Full Judgment Text
16
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA No.257/2009
th
Date of Decision: 19 November, 2009
THE COMMISSIONER OF INCOME TAX-XVII
..... Petitioner
Through: Ms. Rashmi Chopra, Adv.
versus
BRITISH AIRWAYS PLC. …... Respondent
Through: Mr. M.S. Syali, Sr. Adv.
with Ms. Mahua Kalra,
Adv.
CORAM:
HON'BLE MR. JUSTICE A.K. SIKRI
HON'BLE MR. JUSTICE SIDDHARTH MRIDUL
1. Whether reporters of local papers may be Allowed to see the
judgment?
2. To be referred to the Reporter or not?
3. Whether the judgment should be reported in the Digest?
J U D G M E N T
A.K. SIKRI, J (ORAL):
1. In identical circumstances where the penalty order was
passed by the Assessing Officer in respect of the assessment year
1990-91, ITA 425/2008 was preferred by the Revenue, which was
th
disposed of in the following manner vide order dated 10 July, 2009
passed by this Court:
“The assessee herein had not deducted tax at
source from its employees qua meal and
conveyance allowances. This was treated as short
deduction of tax by the assessing officer and on
that basis assessment a search was carried out. At
the same time penalty proceedings were also
ITA 257/2009 Page 1 of 3
initiated against the assessee under section 271 C
of the Income Tax Act for short deduction of tax
and penalty order dated 30.6.1998 was passed. In
appeal preferred by the assessee CIT (A) allowed
the appeal partly. The matter was taken up by the
Income Tax Department before the ITAT by filing
appeal against the order of CIT (A).
It so happened that against the assessment orders
the assessee had gone in appeal and ITAT allowed
the appeal on the ground that assessment was
made after four years and was thus barred by
limitation. Appeal of the revenue preferred under
section 260A of the Income Tax Act before this
Court also failed and this Court affirmed the order
of the ITAT. Since the very assessment, in this
manner, was set aside, the ITAT has dismissed the
appeal of the revenue against the orders passed
under Section 271C as well by the impugned order.
Learned counsel for the appellant submits that
against the orders passed by this Court affirming
the order of the ITAT setting aside the assessment
as time barred revenue has filed the Special Leave
Petition in which notice has been issued and the
said SLP coming up for disposal sometime in
December, 2009. In these circumstances, the
present appeal is disposed of with the observations
that in case the SLP/civil appeal is allowed by the
Supreme Court and the assessment restored, the
appellant shall be entitled to move application
before the ITAT for revival of Appeal
No.3847/Del/2003 on the issue of penalty for
decision of the said appeal on merits.
ITA 257/2009 Page 2 of 3
The appeal stands disposed of in the aforesaid
terms.”
2. The present case relate to assessment year 1991-
92. It is not in dispute that the Special Leave Petition is still
pending before the Supreme Court and is fixed for final
hearing in lieu thereof counsel for the parties agreed that this
appeal be also decided in terms of the aforesaid order dated
th
10 July, 2009.
3. Mr. Syali, however, points out that in respect of
th
this very assessment year, this Court in its judgment dated 6
December, 2006 in Commissioner of Income Tax vs. British
Airways-[2007] 165 TAXMAN 230 (DELHI) has
categorically held that the Income Tax Appellate Tribunal
(ITAT) was justified in rejecting the Revenue’s appeal, insofar
as penalty of short deduction of tax of leave allowance is
concerned. Thus, we make it clear that in case the SLP and
Civil Appeal is allowed by the Supreme Court and the
assessment restored, the Tribunal shall decide the question of
penalty only relating to conveyance allowance and not leave
allowance.
4. The writ petition is disposed of in the aforesaid
terms.
A.K. SIKRI, J.
SIDDHARTH MRIDUL, J.
NOVEMBER 19, 2009
dn
ITA 257/2009 Page 3 of 3
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA No.257/2009
th
Date of Decision: 19 November, 2009
THE COMMISSIONER OF INCOME TAX-XVII
..... Petitioner
Through: Ms. Rashmi Chopra, Adv.
versus
BRITISH AIRWAYS PLC. …... Respondent
Through: Mr. M.S. Syali, Sr. Adv.
with Ms. Mahua Kalra,
Adv.
CORAM:
HON'BLE MR. JUSTICE A.K. SIKRI
HON'BLE MR. JUSTICE SIDDHARTH MRIDUL
1. Whether reporters of local papers may be Allowed to see the
judgment?
2. To be referred to the Reporter or not?
3. Whether the judgment should be reported in the Digest?
J U D G M E N T
A.K. SIKRI, J (ORAL):
1. In identical circumstances where the penalty order was
passed by the Assessing Officer in respect of the assessment year
1990-91, ITA 425/2008 was preferred by the Revenue, which was
th
disposed of in the following manner vide order dated 10 July, 2009
passed by this Court:
“The assessee herein had not deducted tax at
source from its employees qua meal and
conveyance allowances. This was treated as short
deduction of tax by the assessing officer and on
that basis assessment a search was carried out. At
the same time penalty proceedings were also
ITA 257/2009 Page 1 of 3
initiated against the assessee under section 271 C
of the Income Tax Act for short deduction of tax
and penalty order dated 30.6.1998 was passed. In
appeal preferred by the assessee CIT (A) allowed
the appeal partly. The matter was taken up by the
Income Tax Department before the ITAT by filing
appeal against the order of CIT (A).
It so happened that against the assessment orders
the assessee had gone in appeal and ITAT allowed
the appeal on the ground that assessment was
made after four years and was thus barred by
limitation. Appeal of the revenue preferred under
section 260A of the Income Tax Act before this
Court also failed and this Court affirmed the order
of the ITAT. Since the very assessment, in this
manner, was set aside, the ITAT has dismissed the
appeal of the revenue against the orders passed
under Section 271C as well by the impugned order.
Learned counsel for the appellant submits that
against the orders passed by this Court affirming
the order of the ITAT setting aside the assessment
as time barred revenue has filed the Special Leave
Petition in which notice has been issued and the
said SLP coming up for disposal sometime in
December, 2009. In these circumstances, the
present appeal is disposed of with the observations
that in case the SLP/civil appeal is allowed by the
Supreme Court and the assessment restored, the
appellant shall be entitled to move application
before the ITAT for revival of Appeal
No.3847/Del/2003 on the issue of penalty for
decision of the said appeal on merits.
ITA 257/2009 Page 2 of 3
The appeal stands disposed of in the aforesaid
terms.”
2. The present case relate to assessment year 1991-
92. It is not in dispute that the Special Leave Petition is still
pending before the Supreme Court and is fixed for final
hearing in lieu thereof counsel for the parties agreed that this
appeal be also decided in terms of the aforesaid order dated
th
10 July, 2009.
3. Mr. Syali, however, points out that in respect of
th
this very assessment year, this Court in its judgment dated 6
December, 2006 in Commissioner of Income Tax vs. British
Airways-[2007] 165 TAXMAN 230 (DELHI) has
categorically held that the Income Tax Appellate Tribunal
(ITAT) was justified in rejecting the Revenue’s appeal, insofar
as penalty of short deduction of tax of leave allowance is
concerned. Thus, we make it clear that in case the SLP and
Civil Appeal is allowed by the Supreme Court and the
assessment restored, the Tribunal shall decide the question of
penalty only relating to conveyance allowance and not leave
allowance.
4. The writ petition is disposed of in the aforesaid
terms.
A.K. SIKRI, J.
SIDDHARTH MRIDUL, J.
NOVEMBER 19, 2009
dn
ITA 257/2009 Page 3 of 3