ESTER INDUSTRIES LTD vs. COMMISSIONER OF INCOME TAX

In disallowing the appellant’s claim for gratuity liability of Rs.22,48,530/-.

In confirming a disallowance of 50% of the expenditure as if it is in the nature 2013:DHC:3674-DB

In confirming an illegal demand of Rs.1,75,32,108/- towards Minimum Alternate Tax U/s 115JA ignoring the fact that U/s 115 JAA the deposit of any amount will be considered as available as credit and in the absence of any deposit, the credit would be denied and in the absence of any tax liability being determined in the normal assessment and adjusted within the 5 years period, the entire amount of credit would be swallowed by the Government and non-payment of any amount towards interest-free credit cannot, therefore, be considered as tax payable by the appellant and hence the imposition of Minimum Alternate Tax on the appellant is clearly illegal and unauthorised by law and must be set aside and quashed.

In not directing the disallowance U/s 43 43B of Rs.72,17,146/- to be deleted instead of remanding the matter to the Assessing Officer who does not act in a fair and just manner.”

Subsequently, an application raising two additional grounds was filed but the said application was rejected by the tribunal by the impugned order. Additional grounds raised but were not entertained read:- “1. On the facts and in the circumstances of the case, the entire amount of MAT sought to be levied and collected is required to be given credit mandatorily and the amount of such credit ought to be refunded with interest to the assessee in the event of there being no such 2013:DHC:3674-DB

On the facts and in the circumstances of the case, the authorities below have erred, both on facts and in law, in disregarding the provisions for grant of credit u/s 115 JAA and the consequent non-existence of liability to MAT during the five years following the year 1997-98 and hence, the orders passed by the authorities below and denied refund with interest to the appellant cannot be upheld.”

It is noticeable from the grounds of appeal raised before the tribunal as well as the additional grounds that the assessee never challenged the computation made under Section 115JA or challenged or questioned the assessment order on the ground that adjustments had not been made, as required and mandated by law. The assessee in the grounds of appeal as well as additional grounds did not challenge the assessment on the said ground. To this extent, he did not raise grievance or protest. Tribunal in the impugned order dated 13th/14th December, 2007 has dealt with the grounds as originally raised on merits and has dismissed the appeal of the assessee. There is no discussion in the impugned order on the question of adjustments, which should be permitted and allowed under Section 115JA or computation of taxable book profits under Section 115JA. It is apparent and crystal clear that this issue/question was not raised before 2013:DHC:3674-DB

In view of the aforesaid position, we do not think the assessee can now in the fourth appeal, (maintainable only on the ground of substantial question of law arising out of the order of the tribunal) can be allowed and permitted to raise this contention and set the ball rolling back once again to the Assessing Officer, after lapse of several years. The appeal relates to the Assessment Year 1997-98. Allowing the appellant to now question the computation will be allowing a person to raise stale issue and to question a decision which was accepted. In these circumstances, we do not think the appellant- assessee should be permitted and allowed to raise this ground belatedly at this stage. The issue was not raised before the tribunal, and has not been dealt and decided by them. The appeal is accordingly dismissed.