TMI Blog2005 (2) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... no tax has been deducted as such the scope of the appeal was itself limited which even was partly allowed. – Revenue’s appeal is dismissed as having no merit - - - - - Dated:- 3-2-2005 - Judge(s) : SWATANTER KUMAR., MADAN B. LOKUR JUDGMENT The judgment of the court was delivered by Swatanter Kumar J.- The appeal of the assessee against the order dated October 6, 1997, passed by the Commissioner of Income-tax (Appeals) XIII, New Delhi, was dismissed by the Income-tax Appellate Tribunal by a detailed order dated September 19, 2001, the legality and correctness thereof is challenged by the appellant in the present appeal under section 260A of the Income-tax Act, 1961 (hereinafter referred to as the "Act"). The necessary facts are that the assessee filed the return of income on November 29, 1994, declaring a total income of Rs. 33,75,58,470. An order under section 143(1)(a) of the Act was passed on January 12, 1995. However, the case was taken up for scrutiny under section 143(2) of the Act. Notices were issued to the assessee on February 2, 1995 in response to which the representative of the assessee appeared. The Assessing Officer upon scrutiny found that the amount of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y me." The Commissioner of Income-tax held that the conditions of section 40(a)(i) were fully satisfied as the tax was deducted on the royalty within the relevant previous year and the tax so deducted paid in accordance with Chapter XVTI-B of the Act. However, the assessee himself had conceded in relation to the fact that the assessee was not entitled to the benefit in that year because the tax has not been deducted at source and deposited within the prescribed time. The assessee still dissatisfied with the order of the Commissioner of Income-tax (Appeals) preferred an appeal before the Income-tax Appellate Tribunal which as already noticed were partly allowed for the previous years. Referring to the facts of the case as it understood decided the case arrived at a conclusion hereinafter referred to: "The facts of this ground of appeal are that during the previous year, the appellant debited royalty of Rs. 8,84,09,109 in its books of account. This consists of (i) Rs. 6,33,27,801 for which tax was deducted and paid during the previous year and (ii) Rs. 2,50,81,308 for which tax was deducted during the previous year, but was paid after the end of the previous year but within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 251 ITR 84 (SC), while dealing with an analogous provision contained in section 100 of the Code of Civil Procedure, their Lordships of the Supreme Court have observed that to determine whether a question of law raised in a case is a 'substantial question of law', the tests laid down by the Constitution Bench in Chunilal V. Mehta and Sons Ltd. (Sir) v. Century Spinning and Manufacturing Co. Ltd., AIR 1962 SC 1314, still hold good. The five tests so laid are: whether (i) it is of general public importance; or (ii) it directly or substantially affects the rights of the parties; or (iii) it is an open question in the sense that it is not finally settled by the Supreme Court; or (iv) it is not free from difficulty; and (v) it calls for discussion of alternative views." The bare reading of the above enunciated principles of law clearly shows that for the court to determine the fact that the appeal before the court involves a substantial question of law the case should essentially fall within either of the afore-referred class of cases. In the present case, the reading of the provisions of section 40 (a) are so clear and unambiguous that it calls for no elaborate discussion on the inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d at which tax is deductible at source under Chapter XVII-B of the Act and if such tax is not deducted or after deduction has not been paid during the previous year or in the subsequent year before the expiry of the time prescribed under subsection (1) of section 200 shall not be deducted. The section has three ingredients (a) royalty which is payable outside India or in India to a nonresident; (b) the tax is deductible at source under Chapter XVII-B and has not been deducted; or (c) after deduction has not been paid during the period specified. In the section it is a composite performance and a satisfaction of these ingredients which would take the amount indicated in the section beyond the mischief of section 40(a)(i). If the language of these ingredients are not satisfied, the obvious result thereof would be that the specified amount shall not be liable to be deducted. There is no dispute to the fact before us that the assessee had deducted the tax at source within the same financial year but deposited the same subsequently even in the next financial year but within the limitation of time specified under Chapter XVII-B of the Act read with section 200(1) of the Act. This appar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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