ASST CIT 1(3), MUMBAI V. STCI LTD, MUMBAI

ITA 6198/MUM/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1096 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2003-2004
• Appeal Filed On: 07-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR A K NAYAK
• Assessee Lawyers: KARTHIK NATARAJAN
• Section: 244A; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E , MUMBAI BEFORE S HRI B.R. BASKARAN (AM) AND SHRI RAM LAL NEGI (JM) ITA NO. 6198 /MUM/20 1 4 ASSESSMENT YEAR: 2003 - 2004 THE ASST. CIT 1(3), 564, 5 TH FLOOR, AYAKAR BHAVAN, M.K. ROAD, MUMBAI - 400020 VS. M/S STCI LTD., (FORMERLY KNOWN AS SECURITIES TRADING OF INDIA LTD.), A/B 1 - 802, A WING, 8 TH FLOOR, MARATHON INNOVA, MARATHON NEXTGEN COMPOUND, OFF GANPATRAO KADAM MARG, LOWER PAREL (W), MUMBAI - 400013 PAN: AAGCS9709K (APPELLANT) (RESPONDENT) AP PELLANT BY : DR. A.K. NAYAK (DR ) RESPONDENT BY : SH. KARTHIK NATARAJAN (A R) DATE OF HEARING: 11 /04 /201 7 DATE OF PRONOUNCEMENT: 28 / 0 4 /201 7 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS B EEN PREFERRED BY THE R EVENUE AGAINST ORDER DATED 12/06/2014 PASSED BY THE LD. CIT (A PPEALS ) - 2 , MUMBAI, FOR THE A S S ESSMENT YEAR 2003 - 04 , WHEREBY THE LD. CIT(A) HAS PARTLY ALLOWED THE APPEAL OF THE ASSESSEE FILED AGAINST THE ORDER PASSED BY THE AO U/S 154 O F THE INCOME TAX ACT,1961 (FOR SHORT THE ACT ) . 2 ITA NO. 6198/MUM/2014 ASSESSME NT YEAR: 2003 - 04 2. IN THE PRESENT CASE ORDER U/S 154 OF THE ACT WAS PASSED ON 27.9.2010. THE ASSESSEE POINTED OUT CERTAIN MISTAKES IN CALCULATING TAX LIABILITY. ON VERIFICATION THE CONTENTION OF THE ASSESSEE WAS FOUND TO B E CORRECT. ACCORDINGLY, THE MISTAKE APPARENT WAS RECTIFIED AND REVISED AND ORDER WAS PASSED TO GIVE CREDIT TO TDS OF RS. 7,67,840/ - , TO CHARGE INTEREST U/S 234C AS PER LAW AND ALLOW INTEREST U/S 244A AS PER LAW. THE SAID ORDER WAS CHALLENGED BY THE ASSESSE E BEFORE THE LD. CIT(A) ON THE GROUND THAT THE AO HAS ERRED IN NOT GRANTING PROPER/FULL INTEREST U/S 244A OF THE ACT. THE LD. C IT(A) AFTER HEARING THE ASSESSEE PARTLY ALLOWED THE APPEAL AND DIRECTED THE AO TO TAKE INTO CONSIDERATION THE SELF - ASSESSMENT TAX COMPONENT AS WELL AND GRANT INTEREST UP TO THE ACTUAL DATE OF ISSUE OF REFUND TO THE APPELLANT . 3 . AGGRIEVED BY THE ORDER OF LD. CIT (APPEALS) , THE REVENUE HAS PREFERRED THIS APPEAL ON THE FOLLOWING EFFECTIVE GROUNDS: - I. WHETHER ON FACTS AND IN THE CIRC UMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) WAS JUSTIFIED INHOLDING THAT THE ASSESSEE IS ENTITLED FOR THE INTEREST U/S 244A ON THE REFUND OF SELF ASSESSMENT TAX PAID U/S 140A AND THE SAME TO BE CALCULATED FROM THE DATE OF PAYMENT OF TAX TILL THE DATE OF REFUND? II. WHETHER ON FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) WAS JUSTIFIED IN DIRECTION THE ASSESSING OFFICER TO GRANT INTEREST U/S 244A WITHOUT APPRECIATING THE FACT THAT THE EXPLANATION TO SECTION 244A (1) (B) SPECIFIE S THE BASIS FOR GRANT OF INTEREST TO BE THE DATE ON AND FROM WHICH THE AMOUNT OF TAX OR PENALTY SPECIFIED IN THE NOTICE OF DEMAND ISSUED UNDER SECTION 156 IS PAID IN EXCESS OF SUCH DEMAND? III. WHETHER ON THE FAC T S AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A) WAS JUSTIFIED IN DIRECTING THE ASSESSING OFFICER TO GRANT INTEREST U/S 244A WITHOUT APPRECIATING THE FACT THAT THE SELF ASSESSMENT TAX IS NOT CONTEMPLATED TO BE COVERED UNDER CLAUSE (B) OF SECTION 244A (1) AND ONLY THE REFUND ARISING 3 ITA NO. 6198/MUM/2014 ASSESSME NT YEAR: 2003 - 04 OUT OF THE PAYMENTS MADE ON ACCOUNT OF POST ASSESSMENT TAXES ARE INCLUDED IN ITS SCOPE?. 4 . BEFORE US THE LD. DEPARTMENTAL REPRESENTATIVE RELYING ON THE FINDINGS OF THE AO SUBMITTED THAT THE LD. CIT(A) HAS WRONGLY ALLOWED THE RELIEF SOUGHT BY THE ASSESSE E. AS PER CLAUSE (B) OF SECTION 244A(1) SUCH INTEREST SHALL BE CALCULATED FOR EVERY MONTH OR PART OF A MONTH COMPRISED IN THE PERIOD OR PERIODS FROM THE DATE OR DATES OF PAYMENT OF THE TAX OR PENALTY TO THE DATE ON WHICH THE REFUND IS GRANTED. E XPLANATION TO SECTION 244A(1)(B) FURTHER SAYS THAT THE DATE OF PAYMENT OF TAX OR PENALTY MEANS THE DATE ON WHICH THE AMOUNT OF TAX OR PENALTY SPECIFIED IN THE NOTICE OF DEMAND ISSUED UNDER SECTION 156 IS PAID IN EXCESS OF SUCH DEMAND. THEREFORE, THE ORDER OF THE LD. CIT(A) IS CONTRARY TO THE EXPRESSED PROVISIONS OF THE LAW AND LIABLE TO BE SET ASIDE. 5 . ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE SINCE, THE FINDINGS OF THE LD. CIT(A) ARE BASED ON THE LAW LAID DOWN BY THE HONBLE JURISDICTIO NAL HIGH COURT IN THE STOCK HOLDING CORPORATION OF INDIA LTD. VS. N.C. TIWARI, THE COMMISSIONER OF INCOME TAX , THERE IS NO MERIT IN THE REVENUES APPEAL. 6 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE M ATERIAL PLACED ON RECORD. THE LD. C IT(A) HAS DECIDED THE ISSUE INVOLVED IN THIS APPEAL HOLDING AS UNDER: THE FACTS OF THE CASE, THE STAND TAKEN BY THE AO IN ASSESSMENT ORDER AND THE CONTENTIONS OF THE APPELLANT COMPANY DURING THE APPELLATE PROCEEDINGS AS WELL AS THE WRITTEN SUBMISSIONS MADE AND CAREFULLY CONSIDERED. IT IS STATED THAT THE AO HAS NOT GRANTED INTEREST ON THE REFUND ARISING ON ACCOUNT OF SELF - ASSESSMENT TAX PAID. FURTHER, IT IS APPARENT FROM THE FACTS OF THE CASE THE AO HAS NOT GRANTED INTEREST U/S 244A OF THE ACT UP TO THE DATE OF ACTUAL ISSUE OF REFUND ORDER TO THE APPLICANT. IT IS A SETTLED LEGAL POSITION THAT AN ASSESSEE/APPELLANT IS ENTITLED TO INTEREST U/S 244A O F THE 4 ITA NO. 6198/MUM/2014 ASSESSME NT YEAR: 2003 - 04 ACT UP TO THE DATE OF ACTUAL ISSUE OF REFUND. ACCORDINGLY, THE AO IS HEREBY DIRECTED TO TAKE INTO CONSI DERATION THE SELF - ASSESSMENT TAX COMPONENT AS WELL AND GRANT INTEREST UP TO THE ACTUAL DATE OF ISSUE OF REFUND TO THE APPELLANT. 7 . WE NOTICE THAT THE DCIT HAS NOT ALLOWED THE INTEREST ON REFUND OF RS. 88, 49,428/ - ARISING OUT OF SELF - ASSESSMENT PAID BY THE ASSESSEE. SECTION 244A CONTEMPLATES THAT WHERE REFUND OF ANY AMOUNT BECOMES DUE TO THE ASSESSEE, THE ASSESSEE SHALL BE ENTITLED TO RECEIVE , IN ADDITION TO THE SAID AMOUNT, SIMPLE INTEREST THEREON. AS WORKED OUT, THE ASSESSEE IS THEREFORE ENTITLED TO T HE INTEREST OF RS. 5, 750,763/ - FOR THE PERIOD FROM 13.4.2011 TO 4.4 . 2013 U/S 244A OF THE ACT. THE FINDINGS OF THE LD. CIT(A) IS BASED ON THE RATIO LAID DOWN BY THE HONBLE B OMBAY HIGH COURT IN THE STOCK HOLDING CORPORATION OF INDIA LTD. VS. N.C. TIWARI, T HE COMM I SSIONER OF INCOME TAX , 373 ITR 282(BOM) IN WHICH IT HAS BEEN HELD THAT INTEREST IS PAYABLE U/S 244A(1)(B) OF THE ACT ON THE REFUND OF EXCESS AMOUNT PAID AS TAX ON SELF ASSESSMENT UNDER SECTION 140A, FROM THE DATE OF PAYMENT OF TAX ON SELF ASSESSMEN T TO THE DATE OF REFUND OF THE AMOUNT. SINCE, THE LD. CIT(A) HAS PASSED THE SAID ORDER FOLLOWING THE DECISION OF THE HONBLE HIGH COURT, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE SAID ORDER. WE, THEREFORE, UPHOLD THE ORDER PASSED BY THE LD. CIT(A) A ND DISMISS ALL THE GROUNDS OF APPEAL OF THE REVENUE. IN THE RESULT, APPEAL FILED BY THE REVENUE FOR THE ASSESSMENT YEAR 2003 - 2004 IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH APRIL , 2017 . SD/ - SD/ - ( B.R. BASKARAN ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 28 / 0 4 / 2017 ALINDRA , PS 5 ITA NO. 6198/MUM/2014 ASSESSME NT YEAR: 2003 - 04 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI