IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 20.04.2009 Coram : THE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIAN and THE HONOURABLE MR.JUSTICE M.M.SUNDRESH Tax Case (Appeal)No.814 of 2008 Commissioner of Income Tax Coimbatore Appellant/Appellant v. M/s.Roots Multiclean Limited R.K.G.Industrial Estate, Ganapathy, Coimbatore-6. Respondent/Respondent Tax Case Appeal filed under section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, 'D' Bench, Chennai, dated 17.2.2006 passed in ITA No.554/Mds/2004 against the Commissioner of Income Tax (Appeals)-I, Coimbatore dated 3.12.03 in ITA.No.347/02-03 against the order of the Deputy Commissioner of Income Tax,Coimbatore,dated 21.1.03 in AABCR0315F/R.6 For appellant : Mr.J.Nareshkumar, Standing Counsel for Income-tax For Respondent: Mr.J.Balachandran JUDGMENT (Judgment of the Court was delivered by K.RAVIRAJA PANDIAN, J.) The appeal has been preferred by the revenue against the order of the Income Tax Appellate Tribunal, Madras 'D' Bench, Chennai, dated 17.2.2006 passed in ITA No.554/Mds/2004. 2. The material facts culled out from the statement of facts in the memorandum of grounds of appeal are as follows:- The assessee is a Company. For the assessment year 2002- 2003, the assessee was assessed on a total income of Rs.35,88,383/- determining the tax and surcharge at Rs.12,81,053/-. After determining the tax the assessing officer deducted TDS an advance tax calculated interest under Section 234B and 234C and finally brought forward tax credit under Section 115JAA was allowed by the assessing officer. However, the assessee is aggrieved by this method of giving credit to the brought forward MAT credit and according to the assessee the same should have been treated on par with the TDS and tax credit should have been given right at the beginning. Against that order, the assessee preferred an appeal before the Commissioner https://hcservices.ecourts.gov.in/hcservices/ of Income-tax (Appeals), who allowed the appeal. Against that, the Department preferred appeal before the Income-tax Appellate Tribunal and the Tribunal following its judgement in the case of Chemplast Sanmar Limited upheld the order of the Commissioner of Income-tax (Appeals) and dismissed the appeal. Aggrieved by the same, the revenue filed this appeal by formulating the following question of law:- "Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the provisions of Section 115JAA and Section 234B and 234C of the Act concluded that the MAT credit shall be set off before charging interest under Section 234B and 234C of the Income Tax Act, 1961 is valid.? 3. We heard the arguments of the learned counsel for the revenue and perused the materials available on record. 4. The very same issue has been considered by the Division Bench of this Court in T.C.A.Nos.887 of 2004 etc. batch on 09.04.2009 and Division Bench has answered the issues in favour of the assessee and against the revenue by observing thus: "7.In respect of the first question of law, the arguments advanced by the counsel on either side are the same as the one advanced before the Delhi High Court cited supra. The Delhi High Court has considered the relevant provisions and dealt with the matter in detail and held that the credit under Section 115JAA should be given effect to before charging of interest under Section 234A, 234B and 234C of the Act. We are in agreement with the reasoning given by the Delhi High Court. The learned counsel appearing for the revenue has not produced any materials or given compelling reasons to take a contrary view with that of the Delhi High Court. In such circumstances, we answer the first question in favour of the assessee and against the revenue. ..... "18. In the present case, the intention of the legislature is to give tax credit to tax and not to the tax and interest. Once the intention is clear, the revenue cannot rely on the Form-I to say that the MAT credit under Section 115JAA should be given only after tax and interest. Further we have answered the first question of law in favour of the assessee i.e. the MAT credit under Section 115JAA should be given effect to before charging the interest under Section 234B and 234C. Rule 12(1)(a) and Form-I cannot go beyond the provisions of the Act. Form-I cannot lay down the order of priority of adjustment of TDS, https://hcservices.ecourts.gov.in/hcservices/ advance Tax, MAT credit under Section 115JAA which is contrary to the provisions of the Act. The order passed by the Tribunal is in accordance with law and we do not find any error or illegality in the order of the Tribunal so as to warrant interference. Accordingly, we answer the questions 2 and 3 also in favour of the assessee and as against the Revenue. 5. The question of law involved in this case also is identical as the one considered by the Division Bench. Following the Division Bench Judgment cited supra, the appeal is dismissed since the question of law has already been answered in favour of the assessee. Sd/- Asst. Registrar. /true copy/ Sub Asst. Registrar. usk To 1. The Asst.Registrar, Income Tax Appellate Tribunal, Chennai 'D' Bench, Chennai. 2. The Commissioner of Appeals-I, Coimbatore. 3. The Deputy Commissioner of Income Tax, Coimbatore. + 1 CC to Mr.J.Naresh Kumar, Standing Counsel for Income Tax, SR.15706 T.C.(A)No.814 of 2008 BV(CO) EM/29.4 https://hcservices.ecourts.gov.in/hcservices/