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

ITA 8592/MUM/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4012 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 15-07-2013
• Assessment Year: 2001-2002
• Appeal Filed On: 09-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GIRIJA DAYAL
• Assessee Lawyers: MADHAV KHANDELWAL
• Section: 244A; 246

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUM BAI .. , ! , '# ' $ BEFORE SHRI I. P. BANSAL, JM AND SHRI SANJAY ARORA , AM ./ I.T.A. NO.8592/MUM/2010 ( & ' (' & ' (' & ' (' & ' (' / / / / ASSESSMENT YEAR: 2001-02) TATA COMMUNICATIONS LIMITED (FORMERLY VIDESH SANCHAR NIGAM LIMITED) VIDESH SANCHAR BHAVAN, M. G. ROAD, FORT, MUMBAI-400 001 & & & & / VS. ASST. CIT, RANGE-I(3), AAYAKAR BHAVAN, M. G. ROAD, FORT, MUMBAI-400 020 ) '# ./ * ./ PAN/GIR NO. AAACV 2808 C ( )+ / APPELLANT ) : ( ,-)+ / RESPONDENT ) )+ . ' / APPELLANT BY : SHRI DINESH VYAS, SHRI NIRANJAN GOVINDEKAR & SHRI MADHAV KHANDELWAL ,-)+ / . ' / RESPONDENT BY : SHRI GIRIJA DAYAL & / 01# / // / DATE OF HEARING : 15.07.2013 2 ( / 01# / DATE OF PRONOUNCEMENT : 24.07.2013 '3 / O R D E R PER SANJAY ARORA, A. M.: THIS IS AN APPEAL BY THE ASSESSEE AGITATING THE ORD ER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-2, MUMBAI (CIT(A) FOR SHORT) DATED 16.09.2010, DISMISSING THE ASSESSEES APPEAL ARISING OUT OF THE ORDER GIVING E FFECT TO THE ORDER PASSED U/S.250(6) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) OF THE FIRST APPELLATE AUTHORITY FOR THE ASSESSMENT YEAR (A.Y.) 2001-02 VIDE ORDER DATED 24. 08.2009. 2 ITA NO.8592/MUM/2010 (A.Y. 2001-02) TATA COMMUNICATIONS LIMITED VS. ASST. CIT 2.1 EXPLAINING THE BACKGROUND FACTS OF THE CASE, IT WAS SUBMITTED BY THE LD. AR, THE ASSESSEES COUNSEL, THAT VIDE HIS ORDER DATED 24.08 .2009 THE ASSESSING OFFICER (A.O.) GAVE EFFECT TO THE ORDER OF THE FIRST APPELLATE AUT HORITY DATED 20.03.2009, REVISING THE INCOME AS INITIALLY ASSESSED U/S.143(3) R.W.S. 147 VIDE ORDER DATED 26.12.2008. HOWEVER, AS WOULD BE APPARENT FROM THE SAID ORDER, AS WELL A S THE INCOME TAX COMPUTATION FORM (ITNS 150A) OF EVEN DATE, NO INTEREST U/S.244A OF T HE ACT STOOD ALLOWED, EVEN AS THERE WAS A REDUCTION IN THE ASSESSED INCOME, RESULTING I N A REFUND, I.E., IN ADDITION TO THE REFUNDS ALREADY GRANTED. 2.2 THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), HE CONTINUED FURTHER, RAISING THE ISSUE OF NON-GRANT OF INTEREST U/S.244A , WHICH HAS TO BE GRANTED TILL THE DATE OF THE GRANT OF THE REFUND ITSELF, AND FOR WHICH HE WO ULD TAKE US TO THE GROUNDS ASSUMED BY THE ASSESSEE BEFORE THE FIRST APPELLATE AUTHORITY ( ANNEXURE B TO THE MEMO OF APPEAL IN FORM NO. 35). THE LD. CIT(A) WHILE ADMITTING OF THE ORDER PASSED BY THE A.O. GIVING EFFECT TO THE ORDER OF THE APPELLATE AUTHORITY AS B EING ONLY AN ASSESSMENT ORDER, WAS, HOWEVER, OF THE VIEW THAT IN VIEW OF SECTION 246A, THE ISSUE OF GRANT OR OTHERWISE OF INTEREST U/S.244A IS NOT AN APPEALABLE ISSUE. HE TH EREFORE DECLINED TO ADJUDICATE THE