THE COMMISSIONER OF INCOME TAX - INTERNATIONAL TAXATION -1 vs. GE CANADA COMPANY

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ITA/1355/2018HC DelhiDLHC01071754201830 November 2018Bench: HON'BLE MR. JUSTICE SANJIV KHANNA,HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI2 pages
AI SummaryRemanded

What did the High Court hold?

The Delhi High Court disposed of the appeal by stating that the issue of levy of interest under Section 234B of the Income Tax Act, 1961 is covered by its own judgment in Director of Income Tax (International Taxation) vs. GE Packaged Power Inc. (2015) 373 ITR 65 (Delhi). The Court noted that an appeal against this judgment is pending before the Supreme Court. The parties agreed that the ruling of the Supreme Court would apply to the present appeal. Therefore, the appeal was disposed of with the understanding that if any difficulty arises after the Supreme Court's decision, parties can file an application. No specific finding was given on the merits of the current appeal, as it was disposed of based on the pendency of a higher court matter.

What were the facts?

The Commissioner of Income Tax - International Taxation -1 (the Revenue) filed an appeal against an order concerning GE Canada Company (the assessee). The appeal was filed with a delay in re-filing, which was condoned. The parties agreed to dispose of the present appeal in terms of a previous order dated 01.06.2018 passed in ITA No. 661/2018, involving the Principal Commissioner of Income Tax-1 (International Taxation) vs. General Electric Power Systems INC. This was stated to be in consonance with Sections 158A and 158AA of the Income Tax Act, 1961, although these provisions were not strictly applicable. The core issue relates to the levy of interest under Section 234B of the Income Tax Act, 1961.

What were the issues?

1. Whether the levy of interest under Section 234B of the Income Tax Act, 1961 is sustainable in the facts and circumstances of the case? Assessee's Contention: The judgment does not record any specific arguments made by the assessee. However, the appeal is being disposed of in terms of a previous High Court order which was in favor of the assessee on the issue of interest under Section 234B. Revenue's Contention: The Revenue's appeal concerns the levy of interest under Section 234B. The Revenue relies on the fact that an appeal against the High Court's decision in a similar case (Director of Income Tax (International Taxation) vs. GE Packaged Power Inc.) is pending before the Supreme Court, with special leave granted. The Revenue states that the ruling of the Supreme Court would equally apply to the present appeal.

Which sections of the Income-tax Act were involved?

Section 234B,Section 158A,Section 158AA

AI-generated summary — verify with the full judgment below

$~31 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 1355/2018 THE COMMISSIONER OF INCOME TAX - INTERNATIONAL TAXATION -1 ..... Appellant Through: Mr. Ruchir Bhatia, Adv. versus GE CANADA COMPANY ..... Respondent Through: Mr. Sachin Jolly, Adv. CORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI O R D E R % 30.11.2018 CM APPL. 50071/2018 (exemption) Allowed subject to all just exceptions. CM APPL. 50072/2018 (delay in re-filing) Delay in re-filing is not opposed by the respondent-assessee. Accordingly, the application for condonation of delay is allowed. ITA 1355/2018 Counsel for the parties state that the present appeal may be disposed of in terms of the order dated 01.06.2018 passed in ITA No. 661/2018, the Pr. Commissioner of Income Tax-1 (International Taxation) vs. General Electric Power Systems INC. It is stated that this would be in consonance with Sections 158A and 158AA of the Income Tax Act, 1961, though these provisions are not strictly applicable.

2.

The question raised by the Revenue in these appeals relates to levy of interest under Section 234B of the Income Tax Act, 1961 which issue is covered against them vide the judgment of this Court in Director of Income Tax (International Taxation) vs. GE Packaged Power Inc., (2015) 373 ITR 65 (Delhi). 3. Appeal against the said decision is pending before the Supreme Court as special leave to appeal has been granted. 4. Counsel for the parties state that the ruling by the Supreme Court would equally apply to the present appeal. Recording the above, the appeal is disposed of. 5. In case of any difficulty, it will be open to the parties to file an application in this appeal after the decision of the Supreme Court. SANJIV KHANNA, J. ANUP JAIRAM BHAMBHANI, J. NOVEMBER 30, 2018/uj

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