DCIT CIR 2(1), MUMBAI V. M/s. BOMBAY DYEING & MFG. CO. LTD., MUMBAI

ITA 4365/MUM/2005

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2169 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 10 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-04-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 19-04-2010
• Assessment Year: 2000-2001
• Appeal Filed On: 10-06-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N K BALODIA
• Keywords: TDS
• Section: 244A; 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI J BENCH, MUMBAI BEFORE SHRI D.K. AGRAWAL, (JUDICIAL MEMBER), AND SHRI PRAMOD KUMAR, (ACCOUNTANT MEMBER) I.T.A NO.4365/MUM./2005 ASSESSMENT YEAR : 2000-01 DATE OF HEARING 19.4.2010 DY. COMMISSIONER OF INCOME TAX, CIRCLE 2(1) AAYAKAR BHAVAN, R.NO.575, M.K. ROAD MUMBAI 400 020 .. APPELLANT VS THE BOMBAY DYEING & MFG. CO. LTD., NEVILLE HOUSE, J.N. HEREDIA MARG, BALLARD ESTATE MUMBAI 400 001 AAACT2328K RESPONDENT APPELLANT BY : SHRI N.K. BALODIA RESPONDENT BY : SHRI MADHUR AGARWAL O R D E R PER PRAMOD KUMAR A.M. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CH ALLENGED CORRECTNESS OF LD. COMMISSIONER (APPEAL)S ORDER DATED 29 TH MARCH 2005, FOR THE ASSESSMENT YEAR 2000-01, ON THE FOLLOWING GROUND:- ITA NO.4365/MUM./2005 THE BOMBAY DYEING & MFG. CO. LTD. [2] THE LEARNED CIT(A) HAS ERRED IN DIRECTING THE A.O. TO ALLOW THE CREDIT FOR MAT BEFORE ALLOWING CREDIT FOR TDS AND RECOMPUTED THE I NTEREST U/S 244A WITHOUT CONSIDERING THE MEMORANDUM EXPLAINING THE PROVISION S FOR FINANCE BILL 1997. 2. THE RELEVANT MATERIAL FACTS ARE LIKE THIS. ON 18 TH JANUARY 2005, THE ASSESSING OFFICER PASSED AN APPEAL EFFECT ORDER GIVING EFFECT TO THE ORDER PASSED BY THE LEARNED CIT(A) FOR ASSESSMENT YEAR 2000-01. IN THE EFFECT SO GIVEN, THE ASSESSING OFFICER APPARENTLY GAVE MAT CREDIT AFTER COMPUTING THE INTEREST U/S 244A OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT ). IN EFFECT THUS MAT CREDIT U/S 115JA OF THE ACT WAS IGNORED FOR THE PURPOSE OF COMPUTING IN TEREST U/S 244A. 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEA L BEFORE THE LEARNED CIT(A), WHO UPHELD THE PLEA OF THE ASSESSEE AND DIR ECTED THE ASSESSING OFFICER TO GRANT CREDIT FOR MAT U/S 115JA BEFORE COMPUTING INT EREST U/S 244A. IN DOING SO, THE LEARNED CIT(A) FOLLOWED THE DECISIONS OF THE TR IBUNAL IN THE CASE OF SYNTHETIC INDUSTRIAL CHEMICALS LTD., 90 ITD 851 (COCHIN) AND PHILIPS INDIA LTD. VS ACIT, 92 ITD 441 (CHANDI.), WHICH WERE IN THE CONTEXT OF INT EREST COMPUTING U/S 234B AND 234C OF THE ACT, BUT, ACCORDING TO THE LEARNED CIT( A), THE SAME PRINCIPLE IS APPLICABLE FOR GRANT OF INTEREST U/S 244A OF THE AC T. REVENUE IS AGGRIEVED OF THE RELIEF SO GRANTED BY THE LEARNED CIT(A) AND IS IN A PPEAL BEFORE US. 4. LD. REPRESENTATIVES FAIRLY AGREED THAT THE ISSUE IS NOW COVERED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL, DELHI BENCH DECISION IN THE CASE OF DCIT VS BHARAT ALUMINIUM CO. LTD., 2010TIOL145ITATDEL, WHEREIN THE CO-ORDINATE BENCH HAS HELD THAT THE EFFECT OF MAT CREDIT U/S 115JA HAS TO BE TAKEN INTO ACCOUNT FIRST AND, ACCORDINGLY, INTEREST U/S 244A IS TO BE GRANTED BY TAKING THE SAME INTO ACCOUNT. LEARNED COUNSEL FOR THE ASSESSEE HAS ALSO INVITED O UR ATTENTION TO THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS APAR INDUSTRIES LTD., WHERE IDENTICAL SEQUENCE IS ALLOWED. IN VIEW OF THESE DIS CUSSIONS, WE SEE NO INFIRMITY IN THE ORDER OF THE LEARNED CIT(A) AND, ACCORDINGLY, W E CONFIRM THE SAME. NO INTERFERENCE IS CALLED FOR. ITA NO.4365/MUM./2005 THE BOMBAY DYEING & MFG. CO. LTD. [3] 5. LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITS TH AT, IN ANY EVENT, IT WAS NOT UPON TO THE ASSESSING OFFICER TO DISTURB THE CO MPUTATION OF INTEREST U/S 244A IN THIS MANNER, AT THIS STAGE OF GIVING APPEAL EFFECT ORDER. HE POINTS OUT THAT THIS EXERCISE, IN ANY EVENT, COULD HAVE BEEN CONDUCTED O NLY AT THE STAGE OF ASSESSMENT PROCEEDINGS AND NOT IN APPEAL EFFECT PROCEEDINGS. H OWEVER, IN VIEW OF THE FACT THAT WE HAVE UPHELD THE CONTENTIONS OF THE ASSESSEE ON M ERITS, WE NEED NOT ADDRESS OURSELVES TO THIS ASPECT OF THIS MATTER. WE LEAVE I T AT THAT. 6. IN THE RESULT, REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT TODAY ON 20 TH DAY OF APRIL 2010. SD/- (D.K. AGRAWAL) JUDICIAL MEMBER SD/- (PRAMOD KUMAR) ACCOUNTANT MEMBER MUMBAI; 20 TH DAY OF APRIL 2010 COPIES OF THE ORDER FORWARDED TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT, MUMBAI (4) CIT(A), MUMBAI (5) DR, J BENCH (6) GUARD FILE TRUE COPY BY ORDER, ETC. ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PRADEEP J. CHOWDHURY MUMBAI BENCHES SR. PRIVATE SECRETARY ITA NO.4365/MUM./2005 THE BOMBAY DYEING & MFG. CO. LTD. [4] DATE INITIAL 1. DRAFT DICTATED ON 19.4.2010 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 20.4.2010 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 20.4.2010 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 20.4.2010 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 20.4.2010 SR.PS/PS 6. DATE OF PRONOUNCEMENT 20.4.2010 SR.PS 7. FILE SENT TO THE BENCH CLERK 22.4.2010 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER