CANBANK FINANCIAL SERVICES LTD. Vs. ITO, INTERNATIONAL TAXATION

JUDGEMENT

(1.) THIS appeal is by the assessee being aggrieved by the order of the Tribunal holding that the order of CIT (Appeals) is rectifiable under Section 154 of the Act and thereby dismissed the appeal. The appellant company is engaged in financial services. It filed its return of income for the assessment year 2005 -06 on 26.10 2005 declaring nil income. However, the book profits under Section 115JB were shown at Rs. 10,51,09,653.

(2.) THE intimation under Section 143(1) was issued. Credit for pre -paid taxes was given at Rs. 7,33,31,887. The assessee, however, filed an application for rectification seeking for credit to the extent of Rs. 11,90,97,725. But, the Assessing Officer gave credit only to the extent of Rs. 11,33,31,887 and levied interest of Rs. 7,93,203 under Section 234C of the Act. The assessee preferred an appeal before the CIT (Appeals) against the order of the Assessing Officer, wherein the appeal was allowed by holding that there is no question of levy of interest under Section 234C levied on computation of book profits under Section 115JB and accordingly, interest of Rs. 7,93,203 levied by the Assessing Officer on the assessee was deleted. Aggrieved by the same, the revenue preferred an appeal before the Tribunal, wherein the Tribunal dismissed the same on the ground that the permission of the COD was not obtained. Subsequently, the revenue preferred an application under Section 154 of the Income Tax Act before the Commissioner of Income Tax (Appeals) stating that the decision of the jurisdictional High Court in the case of Jindal Thermal Power Company Limited (Formerly Jindal Tracteble Power Co. Ltd.) Vs. The Deputy Commissioner of Income Tax and Union of India (UOI) r/by its Secretary, Ministry of Finance, Department of Revenue, (2006) 286 ITR 182 KAR was not taken into consideration while allowing the assessees appeal. The Appellate Authority entertained the application under Section 154 and rectified the order by levying interest under Section 234C of the Act. Aggrieved by the same, the assessee preferred an appeal before the Tribunal. The Tribunal by the impugned order dismissed the appeal. Hence, the present appeal by the assessee.

(3.) THE Tribunal while passing the impugned order held that the revenues earlier appeal was dismissed not on merits but only on the ground of not obtaining COD permission. Hence that by itself cannot bind the revenue from filing an application under Section 154 of the IT Act for rectification of a mistake, which is apparent on the face of the record. It was further noted on the facts that the order of the jurisdictional High Court was already available on 31.03.2008 and therefore, the non -consideration of the same is a mistake apparent on the face of the record.