Income Tax Appellate Tribunal - Ahmedabad
Cairn India Limited,, Haryana vs The Adit., (Intl.Taxn.), Ahmedabad on 14 March, 2017
SP Nos.66 to 70/Ahd/17
In ITA Nos.2680 to 2684/Ahd/12
AYs: 2008-09, 09-10, 08-09, 09-10 & 08-09
Page 1 of 6
IN THE INCOME TAX APPELLATE TRIBUNAL,
AHMEDABAD I BENCH, AHMEDABAD
[Coram: Pramod Kumar AM and S S Godara JM]
SP Nos.66 to 70/Ahd/17
(In ITA Nos.2680 to 2684/Ahd/12)
Assessment years: 2008-09, 2009-10, 2008-09, 2009-10 & 2008-09
respectively
Cairn India Limited ................Appellant
(Erstwhile known as Cairn Energy Gujarat BV)
3 rd & 4 th Floor, Vipul Plaza,
Sun City, Sector - 54,
Gurgaon (Haryana) - 122 003.
[PAN: AACCC 8799 D]
Vs
Asstt. Director of Income Tax
International Taxation, Ahmedabad. ............Respondent
Appearances by
S N Soparkar and Bandish S Soparkar for the applicant
K Madhusudan for the respondent
Order reserved on : March 10, 2017
Order pronounced on : March 14, 2017
O R D E R
Per S.S. Godara, Judicial Member:
1. Our instant order disposes assessee's above stated five stay petitions seeking to restrain the Department from effecting recovery of the demands raised at the Revenue's behest therein.
2. Heard both sides. Case files perused.
SP Nos.66 to 70/Ahd/17 In ITA Nos.2680 to 2684/Ahd/12 AYs: 2008-09, 09-10, 08-09, 09-10 & 08-09 Page 2 of 6
3. We notice at the outset that the assessee has already been granted the relief prayed therein by a co-ordinate bench in SP Nos.74 to 79/Ahd/2012 decided on 21.12.2012. The above main appeals however have remained pending because of no fault at assessee's behest to have adopted dilatory tactics. The main case file ITA No.2680/Ahd/2012 reveals that these cases came up for hearing before the co- ordinate bench as recently as on 17.01.2017. Learned CIT - D.R. therein prayed for adjournment in the course of hearing. Learned co-ordinate bench however adjourned hearing of the five main cases in question sine die by passing the following order:-
"17-01-2017 Present: Assessee by - Shri S.N. Soparkar Revenue by - Smt. Vibha Bhalla, CIT-DR The present bunch of 32 cross-appeals is at the instance of Revenue and four assessees, common issues have been agitated. In the case of Cairn India Ltd., for the Asstt.Years 2008-09 and 2009-10 stay on the recovery of outstanding demand has also been operating. These appeals have been listed for hearing on number of occasions, but adjourned for one or other reasons. Today an application on behalf of CIT-DR for adjournment has been filed. The reasons pleaded in the application reads as under:
"Respected Sirs, The above appeals are listed for hearing before your honours on 17.01.2017.
2. In all the above appeals, the major issue involved is deduction under section 801B(9) of the Income-tax Act, 1961.
3. In this connection, your kind attention is invited to letter dated 23.09.2016 of the office of the Pr. Chief Commissioner of Income-tax, Gujarat addressed to the Vice President, ITAT, Ahmedabad (copy enclosed). Vide this letter it has been requested as follows:-
"2. As you aware, vide combined order dated 26/03/2015 in SCA No. 10903 of 2009 (petitioner Gujarat State Petrolium SP Nos.66 to 70/Ahd/17 In ITA Nos.2680 to 2684/Ahd/12 AYs: 2008-09, 09-10, 08-09, 09-10 & 08-09 Page 3 of 6 Corporation) and SCA No. 131314 of 2009 (petitioner Niko Resources Ltd.), the Hon'ble Gujarat High Court had ruled that the amendment to section 80IB(9) by restrospective insertion of explanation to section 80IB(9) by the Finance Act, 2009 was "ultravires" to the Constitution.
3. The Department filed SLP and the Hon'ble Apex Court, vide admitting SLP in (CC) No. 18370 of 2015, arising out of order passed by High Court of Gujarat dated 26.03.2015 in SCA No. 10903 of 2009, vide order dated 20.11.2015 has ruled as under:-
"As we are entertaining the matter, the High Court(s) where the appeals are pending shall not finalise the same till the matter is dealt with by this court."
4. In view of the aforesaid directions of the Supreme Court, I am directed to request that matters pertaining to validity of amendment of section 80IB(9) by retrospective insertion of Explanation to 80IB(9) may please be kept in abeyance, in case appeals on such issues are pending before ITAT, Ahmedabad. A copy of the Supreme Court order is enclosed for ready reference."
4. In all the above referred appeals, identical issue is involved. Therefore, in view of the above, it is requested that the above appeals may be adjourned sine die.
5. It is mentioned that in view of direction of hon'ble Supreme Court as mentioned above, the hon'ble Gujarat High Court vide order dated 03.10.2016 in Tax Appeals No. 781, 1240, 1246, 1247, 1248, 1249, and 1859 of 2008 in DIT (International Taxation) vs. Niko Resources Ltd. where identical issue is involved, has adjourned the matter sine die (copy enclosed).
6. I shall be obliged."
2. It is pertinent to observe that one of the issue involved in these appeals relates to admissibility of deduction under section 80IB(9) of the Income Tax Act, 1961. This issue has two fold of disputes, viz. Whether expression "mineral oil" would include "gas", and (b) whether every well in a block licensed constitutes a single undertaking. According to the Revenue, expression "undertaking" employed in sub-section 9 has not been defined anywhere in the Act. Therefore, in the context of "mineral oil" meaning of term "undertaking" has been the subject matter of a considerable dispute. Tax payers have been holding the view that every well in a block SP Nos.66 to 70/Ahd/17 In ITA Nos.2680 to 2684/Ahd/12 AYs: 2008-09, 09-10, 08-09, 09-10 & 08-09 Page 4 of 6 licensed constitutes a single undertaking, and accordingly, the tax holiday is available separately for each such well. According to the Revenue, this understanding of tax payers was contrary to the Legislative intention, and therefore, an Explanation in sub-section 9 was inserted through Finance (No.2) Act, 2009 with retrospective effect from 1.4.2002. According to this explanation, it was explained that for the purpose of claiming deduction under sub-section 9, all blocks licensed under a single contract, which has been awarded under new exploration licence policy or has been awarded in pursuance of any law for the time being in force, shall be treated as a single undertaking. This insertion of explanation was challenged by an assessee viz. Niko Resources Ltd. by way of Civil Application No.131314 of 2009 before the Hon'ble High Court. The Hon'ble High Court vide its judgement dated 26.3.2015 has held that insertion of this explanation is ultravires and contrary to the Article 14 of the Constitution of India.
3. Dissatisfied with the judgement of the Hon'ble Gujarat High Court, Revenue went in appeal before Hon'ble Supreme Court. It has been pointed out to us that Hon'ble Supreme Court has restrained all High Courts from finalising the matters involving such an issue till the matter is being dealt with by the Hon'ble Supreme Court. On the strength of Hon'ble Supreme Court's order dated 20.11.2015 passed in SLP No.18370 of 2015 and others, Revenue has contended that if, in case these appeals are being adjudicated at the level of Tribunal, then the issues will be carried before the Hon'ble High Court and multiplicity of litigation would increase. According to the Revenue, it will be wastage of resources because unnecessarily one tier of litigation before the higher appellate authority i.e. Hon'ble High Court, either at the instance of the assessee or at the end of the revenue will be taken. It is prayed that Tribunal may adjourn the hearing sine die. After the adjudication of the litigation on this issue at the end of the Hon'ble Supreme Court, the appeals may be taken up for hearing.
4. On the other hand, Shri Soparkar, the ld.counsel for the assessee contended that the Hon'ble Supreme Court has not restrained the Tribunal for going ahead with the hearing, hence, the Tribunal can adjudicate the matters. He further submitted that unnecessary demand is outstanding against the assessee, more so when the issue is covered by the decision of the Hon'ble jurisdictional High Court.
5. We have duly considered rival contentions and gone through the record. We find that M/s. Niko Resources Ltd. has adopted two methods for redressing its grievance. It has filed a Special Civil SP Nos.66 to 70/Ahd/17 In ITA Nos.2680 to 2684/Ahd/12 AYs: 2008-09, 09-10, 08-09, 09-10 & 08-09 Page 5 of 6 Application before the Hon'ble Gujarat High Court challenging retrospective amendment carried out in section 80IB(9) by insertion of an explanation. It has also taken regular course of appeal before the Tribunal. Appeal of the Niko Resources had been allowed and the Revenue carried the matter in appeal before the Hon'ble Gujarat High Court in Tax Appeals Nos.781 and others of 2008. These appeals are pending. Its writ petitions have been allowed by the Hon'ble High Court. The assessees before us are relying upon the order of the ITAT, which is subjudiced before the Hon'ble High Court and the Hon'ble High Court had adjourned the hearing in these appeals sine die, in order to await decision of the Hon'ble Supreme Court. We find force in the submission of the ld.CIT-DR that adjudication of these appeals would lead to further litigation before the Hon'ble High Court at the instance of either parties. Thus, it would shift litigation from Tribunal to higher forums. To our mind, it will only increase multiplicity of litigations before the Hon'ble High Court and also have bearing on the resources. Therefore, we adjourn hearing sine die. Parties are directed to file appropriate application for taking up the hearing after adjudication of appeals pending before the Hon'ble Supreme Court.
Sd/- Sd/-
(RAJPAL YADAV) (PRAMOD KUMAR)
JM AM
4. It is thus clear that delay in disposing of the main appeals is not in any way attributable to the assessee. We, therefore, find merit in assessee's instant stay petitions and restrain the department from effecting recovery of demands raised of Rs.26,30,15,729/-, Rs.45,46,63,514/-, Rs.23,47,57,443/-, Rs.45,67,20,227/- & Rs.46,39,21,814/- in SP Nos.66 to 70/Ahd/2017; respectively. The department is directed not to take any further coercive action for a period of 180 days or disposal of the main appeals; whichever is earlier.
SP Nos.66 to 70/Ahd/17 In ITA Nos.2680 to 2684/Ahd/12 AYs: 2008-09, 09-10, 08-09, 09-10 & 08-09 Page 6 of 6
5. The assessee succeeds in all its instant stay petitions. Pronounced in the open court today on 14th day of March, 2017.
Sd/- Sd/-
Pramod Kumar S S Godara
(Accountant Member) (Judicial Member)
Ahmedabad, the 14 th day of March, 2017.
Copies to: (1) The appellant (2) The respondent
(3) CIT (4) CIT(A)
(5) DR (6) Guard File
By order
Assistant Registrar
Income Tax Appellate Tribunal
Ahmedabad benches, Ahmedabad