PHILIPS INDIA LIMITED,KOLKATA vs. A.C.I.T., CIRCLE - 11(1), KOLKATA

PER BENCH:

All these appeals filed by the assessee are against the separate orders of the Commissioner of Income Tax (Appeals)-NFAC, Delhi
[hereinafter referred to as Ld. 'CIT(A)'] passed u/s 250 of the Income
Tax Act, 1961 (hereinafter referred to as ‘the Act’) for AYs 2008-09 to 2014-15 dated 29.06.2024 and 28.06.2024 for AY 2015-16. 1.1
Since the issues are common, all the appeals were heard together and are being decided vide this common order for the sake of convenience and brevity.
2. The assessee is in appeal before the Tribunal raising the following grounds of appeal for AY 2008-09 and more or less similar grounds of appeal have been raised in the appeals for other A.Ys. as well:
ITA No(s). 1776 to 1783/KOL/2024
Assessment Year(s) 2008-09 to 2015-16
Philips India Limited.

“1. That on the facts and circumstances of the case, the National Faceless
Appeal Centre, Delhi [the Ld. CIT(A)] erred in rejecting the claim of refund of excess Dividend Distribution Tax (DDT) paid by the Appellant amounting to Rs. 94,81,687. 2. That on the facts and circumstances of the case, the Ld. CIT(A) erred in following the Special Bench decision of Mumbai Tribunal in the case of DCIT vs Tata Oil India Pvt Ltd (ITA No 6997/Mum/2019) upholding that DDT is a tax on profits of the domestic company and not on the shareholder.
2.1. That on the facts and circumstances of the case, the Ld. CIT(A) erred in not appreciating the decision of Hon'ble Supreme Court in case of Tata Tea Co. Ltd (398 ITR 260) (SC) upholding that the said decision has not dealt with the nature of DDT i.e. as to whether it is a tax on the company or a shareholder.
2.2. That on the facts and circumstances of the case, the Ld. CIT(A) erred in not appreciating the Hon'ble Supreme Court decision in the case of Godrej and Boyce Manufacturing Company Ltd v. DCIT
[2017] (394 ITR 449) (SC) upholding that the Supreme Court has not diluted the reasoning of Bombay High Court in the said case that DDT is a tax on the Company paying the dividend and domestic company does not do so on behalf of the shareholder.
3. That on the facts and circumstances of the case, the Ld. CIT(A) erred in holding that the Double Taxation Avoidance Agreement ('DTAA') is not applicable in the current scenario as DTAA does not get trigger when domestic company pays DDT under section 115-0 of the Income Tax Act,
1961 (the Act).
4. That on the facts and circumstances of the case, the Ld. CIT(A) erred in rejecting the Appellant's request of keeping the matter in abeyance without appreciating that the Juri ictional High Court in the case of Exide Industries Limited (ITAT/9/2024(Cal.) has admitted the question of law on this issue and the matter is pending adjudication.
5. That on the facts and circumstances of the case, consequential interest u/s 244A of the Income Tax Act, 1961 along with the refund of excess
DDT paid be allowed to the Appellant.
6. The Appellant craves leave to add to and/or amend, alter, modify or rescind the grounds hereinabove before or at the time of hearing of the appeal.”
2.1
We shall take up ITA No. 1776/KOL/2024 for AY 2008-09 as the lead case for adjudication.
ITA No(s). 1776 to 1783/KOL/2024
Assessment Year(s) 2008-09 to 2015-16
Philips India Limited.

Exide Industries Limited (ITAT/9/2024(Cal.) has not stayed the order of the Hon'ble Kolkata Tribunal in the case of Exide Industries
Limited but has only admitted a question of law on this issue.
Therefore, the extant law on the subject is the decision of Tata Oil
India Pvt. Ltd. of the Special Bench of the Mumbai Bench of the Tribunal which was followed by the Kolkata Tribunal in the case of Exide Industries.
4. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal.
5. Rival contentions were heard and the submissions made have been examined. The Ld. AR stated that the Hon'ble Bombay High
Court has held in favour of the assessee but the Revenue has requested for constitution of larger Bench. There are decisions of the Tribunal in favour of the assessee.
6. The Ld. DR on the other hand stated that the appeal has been filed after a gap of 12 to 13 years and beyond 4 years no rectification application could be filed. The assessee was claiming the refund of DDT on the basis of DTAA. The tax on DDT is charged on the profits of the company on the dividend distributed by the company and is not a tax on the shareholder. The DDT is a mandatory charge on the dividend distributed by the company and it is not a tax in the hands of the shareholder and so the DDT in Chapter-XII-B cannot be equated with TDS in Chapter-XVII-B. The assessee had filed a petition for refund which was treated as an application u/s 154 of the Act and was decided on 12.10.2022 and the Ld. CIT(A) disposed of the appeal on 29.06.2024. The assessee had filed the application dated 23.06.2022 for all the assessment years. The Ld. AR stated that ITA No(s). 1776 to 1783/KOL/2024
Assessment Year(s) 2008-09 to 2015-16
Philips India Limited.

there was no time limit for claiming the refund. However, the attention of the Ld. AR was drawn to the provisions of sub-section (1) of section 239 of the Act which states that every claim for refund under Chapter-XIX shall be made by furnishing return in accordance with the provisions of section 139 of the Act and it was queried by the Bench whether any return of income had been filed for claiming the refund, to which the Ld. AR stated that no such return was filed.
However, the Ld. AR stated that as per section 237 of the Act, the assessee is entitled to a refund of the excess if it satisfies the Ld. AO that the amount of tax paid by him or on his behalf or treated as paid by him or on his behalf for any assessment year exceeds the amount with which he is properly chargeable under the Act for that year.
7. We have considered the facts of the case, the submissions made and the documents filed. As was argued by the Ld. DR, the DDT is not a tax on the income of the assessee so as to trigger the applicability of DTAA but is a charge levied at the specified rate on the profits of the company distributed as dividend and was brought into the statute for a specific purpose for taxing the distributed profits of the companies while the rate of DDT and the rate of tax applicable in the hands of the taxpayers on its income may also be different.
Moreover, since the assessee had not filed any return of income for claiming the refund in accordance with the provisions of section 139
of the Act, as required under sub-section (1) of section 239 of the Act, the claim of the assessee for the refund is not maintainable and the grounds of appeal are hereby dismissed and the order of the Ld.
CIT(A) is confirmed for all the assessment years.
ITA No(s). 1776 to 1783/KOL/2024
Assessment Year(s) 2008-09 to 2015-16
Philips India Limited.

[Rakesh Mishra]
Judicial Member

Accountant Member
Dated: 20.03.2026
Bidhan (Sr. P.S.)
ITA No(s). 1776 to 1783/KOL/2024
Assessment Year(s) 2008-09 to 2015-16
Philips India Limited.

Copy of the order forwarded to: