BANK OF INDIA, MUMBAI V. ASST CIT 2(1), MUMBAI

ITA 5446/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 84607 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-12-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 08-08-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S J SINGH
• Section: 244A; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B, MUMBAI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER ITA NOS. 5444, 5445 & 5446/MUM/2013 ASSESSMENT YEARS: 2002-03, 2003-04 & 2006-07 M/S. BANK OF INDIA, STAR HOUSE, PLOT C-5, G BLOCK, BANDRA KURLA COMPLEX, BANDRA(E), MUMBAI- 400 051 PAN:AAACB 0472 C VS. DCIT 2(1) MUMBAI (APPELLANT) (RESPON DENT) ITA NO. 5398/MUM/2013 ASSESSMENT YEAR: 2003-04 DCIT 2(1) MUMBAI VS. M/S. BANK OF INDIA, STAR HOUSE, PLOT C-5, G BLOCK, BANDRA KURLA COMPLEX, BANDRA(E), MUMBAI- 400 051 PAN:AAACB 0472 C (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI C. NARESH REVENUE BY : SHRI S.J. SINGH DATE OF HEARING : 10 . 12 . 2014 DATE OF ORDER : 22 . 12 .2014 PER AMIT SHUKLA, JM: THIS AFORESAID APPEALS HAVE BEEN FILED BY THE ASSES SEE AS WELL AS BY THE REVENUE AGAINST SEPARATE ORDERS PASSED BY TH E LD.CIT-4, MUMBAI, OF EVEN DATE 28.05.2013, IN RELATION TO THE PROCEEDINGS U/S ITA NOS. 5444, 5445 & 5446/MUM/2013 M/S. BANK OF INDIA ASSESSMENT YEARS: 2002-03, 2003-04 & 2006-07 2 154. SINCE COMMON ISSUES ARE INVOLVED IN ALL THE AP PEALS, THEREFORE, FOR THE SAKE OF CONVENIENCE, THE SAME WERE HEARD TOGETH ER AND ARE BEING DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER. THE MAIN ISSUE INVOLVED IN ALL THE APPEALS IS NON GRANTING OF INTEREST U/S 244A ON THE SELF ASSESSMENT TAX PAID AND SECONDLY, IMPOSES WORKING O F INTEREST U/S 244 A, WHILE GRANTING REFUND TO THE ASSESSEE. FOR THE S AKE OF CONVENIENCE CROSS APPEALS FOR THE A.Y. 2003-04 IS TAKEN UP FIRS T. 2. IN GROUND NO. 1, THE ASSESSEE HAS CHALLENGED NON GRANTING OF INTEREST ON SELF ASSESSMENT TAX. THE ASSESSEE IS A NATIONALIZED BANK AND IN THIS YEAR, THE ASSESSMENT WAS COMPLETED U/S 143( 3), VIDE ORDER DATED 29.03.2005, WHEREBY INCOME WAS ASSESSED AT RS.15,09 ,60,13,850/-. THE SAID ORDER WAS SUBJECT MATTER OF APPEAL BEFORE THE LD.CIT(A). AFTER GIVING EFFECT TO THE ORDER OF CIT(A) AND WHILE GRA NTING REFUND, THE ASSESSING OFFICER DID NOT GRANT INTEREST U/S 244A O N THE SELF ASSESSMENT TAX PAID BY THE ASSESSEE. AGGRIEVED BY THAT, ASSESS EE FILED A PETITION FOR RECTIFICATION U/S 154 TO GRANT INTEREST. HOWEVER, T HE ASSESSING OFFICER DID NOT ACCEPT THE ASSESSEES CONTENTION THAT INTEREST ON SELF ASSESSMENT TAX IS NOT PAYABLE WITHIN SECTION 244A. THE LD.CIT(A) H OWEVER, DIRECTED THE AO TO LOOK INTO THE MATTER AND DECIDE THE ISSUE ON MERITS. 3. BEFORE US, THE LEARNED COUNSEL SUBMITTED THAT TH E ISSUE OF GRANT OF INTEREST ON SELF ASSESSMENT TAX NOW STANDS COVERED BY THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF STOCK HOLDINGS INDIA PVT. LTD. VS. CIT, VIDE JUDGMENT AND ORDER DATED 17.11.2014 IN WRIT P ETITION NO. 823 OF 2000. THEREFORE, THIS ISSUE SHOULD BE DECIDE D IN THE LIGHT OF THE SAID DECISION OF THE HONBLE BOMBAY HIGH COURT. ITA NOS. 5444, 5445 & 5446/MUM/2013 M/S. BANK OF INDIA ASSESSMENT YEARS: 2002-03, 2003-04 & 2006-07 3 4. ON THE OTHER HAND, LD. DR SUBMITTED THAT THE ASS ESSEE SHOULD HAVE FILED APPEAL AGAINST REGULAR ASSESSMENT ORDER AND NOT U/S 154 AS THE ISSUE IS BEYOND THE SCOPE OF SECTION 154. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND ALSO PER USED THE MATERIAL ON RECORD. SO FAR AS THE CONTENTION OF THE LD. DR T HAT THE ISSUE OF INTEREST ON SELF ASSESSMENT CANNOT BE RAISED IN PRO CEEDINGS U/S 154, CANNOT BE ACCEPTED, BECAUSE IT WAS ONLY AFTER GIVIN G EFFECT TO THE LD.CIT(A) ORDER AND WHILE GRANTING REFUND, THE AO H AS NOT GRANTED THE INTEREST ON SELF ASSESSMENT TAX. THE ONLY COURSE LE FT BEFORE THE ASSESSEE WAS TO FILE A PETITION U/S 154. THUS THE CLAIM OF I NTEREST OF SELF ASSESSMENT TAX IS MAINTAINABLE IN THE PROCEEDINGS U /S 154. SO FAR AS THE ISSUE, WHETHER INTEREST SHOULD BE GRANTED ON THE AM OUNT OF SELF ASSESSMENT TAX PAID IS NOW COVERED BY THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF STOCK HOLDINGS COR PORATION OF INDIA (SUPRA), WHEREIN THE HONBLE HIGH COURT HELD THAT T AX PAID ON SELF ASSESSMENT WOULD FALL WITHIN THE AMBIT OF SECTION 2 44A(I)(B). ACCORDINGLY THE AO IS DIRECTED TO GRANT INTEREST U/S 244A ON TH E SELF ASSESSMENT TAX. THUS GROUND NO. 1 AS RAISED BY THE ASSESSEE IS TREA TED AS ALLOWED. 6. IN GROUND NO. 2, THE ASSESSEE HAS CHALLENGED THE WORKING OF INTEREST AND THE MANNER IN WHICH REFUND HAS BEEN AD JUSTED BY THE ASSESSING OFFICER AS NOT CORRECT. LD COUNSEL SUBMIT TED THAT THE ASSESSING OFFICER WHILE GRANTING INTEREST ON REFUND AND WHILE MAKING THE ADJUSTMENT, OF REFUND, HAS MADE THE ENTIRE ADJUSTME NT ON ACCOUNT OF INTEREST AND NOT AGAINST THE AMOUNT OF TAX. WHEN TH E AO DID NOT PAY THE FULL AMOUNT OF REFUND BUT A PART OF REFUND THEN HE WAS LIABLE TO CALCULATE INTEREST ON THE BALANCE AMOUNT OF OUTSTAN DING DEMAND ITA NOS. 5444, 5445 & 5446/MUM/2013 M/S. BANK OF INDIA ASSESSMENT YEARS: 2002-03, 2003-04 & 2006-07 4 CONSISTING OF TAX AND INTEREST. HE ALSO SUBMITTED W ORKING OF THE REFUND AND THE INTEREST ALLOWED BY THE AO AND STATE THAT S AME IS NOT IN ACCORDANCE WITH THE LAW. THE LD.CIT(A) HAS WRONGLY HELD THAT ASSESSEE HAS REQUESTED FOR INTEREST ON INTEREST. IN SUPPORT OF HIS CONTENTION, HE STRONGLY RELIED UPON THE DECISION OF THE HONBLE DE LHI COURT IN THE CASE OF INDIA TRADE PROMOTION ORGANIZATION VS. CIT REPORTED IN (2014) 361 ITR 646 . 7. ON THE OTHER HAND, LD. DR RELIED UPON THE WORKIN G OF THE AO AS WELL AS THE ORDER OF THE LD.CIT(A). 8. AFTER CONSIDERING THE SUBMISSIONS MADE BY THE PA RTIES AND ALSO THE WORKING GIVEN BY THE AO, WE ARE OF THE OPINION THAT THE ASSESSING OFFICER SHOULD EXAMINE THE WORKING OF REFUND AND IN TEREST AFRESH, KEEPING IN VIEW THE RATIO LAID DOWN BY THE HONBLE DELHI HIGH COURT IN THE CASE OF INDIA TRADE PROMOTION ORGANIZATION VS. CIT (2014) 361 ITR 646. THE ASSESSEE CAN SUBMIT ITS OWN WORKING, WHICH CAN BE EXAMINED BY THE AO IN LIGHT OF THE DECISION OF THE HONBLE D ELHI HIGH COURT AS THEIR LORDSHIPS AFTER EXAMINING THE RELEVANT PROVISION OF SECTION 244A AND EFFECT OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. HEG 324 ITR 331 , HAVE LAID DOWN THE PRINCIPLE AS TO HOW THE PART PAYMENT OF REFUND AND THE INTEREST ON THE BALANCE A MOUNT IS TO BE CALCULATED. THUS THE GROUND RAISED BY THE ASSESSEE IS TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSE. 9. IN THE REVENUES APPEAL, GROUND RAISED IS SIMILA R TO GROUND NO. 1 OF THE ASSESSEES APPEAL, THEREFORE, IN VIEW OF THE FI NDING GIVING THEREIN, THE DEPARTMENT GROUND IS TREATED AS DISMISSED. ITA NOS. 5444, 5445 & 5446/MUM/2013 M/S. BANK OF INDIA ASSESSMENT YEARS: 2002-03, 2003-04 & 2006-07 5 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE AND THE REVENUE IS DISMISSE D . APPEAL FOR A.Y. 2002-03 AND 2006-07, 11. IN THESE APPEALS, ONLY ONE ISSUE IS RAISED WH ICH IS SIMILAR TO GROUND NO. 2, RAISED BY THE ASSESSEE IN THE APPEAL FOR A.Y . 2003-04. THUS, IN VIEW OF THE FINDING GIVEN THEREIN, THE SAID ISSUE I S ALSO SET ASIDE TO THE FILE OF THE AO TO EXAMINE THE WORKING OF INTEREST A ND REFUND AND DECIDE THE ISSUE IN VIEW OF THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF INDIA TRADE PROMOTION ORGANIZATION VS. CIT (SUPRA). ACCORDINGLY THE GROUNDS RAISED BY THE ASSESSEE IN BOTH THE YEARS AR E TREATED AS PARTLY ALLOWED FOR STATISTICAL PURPOSE. 12. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE AND THE REVENUE IS DISMISSE D ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY DECEMBER, 2014. SD/- SD/- (N.K. BILLAIYA) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 22.12.2014 *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR B BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.