Gujarat High Court
The Joint Commissioner Of Income Tax vs Amoli Organics Ltd.....Opponent(S) on 9 October, 2014
Author: Ks Jhaveri
Bench: Ks Jhaveri, K.J.Thaker
O/TAXAP/47/2002 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
TAX APPEAL NO. 47 of 2002
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE KS JHAVERI Sd/-
and
HONOURABLE MR.JUSTICE K.J.THAKER Sd/-
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1 Whether Reporters of Local Papers may be allowed to see No
the judgment ?
2 To be referred to the Reporter or not ? No
3 Whether their Lordships wish to see the fair copy of the No
judgment ?
4 Whether this case involves a substantial question of law as No
to the interpretation of the Constitution of India, 1950 or any
order made thereunder ?
5 Whether it is to be circulated to the civil judge ? No
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THE JOINT COMMISSIONER OF INCOME TAX....Appellant(s)
Versus
AMOLI ORGANICS LTD.....Opponent(s)
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Appearance:
MR SUDHIR M MEHTA, ADVOCATE for the Appellant(s) No. 1
MRS SWATI SOPARKAR, ADVOCATE for the Opponent(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE KS JHAVERI
and
HONOURABLE MR.JUSTICE K.J.THAKER
Page 1 of 5
O/TAXAP/47/2002 JUDGMENT
Date : 09/10/2014
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE KS JHAVERI)
1.By the way of this Appeal, the Department has challenged the judgment and order of the Income Tax Appellate Tribunal, Ahmedabad Bench dated 06.06.2001.
2.While admitting the matter on 05.02.2002, the following substantial questions of law were raised :-
"(1) Whether the Appellate Tribunal is right in law and on facts in directing to deduct the amount of depreciation from the working of profit under Section 115JA, when the Assessee had changed the method of working of depreciation from "Straight line method" to "WDV Method"?
(2) Whether the Appellate Tribunal is right in law and on facts in deleting charging of interest under section 234B and 234C of the Act on the ground that no interest can be charged under the said section when the income is calculated under Section 115JA?"
3.Learned Counsel for the appellant Mr. Sudhir M. Mehta contended that the Issue No.2 is covered by the decision of the Hon'ble Supreme Court in the case of Joint Page 2 of 5 O/TAXAP/47/2002 JUDGMENT Commissioner of Income-Tax v. Rolta India Ltd. reported in 330 Income Tax Reports 470.
In the above decision, the Court was of the view that (Head Note) :-
"It is clear from reading sections 115JA and 115JB of the Income-tax Act, 1961, that the question whether a company which is liable to pay tax under either provision does not assume importance because specific provision is made in the section saying that all other provisions of the Act shall apply to a MAT company (section 115JA(4) and section 115JB(5)). Similarly, amendments have been made in the relevant Finance Acts providing for payment of advance tax under sections 115JA and 115JB. Section 234B is clear that it applies to all companies. The pre- requisite condition for applicability of section 234B is that the assessee is liable to pay tax under section 208 and the expression "assessed tax"
is defined to mean the tax on the total income determined under section 143(1) or under section 143(3) as reduced by the amount of tax deducted or collected at source. Thus, there is no exclusion of section 115J/115JA in the levy of interest under section 234B. The expression "assessed tax"
is defined to mean the tax assessed on regular assessment which means the tax determined on the application of section 115J/115JA in the regular assessment.
Interest under section 234B is Page 3 of 5 O/TAXAP/47/2002 JUDGMENT payable on failure to pay advance tax in respect of tax payable under section 115JA."
4.Learned Senior Counsel for the respondent Mr. Saurabh N. Soparkar contended that the Issue No.1 is covered by the decision of this Court rendered in the case of Deputy Commissioner of Income-Tax (Assessment) v. Farmson Pharmaceuticals Guj. Ltd. reported in 347 Income Tax Reports 394.
In the above decision, the Court had referred to two decisions - Apollo Tyres Ltd. v. CIT reported in [2002] 255 ITR 273 (SC) and CIT v. Kwality Biscuits Ltd. reported in [2006] 284 ITR 434 (SC) and while dismissing the appeal held as under :-
"Following the decision of the Karnataka High court in the case of Kwality Biscuits Ltd. v. CIT [2000] 243 ITR 519 (Karn) affirmed by the Supreme Court in the case of CIT v. Kwality Biscuits Ltd. [2006] 284 ITR 434 (SC), the question is answered in the affirmative, that is, the Income- tax Appellate Tribunal was right in law in upholding the order of the Commissioner of Income-tax (Appeals) directing not to charge interest under sections 234B and 234 of the Act since the total income was determined under section 115J of the Act."
5.In that view of the matter, Issue No.1 is Page 4 of 5 O/TAXAP/47/2002 JUDGMENT answered against the Department and Issue No.2 is answered in favour of the Department.
6.In the aforesaid circumstances, the Tax Appeal partly succeeds.
Sd/-
(K.S. JHAVERI, J.) Sd/-
(K.J.THAKER, J) CAROLINE Page 5 of 5