ISSUE ON MERITS, DISMISSING THE ASSESSEES APPEAL; RATHER ADVISING IT TO, IF AGGRIEVED, MOVE AN APPLICATION U/S.154 OF THE ACT. 2.3 PLACING ON RECORD A VOLUMINOUS PAPER-BOOK CONTA INING COPIES OF JUDGMENTS, HE WOULD FURTHER SUBMIT THAT THE ISSUE ARISING IN THE APPEAL IS, IN FACT, SQUARELY COVERED BY A SERIES OF ORDERS BY THE HIGHER COURTS, AS WELL AS B Y THE TRIBUNAL. TO BEGIN WITH, HE WOULD TAKE US THROUGH THE DECISION BY THE HONBLE JURISDI CTIONAL HIGH COURT IN THE CASE OF CALTEX OIL REFINING (INDIA) LTD. VS. CIT [1993] 202 ITR 375 (BOM). THE SAID DECISION STANDS RENDERED U/S.246 OF THE ACT, WHICH IS PARA MATERIA TO SECTION 246A OF THE ACT WHERE- UNDER THE APPEALS BEFORE THE FIRST APPELLATE AUTHOR ITY ARE FILED SINCE 01.04.1988, HOLDING THAT AN ORDER BY THE ASSESSING AUTHORITY GIVING EFF ECT TO THE ORDER BY THE FIRST APPELLATE AUTHORITY IS AN ASSESSMENT ORDER, SO AS TO BE COVER ED U/S. 246(1)(C) OF THE ACT, WHICH IS PARA MATERIA TO SECTION 246A(1)(A). ITS STANDS FURTHER EXPLAINE D THAT THE PROVISION OF 3 ITA NO.8592/MUM/2010 (A.Y. 2001-02) TATA COMMUNICATIONS LIMITED VS. ASST. CIT SECTION 246 (C), REPRODUCED THEREIN, CONSISTS OF TW O PARTS. THE FIRST PART CONCERNS THE CASE WHERE THE ASSESSEE DENIES ANY LIABILITY TO BE ASSES SED UNDER THIS ACT. THE SAME WAS, THEREFORE, FOUND INAPPLICABLE IN THAT CASE, WHICH A GAIN INVOLVED A DISPUTE IN RELATION TO INTEREST GRANTED BY THE CENTRAL GOVERNMENT U/S.214 OF THE ACT, WHICH IS AGAIN AKIN TO SECTION 244A UNDER WHICH INTEREST IS BEING SOUGHT I N THE INSTANT CASE. SO, HOWEVER, IT WAS EXPLAINED BY THE HONBLE COURT, RELYING ON THE DECI SION IN THE CASE OF CHOCKALINGAM (M.) AND MEYAPPAN (M.) VS. CIT [1963] 48 ITR 34 (SC), THAT THE AMOUNT OF TAX DETERMINED WOULD, FOR THE PURPOSE OF AN APPEAL AGAINST THE ASS ESSMENT ORDER, ALSO INCLUDE THE AMOUNT OF INTEREST PAYABLE BY THE REVENUE TO THE ASSESSEE. IT ALSO DREW SUPPORT FROM THE FACT THAT AS FAR AS THE RECOVERY OF INTEREST IS CONCERNED, TH E PROVISIONS OF THE ACT RELATING TO THE RECOVERY OF ARREARS OF TAX WERE MADE APPLICABLE TO INTEREST U/S. 214. THE PROVISION OF SECTION 214(1A) BEARS THE LEGAL FICTION WHEREBY THE PROVISIONS OF THE ACT AS THEY APPLY TO THE TAX PAYABLE BY THE ASSESSEE ARE MADE APPLICABLE TO INTEREST U/S.214. IT WAS, THEREFORE, ONLY PROPER THAT THE LEGAL FICTION OF SECTION 214(1 A) IS CARRIED TO ITS LOGICAL CONCLUSION. THE PROVISION OF SECTION 244A(3), SIMILARLY, PROVID ES FOR THE PROVISIONS OF THE ACT TO BE APPLICABLE WHERE THERE IS A CHANGE, I.E., INCREASE OR DECREASE, IN THE INTEREST U/S.244A CONSEQUENT TO A MODIFICATION OF ASSESSMENT IN APPEA L OR REVISION OR RECTIFICATION, ETC. THE SAID DECISION BEING BY THE HONBLE JURISDICTIONAL H IGH COURT, COVERING THE ISSUE SQUARELY, WAS PRAYED FOR BEING FOLLOWED, EVEN AS IT WAS URGED THAT THE ASSESSEE RELIES ON A NUMBER OF OTHER DECISIONS, FORMING PART OF THE PAPER-BOOK. 3. THE LD. DR, ON THE OTHER HAND, WOULD RELY ON THE ORDERS BY THE AUTHORITIES BELOW. 4. