Tax, International Taxation v. S. Ravinira Bhat, Jrkajba, J

$~4 to 13*IN THE HIGH COURT OF DELHI AT NEW DELHI +ITA 272/2014+ITA 273/2014+ITA 273/2014 +ITA 274/2014 +ITA 275/2014 +ITA 276/2014+ITA 277/2014+ITA 278/2014+ITA 279/2014+ITA 280/2014+ITA 338/2014+ITA 277/2014+ITA 278/2014+ITA 279/2014+ITA 280/2014+ITA 338/2014 DIRECTOR OF INCOME TAX Appellant Through Mr. N P Sahni, sr. standing counselwith Mr. Nitin Gulati, Adv.versus BRITISH AIRWAYS PEC Respondent Through Mr. Mayank Nagi and Mr. HarkunalSingh, Advs.Singh, Advs. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE R.K.GAUBA ORDER o/o 05.03.2015C.M. Nos.10080/2014. 10082/2014. 10084/2014. 10086/2014, 10088/2014,10090/2014. 10092/2014. 10094/2014. 10095/2014 and 10853/2014 (delay) For the reasons stated in the applications, the delay in re-filing the appeal is condoned. The applications are disposed of. ITANOs.272/2014. 273/2014. 274/2014. 275/2014, 276/2014, 277/2014,278/2014. 279/2014. 280/2014 and 338/2014 1. Issue notice. 2. Mr. Mayank Nagi, Advocate accepts notice. 3. In all these appeals, the common question which the revenue urges isthat the assessees were liable to pay interest under Section 234B of theIncome Tax Act, 1961. 4. The assessee is a foreign company incorporated under UK Laws andengaged in air transport services. The assessee had disputed liability inrespect of a portion of its activities i.e. ground handling services rendered toother entities on the basis of bilateral arrangement or agreement with suchusers. The portion of attributed income on the basis of that activity was asubject matter of assessment and appellate proceedings. The assessee hadalso asserted the applicability of the Indo UK Double Taxation AvoidanceAgreement (DTAA). It was in these circumstances that the question ofpayment of interest arose after determination of the assessee s liabilities to. pay the tax. 5. The AO ruled that in addition to tax, the assessee was also liable tointerest under Section 234B. The set aside the directionpay CIT(Appeals) to pay interest under Section 234B; the ITAT rejected the revenue s appeal.To complete the details, it would also be necessary to notice that pursuant tothe mutual agreement procedure (MAP) dated 18.12.2011, the dispute withrespect to payment of tax stands resolved. The only surviving bone ofcontention, therefore, is the applicability of Section 234B and interestliability, if any, of the assessee. 6. At the outset, this Court notices that the issue as to the payment ofinterest under Section 234B has been answered by this Court in DIT VJacabs Civil Inc. 330 ITR 578 and the recent decision in Director ofIncome Tax, International Taxation V. GE Packaged Power Inc. ITA No.352-391/2014 decided on 12.1.2015. The later decision, i.e. M/s G E PackagedPower Inc. also took note of an earlier discordant ruling in Director ofIncome Tax, International Taxation V. Alcatel Lucent USA Inc. in ITANo.327/2012 decided on 7.11.2013. The Court was of the opinion thatAlcatel was decided in the peculiar circumstance of the case and that therationale in Jacabs applies. Consequently, in view of the Jacabs and GEPackaged Power decisions, question of law sought to be urged by therevenue has to be answered against it.7. The appeals are consequently dismissed. MARCH 05, 2015vld _S. RAVINI|RA BHAT, JRKAJBA, J