COMMISSIONER OF INCOME TAX Vs. SHIVA TEXYARN LIMITED

JUDGEMENT

(1.) THE appeal has been preferred by the revenue against the order of the Income Tax Appellate Tribunal, Madras 'd' Bench, Chennai, dated 5. 5. 2008 passed in ITA No. 2089/mds/2006.

(2.) THE material facts culled out from the statement of facts in the memorandum of grounds of appeal are as follows:-The assessee private limited Company filed return of income for the assessment year 2004-2005 on 1. 11. 2004 declaring an income of Rs. 1,10,31,970/ -. The return was processed under Section 143 (1) on 31. 3. 2005. The assessing officer denied the assessee claim of tax credit of Rs. 8,46,276/- made under Section 115jaa (4) and (5) of the Income Tax Act, 1961 which the assessee had paid on book profits in assessment year 1999-2000. The assessing officer denied the relief on the ground that there was no specific provision of the Act to give credit for MAT on the gross tax payable. Aggrieved by the same, the assessee filed appeal before the Commissioner of Income-tax (Appeals), who allowed the assessee's claim following the order passed by Tribunal in the case of CHEMPLAST SANMAR LIMITED, wherein it was held that MAT credit should be adjusted first before adjusting TDS and advance tax. On further appeal by the Department to the Tribunal, the Tribunal relying on the decision of Chemplast Sanmar Limited reported in 83 TTJ (Chennai) Page 427 which held that MAT credit should be given in precedence of TDS and advance tax dismissed the appeal filed by the Department. Aggrieved by the order of the Tribunal, the revenue filed the present appeal by formulating the following questions of law:-

(3.) WE heard the arguments of the learned counsel for the appellant and perused the materials available on record.