENT YEAR : 20 01 02 ) . / ITA NO. 3322 / MUM./201 2 ( / ASSESSMENT YEAR : 1997 98 ) TCS E SERVE LIMITED (EARLIER KNOWN AS E SERVE INTERNATIONAL LIMITED) BLOCK NO.B 3 NIRLON KNOWLEDGE PARK OFF WESTERN EXPRESS HIGHWAY GOREGAON (EAST) , MUMBAI 400 063 .. / APPELLANT V/S DY. COMMISSIONER OF INCOME TAX (A) CIRCLE 9(3), AAYAKAR BHAVAN 101, M.K. ROAD, MUMBAI 400 020 .... / RESPONDENT ./ PERMANENT ACCOUNT NUMBER AAACC4480F / ASSESSEE BY : MR. A.V. SONDE , SR. COUNSEL / REVENUE BY : MR. GIRIJA DAYAL / DATE OF HEARING 1 5 .0 5 .201 4 / DATE OF ORDE R 1 5.05 .2014 TCS E SERVE LIMITED 2 / ORDER / PER BENCH T HE PRESENT APPEAL S HA VE BEEN PREFERRED BY THE ASSESSEE CHALLENGING THE IMPUGNED SEPARATE ORDER S OF EVEN DATE 28 TH FEBRUARY 2012 , PASSED BY THE LEARNED COMMISSIONER (APPEALS) XX, MUMBAI, FOR THE ASSESSMENT YEAR 20 03 04, 2002 03, 2001 02 AND 1997 98 RESPECTI VELY. SINCE ALL THESE APPEALS PERTAIN TO THE SAME ASSESSEE INVOLVING COMMON ISSUE ARISING OUT OF IDENTICAL SET OF FACTS AND CIRCUMSTANCES, THEREFORE, AS A MATTER OF CONVENIENCE, THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY WAY OF THIS CO NSOLIDATED ORDER. 2 . THE SOLE COMMON ISSUE INVOLVED IN ALL THE YEARS UNDER APPEAL IS THAT, THE LEARNED COMMISSIONER (APPEALS) OUGHT TO HAVE HELD THAT THE ASSESSEE WAS ENTITLED TO INTEREST ON THE AMOUNT OF INTEREST DUE TO THEM UNDER SECTION 244A, WHICH WAS S HORT GRANTED TO THEM, AS, IF SUCH INTEREST HAD BEEN GRANTED TO THE ASSESSEE WHEN DUE, THE ASSESSEE WOULD HAVE EARNED INCOME THEREON. 2 . BEFORE US, THE LEARNED SENIOR COUNSEL, MR. ARVIND SONDE, ON BEHALF OF THE ASSESSEE, SUBMITTED THAT BEFORE THE AUTHORITIES BELOW, APART FROM THE CONTENTION OF ALLOWABILITY OF INTEREST ON THE REFUND, ANOTHER CONTENTION WAS RAISED THAT SINCE THE CORRECT AMOUNT OF INTEREST ON REFUND WAS NOT GRANTED ON TIME, THEREFORE, THEY ARE ENTITLED TO INTEREST ON INTEREST. THE LEARNED COMMISS IONER (APPEALS) HAS DECIDED THIS ISSUE AGAINST THE ASSESSEE ON THE GROUND THAT THERE IS NO PROVISION TCS E SERVE LIMITED 3 UNDER THE INCOME TAX ACT, 1961, FOR PROVIDING INTEREST ON INTEREST. AGAINST THIS FINDING OF THE LEARNED COMMISSIONER (APPEALS), THE ASSESSEE HAS PREFERRED THESE APPEALS. HE SUBMITTED THAT EARLIER, VARIOUS HIGH COURTS HAVE DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE RELYING UPON THE DECISION OF THE HON'BLE SUPREME COURT IN SANDVICK ASIA LTD. V/S CIT, [2006] 280 ITR 643 (SC). NOW, HE CANDIDLY ADMITTED THAT IN THE WAKE OF LATEST SUPREME COURT DECISION IN CIT V/S GUJARAT FLUORO CHEMICALS, [2014] 42 TAXMAN.COM 001, ORDER DATED 18 TH SEPTEMBER 2013 AND [2014] 43 TAXMAN.COM 350, ORDER DATED 26 TH FEBRUARY 2014, THE HON'BLE