2016 (3) TMI 876 - HC - Income Tax

Short deduction of tax from the payment of commission paid by BSNL/MTNL to their public call office franchises - ITAT deleted the demand - Held that - The issue involved in all these appeals is similar and the Punjab and Haryana High Court titled as The Commissioner of Income Tax (TDS), Chandigarh versus M/s Bharat Sanchar Nigam Limited 2013 (3) TMI 199 - PUNJAB & HARYANA HIGH COURT wherein held no substantial question of law arises for consideration, inter alia, for the reason that the Central Board of Direct Taxes vide circular dated 12.03.2008 has taken a stand that the demands are not to be enforced on BSNL and MTNL offices except in the cases where taxes have been deducted at source but not paid over to the revenue. The proviso is clarificatory in nature though it was inserted by the Finance Act, 2007 w.e.f. 01.06.2007. The nature of the amendment and the purpose which it seeks to achieve make it abundantly clear that it is a clarificatory amendment and would be applicable even in respect of assessment years prior to insertion of the said amendment. It is apt to record herein that the Apex Court in a latest judgment in the case titled as Neon Laboratories Limited versus Medical Technologies Limited and others, reported in (2016 (3) TMI 787 - SUPREME COURT) has directed that every High Court must give due deference to the law laid down by other High Courts - Decided in favor of assessee.

Summary

Issues Involved: Determination of similar issues in multiple appeals, application of law laid down by another High Court, disposal of appeals based on precedent.

Analysis:
1. Similar Issues in Multiple Appeals: The counsel for the appellant(s) highlighted that the issue involved in all four appeals was similar to a case decided by the Punjab and Haryana High Court. The lead case, ITA No. 261 of 2012, involving The Commissioner of Income Tax (TDS) versus M/s Bharat Sanchar Nigam Limited, was referenced. The appeals were clubbed together for a common judgment.

2. Application of Precedent: The High Court reviewed the judgment of the Punjab and Haryana High Court in the lead case and concurred with its view. Reference was made to a recent Supreme Court judgment emphasizing the importance of High Courts giving deference to the legal principles established by other High Courts. The Court quoted a specific paragraph from the Supreme Court judgment to underscore this point.

3. Disposal of Appeals: Based on the precedent set by the Punjab and Haryana High Court and the directive from the Supreme Court, the High Court disposed of all the appeals in line with the decision in ITA No. 261 of 2012 and related matters. Any pending applications were also resolved accordingly. The judgment emphasized the need for consistency in legal decisions to prevent chaos and conflicting orders across different states.

Overall, the High Court's decision was guided by the principle of following established legal precedents and ensuring uniformity in the application of law. By aligning its judgment with the decision of the Punjab and Haryana High Court and the directive from the Supreme Court, the High Court aimed to promote legal certainty and avoid jurisdictional conflicts.