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. THE ISSUE ARISING FOR DETERMINATION IN THE INSTANT CASE IS A PURE LEG AL ISSUE, I.E., WHETHER THE ASSESSEE COULD, DE HORS ITS LIABILITY TO TAX, CONTEST AN ORDER OF ASSESSME NT IN APPEAL ON THE GROUND OF NON- GRANT OF OR OTHERWISE THE QUANTUM OF THE INTEREST G RANTED U/S.244A OF THE ACT. THE DECISION BY THE HONBLE JURISDICTIONAL HIGH COURT I N THE CASE OF CALTEX OIL REFINING (INDIA) LTD. (SUPRA) RELIED UPON BY THE ASSESSEE HAS BEEN PERUS ED BY US. IN OUR VIEW, THE SAME SQUARELY COVERS THE ISSUE AT HAND. THE DECISION BY THE APEX COURT IN THE CASE OF CENTRAL 4 ITA NO.8592/MUM/2010 (A.Y. 2001-02) TATA COMMUNICATIONS LIMITED VS. ASST. CIT PROVINCES MANGANESE ORE CO. LTD. VS. CIT [1986] 160 ITR 961 (SC), WHEREIN THE ISSUE INVOLVED WAS THE DENIAL TO LIABILITY AND/OR CHARGE OF INTEREST U/S.215 AT A LESSER AMOUNT, STANDS DULY CONSIDERED AND DISTINGUISHED BY THE HON BLE HIGH COURT. IT IS IN THIS CONTEXT THAT ITS STANDS EXPLAINED THAT CLAUSE (C) OF SECTIO N 246 IS IN TWO PARTS, SO THAT THE ASSESSEES APPEAL WOULD FALL IN THE SECOND PART, I. E., DISPUTING THE TAX AS DETERMINED VIDE THE ASSESSMENT ORDER. IN VIEW OF OUR FINDING AFORES AID, I.E., OF THE ISSUE UNDER REFERENCE AS BEING SQUARELY COVERED BY THE SAID DECISION, WE DO NOT CONSIDER IT NECESSARY TO DWELL ON THE OTHER DECISIONS IN THE MATTER SOUGHT TO BE RELI ED UPON BY THE ASSESSEE. THE ASSESSEE HAD, THUS, PREFERRED A VALID APPEAL, WARRANTING ADJ UDICATION. THE LD. CIT(A) HAVING NOT ADJUDICATED THE MATTER, HOLDING THE SAME AS NOT APP EALABLE, THE MATTER WOULD WARRANT BEING RESTORED BACK TO HIS FILE FOR THE PURPOSE. SO , HOWEVER, AS NOTED EARLIER, IT IS THE ASSESSING AUTHORITY WHO HAS TO GRANT THE SAID INTER EST, AND WHOSE ORDER CONTAINS NO REFERENCE TO ANY REASON FOR THE NON-GRANT OF THE MA NDATORY INTEREST U/S.244A; THE LAW CLEARLY PRESCRIBING THE SAME FOR BEING GRANTED ALON G WITH THE REFUND. UNDER THE CIRCUMSTANCES, WE ONLY CONSIDER IT FIT AN D PROPER TO, SETTING ASIDE THE IMPUGNED ORDER, RESTORE THE MATTER BACK TO THE FILE OF THE A.O. TO ALLOW THE ASSESSEE AN OPPORTUNITY TO PLEAD ITS CASE WITH REFERENCE TO GRA NT OF INTEREST U/S.244A; WE HAVING NOT EXAMINED THE ISSUE ON MERITS AT ALL, AND WHO SHALL DECIDE THE SAME PER A SPEAKING ORDER; THE MATTER BEING APPEALABLE. WE DECIDE ACCORDINGLY. 5. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 4 05 & '40 / 6/ 78'9 ' :0 / 0 ;< ORDER PRONOUNCED IN THE OPEN COURT ON JULY 24, 2013 SD/- SD/- (I. P. BANSAL) (SANJAY ARORA) / JUDICIAL MEMBER '# / ACCOUNTANT MEMBER MUMBAI; =& DATED : 24.07.2013 .&../ ROSHANI , SR. PS 5 ITA NO.8592/MUM/2010 (A.Y. 2001-02) TATA COMMUNICATIONS LIMITED VS. ASST. CIT '3 / ,0> ?'>(0 '3 / ,0> ?'>(0 '3 / ,0> ?'>(0 '3 / ,0> ?'>(0/ COPY OF THE ORDER FORWARDED TO : 1. )+ / THE APPELLANT 2. ,-)+ / THE RESPONDENT 3. @ ( ) / THE CIT(A) 4. @ / CIT - CONCERNED 5. >CD ,0& , , / DR, ITAT, MUMBAI 6. DE' F / GUARD FILE '3& '3& '3& '3& / BY ORDER, 7 77 7/ // /; ; ; ; (DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI