ACIT CIR 4(3), MUMBAI V. KOTAK SECURITIES LTD, MUMBAI

ITA 9000/MUM/2010

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9352 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 26-02-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 24-12-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN
• Assessee Lawyers: CHETAN KAKKA
• Keywords: Retrospective amendment; Question of law
• Section: 143(3); 260A; 147

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A , MUMBAI , , , BEFORE SHRI SANJAY ARORA , A M AND SHRI AMIT SHUKLA , J M ITA NO. 9000 /MUM/20 1 0 : ASST.YEAR 200 2 - 200 3 THE DY.COMMISSIONER OF INCOME - TAX CIRCLE 4(3) MUMBAI. / VS. M/S.KOTAK SECURITIES LIMITED 1 ST FLOOR, BHAKTAWAR 229 NARIMAN POINT MUMBAI 400 021. PAN : AAACK3436F . ( / APPELLANT) ( / RESPONDENT) /APPELLANT BY : SHRI ASGHAR ZAIN /RESPONDENT BY : SHRI CHETAN KAKKA / DATE OF HEARING : 26.02.2015 / DATE OF PRONOUNCEMENT : 13 .03.2015. / O R D E R PER AMIT SHUKLA (JM) : THIS APPEAL HAS BEEN PREFERRED BY THE DEPARTMENT AGAINST THE ORDER DATED 05.10.2010 , PASSED BY THE COMMI SSIONER OF INCOME - TAX (APPEALS) - 11 , MUMBAI, [`CIT(A) FOR SHORT] FOR THE QUANTUM OF ASSESSMENT PASSED U/S 143(3) READ WITH SECTION 147 , FOR THE ASSESSMENT YEAR 200 2 - 200 3 , ON THE FOLLOWING GROUND S OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE DISALLOWANCE OF RS.6,90,589/ - LEVIED FOR CHARGING INTEREST U/S 234D OF THE ACT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE IMPUGNED ORDER OF THE LD.CIT(A) IS CONTRARY TO LAW AND ITA NO. 9000/MUM/2010 M/S. KOTAK S ECURITIES LIMITED . 2 CONSEQUENTLY MERITS TO BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 2. BRIEF FACTS ARE THAT, EARLIER THE TRIBUNAL VIDE ORDER DATED 27 TH JULY, 2011 IN ITA NO.3272/MUM/2006 HAD DELETED THE INTEREST U/S 234 D , ON THE GROUND THAT THE SAID PROVISION IS APPLICABLE ONLY FROM THE ASSESSMENT YEAR 2004 - 2005 , AS THE SAME WAS BROUGHT INTO THE STATUTE WITH EFFECT FROM 01.06.2003 AND WIL L NOT HAVE RETROSPECTIVE EFFECT. A GAINST THE SAID ORDER OF THE TRIBUNAL, THE REVENUE HAD FILED AN APPEAL U/S 260A , HOWEVER, THIS ISSUE WAS NOT RAISED AS SUBSTANTIAL QUESTION OF LAW AND NEITHER IT WAS ADMITTED OR FORMULATED BY THE HON BLE HIGH COURT. LATER ON, THE REVENUE HAD FILED A MISCELLANEOUS APPLICATION BEING , MA NO.246/MUM/2013, WHEREIN THE TRIBUNAL VIDE ORDER DATED 06.12.2013 RECALLED THE ORDER OF THE TRIBUNAL TO THE EXTENT OF ISSUE OF LEVY OF INTEREST U/S 234D AS RAISED VIDE GROUND NO.8. AFTER RECAL L OF THE EARLIER ORDER, THE TRIBUNAL VIDE ORDER DATED 30 TH JANUARY, 2014, GAVE DIRECTION TO THE AO TO GIVE EFFECT TO THE BINDING DECISION OF THE HON BLE BOMBAY HIGH COURT IN THE CASE OF CIT V. INDIAN OIL CORPORATION LIMITED, REPORTED IN (2002) 210 TAXMAN 4 66. IN THE MEAN TIME, THE AO WHILE GIVING EFFECT TO THE HIGH COURT ORDER HAS AGAIN LEVIED THE INTEREST U/S 234D . THE SAID INTEREST HAS BEEN DELETED BY THE CIT(A) AFTER FOLLOWING THE DECISION OF THE ITAT SPECIAL BENCH IN THE CASE OF EKTA PROMOTERS PVT. LTD. 3. NOW IT IS QUITE SETTLED THAT THE SAID DECISION OF THE SPECIAL BENCH IS NO LONGER APPLICABLE, IN WAKE OF THE DECISION OF THE J URISDICTIONAL HIGH COURT IN THE CASE OF CIT V. INDIAN OIL CORPORATION LTD. (SUPRA) . THUS, THE GROUND RAISED BY THE REVENUE HAS TO BE DECIDED AGAINST THE ASSESSEE. BEFORE US, THE LEARNED COUNSEL, THOUGH ADMITTING THE AFORESAID POSITION SUBMITTED THAT , ITA NO. 9000/MUM/2010 M/S. KOTAK S ECURITIES LIMITED . 3 THE A O MAY BE DIRECTED TO GIVE EFFECT TO THE PROVISIONS OF SUB - SECTION (2) OF SECTION 234D, WHILE CALCULATING THE INTEREST. 4 . AFTER CONSIDERING THE FACTS AND SUBMISSIONS OF THE PARTIES, WE HOLD THAT SO FAR AS THE ISSUE OF LEVY OF INTEREST U/S 234D, PRIOR TO ASSESSMENT YEAR 2004 - 2005, HAS BEEN SETTLED BY THE HON BLE BOMBAY HIGH COURT IN THE CASE OF CIT V. INDIAN OIL CORPORATION LTD. (SUPRA), THAT THE AMENDMENT BROUGHT BY THE FINANCE ACT, 2012 WITH RETROSPECTIVE EFFECT FROM 01.06.20 0 3 WOULD BE APPLICABLE EVEN T O THE PERIOD PRIOR TO ASSESSMENT YEAR 2004 - 2005. ACCORDINGLY, THE AO HAS RIGHTLY LEVIED THE INTEREST U/S 234D FOR THE ASSESSMENT YEAR 2002 - 2003. HOWEVER, THE AO IS DIRECTED TO GIVE EFFECT TO THE PROVISIONS OF SUB - SECTION (2) OF SECTION 234D , WHILE CALCULATING THE INTEREST UNDER THE SAID SECTION. WITH THIS DIRECTION, THE REVENUE S APPEAL IS TREATED AS ALLOWED. 5 . IN THE RESULT, THE REVENUE S APPEAL IS ALLOWED . ORDER PRONOUNCED ON THIS 13 TH DAY OF MARCH, 2015 . SD/ - SD/ - ( SANJAY ARORA ) ( AMIT SHUKLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; DATED : 13 TH MARCH, 2015 . DEVDAS* ITA NO. 9000/MUM/2010 M/S. KOTAK S ECURITIES LIMITED . 4 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT , MUMBAI. 4. / CIT(A) - 11 , MUMBAI 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE.