DCIT, New Delhi V. M/s. ONGC Videsh Ltd., New Delhi

ITA 981/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 4098 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 10-05-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 08-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A D MEHROTRA
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F NEW DELHI) BEFORE SHRI C.L. SETHI, JUDICIAL MEMBER AND SHRI K. G. BANSAL, ACCOUNTANT MEMBER ITA. NO.981/D/2010 ASSESSMENT YEAR : 2002-03 D. C.I.T., VS. M/S ONGC VIDESH LIMITED, CENTRAL 13(1), 601, KAILASH BUILDING, 26, NEW DELHI K.G. MARG, NEW DELHI PAN NO.AAACO1230F (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI A.D. MEHROTRA, CIT- DR RESPONDENT BY : SHRI RAVI SHARMA, AR ORDER PER K.G. BANSAL: AM: THIS APPEAL OF THE REVENUE EMANATES FROM THE ORDER OF CIT(A)- XVII, NEW DELHI, PASSED ON 14.12.2009 IN I.T. APPEA L NO.117/09-10, PERTAINING TO ASSESSMENT YEAR 2002-0 3. THE ONLY SUBSTANTIVE GROUND TAKEN BY THE REVENUE IS THA T ON THE FACTS AND IN THE CIRCUMSTANCES OF THE AND IN LAW, T HE LEARNED CIT(A) ERRED IN CANCELING THE PENALTY OF RS.114.19 CRORE IMPOSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF T HE INCOME TAX ACT, 1961. 2. IN THE COURSE OF HEARING BEFORE US, IT TRANSPIRE D THAT THE REVENUE HAS NOT OBTAINED APPROVAL OF THE COMMITTEE ON RESOL UTION OF DISPUTES (COD) FOR PROSECUTING THIS APPEAL. IN THI S CONNECTION, 2 THE ATTENTION OF THE LEARNED CIT-DR WAS DRAWN TOWAR DS THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF MA HANAGAR TELEPHONE NIGAM LIMITED VS. CHAIRMAN CBDT (2004) 26 7 ITR 647, IN WHICH IT WAS HELD INTER ALIA HELD THAT THE FRAMERS OF THE CONSTITUTION OR THE CIVIL PROCEDURE CODE HAD NOT CO NTEMPLATED THAT .THE GOVERNMENT AND ITS UNDERTAKING WILL FIGHT A LITIGATION IN A COURT OF LAW. CONSEQUENTLY, IT WAS DIRECTED THAT A COMMITTEE MAY BE SET UP TO RESOLVE SUCH DISPUTES AND ALSO ENS URE THAT FRIVOLOUS DISPUTES DO NOT COME UP BEFORE THE COURTS WITHOUT THE CLEARANCE FROM THE COMMITTEE. FOR THE SAKE OF READ Y REFERENCE THE RELEVANT PORTION OF THE JUDGMENT IS REPRODUCED BELOW:- UNDOUBTEDLY, THE RIGHT TO ENFORCE A RIGHT IN A COU RT OF LAW CANNOT BE EFFACED. HOWEVER, IT MUST BE REMEMBERED THAT COURTS ARE OVER-BURDENED WITH A LARGE NUMBER OF CAS ES. THE MAJORITY OF SUCH CASES PERTAIN TO GOVERNMENT DEPARTMENTS AND/OR PUBLIC SECTOR UNDERTAKINGS. AS IS STATED IN CHIEF CONSERVATOR OF FORESTS CASE (2003) 3 SCC472 IT WAS NOT CONTEMPLATED BY THE FRAMERS OF TH E CONSTITUTION OR THE CIVIL PROCEDURE CODE THAT TWO DEPARTMENTS OF A STATE OR UNION OF INDIA AND/OR A DEPARTMENT OF THE GOVERNMENT AND A PUBLIC SECTOR UNDERTAKING FIGHT A LITIGATION IN A COURT OF LAW. SUCH A COURSE IS DETRIMENTAL TO PUBLIC INTEREST AS IT ENTA ILS AVOIDABLE WASTAGE OF PUBLIC MONEY AND TIME. THESE ARE ALL LIMBS OF THE GOVERNMENT AND MUST ACT IN CO-ORDI NATION AND NOT CONFRONTATION. THE