COMMISSIONER OF INCOME TAX vs. ELSCOPE PVT.LTD.

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ITR/189/1995HC GujaratGJHC24022512199523 January 2008Bench: HONOURABLE MR. JUSTICE D.A.MEHTA,HONOURABLE MR. JUSTICE Z.K.SAIYED4 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that the Appellate Tribunal was right in law in deleting the additional tax of Rs.3,92,510/- levied under Section 104 of the Act. This decision was based on the fact that the High Court had, by a separate judgment on the same day, answered a reference at the instance of the Revenue in quantum proceedings for the Assessment Year 1979-80 in favour of the assessee, upholding the order made by the Tribunal in the quantum appeal. Consequently, the finding that the distributable income was NIL, which led to the deletion of the additional tax under Section 104, was affirmed. The operative direction was to answer the reference in the affirmative, in favour of the assessee and against the Revenue. No issue was expressly left undecided.

What were the facts?

The assessee is Elscope Pvt. Ltd. and the revenue is the Commissioner of Income Tax. The assessment year in question is 1979-1980. The order under challenge is the deletion of additional tax of Rs. 3,92,510/- levied under Section 104 of the Income Tax Act, 1961, by the Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench 'B'. The Assessing Officer had levied this additional tax consequent to an addition made in the assessment. The Commissioner (Appeals) had deleted this addition. The ITAT, in revenue's second appeal, confirmed the order of the Commissioner (Appeals) by holding that the distributable income was NIL. The ITAT made this reference at the instance of the Revenue because a reference had been made against the order in the quantum appeal.

What were the issues?

1. Whether, the Appellate Tribunal is right in law and on facts in deleting the additional tax of Rs.3,92,510/- levied under section 104 of the Act? (Question of law and fact, concerning Section 104 of the Income Tax Act, 1961). Assessee's contentions: The judgment does not record specific contentions for the assessee regarding this issue. However, it is implied that the assessee supported the ITAT's decision to delete the additional tax. Revenue's contentions: The Revenue, through the Commissioner of Income Tax, initiated the reference to challenge the ITAT's deletion of the additional tax. The judgment notes that the reference is consequential to a reference made by the Revenue in quantum proceedings for the same assessment year.

Which sections of the Income-tax Act were involved?

Section 104,Section 256(1)

AI-generated summary — verify with the full judgment below

ITR/189/1995 1/4 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD INCOME TAX REFERENCE No.189 of 1995 For Approval and Signature: HONOURABLE MR.JUSTICE D.A.MEHTA Sd/- HONOURABLE MR.JUSTICE Z.K.SAIYED Sd/- =================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? NO 2 To be referred to the Reporter or not ? NO 3 Whether their Lordships wish to see the fair copy of the judgment ? NO 4 Whether this case involves a substantial question of law as to the

interpretation

the constitution of India, 1950 or any order made thereunder ? NO 5 Whether it is to be circulated to the civil judge ? NO =================================================== COMMISSIONER OF INCOME TAX - Applicant(s) Versus ELSCOPE PVT.LTD. - Respondent(s) =================================================== Appearance : MR MANISH R BHATT for Applicant(s) : 1, MR RK PATEL for Respondent(s) : 1, =================================================== CORAM : HONOURABLE MR.JUSTICE D.A.MEHTA and HONOURABLE MR.JUSTICE Z.K.SAIYED Date : 23/01/2008 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE D.A.MEHTA)

ITR/189/1995 2/4 JUDGMENT (1) The following question, at the instance of the Commissioner Income-tax, has been referred by Income Tax Appellate Tribunal, Ahmedabad Bench 'B' under Section 256(1) of the Income Tax Act, 1961 (the Act): “Whether, the Appellate Tribunal is right in law and on facts in deleting the additional tax of Rs.3,92,510/- levied under section 104 of the Act ?” (2) The Assessment Year is 1979-1980. Consequent upon the addition made in the assessment for the Assessment Year in question, the Assessing Officer made an order under Section 104 of the Act levying additional tax of Rs.3,92,510/-. The Commissioner (Appeals) deleted the addition. In revenue's second appeal the Tribunal, following its own order in quantum appeal, confirmed the order made by the Commissioner (Appeals) holding that distributable income would be NIL. The Tribunal has made the reference only because a reference had been made

ITR/189/1995 3/4 JUDGMENT against the order made in quantum appeal. (3) Heard the learned advocates appearing for the applicant and the revenue. They accepted the

fact

that

this

reference

is consequential to the reference at the instance of the Revenue for A.Y. 1979-80 being I.T.R. No.235 of 1995. (4) Today, by a separate judgment the question referred to at the instance of the Revenue in quantum proceedings has been answered in favour of the assessee and the order made by the Tribunal in quantum appeal has been upheld. (5) In light of the aforesaid position the question referred, for the opinion of this Court, is answered in the affirmative i.e. in favour of the assessee and against the Revenue holding that the Tribunal was right in law in deleting the additional tax of

ITR/189/1995 4/4 JUDGMENT Rs.3,92,510/- under Section 104 of the Act. (6) The reference stands disposed of with no order as to costs. Sd/- [ D.A. MEHTA, J ] Sd/- [Z.K. SAIYED, J ] *** Bhavesh*

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