KOTAK MAHINDRA BANK LTD. (AS SUCCESSOR IN BUSINESS OF ERSTWHILE ING VYSYA BANK LTD.), Mumbai V. A.C.I.T. CIR. - 2(3)(2), Mumbai

MA 311/MUM/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 4423 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-05-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 1997-1998
• Appeal Filed On: 21-12-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: FAROOKH IRANI
• Keywords: Rectification of order
• Section: 244A; 254(2); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, „H„ BENCH MUMBAI BEFORE: SHRI M.BALAGANESH, ACCOUNTANT MEMBER & SHRI SANDEEP SINGH KARHAIL, JUDICIAL MEMBER M.A. No.308/Mum/2021 (Arising out of ITA No.728/Mum/2018) (Asse ssment Year :1994-95) M.A. No.309/Mum/2021 (Arising out of ITA No.729/Mum/2018) (Asse ssment Year :1995-96) M.A. No.310/Mum/2021 (Arising out of ITA No.730/Mum/2018) (Asse ssment Year :1996-97) & M.A. No.311/Mum/2021 (Arising out of ITA No.731/Mum/2018) (Asse ssment Year :1997-98) M/s. Kotak Mahindra Bank Ltd., (as successor in business to erstwhile ING Vysya Bank Ltd.,) 27, BKC, G-Block Bandra Kurla Complex Bandra (E)- 400 051 Mumbai Vs. The Assistant Commissioner of Income Tax-Circle 2(3)(2) Aaykar Bhavan PAN/GIR No.AABCT0529M (Appellant) .. (Respondent) Assessee by Shri Farookh Irani Revenue by Shri Hoshang B. Irani Date of Hearing 25/02/2022 Date of Pronouncement 09/05 /2022 आदेश / O R D E R PER M. BALAGANESH (A.M): By virtue of these Miscellaneous Applications, the assessee only seeks slight modification in the consolidated order passed by this Tribunal MA No. 308/Mum/2021 to 311/Mum/2021 M/s. Kotak Mahindra Bank Ltd., 2 on 27/10/2021. For the sake of convenience, the Miscellaneous Application preferred by the assessee for A.Y.1994-95 is reproduced hereunder:- “The Applicant, by the present Application, prays for the rectification of an apparent inadvertent error in the Order dated 27 th October 2021 ("the said Order") in the above Appeals. The Applicant states that the brief facts relevant for the purposes of the present Application are as under: 1. The single issue in dispute in the above Appeals was regarding the entitlement of the Applicant to interest under Section 244A of the Income Tax Act, 1961 ("the Act"), on refunds admittedly due to it by an Order of the Income Tax Settlement Commission ("the ITSC"), but granted to it after a delay of 98 months. 2. The following relevant dates, which are set out by the Hon'ble Tribunal in paragraphs 3.1 and 3.2 on pages 2 and 3 of said Order / are as follows: (i) 4 ih March 2008: The ITSC's order under Section 245D(1) and 245D(4) of the Act; (ii) 17 th April 2008: The Applicant's rectification applications seeking rectification of certain arithmetical errors in the amount of income tax and computation of interest under Section 244A of the Act, determined in the above Order of the ITSC dated 4 th March, 2008. (iii) 14 th July, 2009: The ITSC's Order determining tax and interest refundable to the Applicant consequent to the Order under Section 245D(4) dated 4 th March, 2008. 3. The Hon'ble ITAT, while accepting the Applicant's entitlement for interest under Section 244A of the Act, inadvertently directed that such interest was to be granted from 14 th July 2009 instead of from 4 th March 2008. 4. The Applicant respectfully submits that the above direction of the Hon'ble ITAT constitutes an inadvertent apparent error in view, inter alia, of the following: (i) The Hon'ble ITAT, in paragraph 4 at page 5 of the said Order has observed: "Once the ITSC passes the order under Section 245D(4) of the Act, and if the Department chooses not to grant the determined refunds to the Assessee in time, then the interest under Section 244A of the Act shall become automatically eligible to the Assessee as per law". (emphasis supplied) (ii) The Hon'ble ITAT, in paragraph 4.3 at page 7 of the said Order has observed: "It could be seen that Section 244A of the Act uses the expression 'any amount due' to the Assessee under this Act, which manifestly includes