MECHANISM SET UP BY THI S COURT IS NOT, AS SUGGESTED BY MR. ANDHYARUJINA, ONL Y TO CONCILIATE BETWEEN GOVERNMENT DEPARTMENTS. IT IS A LSO SET UP FOR PURPOSES OF ENSURING THAT FRIVOLOUS DISP UTES DO NOT COME BEFORE COURTS WITHOUT CLEARANCE FROM THE H IGH POWERED COMMITTEE. IF IT CAN, THE HIGH POWERED COMMITTEE WILL RESOLVE THE DISPUTE. IF THE DISPUTE IS NOT RESOLVED THE COMMITTEE WOULD UNDOUBTEDLY GIVE 3 CLEARANCE. HOWEVER, THERE COULD ALSO BE FRIVOLOUS LITIGATION PROPOSED BY A DEPARTMENT OF THE GOVERNME NT OR A PUBLIC SECTOR UNDERTAKING. THIS COULD BE PREVENT ED BY THE HIGH POWERED COMMITTEE. IN SUCH CASES THERE IS NO QUESTION OF RESOLVING THE DISPUTE. THE COMMITTEE O NLY HAS TO REFUSE PERMISSION TO LITIGATE. NO RIGHT OF T HE DEPARTMENT/PUBLIC SECTOR UNDERTAKING IS AFFECTED IN SUCH A CASE. THE LITIGATION BEING OF A FRIVOLOUS NATURE MUST NOT BE BROUGHT TO COURT. TO BE REMEMBERED THAT IN ALMO ST ALL CASES ONE OR THE OTHER PARTY WILL NOT BE HAPPY WITH THE DECISION OF THE HIGH POWERED COMMITTEE. THE DISSATISFIED PARTY WILL ALWAYS CLAIM THAT ITS RIGHT S ARE AFFECTED, WHEN IN FACT, NO RIGHT IS AFFECTED. THE COMMITTEE IS CONSTITUTED OF HIGHLY PLACED OFFICERS OF THE GOVERNMENT, WHO DO NOT HAVE AN INTEREST IN THE DISP UTE, IT IS THUS, EXPECTED THAT THEIR DECISION WILL BE FAIR AND HONEST. EVEN IF THE DEPARTMENT/PUBLIC SECTOR UNDER TAKING FINDS THE DECISION UNPALATABLE, DISCIPLINE REQUIRES THAT THEY ABIDE BY IT. OTHERWISE THE WHOLE PURPOSE OF T HIS EXERCISE WILL BE LOST AND EVERY PARTY AGAINST WHOM THE DECISION IS GIVEN WILL CLAIM THAT THEY HAVE BEEN WR ONGED AND THAT THEIR RIGHTS ARE AFFECTED. THIS SHOULD NO T BE ALLOWED TO BE DONE. 2.1 THE LEARNED CIT-DR SUBMITTED THAT EITHER THE RE VENUE MAY BE ALLOWED TIME TO SEEK APPROVAL OF THE COMMITTEE OR T HE APPEAL MAY BE DISMISSED WITH A LIBERTY TO IT TO APPLY FOR RECALLING THE ORDER AS AND WHEN SUCH AN APPROVAL IS RECEIVED. TH E LEARNED COUNSEL HAD NO OBJECTION TO EITHER COURSE OF ACTION . 3. WE HAVE CONSIDERED THE FACTS OF THE CASE AND SUB MISSIONS MADE BEFORE US. IN GENERAL APPEALS COMING UP BEFOR E TRIBUNAL REGARDING DISPUTE BETWEEN THE CENTRAL GOVERNMENT AN D ITS UNDERTAKINGS ARE BEING DISMISSED WITH A LIBERTY TO THE PARTY 4 CONCERNED TO APPLY FOR RECALLING THE ORDER IN CASE APPROVAL OF THE COD IS RECEIVED IN FUTURE. THEREFORE, IN THIS CASE ALSO THE APPEAL IS DISMISSED WITH A LIBERTY TO REVENUE TO AP PLY FOR RECALLING THE ORDER ON RECEIPT OF THE APPROVAL OF T HE COD. 4. IN RESULT, APPEAL IS DISMISSED. 5. THIS ORDER WAS PRONOUNCED IN OPEN COURT ON 10.05 .2010. ( C.L. SETHI ) ( K.G. BANSA L ) JUDICIAL MEMBER ACCOUNTANT ME MBER DT.10.05.2010. NS COPY FORWARDED TO:- 1. DCIT, CIRCLE 13(1), NEW DELHI 2. M/S ONGC VIDESH LTD., 601, KAILASH BUILDING, 26, KG MARG, NEW DELHI. 3. THE CIT 4. THE CIT (A), NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. TRUE COPY BY ORDER (ITAT, NEW DELHI).