COMMISSIONER OF INCOME TAX-I , JDH vs. M/S MAX INDIA LTD.

ITA/428/2010HC Punjab & HaryanaPHHC01093360201001 October 2015Author: MR. JUSTICE SURINDER GUPTA,MRS JUSTICE DAYA CHAUDHARY9 pages
AI SummaryDismissed

What were the facts?

The Revenue (Commissioner of Income Tax, Jalandhar) appealed against an order of the Income Tax Appellate Tribunal (ITAT) for the assessment year 2000-01. The assessee, M/s Max India Limited, had filed its return under Section 115J of the Income Tax Act, 1961. The Assessing Officer (AO) made an assessment under Section 143(3), disallowing excess depreciation and computing interest under Section 234B without setting off brought forward tax credit under Section 115JAA. The Commissioner of Income Tax (Appeals) [CIT(A)] allowed the assessee's appeal, deleting the addition and directing the AO to compute interest under Section 234B after setting off the tax credit. The ITAT dismissed the Revenue's appeal. The Revenue then filed an appeal before the High Court.

What did the High Court hold?

The High Court answered both questions of law. Regarding Question I, the Court held that the set-off of tax credit under Section 115JAA is admissible for the purpose of calculating interest under Section 234B. The Court relied on the Supreme Court's decision in CIT vs. Tulsyan Nec Limited, which held that the Assessing Officer is required to give the benefit of tax credit available under Section 115JAA and then determine the interest payable under Section 234B. The Court emphasized that the right to claim set-off arises from the payment of tax under Section 115JA, and while the quantum may depend on the assessment, the entitlement is not postponed. The Court distinguished the Revenue's cited case, Rolta India Limited, as dealing with a different issue. Regarding Question II, the Court stated it was covered by a prior decision and answered it against the Revenue. Consequently, the appeal filed by the Revenue was dismissed.

What were the issues?

1. Whether, on the facts and circumstances, the ITAT was correct in law in allowing the set-off of tax credit under Section 115JAA for the purpose of calculating interest under Section 234B, despite no specific provision for such set-off. - Revenue's contention: Relied on Joint CIT vs. M/s Rolta India Limited to argue that set-off of tax credit under Section 115JAA is not admissible for calculating interest under Section 234B. - Assessee's contention: Relied on CIT vs. Tulsyan Nec Limited to argue that the issue is concluded in their favour, and the tax credit should be reduced from taxes payable before calculating interest. 2. Whether, on the facts and circumstances, the ITAT was correct in law in directing that depreciation should be worked out with reference to the Written Down Value (WDV) computed as a result of an order passed under Section 250(6) for the assessment year 1998-99. - The judgment notes that this question was not disputed and was covered by a previous decision of the High Court in ITA No.426 of 2010.

Which sections of the Income-tax Act were involved?

Section 260A,Section 115J,Section 143(1)(a),Section 143(2),Section 142(1),Section 143(3),Section 234B,Section 115JAA,Section 250(6),Section 115JA,Section 209(1)(d),Section 156,Section 139,Section 154

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of decision: 1.10.2015 Commissioner of Income Tax, Jalandhar I, Jalandhar ……Appellant M/s Max India Limited …..Respondent CORAM: HON’BLE MR. JUSTICE AJAY KUMAR MITTAL HON’BLE MR. JUSTICE RAMENDRA JAIN

1.

Whether Reporters of local papers may be allowed to see the judgment?

2.

To be referred to the Reporters or not?

3.

Whether the judgment should be reported in the Digest? Present: Mr. Vivek Sethi, Advocate for the appellant-revenue. Mr. Ajay Vohra, Sr. Advocate with Mr. Gaurav Jain, Advocate for the respondent. Ajay Kumar Mittal,J.

1.

The appellant-assessee has filed this appeal under Section 260A of the Income Tax Act, 1961 (in short, “the Act”) against the order dated 1.1.2010, Annexure A.3 passed by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (in short, “the Tribunal”) in ITA No.102(ASR)/ 2006 for the assessment year 2000-01, claiming following substantial questions of law:- “I. Whether on the facts and circumstances of the case, the ITAT was right in law in allowing the set off of tax credit under section 115J (correct provision is Sect

The order continues below.

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