refunds determined by the ITSC under Section 245D(4) of the Act also". (emphasis supplied) MA No. 308/Mum/2021 to 311/Mum/2021 M/s. Kotak Mahindra Bank Ltd., 3 (iii) The Annexures to the Rectification Order dated 14 th July, 2009 passed by the ITSC (see pages 7 to 11 of the Applicant's Paper Book filed before the ITAT at the hearing of the above Appeals) specifically mention the following: "Amount refundable consequent to order under Section 245D(4) dated 4 th March 2008 upto March 2008 inclusive", (emphasis supplied) 5. The Applicant respectfully submits that in view of the above, the direction of the Hon'ble ITAT in paragraph 4.9 on pages 13 and 14 of the said Order, directing the Assessing Officer ("the AO") to grant interest under Section 244A of the Act, on the refund from 14 th July 2009 onwards, constitutes an inadvertent apparent error. It is humbly prayed that the aforesaid date of 14 th July 2009 may kindly be substituted by the date 4 th March 2008, so that the operative part of paragraph 4.9 on pages 13 and 14 of the Hon'ble ITAT's said Order may read: "4.9. .......... we direct the learned AO to grant interest on refund from 4.3.2008 onwards till the date of granting refund for all the Assessment Years under consideration". (emphasis supplied) The Applicant respectfully submits that the Hon'ble ITAT has inherent power to rectify, in the interests of justice, errors in its orders which have caused prejudice to any of the parties to an appeal before it and that, in any event, it has such power u/s 254(2) of the Act. The Applicant states that the Applicant had not filed earlier any other Miscellaneous Application before ITAT againt the order under consideration.” 3. The same facts would prevail for other assessment years also. We find that this Tribunal in para 3.1 of its order dated 27/10/2021 had stated that assessee had preferred an application for rectification before the Hon’ble Income Tax Settlement Commission on 17/04/2008 seeking rectification of arithmetic errors in the computation of additional income tax payable and computation of interest due to assessee u/s.244A of the Act. Hence, assessee had not committed any error in its stand. It was only the department who had granted the refund to the assessee after a considerable delay. Ultimately in para 4.9 of the order dated 27/10/2021, this Tribunal by placing reliance on various decisions including CBDT Circular referred in the said order directed the ld. AO to grant interest on refund from 14/07/2009 onwards till the date of granting refund for all MA No. 308/Mum/2021 to 311/Mum/2021 M/s. Kotak Mahindra Bank Ltd., 4 the assessment years under consideration. Since, there was no delay on the part of the assessee and in view of the fact that assessee had indeed preferred an application for rectification before the ITSC on 17/04/2008 itself, we deem it fit to modify the direction given in para 4.9 of the Tribunal order dated 27/10/2021 as under:- “4.9. In view of the aforesaid observations and placing reliance on various judicial precedents relied upon hereinabove including the CBDT Instruction and CBDT Circular referred to supra, we direct the ld AO to grant interest on refund from 01/04/2008 onwards till the date of granting refund for all the Asst Years under consideration. Accordingly, the grounds raised by the assessee are allowed.” 4. Hence para 4.9 of the Tribunal order dated 27/10/2021 stands modified as above. This modified order should be read in conjunction with the old Tribunal order dated 27/10/2021. 5. In the result, Miscellaneous Applications preferred by the assessee are allowed. Order pronounced on 09/05/2022 by way of proper mentioning in the notice board. Sd/- (SANDEEP SINGH KARHAIL) Sd/- (M.BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated 09/05/2022 KARUNA, sr.ps MA No. 308/Mum/2021 to 311/Mum/2021 M/s. Kotak Mahindra Bank Ltd., 5 Copy of the Order forwarded to : BY ORDER, (Asstt. Registrar) ITAT, Mumbai 1. The Appellant 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy//