Commissioner Of Income Tax Chennai Appellant v. M/S Indian Potash Ltd Ambal Building 727, Anna Salai Chennai 6. Respondent

Dated : 22.12.2009 Coram : THE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIAN and THE HONOURABLE MR.JUSTICE M.M.SUNDRESH Tax Case (Appeal)No.1408 of 2009 Commissioner of Income TaxChennai Appellantv. M/s Indian Potash LtdAmbal Building727, Anna SalaiChennai 6. Respondent Tax Case Appeal filed under section 260A of the Income Tax Act, 1961 against the order of theIncome Tax Appellate Tribunal, Madras 'B' Bench, Chennai, dated 17.07.2009 passed in ITANo.0013/Mds/2009. For appellant : Mr.K.Subramaniam JUDGMENT (Judgment of the Court was delivered byK.RAVIRAJA PANDIAN, J.) The revenue on appeal against the order of the Income Tax Appellate Tribunal, Madras ''B' Bench,Chennai, dated 17.07.2009 passed in ITA No.0013/Mds/2009, relating to the assessment year2000-2001 by formulating the following questions of law:- "1. Whether in the facts and circumstances of the case, the Tribunal was right in holding that theassessee is entitled to adjust the MAT credit before charging interest u/s 234B & 234C?2. Whether on the facts and circumstances of the case the MAT credit can be given priority of set offagainst tax payable, contrary to the scheme of Schedule G of Form 1?". 2. The facts:- (i) The assessee company doing the business of Trading fertilizers. The assessment inrespect of the assessment year was originally assessed under Section 143(1) on 28.03.2002 andsubsequently revised under Section 154 of the Income Tax Act vide order dated 07.02.2003.Subsequent to the completion of assessment, the Assessing Officer, on perusal of the records was of the view that credit of MAT was wrongly given in the same assessment year and therefore issuednotice under Section 148 of the Act. The assessment was completed on 10.09.2007 under Section143(3) by holding that the credits for MAT was wrongly given and on that score added a sum ofRs.81,84,000/-. (ii) The assessee carried the matter on appeal to the Commissioner of Income Tax (Appeals), hoallowed the appeal in favour of the assessee by following the decision of the Tribunal in the case ofChemplast Sanmar reported in 83 TTJ (Chennai) 427.(iii) Aggrieved against the order of the Commissioner of Income Tax (Appeals), the revenue carriedthe matter on appeal to the Tribunal. The Tribunal, by following its own order in Chemplast Sanmarreported in 83 TTJ (Chennai) 427 and the case of Neyveli Lignite Corporation Limited vs. ACITdismissed the appeal filed by the revenue. (iv) Aggrieved against the order of the Income Tax Appellate Tribunal, the revenue filed an appealbefore this Court. 3. We have heard the argument of the learned counsel for the appellant and perused the materialsavailable on record. 4. A batch of cases with identical set of facts has been disposed of by this Court in T.C.A.Nos.887 of2004 etc. batch on 09.04.2009 in the case of Commissioner of Income Tax vs. Chemplast SanmarLimited reported in 314 ITR 231, wherein the first question of law raised was"Whether on the facts and in the circumstances of the case, the Income Tax Tribunal is right in lawin holding that the carry forward MAT credit available to the assessee was to be adjusted first beforecharging interest under Sections 234B and 234C? (iv) Aggrieved against the order of the Income Tax Appellate Tribunal, the revenue filed an appealbefore this Court. 3. We have heard the argument of the learned counsel for the appellant and perused the materialsavailable on record. 4. A batch of cases with identical set of facts has been disposed of by this Court in T.C.A.Nos.887 of2004 etc. batch on 09.04.2009 in the case of Commissioner of Income Tax vs. Chemplast SanmarLimited reported in 314 ITR 231, wherein the first question of law raised was"Whether on the facts and in the circumstances of the case, the Income Tax Tribunal is right in lawin holding that the carry forward MAT credit available to the assessee was to be adjusted first beforecharging interest under Sections 234B and 234C? The issue has been answered in favour of the assessee and against the revenue by observing asfollows by concurring with CIT vs. Jindal Experts Ltd., (2009) 222 CTR 8 (Delhi):-"7.In respect of the first question of law, the arguments advanced by the counsel on either side arethe same as the one advanced before the Delhi High Court cited supra. The Delhi High Court hasconsidered the relevant provisions and dealt with the matter in detail and held that the credit underSection 115JAA should be given effect to before charging of interest under Section 234A, 234B and234C of the Act. We are in agreement with the reasoning given by the Delhi High Court. The learnedcounsel appearing for the revenue has not produced any materials or given compelling reasons totake a contrary view with that of the Delhi High Court. In such circumstances, we answer the firstquestion in favour of the assessee and against the revenue. 5. In respect of the 2nd question of law, the Division Bench has held that the intention of thelegislature is to give tax credit to tax and not to the tax and interest. Once the intention is clear, therevenue cannot rely on the Form-I to say that the MAT credit under Section 115JAA should be givenonly after tax and interest. Rule 12(1)(a) and Form-I cannot go beyond the provisions of the Act.Form-I cannot lay down the order of priority of adjustment of TDS, advance Tax, MAT credit underSection 115JAA which is contrary to the provisions of the Act. 6. Thus the two questions of law were already answered in the batch of cases referred to aboveagainst the revenue and in favour of the assessee. We do not find any extenuating reason foradmitting the tax appeals. Following the Division Bench Judgment cited supra, the appeal isdismissed. No costs. 22.12.2009Index : Yes/Internet : Yes/rg To 1. The Commissioner of Income TaxChennai 2. The Income Tax Appellate Tribunal,Chennai 'B' Bench, Chennai. K.RAVIRAJA PANDIAN, J. And M.M.SUNDRESH, J. rg T.C.(A)No.1408 of 2009 22.12.2009