Minor Haresh Karsanbhai Patel Oral Specific Deferred Family Trust, Ahmedabad V. The Income Tax Officer, Ward-5(2)(2) Now Ward- 5(3)(1), Ahmedabad

ITA 863/AHD/2023

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 9280 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-01-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 26-12-2023
• Assessment Year: misc
• Appeal Filed On: 26-10-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SHRIHEMANSHUSHAH

Judgement Text

आयकरअपीलीयअधिकरण,अहमदाबादनयायपीी INTHEINCOMETAXAPPELLATETRIBUNAL, ‘’SMC’’BENCH,AHMEDABAD BEFORESHRIWASEEMAHMED,ACCOUNTANTMEMBER आयकरअपीलसं ./ITANo.863/AHD/2023 धििाधरणवरध/Asstt.Year:1982-1983 MinorHareshKarsanbhaiPatelOral SpecificDeferredFamilyTrust, NirmaHouse, NearIncomeTaxCircle, AshramRoad, Ahmedabad-380009. PAN:AAATH4880P Vs. IncomeTaxOfficer, Ward-5(2)(2), Ahmedabad. Now IncomeTaxOfficer, Ward5(3)(1), Ahmedabad (Applicant)(Respondent) Assesseeby:ShriHemanshuShah,A.R Revenueby:Ms.SaumyaPandeyJain,Sr.D.R सुिवाईकीतारीख /DateofHearing:27/12/2023 घोरणाकीतारीख /DateofPronouncement:03/01/2024 आदेश /ORDER PERWASEEMAHMED,ACCOUNTANTMEMBER: ThecaptionedappealhasbeenfiledattheinstanceoftheAssesseeagainst theorderoftheLearnedCommissionerofIncomeTax(Appeals),Ahmedabad, arisinginthematterofrectificationorderpassedunders.154oftheIncomeTax Act,1961(here-in-afterreferredtoas"theAct")relevanttotheAssessmentYear 1982-1983. 2.Theassesseehasraisedthefollowinggroundsofappeal. 1)InlawandinfactsandcircumstancesoftheAppellantcase,thelearnedCommissioner ofIncome-tax(Appeals)haserredinpointsoflawandfacts. 2)InlawandinfactsandcircumstancesoftheAppellant'scase,thelearnedCommissioner ofIncome(Appeals)hasgrosslyerreddismissingthegroundregardingnotgranting interesttillthedateofissueofrefund. ITAno.863/AHD/2023 Asstt.Year1982-1983 2 3)InlawandinfactsandcircumstancesoftheAppellant'scase,thelearnedCommissioner ofIncome(Appeals)hasgrosslyerreddismissingthegroundregardingnotgranting interestu/s.244A(1A)oftheI.T.ActfromJune2016tillthedateofissueofrefund 4)Yourappellantreservestherighttoadd,alter,amendalloranyoftheabovegrounds ofappealasmaybeadvisedfromtimetotime. 2.1TheasseseevideletterdatedNilhasalsoraisedtheadditionalgroundsof appealwhicharereproducedasunder: 1)InlawandinfactsandcircumstancesoftheAppellant'scase,Ld.Commissionerof Income-tax(Appeals)hasdirectedtheAssessingOfficertoverifytheSelfAssessmentTax paidandallowinterestasperprovisionsofthesection.Heoughttothesame.have allowed 2)InlawandinfactsandcircumstancesoftheAppellant'scase,Ld.Commissionerof Income-tax(Appeals)hasdirectedtheAssessingOfficertotakeintoaccountofworking andpassspeakingorder.Heoughttohaveallowedthesame. 3)InlawandinfactsandcircumstancesoftheAppellant'scase,Ld.Commissionerof Income-tax(Appeals)haserredindirectingtheAssessingOfficertoverifyregulartaxpaid andallowinterestu/s244AofI.T.Act.asperprovisionsofthesection.Heoughttohave allowedthesame. 