CUMMINS INDIA LIMITED vs. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 1(1) AND ANR
What did the High Court hold?
The High Court acknowledged the assessee's argument that the Tribunal's view was contrary to its earlier consistent decisions and that the fundamental aspect of the agreement clause remained the same. However, the Court noted that determining whether the contents of the two agreements were exactly the same, justifying a different view by the Tribunal in subsequent years, would involve delving into disputed questions of fact. The Court reiterated the principle that a Writ Court, under Article 226 of the Constitution, ordinarily does not adjudicate disputed questions of fact. Given that the assessee has an alternative and more comprehensive remedy under Section 260A of the Income Tax Act, 1961, for filing an appeal to the High Court, the Court deemed it appropriate for the assessee to pursue that remedy. The assessee's counsel then sought to withdraw the petitions to file a miscellaneous application under Section 254(2) of the Income Tax Act, 1961, before the Tribunal to highlight the similarity in the agreements and the principle of consistency, with liberty to file an appeal under Section 260A simultaneously. The Court granted leave to withdraw the petitions.
What were the facts?
The assessee, Cummins India Limited, filed two writ petitions challenging orders of the Income Tax Appellate Tribunal (ITAT) dated September 29, 2022, concerning assessment years 2015-16, 2016-17, and 2017-18. The assessee argued that the ITAT's decision to deny the benefit of aggregation in the manufacturing segment was contrary to its consistent past rulings from assessment year 2006-07 to 2011-12. The earlier favorable decisions were based on an agreement dated October 14, 2005. The ITAT, in the impugned orders, distinguished the present case by noting a subsequent agreement dated September 16, 2010, which it considered different from the earlier one.
What were the issues?
1. Whether the Income Tax Appellate Tribunal erred in holding that the assessee was not eligible for the benefit of aggregation in the manufacturing segment for assessment years 2015-16, 2016-17, and 2017-18, by distinguishing the agreement dated September 16, 2010, from the earlier agreement dated October 14, 2005, contrary to its consistent past decisions. Assessee's Contentions: - The Tribunal's view in the impugned orders is unsustainable as it contradicts its consistent stance from assessment year 2006-07 onwards. The basis for earlier favorable orders was a clause in the agreement dated October 14, 2005. - Although there were two agreements executed on different dates (October 14, 2005, and September 16, 2010), their contents were identical concerning the clause relied upon by the Tribunal. Therefore, a different view based solely on the execution date of the subsequent agreement is unjustified. - Relied on the Supreme Court judgment in Radhasoami Satsang Vs. Commissioner of Income Tax, emphasizing that while res judicata does not apply to income tax proceedings, it is inappropriate to change a sustained position in a subsequent year if the fundamental aspect remains the same. Revenue's Contentions: - Not recorded in the judgment.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
.. 1 .. 4-wp-14513-20225 wp-14519-2022=.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 14513 OF 2022 Cummins India Limited Having its registered offie address at Tower A, 5th Floor, Cummins India Offie Campus, Balewadi, Pune 411 045 PAN No. AAACC7258B .. Petitioner Vs. 1. Additional/Joint/Deputy Assistant Commissioner of Iniome-tax/Iniome-tax Offier, National Faieless Assessment Centre, New Delhi 110004. 2. Assistant Commissioner of Iniome Tax, Cirile 1(1), Pune, Iniome Tax Offie, PMT Building, Shankar Seth Road, Swargate, Pune, Maharashtra 411 037. 3. Priniipal Commissioner of Iniome Tax-1, Pune Iniome Tax Offie, PMT Building, Shankar Seth Road, Swargate, Pune, Maharashtra 411 037. 4. Iniome Tax Appellate Tribunal, Pune Benihes, Pune, 2nd Floor, Maharashtra Jeevan Pradhikaran Building, Near St. Mary High Sihool, 463, Stavely Road, Pune-411 001, Maharashtra. .. Respondents WITH WRIT PETITION NO. 14519 OF 2022 Cummins India Limited Having its registered offie address at 1/6 S.K. Talekar, PS
.. 2 .. 4-wp-14513-20225 wp-14519-2022=.doc Tower A, 5th Floor, Cummins India Offie Campus, Balewadi, Pune 411 045 PAN No. AAACC7258B .. Petitioner Vs. 1. Assistant Commissioner of Iniome Tax, Cirile 1(1), Pune, Iniome Tax Offie, PMT Building, Shankar Seth Road, Swargate, Pune, Maharashtra 411 037. 2. Priniipal Commissioner of Iniome Tax-1, Pune Iniome Tax Offie, PMT Building, Shankar Seth Road, Swargate, Pune, Maharashtra 411 037. 3. Iniome Tax Appellate Tribunal, Pune Benihes, Pune, 2nd Floor, Maharashtra Jeevan Pradhikaran Building, Near St. Mary High Sihool, 463, Stavely Road, Pune-411 001, Maharashtra. .. Respondents ***** Mr.J.D. Mistri, Senior Advoiate a/w. Mr.Jitendra Singh, Advoiate for petitioner. Mr.Suresh Kumar, Advoiate for respondents. CORAM : DHIRAJ SINGH THAKUR & VALMIKI SA MENEZES, J.J. DATE : 29th NOVEMBER , 2022. : O R D E R : PER DHIRAJ SINGH THAKUR (OPEN COURT) : 1. These two petitions have been preferred against the orders of the Tribunal, dated 29th September 2022 in regard to 2/6 S.K. Talekar, PS
.. 3 .. 4-wp-14513-20225 wp-14519-2022=.doc assessment year 2015-16, 2016-17 and 2017-18, respeitively. 2. Mr.Mistri, learned Senior Counsel argued at length that the view expressed by the Tribunal in the orders impugned is unsustainable beiause it went iontrary to the view expressed by the Tribunal on a similar issue ionsistently from 2006-07 onwards till the orders in regard to assessment year 2011-12. It was urged that the basis for the Tribunal passing an order in favour of the petitioner in the earlier years had its genesis in a partiiular ilause of the agreement whiih was dated 14th Oitober 2005. Contrary to the view earlier expressed, the Tribunal, by virtue of the orders impugned, held the petitioner not eligible to the beneft of aggregation in the manufaituring segment holding that the Tribunal in the earlier years was seized of the terms and ionditions of an agreement whiih was different than the one whiih was now plaied before it. Needless to say that the subsequent agreement was dated 16th September 2010. 3. Mr.Mistry, however, vehemently urged that the Tribunal did not appreiiate the fait that although there were two agreements exeiuted on different dates, the iontents thereof were absolutely similar, word to word, in so far as the ilause relied upon by the 3/6 S.K. Talekar, PS
.. 4 .. 4-wp-14513-20225 wp-14519-2022=.doc Tribunal in the order impugned was ionierned, and therefore, simply beiause the subsequent agreement was exeiuted on a different date would not per-se justify a view to be taken iontrary to the one it had taken earlier. 4. Mr.Mistri relied upon a judgment of the Apex Court in the iase of Radhasoami Satsang Vs. Commissioner of Iniome Tax 1 to bring home the point that although res judiiata did not apply to iniome-tax proieedings and eaih assessment year was a separate unit and what was deiided in one year may not apply in the following year, yet if the fundamental aspeit remained the same and that position was sustained by not ihallenging the order, it would not be appropriate to allow the position to be ihanged in a subsequent year. 5. We are in agreement with what is urged by Mr.Mistry on the position of law as was stated hereinabove, yet we are of the opinion that we may have to go into questions of fait to determine as to whether the iontents of the two agreements dated 14th Oitober 2005 and dated 16th September 2010 were exaitly the same and would otherwise justify a different view to be taken by the Tribunal in subsequent years. It is trite law that ordinarily the 1 (1991) Iniome Tax Reports SC 321 4/6 S.K. Talekar, PS
.. 5 .. 4-wp-14513-20225 wp-14519-2022=.doc Writ Court in exeriise of its jurisdiition under Artiile 226 of the Constitution does not go into disputed questions of fait. Even otherwise, we are of the opinion that sinie the petitioner ian also avail an alternate remedy of fling an appeal before this Court under seition 260A of the Iniome Tax Ait, 1961, whiih in our opinion iould be more iomprehensive, in the faits and iiriumstanies of the iase, it would be appropriate that suih a remedy be availed. 6. In these iiriumstanies, learned Senior Counsel for the petitioner fairly stated that he wished to withdraw the petitions with a view to fle a misiellaneous appliiation under seition 254(2) of the Iniome Tax Ait, 1961 to bring to the notiie of the Tribunal, the fait that there was no differenie at all in so far as the iontents of the two agreements were ionierned and that following the priniiple of ionsisteniy, the view expressed by the Tribunal in the orders impugned ought not to have been taken. It is further suggested that in iase, the appliiation so fled, does fnd favour with the Tribunal, it may avail the remedy of appeal. This, Mr.Mistri suggested was without prejudiie to the right of the petitioner of fling an appeal before this Court under Seition 260A of the Iniome Tax Ait, 1961 simultaneously. 5/6 S.K. Talekar, PS
.. 6 .. 4-wp-14513-20225 wp-14519-2022=.doc 7. Be that as it may, with liberty as prayed for by Mr.Mistry, leave to withdraw these petitions is granted. The Writ Petitions are dismissed as withdrawn. [ VALMIKI SA MENEZES, J. ] [ DHIRAJ SINGH THAKUR, J.] 6/6 S.K. Talekar, PS
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