Oracle Systems Corporation, New Delhi V. ADIT, New Delhi

MA 7/DEL/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 5085 (ITAT-DELHI)
• Duration Of Justice: 1 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-02-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 1997-1998
• Appeal Filed On: 23-01-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘D’ NEW DELHI BEFORE SHRI G.S. PANNU, HON’BLE PRESIDENT AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER M.A. No. 7/Del/2022 [Arising out of S.A. No. 3/Del/2022] Assessment Year: 1997-98 And M.A. No. 8/Del/2022 [Arising out of S.A. No. 4/Del/2022] Assessment Year: 1998-99 And M.A. No. 9/Del/2022 [Arising out of S.A. No. 5/Del/2022] Assessment Year: 1999-00 And M.A. No. 10/Del/2022 [Arising out of S.A. No. 6/Del/2022] Assessment Year: 2000-01 And M.A. No. 11/Del/2022 [Arising out of S.A. No. 7/Del/2022] Assessment Year: 2001-02 And M.A. No. 12/Del/2022 [Arising out of S.A. No.8/Del/2022] Assessment Year: 2002-03 And M.A. No.13/Del/2022 [Arising out of S.A. No.9/Del/2022] Assessment Year: 2003-04 And M.A. No.14/Del/2022 [Arising out of S.A. No.10/Del/2022] Assessment Year: 2004-05 And 2 M.A. Nos. 7 to 22/Del/2022 (M/s. Oracle Systems Corporation) M.A. No. 15/Del/2022 [Arising out of S.A. No.11/Del/2022] Assessment Year: 2005-06 And M.A. No. 16/Del/2022 [Arising out of S.A. No.12/Del/2022] Assessment Year: 2006-07 And M.A. No. 17/Del/2022 [Arising out of S.A. No. 13/Del/2022] Assessment Year: 2007-08 And M.A. No.18/Del/2022 [Arising out of S.A. No.14/Del/2022] Assessment Year: 2008-09 And M.A. No.19/Del/2022 [Arising out of S.A. No.15/Del/2022] Assessment Year: 2009-10 And M.A. No. 20/Del/2022 [Arising out of S.A. No.16/Del/2022] Assessment Year: 2010-11 And M.A. No.21/Del/2022 [Arising out of S.A. No.17/Del/2022] Assessment Year: 2011-12 And M.A. No.22/Del/2022 [Arising out of S.A. No.18/Del/2022] Assessment Year: 2012-13 M/s. Oracle Systems Corporation, C/o- Pricewater House Coopers Pvt. Ltd., Gate No. 2, 2 nd Floor, Sucheta Bhawan, 11-A, Vishnu Digamber Marg, New Delhi Vs. ADIT, Circle-2(1), International Taxation, New Delhi PAN :AAACO0207A (Applicant) (Respondent) 3 M.A. Nos. 7 to 22/Del/2022 (M/s. Oracle Systems Corporation) ORDER PER SAKTIJIT DEY, JM: Captioned applications have been filed by the assessee seeking modification in the order dated 07.01.2022 passed in S.A. No. 3 to 18/Del/2022, pertaining to assessment years 1997-98 to 2012-13 respectively. 2. We have heard Shri G.C. Srivastava, learned counsel appearing for the assessee and Shri M.K. Jain, learned Departmental Representative. While granting conditional stay to the assessee in the order referred to above, one of the conditions put by the Tribunal on the assessee is to secure the balance demand remaining outstanding after excluding interest charged under section 234B of the Income-tax Act, 1961 (in short ‘the Act’), and payment of Rs.250 crores to be made as per the Applicant by Sh. G.C. Srivastava, Advocate Sh. Kalrav Mehrotra, Advocate Respondent by Sh. M.K. Jain, Sr. DR Date of hearing 11.02.2022 Date of pronouncement 28.02.2022 4 M.A. Nos. 7 to 22/Del/2022 (M/s. Oracle Systems Corporation) direction of the Tribunal, by furnishing adequate security to the satisfaction of the Assessing Officer. 3. Learned counsel for the assessee submitted, while imposing aforesaid condition put by the Tribunal, the Assessing Officer may, in all likelihood, insist upon furnishing bank guarantee, which would entail a heavy cost not only by way of commission or fee to the bank, but also the cost of maintaining suitable balance in the account of the assessee with the bank. This, according to learned counsel for the assessee, would cause hardship to the assessee. Learned counsel further submitted that in view of the decision of the Hon’ble Apex Court in case of DIT Vs. Mitshubishi Corporation, [2021] 130 taxmann.com 276 (SC), the interest component charged under section 234B of the Act amounting to Rs.714,18,37,028/- is not payable by the assessee. Thus, the balance outstanding demand remains to be paid by the assessee is to the tune of Rs.1518,06,40,467/-. Thus, he submitted, the condition imposed by the Tribunal for furnishing adequate security should be modified, in which event, the assessee is willing to pay a further amount of Rs.53.61 crores to cover 20% of the demand remaining outstanding after exclusion of the interest charged under section 234B of the Act which, in any case, is not 5 M.A. Nos. 7 to 22/Del/2022 (M/s. Oracle Systems Corporation) enforceable. Thus, he submitted, as against the third installment of Rs.50/- crores fixed by the Tribunal to be paid on or before 15.03.2022, the assessee is willing to pay an amount of Rs.103 crores. 4. We have heard the parties and perused the materials on record. We find merit in the submission of learned counsel for the assessee that the demand relating to interest charged under section 234B amounting to Rs.714,18,37,028/- may not be enforceable because of the Hon’ble Apex Court’s decision in case of DIT Vs. Mitshubishi Corporation (supra). After exclusion of the aforesaid interest component, the balance outstanding demand which remains to be paid is Rs.1518,06,40,467/-. Before us, learned counsel for the assessee has submitted, in lieu of furnishing security, the assessee is willing to pay further sum in addition to Rs.250 crores, as directed by us, so as to cover 20% of Rs.1518.06 crores. Considering the above, we are inclined to dispense with the condition imposed of furnishing security to the satisfaction of the Assessing Officer. However, as promised, the assessee must pay a further amount of Rs.54 crores in addition to Rs.250/- crores, as directed by us earlier. The aforesaid amount of Rs.54/- crores should form part of the third 6 M.A. Nos. 7 to 22/Del/2022 (M/s. Oracle Systems Corporation) installment. In other words, the assessee should now pay an amount of Rs.104/- crores on or before 15.03.2022 towards the third installment. The order dated 07.01.2022 in S.A. No. 3 to 18/Del/2022 stands modified to this extent only. 4. In the result, all the miscellaneous applications are allowed, as indicated above. Order pronounced in the open court on 28 th February, 2022 Sd/- Sd/- (G.S. PANNU) (SAKTIJIT DEY) PRESIDENT JUDICIAL MEMBER Dated: 28 th February, 2022. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi