THE COMMISSIONER OF INCOME TAX vs. O.N.G.C.

ITA/37/1999HC UttarakhandUKHC01014997200424 June 2004Bench: OTHER1 pages

AI SummaryAllowed

What did the High Court hold?

The High Court held that the Income Tax Appellate Tribunal was justified in directing the application of single-state grossing up of tax perquisites paid by ONGC on behalf of the assessee, instead of the multi-state grossing up applied by the Assessing Officer under section 195-A of the Income Tax Act, 1961. The Court's decision was squarely covered by its prior judgment dated September 30, 2003, in Income Tax Appeal No. 470 of 2001 (Commissioner of Income Tax, Meerut & another Vs O.N.G.C., Dehradun). The question was answered in the affirmative, favoring the assessee and against the Department. The appeal was disposed of accordingly, with no order as to costs. The ratio decidendi is that single-state grossing up is the correct method for tax perquisites in this context, as per established precedent.

What were the facts?

The appeal concerns Assessment Year 1990-91. The Commissioner of Income Tax, Meerut, and another are the appellants, and ONGC, Dehradun, acting as an agent for Mr. Malkhas Baratel, is the respondent. The dispute revolves around the method of grossing up tax perquisites paid by ONGC on behalf of the assessee. The Assessing Officer applied a multi-state grossing up, while the Income Tax Appellate Tribunal directed the application of a single-state grossing up. This appeal challenges the Tribunal's direction.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the learned Income Tax Appellate Tribunal was justified in directing to apply single state grossing up of the Tax Perquisites paid by ONGC on behalf of the assessee instead of multi-state 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 contentions for the assessee. Revenue's contention: The revenue, represented by the Commissioner of Income Tax, argued that the Assessing Officer was justified in applying multi-state grossing up. The judgment does not name any specific authorities, circulars, or precedents relied upon by the revenue.

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. 243 of 2001 Old No. 37/1999

The Commissioner of Income Tax Meerut & another … Appellants Versus ONGC, Tel Bhawan Dehradun as agent of Mr. Malkhas Baratel … Respondent

Hon’ble M.M. Ghildiyal, J. Hon’ble Rajesh Tandon, J.

Mr. S.K. Posti, learned counsel for the Tax Deptt. Mr. J.P. Joshi, learned counsel for the respondent.

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 on the facts and in the circumstances of the case, learned Income Tax Appellate Tribunal was justified in directing to apply single state grossing up of the Tax Perquisites paid by ONGC on behalf of assessee instead of multi state 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.

(Rajesh Tandon, J.) (M.M. Ghildiyal, J.)

Dt. 24.06.2004 NCM

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