Mesto Minerals (I) Pvt. Ltd., Gurgaon V. DCIT, New Delhi

ITA 3785/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65885 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 07-11-2012
• Assessment Year: 1994-1995
• Appeal Filed On: 08-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEEPAK SEHGAL
• Assessee Lawyers: RANO JAIN CAS
• Section: 244A; 147; 263; 144; 154

Judgement Text

ITA NOS. 3785 & 3786/DEL/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E NEW DELHI BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NOS. 3785 & 3786/DEL/2011 A.YRS. : 1994-95 & 1995-96 M/S METSO MINERALS (I) PVT. LTD., 1 ST FLOOR, TOWER-A, BUILDING NO. 10, CYBER CITY, DLF PHASE-II, GURGAON-122002 (PAN : AAACS3407L) VS. DCIT, CIRCLE 6(1), DELHI (APPELLANT ) (APPELLANT ) (APPELLANT ) (APPELLANT ) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) ASSESSEE BY : SH. VED JAIN & MS. RANO JAIN, CAS DEPARTMENT BY : SH. DEEPAK SEHGAL, SR. D.R. ORDER ORDER ORDER ORDER PER SHAMIM YAHYA : AM PER SHAMIM YAHYA : AM PER SHAMIM YAHYA : AM PER SHAMIM YAHYA : AM THESE TWO APPEALS FILED BY THE ASSESSEE ARE DIREC TED AGAINST THE RESPECTIVE ORDERS OF THE LD. COMMISSIONER OF INCOME T AX (APPEALS)-IX, NEW DELHI PERTAINING TO ASSESSMENT YEARS 1994-95 & 19 95-96 RESPECTIVELY. SINCE THE ISSUES ARE COMMON AND T HE APPEALS WERE HEARD TOGETHER, THESE APPEALS ARE BEING CONSOLIDATE D AND DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE COMMON ISSUE RAISED IN THESE TWO APPEALS IS THAT LD. COMMISSIONER OF INCOME TAX (A) HAS ERRED IN CONFIRMIN G THE ACTION OF THE ASSESSING OFFICER IN NOT ALLOWING INTEREST ON EXCESS TAX COLLECTED FROM THE DATE OF PAYMENT UPTO THE DATE OF THE ORDER OF ITAT. ITA NOS. 3785 & 3786/DEL/2011 2 3. SINCE THE ISSUES AND CIRCUMSTANCES ARE COMMON, W E ARE ADJUDICATING THE ISSUE WITH REFERENCE TO THE FACTS O F ASSESSMENT YEAR 1994-95 FOR THE SAKE OF CONVENIENCE. 4. IN THIS CASE ASSESSEES CONTENTION FOR INTEREST U/S. 244A WAS NOT ACCEPTED BY THE ASSESSING OFFICER. ASSESSING OFFIC ER OBSERVED THAT ACCORDING TO SECTION 244A(2), IF THE PROCEEDINGS RE SULTING IN REFUND ARE DELAYED FOR REASONS ATTRIBUTABLE TO THE ASSESSEE, WHETHER WHOLLY OR IN PART, THE PERIOD OF THE DELAY SO ATTRIBUTABLE TO HI M SHALL BE EXCLUDED FROM THE PERIOD FOR WHICH INTEREST IS PAYABLE. ASS ESSING OFFICER HELD THAT FROM THE RECORDS IT IS SEEN THAT THE ABOVE CON DITION WAS DIRECTLY APPLICABLE TO THE ASSESSEES CASE. HE OBSERVED T HAT ASSESSEE COMPANY WAS NOT ABLE TO PRODUCE THE ORIGINAL DOCUMEN TS AND THESE WERE PROCURED BY ASSESSEE COMPANY MUCH LATER TO AS SESSMENT PROCEEDINGS. ACCORDINGLY, ASSESSING OFFICER HELD THAT NO INTEREST U/S. 244A WAS TO BE GRANTED. 