Judgment · High Court
Case at a glance
Outcome
Allowed
SOUTHERNEXPLOSIVES CO), the appeal is allowed holding that the tax collected andretained as deposit was liable to be taxed in the hands of the assessee
Provisions considered
Key paragraphs
- Para 55. Having regard to the above said fact and following the decision of the Supreme Court reported in 245 ITR 421 (KCP LIMITED v. COMMISSIONER OFINCOME TAX) as well as 242 ITR 107 (COMMISSIONER OF INCOME TAX v. SOUTHERNEXPLOSIVES CO), the appeal is allowed holding…
Judgment
IN THE HIGH COURT OF JUDICATURE AT MADRASDated : 19.02.2007CoramThe Honourable Mr.Justice P.D.DINAKARANandThe Honourable Mrs. Justice CHITRA VENKATARAMANT.C.(Appeal) No.104 of 2003 Asst. Commissioner of Income TaxChennai ...Appellant-vs-M/s.Mohan Brewaries and DistilleriesLimited, Chennai ...RespondentSubstituted the name of the respondent as per order dated 5.2.2007 in TCMP.NO.4/07Tax Case (Appeal) is against the order of the Income Tax AppellateTribunal Madras A bench, dated 19.2.2003 in ITA.No. 1929/Mds/94 for the Assessment year 1991-92and order dataed 21/7/1994 from the commissioner of income Tax (Appeal) I Madras in ITA.No. 21/94-95 and the order dated17.3.94 from Assistant Commissioner of Income tax Central Circle-II (4)Madras-34 in PAN/GIR.No. 47-039-CV-394) For Appellant: Mrs. Pushya SitaramanSenior Standing Counsel for Income TaxFor Respondent: Mr.V.S.JayakumarJUDGMENT(Judgment of the Court was delivered by CHITRA VENKATARAMAN,J)This Tax Case Appeal is filed under Section 260-A of the Income TaxAct, 1961, by the Revenue for the assessment year 1991-92 raising following question of law:-"Whether in the facts and circumstances of the case, the Tribunal was right in holding that excess sales tax collected and retained as a deposit due to adispute cannot be taxed in the hands of the assessee?"
The assessee filed a return income for the assessment year 1991-92claiming a huge loss. The Assessing Authority, however, added a sum of https://hcservices.ecourts.gov.in/hcservices/ Rs.1,86,70,554/- being the sales tax collected and kept in deposit, pending the decision on the assessment. Following the earlier decisionson the same issue, the Tribunal allowed the appeal of the assessee holding that the said deposit of tax collected could not be held to be the income of the assessee.
The learned counsel appearing for the assessee brought to our attention that the Supreme Court, in its order dated 25.3.1991, directed the appellant herein to deposit the amount with the Government till the appeal was disposed of. In the light of the said order, the assessee had already deposited the said amount to the Government.
The learned counsel for the respondent submits that in view of the corresponding deduction that he was entitled to, the question could not be seriously agitated by the respondent herein.
Operative part
Having regard to the above said fact and following the decision of the Supreme Court reported in 245 ITR 421 (KCP LIMITED v. COMMISSIONER OFINCOME TAX) as well as 242 ITR 107 (COMMISSIONER OF INCOME TAX v. SOUTHERNEXPLOSIVES CO), the appeal is allowed holding that the tax collected and retained as deposit was liable to be taxed in the hands of the assessee. bgSd/Asst. Registrar/true copy/Sub Asst. RegistrarTo1.THE ASSISTANT REGISTRAR INCOME APPELLATE TRIBUNAL, III FLOOR, RAJAJI BHAVAN CHENNAI.2. THE ASSISTANT COMMISSIONER OF INCOME TAX, CHENNAI.3. THE COMMISSIONER OF INCOME TAX (APPEALS I) NUNGAMBAKKAM MADRAS. -0344. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II (4) MADRAS 34.+ One CC to Mrs. Pusya Sitaraman Advocate SR 10293+ One cc to Mr. V.S. Jayakumar Advocate SR 10242SSV (co)sg 15/3/07T.C. (Appeal) No.104 of 200319.2.2007
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