Commissioner Of Income Tax v. Gujarat Mineral Development Corporation Ltd.....opponent(S

O/TAXAP/95/2006 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 95 of 2006 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ?the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ?judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ?to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ COMMISSIONER OF INCOME TAX....Appellant(s) Versus GUJARAT MINERAL DEVELOPMENT CORPORATION LTD.....Opponent(s) ================================================================ Appearance: MR M.R. BHATT, SR. STANDING COUNSEL WITH MRS MAUNA M BHATT, ADVOCATE for the Appellant(s) No. 1 MR BS SOPARKAR FOR MRS SWATI SOPARKAR, ADVOCATE for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI andHONOURABLE MR.JUSTICE K.J.THAKER Date : 13/11/2014 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1.While admitting the appeal on 21.08.2006, the following substantial question of law was formulated for our consideration; “Whether on the facts and circumstances of the case, the Appellate Tribunal was right in law in holding that interest u/s.234C of the Income Tax Act, 1961 cannot be charged in case of assessment of profit u/s 115J of the I.T. Act ? 2.Briefly stated, the facts are that the Assessing Officer had levied interest u/s.234B and 234C of the Act on the income determined u/s.115J of the Act. The CIT(A) upheld the order of the Assessing Officer. On further appeal being filed, the Appellate Tribunal reversed the order passed by the A.O and deleted the levy of interest. Being aggrieved by the same, the present appeal has been preferred. 3.Mr. M.R. Bhatt learned Senior Standing Counsel appearing for the Revenue submitted that the question raised in this appeal is already answered by the Apex Court in the case of Joint Commissioner of Income-tax v. Rolta India Ltd., [2011] 330 ITR 470 (SC), it was held that interest u/s.234B is payable on failure to pay advance tax in respect of tax payable u/s.115JA. He drew our attention to the observations made in para-8, which reads as under; 3.Mr. M.R. Bhatt learned Senior Standing Counsel appearing for the Revenue submitted that the question raised in this appeal is already answered by the Apex Court in the case of Joint Commissioner of Income-tax v. Rolta India Ltd., [2011] 330 ITR 470 (SC), it was held that interest u/s.234B is payable on failure to pay advance tax in respect of tax payable u/s.115JA. He drew our attention to the observations made in para-8, which reads as under; “8.Section 115J was inserted by the Finance Act, 1987 with effect from April 1, 1988. This section was in force from April 1, 1988 to March 31, 1991. After April 1, 1991, section 115JA was inserted by the Finance Act of 1996 with effect from April 1, 1997. After insertion of section 115JA, section 115JB was inserted by the Finance Act, 2000 with effect from April 1, 2001. It is clear from reading sections 115JA and 115JB that the question whether a company which is liable to pay tax under either provision does not assume importance because specific provision(s) is made in the section saying that all other provisions of the Act shall apply to the MAT company (section 115JA(4) and section 115JB(5)). Similarly, amendments have been made in the relevant Finance Acts providing for payment of advance tax under sections 115JA and 115JB. So far as interest leviable under section 234B isconcerned, the section is clear that it applies to all companies.The prerequisite condition for applicability of section 234B isthat the assessee is liable to pay tax under section 208 andthe expression “assessed tax” is defined to mean the tax onthe total income determined under section 143(1) or underSection 143(3) as reduced by the amount of tax deducted orcollected at source. Thus, there is no exclusion of section115J/115JA in the levy of interest under section 234B. The expression “assessed tax” is defined to mean the tax assessed on regular assessment which means the tax determined on the application of section 115J/115JA in the regular assessment.” 4.Mr. BS Soparkar learned counsel appearing for the assessee submitted that the above point was considered by this Court in the case of Deputy Commissioner of Income-tax (Assessment) v. Associated Crown Closures P. Ltd., [2009] 315 ITR 291 (Guj), wherein, it is held that interest is not leviable under sections 234B and 234C of the Act in the case of assessment of a company on the basis of book profits u/s.115J of the Act. 4.1Learned counsel Mr. Soparkar submitted that in the aforesaid decision, the Apex Court reiterated the principle laid down in its earlier decision in the case of Commissioner of Income-tax v. Kwality Biscuits Ltd., [2006] 284 ITR 434 (SC). Learned counsel submitted that in the aforesaid decision, the Apex Court has distinguished the provisions of Section 115J and 115JA and 115JB of the Act and therefore, the present appeal deserves to be dismissed. 5.We have heard learned counsel for both the sides. Having gone through the factual aspects of the case and the principle rendered by the Apex Court in the above-referred cases, we are of the opinion that the submission made by learned Senior Standing Counsel Mr. M.R. Bhatt deserves consideration. In Jt. CIT v. Rolta India’s case (supra), it has been categorically held that interest leviable u/s.234B is applicable to all companies and that the only prerequisite condition for applicability of section 234B is that the assessee is liable to pay tax under section 208. 6.The expression “assessed tax” is defined to mean the tax on the total income determined under section 143(1) or under section 143(3) as reduced by the amount of tax deducted or collected at source. Thus, there is no exclusion of section 115J/115JA in the levy of interest under section 234B. The expression “assessed tax” is defined to mean the tax assessed on regular assessment, which means the tax determined on the application of section 115J/115JA in the regular assessment. 6.The expression “assessed tax” is defined to mean the tax on the total income determined under section 143(1) or under section 143(3) as reduced by the amount of tax deducted or collected at source. Thus, there is no exclusion of section 115J/115JA in the levy of interest under section 234B. The expression “assessed tax” is defined to mean the tax assessed on regular assessment, which means the tax determined on the application of section 115J/115JA in the regular assessment. 7.Considering the principle rendered in the above decision of the Apex Court, the question of law raised in this appeal is answered in favour of the Revenue and against the assessee. 8.The appeal is, accordingly, allowed. (K.S.JHAVERI, J.) (K.J.THAKER, J) Pravin/*