COMMISSIONER OF INCOME-TAX vs. MAHAVIR SHIP BREAKING CO. PVT.LTD.

ITR/120/1993HC GujaratGJHC24021203199314 June 2005Author: HONOURABLE MR. JUSTICE D.A.MEHTA,HONOURABLE MS. JUSTICE HARSHA DEVANI3 pages
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What were the facts?

The Gujarat High Court was hearing an Income Tax Reference filed by the Revenue (Commissioner of Income-tax) against the respondent-assessee, Mahavir Ship Breaking Co. Pvt. Ltd. The reference was made at the instance of the Revenue under Section 256(1) of the Income-tax Act, 1961, concerning two questions of law. Despite attempts to serve the respondent-assessee through public notice, there was no appearance on their behalf. The Court proceeded to hear the matter based on the submissions of the Revenue's counsel.

What did the High Court hold?

The High Court answered the first question in the affirmative, in favour of the assessee and against the Revenue. This was based on the submission that the issue was concluded by the Supreme Court's decision in Allied Motors (P.) Ltd. Vs. Commissioner of Income-tax, which held that if a statutory liability is paid within the due date of filing the return, the deduction is allowable. For the second question, the Court answered in the negative, in favour of the Revenue and against the assessee. This was based on the Court's own prior decision in Commissioner of Income-tax Vs. Vijay Ship Breaking Corporation, which dealt with a similar issue concerning a ship-breaking company. The reference was accordingly disposed of with no order as to costs.

What were the issues?

The Tribunal had to decide two questions of law: 1. Whether the Appellate Tribunal was right in holding that if unpaid sales-tax liability pertaining to the last quarter is paid within the time stipulated for filing of return under section 139(1), the provisions of section 43B cannot be made applicable. The Revenue argued that this question is concluded by the Supreme Court decision in Allied Motors (P.) Ltd. Vs. Commissioner of Income-tax, [1997] 224 ITR 677 (SC) and should be answered against the Revenue. 2. Whether the Appellate Tribunal was right in treating the assessee, engaged in ship breaking, as an industrial company. The Revenue contended that this question should be answered against the assessee in light of this Court's decision in Commissioner of Income-tax Vs. Vijay Ship Breaking Corporation, [2003] 261 ITR 113.

Which sections of the Income-tax Act were involved?

Section 256(1),Section 139(1),Section 43B

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

INCOME TAX REFERENCE No. 120 of 1993

For Approval and Signature:

THE HON'BLE MR.JUSTICE D.A.MEHTA MS.JUSTICE H.N.DEVANI ============================================================== ============================================================== COMMISSIONER OF INCOME-TAX - Petitioner(s) Versus MAHAVIR SHIP BREAKING CO. PVT. LTD. - Respondent(s) ============================================================== Appearance : MS M.M. BHATTfor Applicant No(s).: 1. DS AFF.NOT FILED (N) for Respondent No(s).: 1. ============================================================ CORAM :THE HON'BLE MR.JUSTICE D.A.MEHTA MS.JUSTICE H.N.DEVANI 1 Whether Reporters of Local Papers may be allowed to see the judgement ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgement ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 of any order made thereunder ? 5 Whether it is to be circulated to the civil judge ?

Date : 14/06/2005 ORAL JUDGMENT (Per : THE HON'BLE MR.JUSTICE D.A.MEHTA)

1.

On 9th March, 2005 this

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