TATA COMMUNICATIONS LTD (FORMERLY VIDESH SAMACHAR NIGAM LTD), MUMBAI V. DCIT 1(3), MUMBAI

ITA 4962/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 84033 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Assessment Year: 1990-1991
• Appeal Filed On: 01-07-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: LAV KUMAR
• Assessee Lawyers: DINESH VYAS
• Section: 244A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E MUMBAI . . , . . , BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER /AND SHRI R.C.SHARMA , ACCOUNTANT MEMBER ITA NO.4962/MUM/2013(A.Y. 1990-91) TATA COMMUNICATIONS LTD. VIDESH SANCHAR BHAVAN, MG ROAD, FORT, MUMBAI 400001 PAN: AAACV2808C (APPELLANT ) VS. THE DCIT 1(3), AAYKAR BHAVAN, MK ROAD MUMBAI 400 020 (RESPONDENT) APPELLANT BY : SHRI DINESH VYAS RESPONDENT BY : SHRI LA V KUMAR DATE OF HEARING : 22/10/2014 DATE OF PRONOUNCEMENT : 22 /10/2014 ORDER PER I.P.BANSAL, J.M: THIS APPEAL IS FILED BY THE ASSESSEE AND IT IS DIR ECTED AGAINST ORDER PASSED BY LD. CIT(A-20 MUMBAI DATED 12/04/2013 FOR ASSESSME NT YEAR 1990-91. GROUNDS OF APPEAL READ AS UNDER: GROUND NO.1: SHORT GRANT OF INTEREST U/S. 244A: ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE HONBLE CIT(A) HAS ERRED IN NOT DIRECTING THE LEARNED ASSESSING OFFICER TO GRAN T INT EREST U/S. 244A ON REFUND DUE IN ACCORDANCE WITH LAW AND THE CURRENT LEGAL POSITION. 2. AT THE OUTSET IT WAS SUBMITTED BY LD. AR THAT IN TEREST UNDER SECTION 244A HAS NOT BEEN CORRECTLY COMPUTED BY THE AO. REFERENCE IN THIS REGARD WAS MADE TO THE ORDER PASSED BY THE TRIBUNAL IN GROUP CASE OF THE A SSESSEE I.E. IN THE CASE OF ACIT VS. TATA POWER COMPANY LTD. VIDE ORDER DATED 6/3/2013 I N ITA NO.6863/MUM/2011 FOR ITA NO.4962/MUM/2013(A.Y. 1990-91) 2 ASSESSMENT YEAR 1997-98. IN THE SAID CASE REVENUE AGITATED THE DIRECTION OF LD. CIT(A) WHEREIN HE DIRECTED THE AO TO DEDUCT ONLY TA X ELEMENT FROM THE REFUND GENERATED EARLIER EXCLUDING INTEREST PORTION. ACCO RDING TO REVENUE SUCH DIRECTION OF LD. CIT(A) IS CONTRARY TO LAW AND WOULD LEAD TO EXC ESS GRANT OF INTEREST. REFERENCE WAS INVITED TO THE GROUNDS OF APPEAL RAISED BY THE REVENUE IN THE SAID CASE. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) FAILED TO APPRECIATE THAT AS PER THE PROVISION OF SECTION 244A, THE ASSESSEE WILL BE ENTITLED TO SIMPLE INTEREST WHEREAS THE DIRECTION GIVEN BY THE CIT(A) IS CONTRARY TO THE PROVISION. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DIRECTING THE AO TO DEDUCT ONLY THE TAX ELEMENT FRO M THE REFUND GENERATED EARLIER EXCLUDING THE INTEREST PORTION CONTRARY TO THE I NTENTION OF THE LEGISLATION. THIS WOULD LEAD TO EXCESS GRANT OF INTEREST TO THE TUNE OF RS. 1,98,42,960/-. 3. FOR THESE AND OTHER GROUNDS THAT MAY BE URGED A T THE TIME OF HEARING THE DECISION OF THE LD. CIT(A) MAY BE SET ASIDE AND THAT OF THE AO RESTORED. THE AFOREMENTIONED ISSUE WAS DECIDED BY THE TRIBUNA L AS FOLLOWS: 4. BEFORE US, THE LD. DR HAS STATED THAT THE LD. CIT(A) OUGHT NOT TO HAVE DIRECTED THE AO TO DEDUCT ONLY TAX ELEMENT FROM THE REFUND GENER ATED EARLIER EXCLUDING THE INTEREST PORTION WHICH LEAD TO EXCESS GRANT OF INTEREST TO T HE TUNE OF RS.1,92,42,460/-. ON THE OTHER HAND, LD. AR HAS RELIED ON THE ORDER OF THE L D. CIT(A). 