3.Attheoutset,wenotethattherewasadelayinfilingtheappealbythe assesseefor167days.Theassesseehasfiledthepetitionforcondonationof delaydated08/12/2023,explainingthattheorderpassedbytheLd.CIT(A)dated 13/03/2023,wasnotreceivedbyit.Assuchtheassesseecametoknowaboutthe orderpassedbytheLd.CIT(A)onviewingIncome-taxportalandtheorderwas accordinglydownloadedon29/09/2023.Thereafter,theassesseepreferredthe appealbeforetheITATdated27/10/2023,withintheperiodof60dayswhenit cametoitsnoticeabouttheorderpassedbytheLd.CIT(A).Itisforthisreason theassesseefailedtofiletheappealwithinthestipulatedtimeandaccordingly, therewasdelayof167daysinfilingtheappeal. 4.TheLd.ARalsosubmittedassesseehasfairchancetosucceedonmerit andtherefore,ameritoriouscaseshouldnotberejectedontechnicalground. ITAno.863/AHD/2023 Asstt.Year1982-1983 3 5.Ontheotherhand,theLd.DRopposedtocondonethedelayinfilingthe appealbytheassessee. 6.Ihaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.TheissuebeforeusrelatestotheAssessmentYear 1982-1983meaningtherebyalmost40yearshavegoneinthelitigation. Consideringthelengthoflitigationandkeepinginviewthesufferingfacedbythe assesseeinpursuingthematteratdifferentstages,Iaminclinedtocondonethe delayinfilingtheappealbytheassessee. 6.1Besidestheabove,InotethattheHon’bleGujaratHightCourtinthecase ofS.R.KoshtiVs.CITreportedin276ITR165hasheldasunder: 20.Awordofcaution.TheauthoritiesundertheActareunderanobligationtoactin accordancewithlaw.TaxcanbecollectedonlyasprovidedundertheAct.Ifanassessee, underamistake,misconceptionoronnotbeingproperlyinstructed,isover-assessed,the authoritiesundertheActarerequiredtoassisthimandensurethatonlylegitimatetaxes duearecollected.ThisCourt,inanunreporteddecisionincaseofVinayChandulal Satiav.N.O.Parekh,CIT[Spl.CivilApplicationNo.622of1981dated20-8-1981],haslaid downtheapproachthattheauthoritiesmustadoptinsuchmattersinthefollowingterms: "TheSupremeCourthasobservedinnumerousdecisions,includingRamlalv.Rewa CoalfieldsLtd.AIR1962SC361,StateofWestBengalv.Administrator,Howrah MunicipalityAIR1972SC749andBabutmalRaichandOswalv.LaxmibaiR.TarteAIR 1975SC1297,thattheStateauthoritiesshouldnotraisetechnicalpleasifthecitizens havealawfulrightandthelawfulrightisbeingdeniedtothemmerelyontechnical grounds.TheStateauthoritiescannotadopttheattitudewhichprivatelitigantsmight adopt." 6.2Fromtheabove,itisrevealedthattheincomeoftheassesseeshouldnot beoverassessedevenifthereisamistakeoftheassessee.Assuchthelegitimate deductionforwhichtheassesseeisentitledshouldbeallowedwhiledetermining thetaxableincome. 6.3IalsonotethattheHon’bleGujaratHighCourtinthecaseofVarelitextile industryversusCITreportedin154Taxman33hasheldasunder: Itisequallywell-settledthatwhereacauseisconsciouslyabandoned(asinthepresent case)thepartyseekingcondonationhastoshowbycogentevidencesufficientcausein supportofitsclaimofcondonation.Theonusisgreater.Oneofthepropositionsofsettled legalpositionistoensurethatameritoriouscaseisnotthrownoutonthegroundof ITAno.863/AHD/2023 Asstt.Year1982-1983 4 limitation.Therefore,itisnecessarytoexamine,atleastprimafacie,whethertheassessee hasorhasnotacaseonmerits. 6.4Inviewoftheaboveandafterconsideringthefactsintotality,Iamofthe viewthatitisafitcasewherethedelayinfilingtheappealbytheassessee deservestobecondoned.Accordingly,Icondonethedelayandproceedto adjudicatetheissueraisedbytheassesseeonmerit. 