5. UPON ASSESSEES APPEAL LD. COMMISSIONER OF INCOME TAX (A) NOTED THAT THE DISPUTE IN THE CASE WAS REGARDING TH E ALLOWABILITY OF INTEREST ON THE TAX FOUND REFUNDABLE TO THE ASSESSE E CONSEQUENT TO THE ASSESSMENT FRAMED BY THE ASSESSING OFFICER U/S. 14 3(3) READ WITH SECTION 254 OF THE ACT. HE NOTED THAT AS PER ASS ESSING OFFICER NO INTEREST WAS PAYABLE ON THE REFUND OF TAX AS THE D ELAY IN THE SAME WAS ATTRIBUTABLE TO THE ASSESSEE. LD. COMMISSIONE R OF INCOME TAX(A) FURTHER OBSERVED THAT ON GOING THROUGH THE FACTS, I T WAS NOTICED THAT THE RETURN WAS FILED ON 30.11.1994; THAT DURING T HE ASSESSMENT PROCEEDINGS, ASSESSEE SUBMITTED SOME DETAILS BUT HA D FAILED TO FURNISH EVIDENCES FOR CERTAIN TRANSACTIONS BECAUSE OF WHICH THE ADDITIONS WERE MADE BY THE ASSESSING OFFICER. FROM T HIS LD. ITA NOS. 3785 & 3786/DEL/2011 3 COMMISSIONER OF INCOME TAX (A) INFERRED THAT IT IS C LEAR THAT THE ADDITIONS WERE MADE BY THE ASSESSING OFFICER DUE T O FAILURE ON THE PART OF THE ASSESSEE TO SUBSTANTIATE ITS CLAIMS AS PER THE RETURN OF INCOME. LD. COMMISSIONER OF INCOME TAX (A) FURTHER NOTED THAT NOT ONLY THE ASSESSEE DID NOT PRODUCE THE REQUIRED EVID ENCE DURING THE ASSESSMENT PROCEEDING, BUT ALSO IT FAILED TO DO SO EVEN DURING THE APPELLATE PROCEEDING RESULTING INTO THE DECISION OF THE FIRST APPELLATE AUTHORITY GOING AGAINST IT. TO THIS EXTENT, LD. C OMMISSIONER OF INCOME TAX (A) HELD THAT THE DELAY WAS SURELY ATTRIBUTABLE TO THE ASSESSEE. LD. COMMISSIONER OF INCOME TAX (A) FURTHER OBSERVED THAT SINCE THE ASSESSEE HAS FAILED TO DISCHARGE THE ABOVE RESPONSI BILITY AS PER THE LAW, IT WILL BE HIGHLY INAPPROPRIATE TO GRANT IT IN TEREST FOR THE PERIOD WHEN IT HAD FAILED TO DISCHARGE SUCH RESPONSIBILITY . 5.1 FURTHER, LD. COMMISSIONER OF INCOME TAX (A) NOTED THAT THE ORDER WAS SET ASIDE BY THE TRIBUNAL ON 7.4.2003 TO THE F ILE OF THE ASSESSING OFFICER WHO TOOK MORE THAN SIX YEARS TO COMPLETE THE ASSESSMENT AND THEREFORE, DELAY FOR SUCH PERIOD CANNOT BE ATTRI BUTED TO THE ASSESSEE. LD. COMMISSIONER OF INCOME TAX (A) CONCLUDED THAT ASS ESSING OFFICER WAS NOT JUSTIFIED IN NOT PAYING INTEREST ON THE TAX WHICH WAS RECOVERED CONSEQUENT TO THE PASSING OF THE ORIGINAL ASSESSMEN T ORDER FOR THE WHOLE PERIOD INCLUDING THE 6 YEARS TAKEN BY HER TO PASS THE ORDER GIVING EFFECT TO THE ITATS ORDER. LD. COMMISSION ER OF INCOME TAX (A) DIRECTED THE ASSESSING OFFICER TO ALLOW THE INTER EST ON THE EXCESS TAX PAID BY THE ASSESSEE FROM THE DATE OF THE RECEIPT O F THE ORDER OF THE ITAT SETTING ASIDE THE ASSESSMENT TILL THE DATE OF GIVING EFFECT TO SUCH ORDER. ITA NOS. 3785 & 3786/DEL/2011 4 6. AGAINST THE ABOVE ORDER THE ASSESSEE IS IN APPEA L BEFORE US AGITATING THAT INTEREST SHOULD BE ALLOWED ON EXCESS TAX COLLECTED FROM THE DATE OF PAYMENT UPTO THE DATE OF THE ORDER OF TH E ITAT. 7. WE CAN GAINFULLY REFER TO THE PROVISIONS