APPAREL EXPORTS PROMOTION COUNCIL,NEW DELHI vs. ACIT(E), NEW DELHI

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ITA 6261/DEL/2018Status: DisposedITAT Delhi28 January 2022AY 2009-103 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that if the assessee is exempted from tax, retaining the taxes paid by the assessee would render the High Court's order otiose. Therefore, the assessee is eligible for a refund of taxes paid.

What were the facts?

The assessee declared income and was assessed at a higher amount. Subsequently, based on a High Court order granting exemption under Section 11, the assessed income was determined at NIL. The assessee sought a refund of taxes paid.

What were the issues?

Whether the assessee is entitled to a refund of taxes paid when exemption under Section 11 was granted by the High Court, and the consequential impact on the assessment orders.

Which sections of the Income-tax Act were involved?

Section 11,Section 240,Section 250,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘A’, NEW DELHI

Before: Sh. Saktijit DeyDr. B. R. R. Kumar

Hearing: 19.01.2022Pronounced: 28.01.2022

Per Dr. B. R. R. Kumar, Accountant Member:

1.

The present appeal has been filed by the assessee against the order of the ld. CIT(A)-40, New Delhi dated 05.07.2018.

2.

Following grounds have been raised by the assessee:

“1 (a) That the learned CIT(A) erred in law and on facts in denying the refund of taxes amounting to Rs. 3,93,59,590 by misinterpreting the proviso (b) to section 240 of the Act.

(b) That in this connection, the learned CIT(A) erred in law and on facts by ignoring the original appeal effect order under section 250/143(3) of the Act dated 04.03.2013 passed by Asstt. Director of Income Tax (E), Investigation Circle - 1, Delhi wherein income was determined at NIL and relying on the subsequent infructuous appeal effect order u/s 2 Apparel Exports Promotion Council 250/143(3) of the Act dated 23.11.2016 without giving credence to the fact that the Hon’ble Delhi High Court has allowed exemption under section 11 of the Act to the appellant.”

3.

The assessee filed return of income on 30.09.2009 declaring an income of Rs.5,86,76,420/-. The same was assessed u/s 143(3) of the Income Tax Act, 1961 vide order dated. 30.12.2011 assessing total income at Rs.11,01,14,409/-. Subsequently, on receipt of the order of ld. CIT(A) dated 30.11.2012 an order has been passed u/s 143(3) determining the total income at Rs.5,86,76,420/-. Vide order dated 04.03.2013, the ADIT(E) passed an order determining the assessed income at Rs. “NIL”.

4.

The ld. CIT(A) vide order dated 05.07.2018 held that as per the order of the Hon’ble Jurisdictional High Court in assessee’s own case in C.M. APP 43263 & 264/2016 order dated 22.11.2016, the assessee is eligible for exemption u/s 11 of the Act.

5.

Consequent to the order of the Hon’ble High Court/CIT(A), the assessee is eligible to claim the income as exempt u/s 11 and not liable to pay any tax. It is the function of the sovereign authority and the official involved that due taxes have to be collected and any tax which has been paid over and above of the tax payable is liable to be refunded. While holding that the assessee is exempted from tax, at the same time keeping the amounts paid by the assessee is antithesis. Non-adherence to this principles, would lead to a situation of making the order of the Hon’ble Jurisdictional High Court otiose. In the result, the appeal of the assessee is allowed.

3 Apparel Exports Promotion Council 6. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 28/01/2022.

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