THE COMMISSIONER OF INCOME TAX vs. ATWOOD OCEAUICS INTERNATIONAL

ITA/108/1999HC UttarakhandUKHC01025135200303 November 2003Bench: OTHER1 pages

AI SummaryPartly Allowed

What did the High Court hold?

The High Court held that the learned Income Tax Appellate Tribunal was justified in directing the application of single-stage grossing up of tax perquisites paid by ONGC on behalf of the assessee, instead of the multi-stage grossing up applied by the Assessing Officer. The Court's decision is based on its prior judgment dated September 30, 2003, in Income Tax Appeal No. 470 of 2001, between the same parties. The ratio decidendi is that single-stage grossing up is the correct method in this context. The question is answered in the affirmative, favoring the assessee and against the Department. The appeal is disposed of accordingly, with no order as to costs.

What were the facts?

This case concerns Assessment Year 1990-91. The appeal is filed by the Commissioner of Income Tax, Meerut, against an order of the Income Tax Appellate Tribunal (ITAT). The respondent is ONGC, acting as the representative of Mr. Arib Guezuev. The dispute revolves around the method of grossing up of tax perquisites paid by ONGC on behalf of the assessee. The Assessing Officer applied a multi-stage grossing up, while the ITAT directed a single-stage grossing up. The High Court is considering the justification of the ITAT's direction.

What were the issues?

1. Whether, in the facts and circumstances of the case, the learned Income Tax Appellate Tribunal was justified in directing to apply single-stage grossing up of the tax perquisites paid by ONGC on behalf of the assessee instead of multi-stage grossing up, applied by the Assessing Officer under section 195-A of the Income Tax Act, 1961? Assessee's contention: The judgment does not record specific arguments made by the assessee. Revenue's contention: The Assessing Officer applied multi-stage grossing up. The judgment does not record specific arguments made by the revenue in support of this method.

Which sections of the Income-tax Act were involved?

195-A

AI-generated summary — verify with the full judgment below

Assessment Year 1990-91

IN THE HIGH COURT OF UTTARANCHAL AT NAINITAL

I.T.A No. 316 of 2001 Old No. 108/1999

The Commissioner of Income Tax Meerut & another

……… Appellants

Versus

O.N.G.C., As representative of Mr. Arib Guezuev, Dehradun

………. Respondent

Mr. S.K. Posti, learned counsel for the Income Tax Department.

Hon. P.C. Verma, A.C.J. Hon. M.M. Ghildiyal, J.

The matter is squarely covered by our decision dated 30th September, 2003 in Income Tax Appeal No. 470 of 2001; The Commissioner of Income Tax, Meerut & another Vs O.N.G.C., Dehradun.

The question raised before us is as follows: “Whether in the facts and circumstances of the case the learned Income Tax Appellate Tribunal was justified in directing to apply single stage grossing up of the Tax perquisites paid by ONGC on behalf of the assessee instead of multi stage grossing up, applied by the Assessing Officer under section 195-A of the Income Tax Act, 1961?”

For the reasons recorded in the above judgment in Income Tax Appeal No. 470 of 2001 dated 30th September, 2003, we answer this question in the affirmative i.e. in favour of the assessee and against the Department.

Appeal is disposed of accordingly. No order as to costs.

(M.M. Ghildiyal, J.)

(P.C. Verma, A.C.J.)

Dt. 20.04.2004

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