OF SECT ION 244A AS UNDER:- 244A. (1) [WHERE REFUND OF ANY AMOUNT BECOMES DUE TO THE ASSESSEE UNDER THIS ACT], HE SHALL, SUBJECT TO THE PROVISION S OF THIS SECTION, BE ENTITLED TO RECEIVE, IN ADDITION TO THE SAID AMOUNT , SIMPLE INTEREST THEREON CALCULATED IN THE FOLLOWING MANNER, NAMELY : (A) WHERE THE REFUND IS OUT OF ANY TAX [PAID UNDER SECTION 115WJ OR] [COLLECTED AT SOURCE UNDER SECTION 206C OR] PAID BY WAY OF ADVANCE TAX OR TREATED AS PAID UNDER SECTION 199, DURING TH E FINANCIAL YEAR IMMEDIATELY PRECEDING THE ASSESSMENT YEAR, SUCH INT EREST SHALL BE CALCULATED AT THE RATE OF [ONE-HALF PER CENT] FOR E VERY MONTH OR PART OF A MONTH COMPRISED IN THE PERIOD FROM THE 1ST DAY OF APRIL OF THE ASSESSMENT YEAR TO THE DATE ON WHICH THE REFUND IS GRANTED: PROVIDED THAT NO INTEREST SHALL BE PAYABLE IF THE AMOUNT OF REFUND IS LESS THAN TEN PER CENT OF THE TAX AS DETERMINED [UN DER [SUB-SECTION (1) OF SECTION 115WE OR] SUB-SECTION (1) OF SECTION 143 OR] ON REGULAR ASSESSMENT; (B) IN ANY OTHER CASE, SUCH INTEREST SHALL BE CALC ULATED AT THE RATE OF [ONE-HALF PER CENT] FOR EVERY MONTH OR PART OF A MO NTH COMPRISED IN THE PERIOD OR PERIODS FROM THE DATE OR, AS THE CASE MAY BE, DATES OF ITA NOS. 3785 & 3786/DEL/2011 5 PAYMENT OF THE TAX OR PENALTY TO THE DATE ON WHICH THE REFUND IS GRANTED. EXPLANATION.FOR THE PURPOSES OF THIS CLAUSE, 'DATE OF PAYMENT OF TAX OR PENALTY' MEANS THE DATE ON AND FROM WHICH THE AM OUNT OF TAX OR PENALTY SPECIFIED IN THE NOTICE OF DEMAND ISSUED UN DER SECTION 156 IS PAID IN EXCESS OF SUCH DEMAND. (2) IF THE PROCEEDINGS RESULTING IN THE REFUND ARE DELAYED FOR REASONS ATTRIBUTABLE TO THE ASSESSEE, WHETHER WHOLLY OR IN PART, THE PERIOD OF THE DELAY SO ATTRIBUTABLE TO HIM SHALL BE EXCLUDED FROM THE PERIOD FOR WHICH INTEREST IS PAYABLE, AND WHERE ANY QUESTION A RISES AS TO THE PERIOD TO BE EXCLUDED, IT SHALL BE DECIDED BY THE C HIEF COMMISSIONER OR COMMISSIONER WHOSE DECISION THEREON SHALL BE FIN AL. (3) WHERE, AS A RESULT OF AN ORDER UNDER [SUB-SECTI ON (3) OF SECTION 115WE OR SECTION 115WF OR SECTION 115WG OR] [SUB-SE CTION (3) OF SECTION 143 OR SECTION 144 OR] SECTION 147 OR SECTI ON 154 OR SECTION 155 OR SECTION 250 OR SECTION 254 OR SECTION 260 OR SECTION 262 OR SECTION 263 OR SECTION 264 OR AN ORDER OF THE SETTL EMENT COMMISSION UNDER SUB-SECTION (4) OF SECTION 245D, THE AMOUNT O N WHICH INTEREST WAS PAYABLE UNDER SUB-SECTION (1) HAS BEEN INCREASE D OR REDUCED, AS THE CASE MAY BE, THE INTEREST SHALL BE INCREASED OR REDUCED ACCORDINGLY, AND IN A CASE WHERE THE INTEREST IS RE DUCED, THE ASSESSING OFFICER SHALL SERVE ON THE ASSESSEE A NOTICE OF DEM AND IN THE PRESCRIBED FORM SPECIFYING THE AMOUNT OF THE EXCESS INTEREST PAID AND REQUIRING HIM TO PAY SUCH AMOUNT; AND SUCH NOTICE O F DEMAND