J. M . HUBER INDIA P.LTD, MUMBAI V. JCIT 8(2), MUMBAI

ITA 7287/MUM/2012

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9257 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2015
• Appeal Filed By: Assessee
• Bench Allotted: J
• Next Hearing Date: 12-02-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 07-12-2012
• Court: TRIBUNAL
• Keywords: Question of law
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI D.KARUNAKARA RAO, ACCOUNTANT MEMBER ITA NO.7287/MUM/2012 ASSESSMENT YEAR: -2009-10 J.M. HUBER INDIA PRIVATE LIMITED 4014-4019, OBEROI GARDEN ESTATES CHANDIVLI FARMS ROAD, ANDHERI (E) MUMBAI 400072. VS.` THE JOINT COMMISSIONER OF INCOME TAX, RANGE 8(2), MUMBAI APPELLANT RESPONDENT ORDER PER VIJAY PAL RAO, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 25.09.2012 OF CIT(A) FOR A.Y. 2009-10. THE ASSESSEE HAS RAISED FO LLOWING GROUNDS:- GROUNDS OF APPEAL 1 : 0 RE.: CREDIT FOR MINIMUM ALTERNATIVE TAX PAID IN TERMS OF SECTION 115JAA 1 : 1 THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN CONFIRMING THE ASSESSING OFFICER'S ACTION OF ALLOWING CREDIT FOR M INIMUM ALTERNATIVE TAX PAID TO THE EXTENT OF RS. 36,81,362/- AS AGAINST THE APPELL ANT'S CLAIM FOR RS. 66,36,027/-. ASSESSEE BY SHRI HITESH JOSHI REVENUE BY SHRI HARI GOVIND SINGH DATE OF HEARING 12.02.2015 DATE OF PRONOUNCEMENT 12.02.2015 J.M. HUBER INDIA PRIVATE LIMITED 2 | P A G E 1 : 2 THE APPELLANT SUBMITS THAT CONSIDERING THE FAC TS AND CIRCUMSTANCES OF ITS CASE AND THE LAW PREVAILING ON THE SUBJECT IT IS ENTITLE D TO CREDIT FOR MINIMUM LTERNATIVE TAX PAID AT RS. 66,36,027/- AND THE COMMISSIONER OF INCOME-TAX (APPEALS) OUGHT TO HAVE DIRECTED THE ASSESSING OFFICER ACCORDINGLY. L: 3 THE APPELLANT SUBMITS THAT THE ASSESSING OFFIC ER BE DIRECTED TO GRANT CREDIT FOR MINIMUM ALTERNATIVE TAX PAID IN ACCORDANCE WITH LAW AND TO RE-COMPUTE ITS TAX LIABILITY FOR THE YEAR ACCORDINGLY. 2 : 0 RE.: INCORRECT LEVY OF INTEREST UNDER SECTIONS 234B AND 234C 2 : 1 THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS E RRED IN PERFUNCTORILY DISMISSING THE APPELLANT'S GROUND OF APPEAL RELATIN G TO LEVY OF INTEREST UNDER SECTIONS 234B AND 234C. 2 : 2 THE APPELLANT SUBMITS THAT THE ASSESSING OFFICE R HAD NOT LEVIED INTEREST UNDER SECTIONS 234B AND 234C IN ACCORDANCE WITH LAW AND THE COMMISSIONER OF INCOME- TAX (APPEALS) OUGHT TO HAVE HELD AS SUCH. 2 : 3 THE APPELLANT SUBMITS THAT THE ASSESSING OFFIC ER BE DIRECTED TO RE-COMPUTE THE INTEREST IN TERMS OF SECTIONS 234B AND 234C IN A CCORDANCE WITH LAW AND TO RE- COMPUTE ITS TAX LIABILITY ACCORDINGLY. 2. GROUND NO. 1 IS REGARDING SHORT CREDIT OF MAT GI VEN BY THE ASSESSING OFFICER. 