7.Thefirstissueraisedbytheassesseeingroundnumber2isthattheLd. CIT(A),erredinconfirmingtheorderoftheAObynotgrantinginteresttillthe dateofrefundisissued. 8.TheAOinthepresentcasehaspassedthegivingeffectorderinpursuance tothedirectionoftheLd.CIT(A)u/s154oftheAct,dated28/06/2019, determiningtherefundofRs.185313/-only.Suchrefundwasissuedon 15/04/2020,buttheinterestu/s244AoftheAct,wasgrantedtill28/06/2019, insteadofgrantingthesametill15/04/2020i.e.up-tothedatewhentherefund wasissued.Therelevantsubmission,inthisregard,oftheassesseeisreproduced asunder: 1.ItissubmittedthattheId.AssessingOfficerpassedCIT(A)seffectorderandorderu/s. 154ofI.T.Acton20-06-2019determiningrefundaggregatingtoRs.1,85,313/-.However, thesaidrefundwasissuedon15-04-2020.Copiesofthesaidorderalongwiththeproofof refundissuedareenclosedmarkedasAnnexure-A&Brespectively. 2.Ld.AssessingOfficergrantedinterestu/s.244AoftheI.T.ActofRs.1,16,985/-on Rs.68,328/-uptothedateoforderi.e.20-06-2019.However,refundwasissuedon15- 04-2020.Itistobenotedthatinterestu/s.244AoftheI.T.Actistobegranteduptothe dateofissueofrefund.Hence,interestshouldbegrantedfromJuly2019toApril,2020on refundofRs.68,328/- 3.ItisrequestedtodirectAssessingofficertograntinterestonrefundfromJuly2019till April2020onrefundamountofRs.68,328/- 9.However,theLd.CIT(A)rejectedthecontentionoftheassesseeby observingasunder: Theappellant'ssubmissionshavebeendulyconsidered.Itmayhoweverbenotedthatas perthewordingandprovisionsofSection244A,interestistobecomputeduptodateof grantofrefund,andnotdateofissueofrefund.Hence,thisgroundisdismissed. ITAno.863/AHD/2023 Asstt.Year1982-1983 5 10.BeingaggrievedbytheorderoftheLd.CIT(A),theassesseeisinappeal beforeus. 11.TheLd.ARbeforemefiledapaperbookrunningfrompages1to32and contendedthattheinterestshouldbegiventotheassesseeu/s244AoftheActtill therefundisissuedtotheassesseeandnotup-tothedateofgrantofrefund. 12.Ontheotherhand,theLd.DRbeforemevehementlysupportedtheorder oftheauthoritiesbelow. 13.Ihaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.TheHon’bleSCinthecaseofSandvikAsiaLtd.Vs. CITreportedin280ITR643hasheldasunder: Interestonrefundwasgrantedtotheappellantafterasubstantiallapseoftimeandhence itshouldbeentitledtocompensationforthisperiodofdelay.TheHighCourthasfailedto appreciatethatwhilecharginginterestfromtheassessees,theDepartmentfirstadjusts theamountpaidtowardsinterestsothattheprincipleamountoftaxpayableremain outstandingandtheyareentitledtochargeinteresttilltheentireoutstandingispaid.But whenitcomestograntingofinterestonrefundoftaxes,therefundsarefirstadjusted towardsthetaxesandthenthebalancetowardsinterest.Henceasperthestandthatthe Departmenttakestheyareliabletopayinterestonlyuptothedateofrefundoftaxwhile theytakethebenefitofassesseesfundsbydelayingthepaymentofinterestonrefunds withoutincurringanyfurtherliabilitytopayinterest. 13.1Inviewoftheabove,wecansafelyholdthatinteresthastobegrantedto theassesseeup-tothedateofactualpaymentofrefundandnotmerelyup-tothe dateofgrantofrefund.Inotherwords,theassesseeinthegivencaseshallbe entitledofinterestup-to15/04/2020,i.e.thedateonwhichtherefundwasissued totheassessee.Hence,thegroundofappealoftheassesseeisallowed. 