9911796707
TMI Blog2008 (9) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... 18.10.1999 under Section 10 (15A) of the said Act in respect of two aircrafts leased by the petitioner No.1 to the respondent No.3 (Jet Airways). There is also a prayer for refund of Rs 10,98,42,772/- withheld and paid under Section 195 of the said Act in respect of the lease rents paid by the respondent No.3 to the petitioner No.1 being the owner of the aircrafts. There is also a prayer for striking down the words "not being an agreement entered into between the 1st day of April 1997 and the 31st day of March 1999" in Section 10 (15A) of the said Act. However, the learned counsel for the petitioners has not pressed this prayer. 2. The factual background is that two companies known as Birds of Paradise-I and Birds of Paradise-II belonging to the General Electric Group of Companies were owners of several aircrafts, including the two Boeing 737 ' 400 aircrafts in question. The said two companies being joint owners leased out the said two aircrafts to GE Capital Bank, Austria which was a company registered in Austria. The said GE Capital Bank, Austria entered into a sub-lease with the respondent No.3 (Jet Airways) on 05.10.1999. On the basis of this sub- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99. A non-speaking order was passed on 15.11.2000 rejecting the application. Jet Airways preferred a review and that was also disposed of by an order dated 04.03.2002 which was equally non-speaking in the following terms:- "As the same does not fall within the provisions of Section 10 (15A) " 5. Being aggrieved by the said order dated 04.03.2002, the petitioners herein filed a writ petition (CWP 1067/2003). In that writ petition, Jet Airways was impleaded as respondent No.3. The Division Bench hearing the said writ petition passed an order dated 10.11.2003 requiring the respondents 1 and 2 to disclose the reasons by filing an affidavit. Thereafter, an additional affidavit was filed on 24.11.2003. The reasons indicated were as under:-?In this case, the issue was whether the agreements entered on 18.10.1999 by Jet Airways should be approved by the Government so that the benefit of exemption under section 10(15A) may be made available on payments made by Jet Airways. The following points emerged in this case:- i) The point which is of vital importance is that the terms and conditions of the new lease agreements concluded with AFT Trust Sub-I on 18.10.1999 are identical to those ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsp; Accordingly, the application was rejected on the ground that the new agreements were only a fence having no other commercial motivation other than tax advantage." 6. Thereafter, by an order dated 05.10.2004, this court disposed of the said writ petition (CWP 1067/2003) in the following manner:- " It will be for the Central Government to examine these aspects. It is under these circumstances, as no cogent reasons have been given, we quash the impugned orders dated 15.11.2000 and 4.3.2002. We direct the Central Government to consider the application of the petitioners. For this purpose, the petitioners will move a fresh application in this behalf within a period of four weeks. If the application is made within four weeks, the Central Government shall decide the same within a period of six weeks thereafter by passing a speaking order." 7. It may be noted that while disposing of the writ petition, this court granted the alternative prayer taken by the petitioner and was not inclined to grant the prayers with regard to directing the respondents 1 and 2 to grant approval to the lease agreements dated 18.10.1999 under Section 10 (15A) of the said Act and for directing the refund of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... request for approval u/s 10(15A) of Income Tax, Act, 1961 to the two agreements dated 18/10/1999 each entered into between M/s. Jet Airways (India) Limited and M/s. AFT Trust Sub-I Delaware for acquiring two aircrafts bearing Serial No. 25663 and 25664 on lease cannot be acceded to. The application is accordingly rejected." 9. The counsel for the parties have been heard at length. Mr Jolly, who appears on behalf of the respondents 1 and 2, has supported the impugned order. His main submission, relying upon the counter-affidavit filed by the respondents 1 and 2 in this writ petition, is that the agreements of 18.10.1999 are identical to the earlier agreements of 05.10.1997 and that there is only a change in the name of the owner. He submitted that this was done only with the purpose of circumventing the difficulty that the petitioners faced inasmuch as the benefit of Section 10 (15A) was not available to the agreements entered into between 01.04.1997 and 31.03.1999. Since the old agreements were entered into on 05.10.1997, the benefit could not be availed by the petitioners. Therefore, they thought it fit to enter into new agreements on 18.10.1999 which were beyond the excluded per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 05.10.2004 makes it clear that this court was granting the alternative prayer of issuing a direction to the Central Board of Direct Taxes to reconsider the application under Section 10 (15A) of the said Act and, therefore, it did not consider it necessary to grant the reliefs of directing the grant of approval to the lease agreements dated 18.10.1997 under Section 10 (15A) of the said Act or of directing the grant of a refund as prayed for. That was subject to whatever decision would be taken on a reconsideration of the application under Section 10 (15A) of the said Act. Thus, the non-grant of those reliefs by virtue of the order dated 05.10.2004 does not come in the way of the petitioners in this petition seeking the same reliefs after the petitioners' application had been reconsidered pursuant to the said order dated 05.10.2004 12. We, therefore, set aside the impugned order dated 17.02.2005 as well as the purported reasons in support of the said order. No other reasons are forthcoming and, in fact, the reasons given in the impugned order are the very same reasons which were given in the earlier orders which were set aside. We direct the respondents 1 and 2 to grant appro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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