3. WE HAVE HEARD THE LD. AR AS WELL AS LD. DR AND C ONSIDERED THE RELEVANT MATERIAL ON RECORD. WE NOTE THAT THE CIT(A) WHILE DECIDING T HIS ISSUE IN PARA NO. 4.2 DIRECTED THE ASSESSING OFFICER TO GIVE THE CREDIT TO THE ASS ESSEE OF THE MAT ARRIVED AT AFTER GIVING APPEAL EFFECT TO THE ORDERS OF THE TRIBUNAL A ND CIT(A). ACCORDINGLY, THIS GROUND OF APPEAL WAS ALLOWED BY THE CIT(A). THUS WE FIND T HAT ON THIS ISSUE, THE ASSESSEE HAS NO GRIEVANCE AGAINST THE ORDER OF CIT(A). FURTHER T HE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HAS SUBMITTED THAT DESPITE THE DIRECTI ONS OF THE CIT(A), THE ASSESSING OFFICER HAS NOT GIVEN EFFECT IN GRANTING MAT CREDIT AS PER ORDERS OF THIS TRIBUNAL AND CIT(A). ACCORDINGLY, WE DIRECT THE ASSESSING OFFICE R TO GIVE EFFECT TO THE ORDERS OF THIS TRIBUNAL AND CIT (A) FOR THE A.Y. 2003-04 AND 2004- 05 AND ACCORDINGLY GRANT THE MAT CREDIT TO THE ASSESSEE. J.M. HUBER INDIA PRIVATE LIMITED 3 | P A G E 4. GROUND NO. 2 IS REGARDING GRANTING MAT CREDIT AG AINST THE TAX LIABILITY PRIOR TO LEVY OF SURCHARGE AND EDUCATION CESS. 5. WE HAVE HEARD THE LD. AR AS WELL AS LD. DR AND C ONSIDERED THE RELEVANT MATERIAL ON RECORD. AT THE OUTSET, WE NOTE THAT AN IDENTICAL ISSUE HAS BEEN CONSIDERED AND DECIDED BY THIS TRIBUNAL IN THE CASE OF WYETH LIMITED VS. ACIT VIDE ORDER DATED 09.01.2015 IN PARA 4 AND 5 AS UNDER:- 4. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD, WE NOTE THAT THE AUTHORITIES BELOW HELD THAT THE MA T CREDIT IS ALLOWABLE AGAINST THE TAX LIABILITY INCLUSIVE OF SURCHARGE AND CESS AND N OT THE TAX PAYABLE BEFORE THE SURCHARGE AND CESS. THE ASSESSEE HAS RELIED UPON TH E JUDGMENT OF ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. VACMENT INDIA (349 ITR 304) WHEREIN THE HONBLE HIGH COURT WHILE CONSIDERING THE QUESTION OF SURCHARGE A ND EDUCATION CESS ON TAX PAYABLE HAS BEEN CALCULATED BEFORE ALLOWING THE CREDIT OF M AT U/S 115JAA HELD IN PARA 5 TO 7 AS UNDER:- 5. THE ONLY QUESTION WHICH IS RAISED PERTAINS TO T HE COMPUTATION OF TAX IN ACCORDANCE WITH THE MODALITIES WHICH ARE PRESCRIBED IN THE RELEVANT FORM, ITR- 6. IN SO FAR AS IS MATERIAL, THE RELEVANT ENTRIES I N THE FORM (PART B-TTI) ARE AS FOLLOWS: 3. GROSS TAX PAYABLE (ENTER HIGHER OF 2C AND 1) 4. CREDIT UNDER SECTION 115JAA OF TAX PAID IN EARLI ER YEARS (IF 2C IS MORE THAN 1) (7 OF SCHEDULE MATC) 5. TAX PAYABLE AFTER CREDIT UNDER SECTION 115JAA [3 -4] 6. SURCHARGE ON 5 7 EDUCATION CESS, INCLUDING SECONDARY AND HIGHER ED UCATION CESS ON (5+6) 8. GROSS TAX LIABILITY (5+6+7) 6 THE AFORESAID ENTRIES LEAVE NO MANNER OF AMBIGUIT Y IN REGARD TO THE METHOD OF COMPUTATION OF TAX LIABILITY. ENTRY 3 REQUIRES CO MPUTATION OF THE GROSS TAX PAYABLE. UNDER ENTRY 4, CREDIT IS REQUIRED TO BE GI VEN UNDER SECTION 115JAA OF THE ACT OF THE TAX PAID IN EARLIER YEARS. ENTRY 5 RE QUIRES A COMPUTATION OF THE J.M. HUBER INDIA PRIVATE LIMITED 4 | P A G E TAX PAYABLE AFTER CREDIT UNDER SECTION 115JAA OF TH E ACT. THE MATTER IS PLACED BEYOND DOUBT BY THE PARENTHESIS, WHICH INDICATES TH AT TAX PAYABLE UNDER ENTRY 5 IS TO BE 'ARRIVED AT BY DEDUCTING THE CREDIT UNDE R SECTION 115JAA OF THE ACT (UNDER ENTRY 3) FROM THE GROSS TAX PAYABLE (UNDER E NTRY 4). THE SURCHARGE 'IS COMPUTED ON THE AMOUNT REFLECTED IN ENTRY 5. 