14.ThesecondissueraisedbytheassesseeisthattheLd.CIT(A),erredinnot grantinginterestprovidedu/s244A(1A)oftheAct,fromJune2016tillthedateof issueofrefund. 15.TheassesseebeforetheLd.CIT(A),submittedasunder: ITAno.863/AHD/2023 Asstt.Year1982-1983 6 1.Itissubmittedthatinterestu/s.244A(1A)ofI.T.ActswasnotgrantedbyId.Assessing OfficeronprincipalrefundofRs.68.325/-fromJune2016tillthedateofissueofrefund. Hon'bleCIT(A)passedappellateordervideappealNo.CIT(A)/GNR/80/200-01dated30- 01-2003.TheeffectthereofwasgivenbytheLd.AssessingOfficervideorderdated20-06- 2019andrefundwasissuedon15-04-2020ieafteraperiodof17years 2.Itistobenotedthatinterestu/s244A(1A)oftheI.T.T.ActActistobegrantedfrom June2016uptothedateofissueofrefund.Yourkindattentionisinvitedtosection 244A(1A)ofI.T.Actwhichprovidesasunder. "(1A)Inacasewherearefundarisesasaresultofgivingeffecttoanorderunder section250orsection254orsection260orsection262orsection263orsection 264,whollyorpartly,otherwisethanbymakingafreshassessmentor reassessment,theassesseeshallbeentitledtoreceive,inadditiontotheinterest payableundersub-section(1),anadditionalinterestonsuchamountofrefund calculatedattherateofthreepercentannum,fortheperiodbeginningfromthe datefollowingthedateofexpiryofthetimeallowedundersub-section(5)of section153tothedateonwhichtherefundisgranted." 3.ItisrequestedtodirectAssessingofficertograntinterestu/s.244A(1A)oftheI.T.Act onrefundonrefundRs.68,325/-fromJune2016tillthedateofissueofrefund. 16.However,theLd.CIT(A),rejectedthecontentionoftheassesseeby observingasunder: 1.Itissubmittedthatinterestu/s.244A(1A)ofI.T.ActswasnotgrantedbyId.Assessing OfficeronprincipalrefundofRs.68.325/-fromJune2016tillthedateofissueofrefund. Hon'bleCIT(A)passedappellateordervideappealNo.CIT(A)/GNR/80/200-01dated30- 01-2003.TheeffectthereofwasgivenbytheLd.AssessingOfficervideorderdated20-06- 2019andrefundwasissuedon15-04-2020ieafteraperiodof17years 2.Itistobenotedthatinterestu/s244A(1A)oftheI.T.T.ActActistobegrantedfrom June2016uptothedateofissueofrefund.Yourkindattentionisinvitedtosection 244A(1A)ofI.T.Actwhichprovidesasunder. "(1A)Inacasewherearefundarisesasaresultofgivingeffecttoanorderunder section250orsection254orsection260orsection262orsection263orsection 264,whollyorpartly,otherwisethanbymakingafreshassessmentor reassessment,theassesseeshallbeentitledtoreceive,inadditiontotheinterest payableundersub-section(1),anadditionalinterestonsuchamountofrefund calculatedattherateofthreepercentannum,fortheperiodbeginningfromthe datefollowingthedateofexpiryofthetimeallowedundersub-section(5)of section153tothedateonwhichtherefundisgranted." 3.ItisrequestedtodirectAssessingofficertograntinterestu/s.244A(1A)oftheI.T.Act onrefundonrefundRs.68,325/-fromJune2016tillthedateofissueofrefund. 6.6.2Theappellant’ssubmissionshavebeendulyconsidered.Itmay,however, benotedthatasperthewordingandprovisionsofSection244A,interestistobe computeduptodateofgrantofrefund,andnotdateofissueofrefund.Hence,this groundisdismissed. ITAno.863/AHD/2023 Asstt.Year1982-1983 7 17.BeingaggrievedbytheorderoftheLd.CIT(A),theassesseeisinappeal beforeus. 18.TheLd.ARbeforemereiteratedthecontentionsraisedbeforetheLd. CIT(A).Ontheotherhand,theLd.DRvehementlysupportedtheorderofthe authoritiesbelow. 19.Attheoutset,Inotethattheissueraisedingroundnumber3isidenticalto theissueraisedbytheassesseeingroundnumber2asdiscussedabove. Therefore,thefindinggiveninthegroundnumber2shallbeapplicabletothe groundnumber3aswell.Theappealoftheassesseepertainingtoground number2hasbeenadjudicatedvideparagraphnumber12ofthisorderinfavour oftheassesee.Thus,respectfullyfollowingthesamethegroundnumber3ofthe asseseeisalsoallowed. Comingtotheadditionalgroundsofappeal,reproducedabove,raisedby theassessee. 20.Attheoutset,Inotethattheadditionalgroundsofappealraisedbythe asseseearepurelegalinnatureandallthenecessaryfactsarealreadyavailable onrecordintheorderoftheLd.CIT(A).Accordingly,Iadmittheadditional groundofappealraisedbytheassesseeinviewofthejudgmentoftheHon’bleSC inthecaseofNTPCLtd.reportedin229ITR383whereitwasheldasunder: TheviewthattheTribunalisconfinedonlytoissuesarisingoutoftheappealbeforethe Commissioner(Appeals)takestoonarrowaviewofthepowersoftheTribunal. Undoubtedly,theTribunalwillhavethediscretiontoallowornotallowanewgroundtobe raised.ButwheretheTribunalisonlyrequiredtoconsideraquestionoflawarisingfrom thefactswhichareonrecordintheassessmentproceedingsthereisnoreasonwhysuch aquestionshouldnotbeallowedtoberaisedwhenitisnecessarytoconsiderthat questioninordertocorrectlyassessthetaxliabilityofanassessee. 21.Thecommonissuesraisedinalltheadditionalgroundsofappealofthe asseseeisthattheLd.CIT(A),erredindirectingtheAOtoverifytheclaimofthe asseseeanddecidetheissueaspertheprovisionoflaw.Itwassubmittedbythe ITAno.863/AHD/2023 Asstt.Year1982-1983 8 Ld.ARthattheLd.CIT(A)hasnopowertoremitbackthemattertotheAOunder thestatue.Therefore,theLd.CIT(A),wasundertheobligationtoadjudicatethe issueraisedbytheassesseeonmerit.Onthecontrary,theLd.DRcontendedthat theissuesraisedintheadditionalgroundsofappealhavedulybeenadjudicated bytheLd.CIT(A)anduponadjudication,restoredtheissuetothefileoftheAO forlimitedpurposei.e.verification/computationofinterestaspertheprovisionof law.Thus,itwascontendedbytheLd.DRthattheissueshavenotbeenset-aside tothefileoftheAOforde-novoassessment/verification. 22.Ihaveheardtherivalcontentionsofboththepartiesandperusedthe materialsavailableonrecord.OnperusaloftheorderoftheLd.CIT(A),Inote thatalltheissuesweredulyadjudicatedbytheLd.CIT(A),inhisorderand thereaftertheissuewasset-asidetotheAOonlyforthepurposeofverification andcomputationofinterestundertheprovisionoflaw.Therefore,Iamnot convincedwiththeargumentoftheLd.ARthattheLd.CIT(A)hasexceededhis powergrantedunderthestatuebyrestoringtheissuetothefileoftheAOfor freshassessment.Thus,Idonotfindanymeritintheargumentadvancedbythe Ld.ARfortheassessee.Accordingly,alltheissuesraisedbytheassesseeinthe additionalgroundsofappealareherebydismissed. 23.Intheresult,theappealfiledbytheasseseeispartlyallowed. OrderpronouncedintheCourton03/01/2023atAhmedabad. Sd/-Sd/-/-/-/- (TRSENTHILKUMAR)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated03/01/2023 Manish