M/s Mysore Urban Development Authority, Mysore V. Addl.CIT, Mysore

ITA 619/BANG/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0582 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2009
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-10-2009
• Assessment Year: 2006-2007
• Appeal Filed On: 12-06-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: V S SREELEKHA
• Assessee Lawyers: S R KIRON
• Section: 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH B BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO. 619/BANG/2009 ASSESSMENT YEARS : 2006-07 M/S. MYSORE URBAN DEVELOPMENT AUTHORITY, JLB ROAD, MYSORE. APPELLANT VS. THE ADDITIONAL CIT, RANGE 2, MYSORE. RESPONDENT APPELLANT BY : SHRI S.R. KIRON RESPONDENT BY : SMT. V.S. SREELEKHA O R D E R PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST T HE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEAL S), MYSORE DATED 26.3.2009 FOR THE ASSESSMENT YEARS 200 6-07. 2. THE ASSESSEE IS AN URBAN DEVELOPMENT AUTHORITY CREATED BY SPECIAL STATUTE I.E., THE KARNATAKA URBA N DEVLEOPMENT AUTHORITIES ACT, 1987 WHICH CAME INTO EXISTENCE W.E.F. 1.5.1988. AT THE OUT SET, WE N OTICE THAT ITA NO.619/B/09. PAGE 2 OF 4 THE ASSESSEE HAS NOT PRODUCED THE NECESSARY CLEARAN CE FROM THE COMMITTEE ON DISPUTES/HIGH POWER COMMITTEE. ON A SIMILAR ISSUE, ON AN EARLIER OCCASION, THIS TRIBUNA L IN ITA NO.1063 TO 1067 & 1071 TO 1075/08 IN THE CASE OF BANGALORE WATER SUPPLY & SEWERAGE BOARD HAD DISMISS ED THE APPEAL OF THE ASSESSEE. THE EXTRACT OF THE SAI D ORDER IS REPRODUCED HEREBELOW FOR REFERENCE: 2. WE FIND THAT THE MATTER OF DISPUTE BETWEEN A PUBLIC SECTOR UNDERTAKINGS AND THE GOVERNMENT AS LAID DOWN BY THE SUPREME COURT IN ONGC VS COLLECTOR OF CENTRAL EXCISE (1995) SUPP(40SCC 541 AND IN OTHER CASES, HAS SET GUIDELINES IN SUCH MATTERS. WHETHER THIS REQUIREMENT OF PRIOR CLEARANCE FROM A GOVERNMENT COMMITTEE IS NECESSARY EVEN IN RESPECT OF A DISPUTE BETWEEN SUCH PUBLIC SECTOR UNDERTAKINGS AND THE STATE GOVERNMENT IS NOW A LIVE ISSUE. APPROVAL BY A DIFFERENT COMMITTEE OF DISPUTES (COD) WITH STATE PARTICIPATION WAS HELD TO BE A REQUIREMENT AS DECIDED BY THE HONBLE MADRAS HIGH COURT IN THE CASE OF TAMILNADU WAREHOUSING CORPORATION VS DEPUTY CIT(2009) 309 ITR 252. HONBLE RAJASTHAN HIGH COURT IN THE STATE OF RAJASTHAN VS ITAT (2003) 259 ITR 686 AND CIT VS DELHI TOURISM AND TRANSPORTATION DEVELOPMENT CORPORATION LTD., (2005) 274 ITR 35(DELHI) ALSO REQUIRED SUCH CLEARANCE. BUT THE HONBLE ANDHRA PRADESH HIGH COURT IN ANDHRA PRADESH POWER GENERATION LTD., VS ASST. CIT(2006) 280 ITR 388(AP) TOOK THE VIEW THAT THE RULE IN ONGCS CASE HAS NO APPLICATION, WHERE STATE GOVERNMENT WAS A PARTY, FOLLOWED BY THE TRIBUNAL IN DEPUTY CIT VS MAHARASHTRA STATE ROAD TRANSPORT CORPORATION(2006) 284 ITR (AT) 602 (MUM) (SB). THE SAME ISSUE HAS COME UP BEFORE THE HONBLE GUJARAT HIGH COURT IN GUJARAT MINERAL DEVELOPMENT CORPORATION LTD., VS ITAT(2009) 314 ITR 14, WHICH FOLLOWED THE DECISION OF ITA NO.619/B/09. PAGE 3 OF 4 HONBLE ANDHRA PRADESH HIGH COURT THAT PRIOR APPROVAL IS NOT NECESSARY. THE HONBLE MADRAS HIGH COURTS VIEW, WHICH HAD PROVIDED A MECHANISM ACCEPTABLE TO THE STATE GOVERNMENT WITH STATE PARTICIPATION IN COMMITTEE OF DISPUTES (COD), IN LINE WITH THE SUPREME COURT GUIDELINES IN ONGC AND OTHER CASES, WOULD BE A BETTER OPTION. 3. IT IS NOT IN DISPUTE THAT THE ASSESSEE IS A ST ATE GOVERNMENT PUBLIC SECTOR UNDERTAKING AND THERE IS NO CLEARANCE FROM HIGH POWER COMMITTEE. THE HONBLE MADRAS HIGH COURT OF TAMILNADU IN THE CASE OF WAREHOUSING CORPORATION (SUPRA) HAS HELD THAT THE DISPUTE BETWEEN GOVERNMENT DEPARTMENTS WOULD NOT BE CONTESTED IN THE COURTS. THE STATE/UNION OF INDIA MUST EVOLVE A MECHANISM FOR RESOLVING THE INTERDEPARTMENTAL CONTROVERSIES. THE COMMITTEE WOULD CONSISTS OF CHIEF SECRETARY, SECRETARY OF DEPARTMENTS CONCERNED, SECRETARY OF LAW AND SECRETARY OF FINANCE WHERE FINANCIAL CONSTRAINTS ARE INVOLVED. THE DECISION OF SUCH COMMITTEE SHOULD BE BINDING ON ALL THE DEPARTMENTS CONCERNED. IT WAS FURTHER HELD THAT IT WOULD BE OBLIGATION ON EVERY TRIBUNAL AND EVERY COURT WHERE SUCH DISPUTE IS RAISED HERE AFTER TO OBTAIN CLEARANCE FROM COMMITTEE. IN ABSENCE OF CLEARANCE, PROCEEDINGS SHOULD NOT BE PROCEEDED WITH. HONBLE MADRAS HIGH COURT IN THE CASE OF M/S MADRAS FERTILIZERS LTD., VS DCIT( 2008) 298 ITR 136(MAD.) HELD THAT IN CASE OF PUBLIC SECTOR UNDERTAKINGS, WHERE THERE IS NO CLEARANCE FROM THE HIGH POWER COMMITTEE THE APPEAL WAS TO BE DISMISSED WITH LIBERTY TO REVIVE THE APPEAL. 3. FOLLOWING THE ABOVE DECISION, WE DISMISS THE APPEAL OF THE ASSESSEE IN THE ABSENCE OF COD APPROVAL. WE REFRAIN FROM MAKING ANY COMMENT ON THE ISSUE ON HAN D. ITA NO.619/B/09. PAGE 4 OF 4 HOWEVER, THE ASSESSEE IS AT LIBERTY TO REVIVE THE A PPEAL ON OBTAINING THE APPROVAL FROM COD. 4. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS 30 TH DAY OF OCTOBER, 2009. SD/- SD/- (GEORGE GEORGE K.) (A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT M EMBER BANGALORE, DATED, 30 TH OCTOBER, 2009. DS/- COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A), 5 DR, ITAT, BANGALORE. 6 GUARD FILE (1+1) BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.