Income Tax Appellate Tribunal Delhi Parpool Ltd., New Delhi vs Department Of Income Tax on 3 June, 2016 Page 1 of 13 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH " F ": NEW DELHI BEFORE SHRI H S SIDHU JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA No.: 3316 /Del/2012 Assessment Year: 200102 ADIT Circle 1(2) Vs Parpool Limited International taxation M/s M G B Metro group Buying H K New Delhi Limited ILO 40 Okhla Industrial Estate Phase II New Delhi PAN AAECM3289J (Appellant) (Respondent) Assessee by : None Respondent by: Mr. R S Negi Sr DR Date of Hearing 18/04/2016 Date of pronouncement 03 /06/2016 ORDER PER PRASHANT MAHARISHI, A. M. 1) This appeal is filed by revenue against the order of CIT (A) XXIX , New Delhi dated 26/03/2012 where Ld. CIT (A) appeal has held that interest under section 234B cannot be levied on the tax payable by the assessee. 2) The solitary ground of the appeal taken by the revenue is that on the facts and in the circumstances of the case, the Ld. Commissioner of Income Tax (Appeals) erred in deleting the interest levied under section 234 B of the Income Tax Act. 3) The brief facts of the case are that appellant is a liaison office of the Hong Kong Company. It was found to be earning certain income in India and therefore it was chargeable to tax. However, the issue was that whether interest under section 234B of the income tax act can be levied on income tax of the assessee where tax under section 195 of the income tax act is deductible from whole of such income. The Learned assessing ITA 3316 DEL 2012 ADIT V PARPOOL LIMITED AY 2001_02 Page 2 of 13 officers held that interest in the section 234B of the act is chargeable and therefore this ground was raised by assessee before the ld. CIT (A). However, the CIT (A) did not pass any order on applicability of the provisions of section 234B and consequent interest payable by the assessee in his order dated 01/12/2011 for A Y 2001 2002 and 2008 2009. Therefore the assessee filed an application under section 154 of the income tax act for the both the years making the prayer that the ground against charging of interest under section 234B of the act has not been decided. Based on this application under section 154 the Ld. Commissioner of income tax (A) relying on the various High Court decisions including decision of honourable jurisdictional High Court on that issue held that interest under section 234B of the act is not chargeable in the hands of the appellant being non resident when its entire income is subject to tax deduction at source under section 195 of the income tax act., hence revenue is in appeal before us. 4) Ld. departmental representative contended before us that interest u/s 234B of the income tax act is consequent of income determination and tax thereon therefore it is leviable. 5) Despite notice, none appeared on the half of the assessee and therefore in absence of the representation from the respondent we decide this issue on the merits of the case. 6) We have carefully considered the contentions of the Ld. departmental representative and perused relevant orders of lower authorities. The issue in appeal is whether interest is chargeable under section 234B of the income tax act in case of nonresident whose income is subject to tax deduction at source under section 195 of the income tax act. In fact in view of the decision of honourable Delhi high court in case of DIT V G E packaged Power inc. 56 taxmann.com 190 ( Delhi) this issue is now squarely covered in favour of the assessee. Honourable Supreme court has also dismissed the special leave petition filed by revenue against this order vide order dated 15.07.2015. Honourable Delhi high court has held as under : "18. The v