SHALL BE ITA NOS. 3785 & 3786/DEL/2011 6 DEEMED TO BE A NOTICE UNDER SECTION 156 AND THE PRO VISIONS OF THIS ACT SHALL APPLY ACCORDINGLY. (4) THE PROVISIONS OF THIS SECTION SHALL APPLY IN R ESPECT OF ASSESSMENTS FOR THE ASSESSMENT YEAR COMMENCING ON THE 1ST DAY O F APRIL, 1989, AND SUBSEQUENT ASSESSMENT YEARS :] [ PROVIDED THAT IN RESPECT OF ASSESSMENT OF FRINGE BENEFITS, THE PROVISIONS OF THIS SUB-SECTION SHALL HAVE EFFECT AS IF FOR THE FIGURES '1989', THE FIGURES '2006' HAD BEEN SUBSTITUTED.] 8. FROM THE ABOVE IT IS EVIDENT THAT IN CASE OF REFUN D, INTEREST HAS TO BE PAID FROM THE DATE OF PAYMENT OF TAX TO THE DATE ON WHICH THE REFUND IS GRANTED. FURTHER, IF THERE IS DELAY IN THE PROCEEDINGS FOR REASONS ATTRIBUTABLE TO THE ASSESSEE, THE PERIOD OF SUCH DELAY SHOULD BE EXCLUDED. FURTHER, IF IN THE APPELLATE PROCEED INGS THE AMOUNT ON WHICH INTEREST WAS PAYABLE IS INCREASED OR REDUCED THE INTEREST SHALL BE ADJUSTED ACCORDINGLY. IN THE PRESENT CASE WE NOTE THAT ADDITION WAS MADE PURSUANT TO THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S. 143(3). THE SAME WAS ALSO CONFIRMED BY THE LD. COMMISSIONER OF INCOME TAX (A). IN THE APPELLATE PROCEEDING BEFORE THE ITAT THE MATTER WAS SET ASIDE. THEREAFTER, AFT ER CONSIDERABLE TIME ASSESSING OFFICER PASSED THE ORDER GIVING EFFECT TO THE TRIBUNAL ORDER WHICH RESULTED IN REFUND TO THE ASSESSEE. IN A S ITUATION AS NARRATED ABOVE THE ASSESSEE HAS BEEN GRANTED INTEREST ON REF UND FROM THE DATE OF ITAT ORDER. NO INTEREST HAS BEEN GRANTED FROM T HE DATE OF PAYMENT TO THE DATE OF ITAT ORDER ON THE GROUND THAT ASSES SMENT PROCEEDINGS WERE DELAYED DUE TO ASSESSEE, AS THE ASSESSEE HAD F AILED TO FURNISH THE REQUISITE DETAIL BEFORE THE ASSESSING OFFICER & LD. COMMISSIONER OF ITA NOS. 3785 & 3786/DEL/2011 7 INCOME TAX (A). HOWEVER, NO COGENT BASIS FOR THIS HAS BEEN BROUGHT ON RECORD. 9. IN OUR CONSIDERED OPINION, THE ABOVE IS NOT SUST AINABLE. THE PROCEEDINGS BEFORE THE ASSESSING OFFICER, THE LD. C OMMISSIONER OF INCOME TAX (A) AND THE ITAT IS A CONTINUOUS PROCESS . IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE THERE IS NO COGENT BASIS TO HOLD THAT ASSESSMENT PROCEEDINGS GOT DELAYED DUE TO THE ASSES SEES FAILURE TO SUBMIT THE DETAILS BEFORE THE ASSESSING OFFICER & LD. COMMISSIONER OF INCOME TAX (A). 10. UNDER THE CIRCUMSTANCES, WE HOLD THAT THE ASSESS EE SHOULD ALSO BE GRANTED INTEREST ON REFUND FROM THE DATE OF PAY MENT OF TAX TO THE DATE OF ITAT ORDER. 11. IN THE RESULT, BOTH THE APPEALS FILED BY THE A SSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23/11/2012. SD/- SD/- [RAJPAL YADAV] [RAJPAL YADAV] [RAJPAL YADAV] [RAJPAL YADAV] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 23/11/2012 SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES