2009-VIL-444-BOM-DT

Equivalent Citation: [2010] 327 ITR 269 (Bom)

BOMBAY HIGH COURT

778 of 2007

Date: 24.03.2009

COMMISSIONER OF INCOME-TAX

Vs

NATURAL GEMS LTD.

Suresh Kumar for the appellant.
J.D. Mistri, amicus curiae for the appellant.

BENCH

F. I. REBELLO and R. S. MOHITE JJ.

JUDGMENT

1. We had requested Mr. Mistri to appear as amicus curiae for the respondent as none had appeared on behalf of the respondent-assessee.

2. By this appeal, the Revenue has approached this court on the following questions:

"(a) Whether on the facts and in the circumstances of the case the hon'ble Tribunal's order dated August 25, 2006, is correct in law, in directing the Assessing Officer to delete the amount of Rs. 7,54,960 charged as interest under sections 234B and 234C on the minimum alternate tax of Rs. 24,74,024 levied under section 115JB on the book profit of Rs. 2,91,025, holding that the matter is covered in favour of the assessee by the decision of the hon'ble Supreme Court in the case of CIT v. Kwality Biscuits Ltd. [2006] 284 ITR 434, which confirms the order of the Karnataka High Court in the same case as reported in Kwality Biscuits Ltd. v. CIT [2000] 243 ITR 519 ?

(b) Whether on the facts and in the circumstances of the case the hon'ble Tribunal was right in law, in disregarding sub-section (5) of section 115JB of the Income-tax Act which specifically provides for applicability of all other provisions of the Act, including section 210 with respect to payment of advance tax and sections 234B and 234C which provides for charging of interest in case of non-compliance with section 210?"

3. The learned counsel for the Revenue draws our attention to the judgment of this court in CIT v. Kotak Mahindra Finance Ltd. [2004] 265 ITR 119. It is also brought to our attention that unlike sections 115, section 115JA(4) and section 115JB(5) have made provisions for applicability of other provisions of the Act in the matter of computation of payment of advance tax. In Kotak Mahindra [2004] 265 ITR 119 (Bom), a learned Bench of this court was considering whether the provisions pertaining to interest under sections 234B and 234C would be applicable to the company covered by section 115J of the Income-tax Act. The learned Bench answered the issue in favour of the assessee as in that case there was shortfall in the payment of the advance tax paid and after regular computation as worked out in terms of section 115J.

4. The issue had come up for consideration before this court in Income-tax Appeal No. 238 of 2006 in Snowcem India Ltd. v. Deputy CIT [2009] 313 ITR 170 (Bom) decided by unreported order dated January 5, 2009. While hearing the appeal our attention was invited to the judgment of this court in Kotak Mahindra Finance Ltd. [2004] 265 ITR 119 (Bom). Our attention however, had also been invited to the judgment of the Karnataka High Court in Kwality Biscuits [2000] 243 ITR 519 where the Karnataka High Court had taken a different view from the view taken by this court. The judgment of the Karnataka High Court was taken in appeal before the Supreme Court by way of special leave petition. From the order produced before us we find that the appeals were heard meaning thereby the leave has been granted and appeals were dismissed. Placing reliance on the judgment of the Supreme Court in Kunhayammed v. State of Kerala [2000] 245 ITR 360 (Ker); [2000] 119 STC 505 we had held that the dismissal of the appeal by the Supreme Court in the case of Kwality Biscuits (supra) would amount to confirmation of the law as held by the Karnataka High Court and in view of that we had allowed the appeal preferred by the assessee.

5. The learned counsel, however, sought to bring to our attention the judgment of the Supreme Court in CIT v. Xpro India Ltd. [2008] 300 ITR 337.

The question before the Supreme Court was as under (page 338):

"Whether on the facts and in the circumstances of the case, the hon'ble High Court was right in allowing credit for MAT, under section 115JAA of the Income-tax Act, 1961, before charging interest under sections 234B and 234C of the Income-tax Act."

6. The matter has been remanded back for consideration. It appears that the attention of the Supreme Court was not invited to the dismissal of the appeals in Kwality Biscuits.

7. Considering the judgment in Snowcem, in our opinion, there is no merit in the questions as framed and accordingly the appeal dismissed.

8. We place on record the valuable assistance rendered by the learned amicus curiae.

 

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