The Division Bench Of This Court In Ultramarine & Pigments Ltd v. O.p. Srivastava, Commissioner Of Income Tax[1] In Paragraph

Digitally IN THE HIGH COURT OF JUDICATURE AT BOMBAYsigned byPURTIPURTIPRASAD ORDINARY ORIGINAL CIVIL JURISDICTIONPRASADPARABPARABDate:2023.12.1211:05:47+0530 INCOME TAX APPEAL NO. 1112 OF 2018 Pr. Commissioner of Income Tax – 2 V/s.State Bank of India ---- Mr. Suresh Kumar for Appellant. Mr. Nitesh Joshi i/b Mr. Atul K. Jasani for Respondent. ---- ….Appellant …Respondent CORAM : K.R. SHRIRAM & DR. NEELA GOKHALE, JJ. DATED : 6[th] DECEMBER 2023 P.C. : 1.The following substantial question of law is proposed. QUESTION OF LAW a) Whether in facts and circumstances of the case and in law,the Hon’ble ITAT was right in directing the A.O. to applyprovision u/s 214(1A) of the I.T. Act, 1961 without appreciatingthe fact that the said provision is not applicable retrospectivelybut is applicable only w.e.f. 01.04.1985 and hence not applicableto the current assessment year? 2.The scrutiny assessment of respondent/assessee under Section 143(3) of the Income Tax Act, 1961 (the Act) was completed at assessedincome of Rs.391,66,88,863/- against returned income of Rs.191,61,33,630/-which was reduced to Rs.275,92,63,549/- while giving effect to order ofCommissioner of Income Tax (Appeals) [CIT(A)]. The income was againreassessed under Section 147 read with Section 143(3) of the Act vide orderdated 21[st] October 1994 at Rs.277,43,87,168/- which was again reduced toRs.247,81,14,380/- after giving effect to order of CIT (A). The Income Tax Appellate Tribunal (ITAT) vide its order dated 22[nd] August 2006 set asidecertain portions of the order and directed the Assessing Officer (A.O.) todecide the issue afresh. The final assessment was completed under Section143(3) read with Section 254 of the Act and by an order dated 19[th]December 2007 assessee’s income was assessed at Rs.173,05,09,080/- andrefund of Rs.1,73,71,46,304/- was determined and issued to assessee. Thisincluded interest of Rs.78,98,38,191/- under Section 214 of the Act andRs.8,06,96,480/- under Section 244(1A) of the Act and Rs.60,74,69,333/-under Section 244A(1)(b) of the Act. 3.By an order dated 31[st] March 2012 under Section 154 of theAct, the Assessing Officer (A.O.) withdrew an amount of Rs.52,22,62,210/-as excess interest paid. 4.Assessee filed an appeal before the CIT(A) who partly allowedthe appeal but confirmed the order of the A.O. on the issue of interest.Aggrieved by the order assessee filed an appeal before the ITAT, whichfollowing the decision of this court held that there was no merit in A.O.disallowing the claim of interest under Section 214(1A) of the Act andallowed the appeal. It is impugning this order dated 14[th] December 2016passed by the ITAT, this appeal has been filed. 5.The Division Bench of this court in Ultramarine & Pigments Ltd. vs. O.P. Srivastava, Commissioner of Income Tax[1] in Paragraph No. 7 has 1 (2006) 286 ITR 86 (Bom) held as under : 7. Two grounds are given in that order. Firstly that there wasdelay. As far as this aspect is concerned, on the facts which arenarrated above, it cannot be said that there was delay and therevision could not be rejected only on that ground. The secondground for rejecting the application was that the amendedprovisions of s. 214(1A) are applicable with effect from 1[st] April1985 and not in respect of the year in question. Mr. Mehta, learnedcounsel appearing for the petitioner, has drawn our attention to aDivision Bench judgment of this Court in the case of CIT vs. SaswadMali Sugar Factory Ltd. (2001) 168 CTR (Bom) 337 : (2001) 249ITR 756 (Bom). The Division Bench has held therein that theTaxation Laws (Amendment) Act, 1984 is procedural in nature and,therefore, it will apply to all the pending actions. This being so,sub-section (1A) which was introduced in s. 214 will apply to thepetitioner’s case. There is no substance in the second ground ofrejection of revision. 6.The tribunal has followed this judgment to say that Sub Section 1A of the Act which was introduced in Section 214 of the Act will apply topetitioner’s case for Assessment Year 1984-85. We agree with the conclusionof the ITAT because the proceedings were still pending and the refundpayable was determined by an order passed under Section 154 of the Actonly on 31[st] March 2012 and Sub Section 1A in Section 214 of the Act wasintroduced w.e.f. 1[st] April 1985. 7.Therefore, we find no merit in the appeal. 8.Appeal dismissed. (DR. NEELA GOKHALE, J.) (K.R. SHRIRAM, J.)