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

ITA/63/1999HC UttarakhandUKHC01015017200421 May 2004Bench: OTHER1 pages

AI SummaryPartly Allowed

What did the High Court hold?

The High Court held that the learned Income Tax Appellate Tribunal was legally correct in directing the application of single-stage grossing up of tax perquisites paid by ONGC on behalf of the assessee, as opposed to the multi-stage grossing up applied by the Assessing Officer under section 195-A of the Income Tax Act, 1961. The Court's decision was based on its prior ruling dated September 30, 2003, in Income Tax Appeal No. 470 of 2001, between the same parties. The reasoning in that prior judgment, which is not detailed here, formed the basis for answering the question in the affirmative, favoring the assessee. The appeal was disposed of accordingly, with no order as to costs.

What were the facts?

This case involves an appeal by the Commissioner of Income Tax, Meerut, and another against O.N.G.C., Dehradun, representing Mr. Chaidulia Moussaev, for the assessment year 1990-91. The appeal challenges an order passed by the Income Tax Appellate Tribunal (ITAT). The core of the dispute concerns the method of grossing up tax perquisites paid by ONGC on behalf of the assessee. The Assessing Officer had applied a multi-stage grossing up, while the ITAT directed the application of single-stage grossing up. The High Court of Uttaranchal at Nainital is hearing this appeal.

What were the issues?

1. Whether, in the facts and circumstances of the case, the learned Income Tax Appellate Tribunal was legally correct 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 any specific arguments made by the assessee (respondent). Revenue's Contention: The revenue (appellants) argued that the Assessing Officer was correct in applying multi-stage 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?

Section 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. 215 of 2001(Defective) OLD NO. 63 OF 1999 The Commissioner of Income Tax, Meerut & another

........... Appellants

Versus

O.N.G.C., Dehradun As Representative of Mr. Chaidulia Moussaev.......... Respondent

Hon. P.C. Verma, A.C.J. Hon. 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 in the facts and circumstances of the case the learned Income Tax Appellate Tribunal was legally correct 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.

(Rajesh Tandon, J.)

(P.C. Verma, A.C.J.) Dt. 21.05.2004

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