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. IT IS PERTINENT TO MENTION THAT GROUND NO.1 IS VAGUE AND ALSO THE DR H AS BEEN UNABLE TO POINT OUT ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A). WE HEREB Y DISMISS GROUND NO.1 FOR THE REASON THAT THE ASSESSEE IS ENTITLED FOR THE INTEREST ON R EFUND ACCORDING TO THE PROVISION OF SECTION 244A(1) AND LD. CIT(A) HAS NOT GIVEN ANY DI RECTION CONTRARY TO LAW. 5.1 AS GROUND NO.2, WE DO NOT FIND ANY JUSTIFIABL E REASON TO INTERFERE WITH ORDER PASSED BY THE LD. CIT(A) DIRECTING THE AO TO EXCLUDE THE I NTEREST ELEMENT OF REFUND EARLIER GRANTED AS THE PROVISIONS OF THE I.T. ACT DO NOT P ERMIT TO INCLUDE INTEREST WITHIN REFUND IN THE GIVEN SITUATION WHILE DEDUCTING THE AMOUNT OF R EFUND ISSUED EARLIER AND, THEREFORE, GROUND NO.2 IS HEREBY DISMISSED. ACCORDINGLY, THE ORDER OF THE LD. CIT(A) IS HEREBY UPHELD. 2.1 IT WAS FURTHER SUBMITTED THAT THE SAID DECISION GIVEN WAS FOLLOWED BY THE TRIBUNAL IN THE SAME VERY CASE IN RESPECT OF A.Y 20 02-03 AND 2005-06 VIDE ORDER DATED 3/7/2013 IN ITA NOS. 3977 & 3978/MUM/2012. C OPIES OF BOTH THESE ORDERS WERE PLACED ON OUR RECORD AND WERE ALSO GIVEN TO L D. DR. REFERRING TO AFOREMENTIONED DECISION IT WAS SUBMITTED BY LD. AR THAT WHILE COMPUTING INTEREST FOR ITA NO.4962/MUM/2013(A.Y. 1990-91) 3 THE YEAR UNDER CONSIDERATION THE AO HAS CALCULATED THE TAX CONTRARY TO THE AFOREMENTIONED DECISION OF THE TRIBUNAL. LD. AR HA S PLACED BEFORE US THE CALCULATION OF THE INTEREST WHICH IS IN ACCORDANCE WITH THE AFO REMENTIONED POSITION OF LAW ACCEPTED BY THE TRIBUNAL IN GROUP CASE. THE CALCUL ATION READ AS UNDER: ASSESSMENT YEAR 1990-91 REFUND DUE AS AT APRIL 27, 1994 AS PER INCOME TAX DEPARTMENT 7,39,52,350 AS PER THE APPELLANT 7,39,52,350 REFUND RECEIVED DURING TAX COMPONENT INTEREST COMPONENT TOTAL REFUND TAX COMPONENT JANUARY 1997 4,31,52,261 1,42,46,316 5,73,98, 577 4,31,52,261 FEBRUARY 2003 2,86,97,603 1,10,88,874 3,97,86 ,477 2,86,97,603 MARCH 2003 (1,172) 98,51,812 98,50,64 0 (1,172) INTEREST PAYABLE TO THE APPELLANT U/S.244A 3,77,01,243 4,82,779 REFUND SHORT GRANTED 1,05,57,536 2.2 LD. AR PLEADED THAT LD. CIT(A) HAS ERRED IN NOT ACCEPTING THESE SUBMISSIONS OF THE ASSESSEE AND, THEREFORE, THE ORDER PASSED BY LD . CIT(A) SHOULD BE SET ASIDE AND AO MAY BE DIRECTED TO RECALCULATE THE INTEREST UNDE R SECTION 244A OF THE ACT IN ACCORDANCE WITH THE PROPOSITION ACCEPTED BY THE TRI BUNAL IN THE AFOREMENTIONED GROUP CASE. 3. ON THE OTHER HAND, LD. DR RELIED UPON THE ORDER PASSED BY A.O AND LD. CIT(A). 4. AFTER HEARING BOTH THE PARTIES, RESPECTFULLY FOL LOWING AFOREMENTIONED DECISION OF TRIBUNAL IN GROUP CASE OF THE ASSESSEE THE RELEVANT PORTION OF WHICH HAS ALREADY BEEN REPRODUCED, WE DIRECT THE AO TO RECALCULATE THE INT EREST IN ACCORDANCE WITH THE AFOREMENTIONED DECISION OF THE TRIBUNAL. WE DIRECT ACCORDINGLY. ITA NO.4962/MUM/2013(A.Y. 1990-91) 4 5. IN THE RESULT, THE GROUND RAISED BY THE ASSESSEE IS CONSIDERED TO BE ALLOWED FOR STATISTICAL PURPOSES IN THE MANNER AFORESAID. ORDER PRONOUNCED IN THE OPEN COURT ON 22/10/20 14 !' # $%& 22/10/2014 ! ' SD/- SD/- ( . . /R.C.SHARMA ) ( . . / I.P. BANSAL ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; $% DATED 22/10/2014 ()* ()* ()* ()* +*') +*') +*') +*') / COPY OF THE ORDER FORWARDED TO : 1. ,- / THE APPELLANT 2. (.,- / THE RESPONDENT. 3. / ( ) / THE CIT(A)- 4. / / CIT 5. *0' ()% , , / DR, ITAT, MUMBAI 6. '1 2 / GUARD FILE. % % % % / BY ORDER, .*) () //TRUE COPY// 3 33 3 / 4 4 4 4 5 5 5 5 (DY./ASSTT. 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