7 THE TRIBUNAL HAS NOTED THAT FROM THE NEXT ASSESSM ENT YEAR, THE ASSESSMENT YEAR 2012-13, THE POSITIORI WAS MATERIALLY ALTERED BUT, IN THE PRESENT CASE, SINCE THE DISPUTE RELATED TO THE ASSESSMENT YEAR 20 11-12, THE METHOD OF COMPUTATION, AS DIRECTED BY THE COMMISSIONER {APPEA LS) WAS PLAINLY IN ACCORDANCE WITH THE METHODOLOGY AS PROVIDED IN ITR- 6. 'THE TRIBUNAL IN CONFIRMING THE ORDER OF THE COMMISSIONER (APPEALS) HAS, HENCE, NOT COMMITTED ANY ERROR. THE APPEAL-WILL NOT GIVE RISE' TO ANY SU BSTANTIAL QUESTION OF LAW AND IS, ACCORDINGLY, DISMISSED. 5. THUS IT IS CLEAR THAT THE HONBLE HIGH COURT HAS TAKEN INTO ACCOUNT THE ORDER OF ENTRIES IN THE FORM ITR-6 FOR THE A.Y. 2011-12 IN T HE SAID CASE AND HELD THAT AS PER FORM ITR-6, THE MAT CREDIT HAS TO BE GIVEN AGAINST THE GROSS TAX PAYABLE EXCLUSIVE OF SURCHARGE /CESS AND ONLY AFTER THE MAT CREDIT TAX L IABILITY, THE SURCHARGE AND CESS HAS TO BE CALCULATED FOR THE PURPOSE OF WORKING OUT TH E GRAND TAX LIABILITY. WE ALSO FIND MERIT AND SUBSTANCE IN THE ALTERNATIVE CONTENTION O F THE ASSESSEE THAT IF THE MAT CREDIT IS TAKEN INTO ACCOUNT WITHOUT INCLUDING THE SURCHARGE AND EDUCATION CESS THEN THE SURCHARGE AND EDUCATION CESS ON THE TAX LIABILI TY HAS TO BE CALCULATED ONLY AFTER ALLOWING THE MAT CREDIT. ALTERNATIVELY, THE AMOUNT OF MAT CREDIT SHOULD ALSO INCLUDE SURCHARGE AND EDUCATION CESS FOR THE PURPOSE OF ALL OWING THE CREDIT AGAINST THE TAX LIABILITY INCLUSIVE OF SURCHARGE AND EDUCATION CESS . THEREFORE, THE MAT AS WELL AS NORMAL TAX BEFORE ALLOWING THE MAT CREDIT HAS TO BE TAKEN ON PARITY EITHER EXCLUSION OF SURCHARGE AND EDUCATION CESS OR INCLUSIVE OF SUR CHARGE AND EDUCATION CESS OR INCLUSIVE OF SURCHARGE AND EDUCATION CESS. ACCORDIN GLY WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DIRECT THE ASSESSING OFFICER TO ALLOW THE MAT CREDIT AGAINST THE TAX LIABILITY PAYABLE BEFORE SURCHARGE AND EDUCATIO N CESS OR ALTERNATIVELY THE AMOUNT OF MAT CREDIT SHOULD ALSO BE INCLUSIVE OF SURCHARGE AND EDUCATION CESS AND THEN ALLOW THE CREDIT AGAINST THE TAX PAYABLE INCLUSIVE OF SUR CHARGE AND EDUCATION CESS. 6. FOLLOWING THE EARLIER ORDER OF THE CO-ORDINATE B ENCHES OF THIS TRIBUNAL IN THE CASE OF WYETH LIMITED VS. ACIT (SUPRA). WE DIRECT THE ASSES SING OFFICER TO ALLOW THE MAT CREDIT AGAINST THE TAX LIABILITY PAYABLE BEFORE SURCH ARGE AND EDUCATION CESS OR J.M. HUBER INDIA PRIVATE LIMITED 5 | P A G E ALTERNATIVELY THE AMOUNT OF MAT CREDIT SHOULD ALSO BE INCLUSIVE OF SURCHARGE AND EDUCATION CESS AND THEN ALLOW THE CREDIT AGAINST TH E TAX PAYABLE INCLUSIVE OF SURCHARGE AND EDUCATION CESS. 7. GROUND NO. 3 IS REGARDING LEVY OF INTEREST U/S 2 34B AND 234C. 8. LEVY OF INTEREST U/S 234B AND 234C IS CONSEQUENT IAL AND NO SEPARATE FINDING IS REQUIRED. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUCNED IN THE OPEN COURT ON THIS 12 TH DAY OF FEBRUARY 2015. SD/- SD/- (D. KARUNAKARA RAO) (VIJAY PAL RAO) (ACCOUNTANT MEMBER/ YS[KK LNL; YS[KK LNL; YS[KK LNL; YS[KK LNL; ) (JUDICIAL MEMBER/ U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; U;KF;D LNL; ) MUMBAI DATED 12-02-2015 SKS SR. P.S, COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, J BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI