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ITA 272/2014
DIRECTOR OFINCOMETAX Appellant
Through Mr. N P Sahni, sr. standing counsel with Mr.Nitin Gulati,Adv.
Through Mr. Mayank Nagi and Mr. Harkunal Singh,Advs.
HON'BLE MR.JUSTICE R.K.GAUBA
ORDER o/o 05.03.2015 C.M.Nos.10080/2014. 10082/2014. 10084/2014. 10086/2014, 10088/2014, 10090/2014.10092/2014.10094/2014.10095/2014 and 10853/2014(delay)
For the reasons stated in the applications, the delay in re-filing the appeal is condoned.
The applications are disposed of.
ITANOs.272/2014.273/2014.274/2014.275/2014,276/2014,277/2014, 278/2014.279/2014.280/2014 and 338/2014
2015:DHC:11034-DB
JUDGMENT
1. Issue notice.
2. Mr.Mayank Nagi,Advocate accepts notice.
3. In all these appeals,the common question which the revenue urges is that the assessees were liable to pay interest under Section 234B of the Income Tax Act,1961.
4. The assessee is a foreign company incorporated under UK Laws and engaged in air transport services. The assessee had disputed liability in respectofa portion ofits activities i.e. ground handling servicesrendered to other entities on the basis ofbilateral arrangement or agreement with such users. The portion ofattributed income on the basis ofthat activity was a subject matter ofassessment and appellate proceedings. The assessee had also asserted the applicability ofthe Indo UK Double Taxation Avoidance Agreement(DTAA). It was in these circumstances that the question of payment ofinterest arose after determination ofthe assessee s liabilities to. pay the tax.
5. The AO ruled that in addition to tax,the assessee was also liable to pay interest under Section 234B. The CIT(Appeals)set aside the direction to pay interestunder Section 234B;theITAT rejectedthe revenue s appeal. To completethe details,it would also benecessary to noticethat pursuantto the mutual agreement procedure(MAP)dated 18.12.2011,the dispute with respect to payment of tax stands resolved. The only surviving bone of contention, therefore, is the applicability of Section 234B and interest liability,ifany,ofthe assessee.
6. At the outset, this Court notices that the issue as to the payment of interest under Section 234B has been answered by this Court in DIT V Jacabs CivilInc. 330ITR 578 and the recent decision inDirector ofIncome \t> Tax, International Taxation V. GE Packaged Power Inc. ITA No.352- 391/2014 decided on 12.1.2015. The later decision,i.e. M/s GEPackaged Power Inc. also took note of an earlier discordant ruling in Director of Income Tax, International Taxation V. Alcatel Lucent USA Inc. in ITA No.327/2012 decided on 7.11.2013. The Court was of the opinion that Alcatel was decided in the peculiar circumstance ofthe case and that the rationale in Jacabs applies. Consequently, in view ofthe Jacabs and GE Packaged Power decisions, question of law sought to be urged by the revenue has to be answered against it.
7. The appeals are consequently dismissed. _S.RAVINI|RABHAT,J A K R JBA,J MARCH 05,2015 vld