Itxa/2059/2011 Of The Commissiosner Of Income Tax -Central -I v. Jafferali Kasamali Rottonsey

sas IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.2059 OF 2011 The Commissioner of Income Tax, Central-1, Mumbai ..Appellant. V/s. Mr. Jafferali Kasamlai Rattonsey ..Respondent. Mr. P.C. Chhotaray with Padma Divakar for the appellant.Mr. Satish R. Mody with Aasifa Khan for the respondent. CORAM : J.P. DEVADHAR AND M.S. SANKLECHA, JJ. DATED : 18TH FEBRUARY, 2013 P.C. :- 1.In this appeal by the revenue, following question has been raised for our consideration :- “ Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in directing the A.O. to treat the date of seizure as the date of payment of advance tax, for computation of interest payable u/s.234A, 234B and 234C of the I.T. Act, 1961 ?” 2.There was a search on the respondent-assessee under Section 132 of the Income Tax Act (the Act) in July, 2006. In the course of search, Rs.41 lakhs were seized. During the course of the search the respondent-assessee made a statement on 22[nd] July, 2006, wherein he has categorically stated that the seized amounts may be adjusted against the tax liability arising out of the disclosures. In spite of the above request, the Assessing Officer and the CIT(A) did not consider the seized amount as Advance tax and levied interest under Sections 234A, 234B & 234C of the Act while computing the shortfall in advance tax. 3.The Tribunal by the impugned order held that the respondent-assessee has made a statement before the authorities that the cash found during the course of search may be adjusted towards the tax liability. In these circumstances, the Tribunal held that the amounts found in the course of search should be treated as payment of advance tax and the interest under Sections 234A, 234B & 234C is not chargeable on the amount of Rs.41 lakhs. 4.Counsel for the respondent-assessee states that the issue arising in the present case is covered by the decision of this Court in the matter of CIT V/s. Shri Jyotindra B. Mody in Income Tax Appeal itxa2059-11 No.3741 of 2010 decided on 21[st] September, 2011. In the above case, this Court has held that amounts found during the search proceedings be adjusted towards advance tax liability when so requested by the assessee. In such circumstances, this Court held that no interest under Sections 234B & 234C of the Act is chargeable. 5.Mr. Chhotaray, counsel for the revenue submits that the decision in the matter of Jyotindra B. Mody (supra) is not applicable to the facts of the present case as in that case, the assessee had addressed a letter to the assessing officer requesting him to adjust the cash amount found during the search towards advance tax, while in this case, no such letter has been written. The Tribunal in the impugned order records a fact that in a statement recorded during the course of the search, the respondent-assessee had clearly stated that the amount found during the course of search should be adjusted against his tax liability. Admittedly, the seized amount of Rs.41 lakhs was with the revenue at all times from the date of seizure in July, 2006. In this view of the matter, the distinction sought to be made by Mr. Chhotaray between request being made in a letter for adjustment of the seized amounts from that of a request being made in a statement made under Sections 132(4) of the Act is not a distincion which would warrant non application of the decision of this Court in the matter of Jyotiendra B.Modi (supra). In these circumstances, the amount of Rs.41 lakhs seized during the course of the search be adjusted / considered while computing the interest leviable under Sections 234A, 234B & 234C of the Act. 6.Accordingly, in our view the question as framed stands itxal-1646-12covered in favour of the assessee and against the revenue by the decision of this Court in the matter of Jyotindra B. Mody (supra). Thus, we see no reason to entertain the proposed question of law. Jyotiendra B.Modi (supra). In these circumstances, the amount of Rs.41 lakhs seized during the course of the search be adjusted / considered while computing the interest leviable under Sections 234A, 234B & 234C of the Act. 6.Accordingly, in our view the question as framed stands itxal-1646-12covered in favour of the assessee and against the revenue by the decision of this Court in the matter of Jyotindra B. Mody (supra). Thus, we see no reason to entertain the proposed question of law. 7MAccordingly, the appeal is dismissed with no order as to costs. (M.S. SANKLECHA, J.) (J.P. DEVADHAR, J.)