DIRECTOR OF INCOME TAX vs. CARGIL TSF PTE LTD

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ITA - 194 / 2013HC Delhi16 April 20131 pages
For Petitioner: ABHISHEK MARATHA
AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeal filed by the Revenue did not survive. The Court noted that the ITAT had disposed of the appeal by holding that the levy of interest under Section 234B was consequential in nature, as the quantum addition had been deleted. The ITAT had followed its own prior decision on this point for subsequent assessment years. The High Court further observed that its own order dated 19.11.2012, in a similar appeal by the Revenue concerning assessment years 2006-07 and 2007-08, had dismissed the appeal. Therefore, following its own precedent, the High Court dismissed the present appeal. No costs were awarded.

What were the facts?

The Revenue (Director of Income Tax) filed an appeal before the High Court of Delhi against an order dated 19.08.2011 passed by the Income Tax Appellate Tribunal (ITAT). The ITAT's order pertained to assessment year 2005-06 and dealt with an appeal filed by the assessee, Cargill TSF Pte Ltd. The core of the ITAT's decision was that the quantum addition had been deleted, and therefore, the levy of interest under Section 234B was consequential. The ITAT followed its own previous decision in similar appeals for assessment years 2006-07 and 2007-08. The High Court noted that a similar appeal by the Revenue against the ITAT's order for assessment years 2006-07 and 2007-08 had been dismissed by the High Court on 19.11.2012.

What were the issues?

1. Whether the levy of interest under Section 234B of the Income Tax Act, 1961, is consequential in nature when the quantum addition has been deleted. Assessee's Contention: The judgment does not record any specific contentions made by the assessee before the High Court. However, the ITAT's order, as quoted, indicates that the quantum addition was deleted, leading to the conclusion that interest under Section 234B was consequential. Revenue's Contention: The Revenue appealed against the ITAT's order. The judgment implies that the Revenue contested the ITAT's finding that the interest under Section 234B was consequential and should be deleted or not levied, given the deletion of the primary addition. The Revenue's appeal before the High Court was based on challenging the ITAT's order.

Which sections of the Income-tax Act were involved?

Section 234B

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF DELHI AT NEW DELHI . . . ITA 194/2013 . . . DIRECTOR OF INCOME TAX ..... Appellant . Through: Mr Abhishek Maratha, Sr. Standing Counsel. . versus . . . CARGIL TSF PTE LTD. ..... Respondent . Through: Mr Vikas Jain with Mr Sanat Kapoor and Mr Ankit Gupta, Advocates. . . . CORAM: . HON'BLE MR. JUSTICE BADAR DURREZ AHMED . HON'BLE MR. JUSTICE R.V.EASWAR . . . O R D E R . 16.04.2013 . . . This appeal by the revenue is directed against the order dated 19.08.2011 passed by the Income Tax Appellate Tribunal in ITA No.581/Del/2010 pertaining to the assessment year 2005-06. The Tribunal disposed of the said appeal in the following manner: - . ?6. We have heard the submissions of the parties and gone through the relevant material on record. Since quantum addition has been deleted and in revenue?s similar appeal on 234B for A.Y. 2006-07 and 2007-08 (supra), it has been held that levy of interest u/s 234B is consequential in nature, following the same we hold that the levy of interest u/s 234B is consequential in nature. The AO will verify accordingly.? . . . From the above extract, it is apparent that the issue only relates to interest under section 234B which was consequential in nature to the quantum appeal which was decided by the Tribunal for the assessment year 2006-07. The appeal therefrom being ITA No.621/2012 was dismissed by this Court by an order dated 19.11.2012. As such, the present appeal also does not survive. The appeal is dismissed. There shall be no order as to costs. . . . BADAR DURREZ AHMED, J . . . . . . . R.V.EASWAR, J . APRIL 16, 2013 . hs . . . . . $ 2 .

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