SUPREME COURT HAS HELD THAT THE DECISION OF SANDVICK ASIA LTD. (SUPRA) HAS BEEN MISINTERPRETED, AS IN THAT CASE, THE REVENUE WAS DIRECTED TO PAY THE INTEREST ON STATUTORY INTEREST BECAUSE OF INORDINATE DELAY AND SAID DECISION WAS PASSED ON THE FACTS OF THAT CASE. THE HON'BLE SUPREME COURT HAS CLARIF IED THAT ONLY INTEREST PROVIDED UNDER THE STATUTE WHICH CAN ALONE BE CLAIMED BY THE ASSESSEE, AND NOT ANY OTHER INTEREST ON STATUTORY INTEREST. ACCORDINGLY, THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER TO COMPUTE INTEREST IN ACCO RDANCE WITH THE DECISION OF THE HON'BLE SUPREME COURT. THE LEARNED DEPARTMENTAL REPRESENTATIVE TOO AGREED WITH THIS PROPOSITION. 3 . AFTER CONSIDERING THE DECISION OF THE HON'BLE SUPREME COURT IN CIT V/S GUJARAT FLUORO CHEMICALS (SUPRA), WE FIND THAT THE HON' BLE SUPREME COURT HAS CATEGORICALLY HELD THAT THE PROVISIONS OF SECTION 244A ONLY PROVIDES FOR INTEREST ON REFUND UNDER VARIOUS CONTINGENCIES, AND ONLY THE INTEREST AS PROVIDED IN THE STATUTE CAN BE CLAIMED BY THE ASSESSEE AND NO OTHER INTEREST ON SUCH INT EREST, WHICH HAS BEEN TO BE COMPUTED UNDER SECTION 244A. THUS, THE GROUND RAISED IN ALL THESE TCS E SERVE LIMITED 4 APPEALS RAISING A PLEA THAT IT IS ENTITLED TO INTEREST ON THE AMOUNT OF INTEREST DUE TO THEM UNDER SECTION 244A WHICH WAS SHORT GRANTED TO THEM, WOULD HAVE TO BE DECIDED IN THE LIGHT OF THE DECISION OF THE HON'BLE SUPREME COURT CITED SUPRA. CONSEQUENTLY, WE SET ASIDE THE IMPUGNED ORDERS PASSED BY THE LEARNED COMMISSIONER (APPEALS) FOR THE ASSESSMENT YEAR 1997 98, 2001 02, 2002 03 AND 2003 04 AND RESTORE THE ISSUE B ACK TO THE FILE OF THE ASSESSING OFFICER, WHO SHALL COMPUTE THE INTEREST WHICH IS ALLOWABLE UNDER SECTION 244A. AND IN ACCORDANCE WITH THE JUDGMENT OF THE HON'BLE SUPREME COURT, GRANT INTEREST WHICH THE ASSESSEE IS ENTITLED TO. THUS, THE GROUND RAISED BY T HE ASSESSEE IN ALL THE YEARS UNDER APPEAL IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 4 . 1997 98, 2001 02, 2002 03 AND 2003 04 4. IN THE RESULT, ASSESSEES APPEAL S FOR THE ASSESSMENT YEAR 1997 98, 2001 02, 2002 03 AND 2003 04 ARE ALLOWED FOR STATISTI CAL PURPOSES. 1 5 TH MAY 2014 ORDER PRONOUNCED IN THE OPEN COURT ON 1 5 TH MAY 2014 SD/ - SANJAY ARORA ACCOUNTANT MEMBER SD/ - AMIT SHUKLA JUDICIAL MEMB ER MUMBAI, DATED : 1 5 TH MAY 2014 TCS E SERVE LIMITED 5 / COPY OF THE ORDER FORWARDED TO : ( 1 ) / THE ASSESSEE ; ( 2 ) / THE REVENUE; ( 3 ) ( ) / THE CIT(A ) ; ( 4 ) / THE CIT, MUMBAI CITY CONCERNED ; ( 5 ) , , / THE DR, ITAT, MUMBAI ; ( 6 ) / GUARD FILE . / TRUE COPY / BY ORDER . / PRADEEP J. CHOWDHURY / SR. PRIVATE SECRETARY / / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI