THE COMMISSIONER OF INCOME TAX HYD vs. M/S SOUTHERN PLANT AIDS P LTD

HON’BLE SRI JUSTICE G. CHANDRAIAH AND HON’BLE SRI JUSTICE CHALLA KODANDA RAM I.T.T.A. No. 115 OF 2001 JUDGMENT:- (per Hon’ble Sri Justice Challa Kodanda Ram) This appeal is preferred by the Revenue, against the order dated 29.09.2000 in I.T.A. No.220/Hyd/95 passed by the Income Tax Appellate Tribunal, Hyderabad Bench “A” (in short “the Tribunal”). The present case is pertaining to the assessment year 1991-1992. 2) This appeal is filed at the instance of the Revenue raising the following question of law under Section 260(A) of the Income Tax Act, 1961 (in short “the Act”). “Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is justified in deleting the interest levied U/s 234(B) of the Income-Tax Act?” 3) The issue involved in the appeal is with respect to the levy of interest under Section 234B of the Act. The Tribunal, in view of its decision in I.T.A.No.220/Hyd/95, against which I.T.T.A.No.59 of 2001 was filed, which was allowed setting aside the deletion of the secret commissions paid to the Government employees and others had cancelled the interest under Section 234B of the Act. As against the orders of the Tribunal in I.T.A.No.220/Hyd/95, I.T.T.A.No.59 of 2001 was filed by the department, in which the question raised was ““Whether on the facts and in the circumstances of the case, the Appellate Tribunal is justified in holding that the secret commission paid to the Government employees is not deductible under Section 37(1) of the Income Tax Act?” which was answered in favour of the assessee. In the above I.T.T.A., it was also directed that the bifurcation of the amounts which was in fact paid to the Government servants and others have to be made and to the extent recomputing the secret commission to the Government employees alone is disallowable. In the light of the said order, the interest that may be leviable, allowable to be paid to the assessee under Section 234 (2B) also requires to be recomputed.

4) In these circumstances, the appeal is disposed of answering the question in favour of the revenue and against the assessee. However, while passing the consequential order, the authorities are required to recompute the actual interest payable.

5) Accordingly, the appeal is disposed of. No order as to costs. Miscellaneous Petitions, if any, pending in this appeal shall stand disposed of.

______________________ G. CHANDRAIAH,J

____________________________ CHALLA KODANDA RAM, J Date:03.12.2013. SSV