9911796707
TMI Blog2008 (9) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Board of Direct Taxes, Ministry of Finance, Government of India (Respondent No.2) whereby the application of the petitioners 1 and 2 under Section 10 (15A) of the Income-tax Act, 1961 (hereinafter referred to as "the said Act") was rejected. By way of this writ petition, the petitioners 1 and 2 also pray for an appropriate writ, order or direction 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 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 1 st day of April 1997 and the 31 st 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was not available to the petitioner No.1. However, the petitioner No.1 realised that it was eligible to claim the benefit under Section 10 (15A) of the said Act and, therefore, it contemplated moving application seeking Central Government approval which was a necessary pre-condition for availing of the benefit. Such an application was moved by Jet Airways on behalf of the petitioner No.1 on 26.11.1999. 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 agreemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t with the new owner i.e. petitioner No.1 and therefore also undertook to indemnity to respondent No.3 by owning the liability of huge amount, which strengthen the fact that Master Purchase Agreement was entered into deliberately with a with an ulterior motive. In view of this, the intention of the assessee was primarily for the purpose of taking unintended advantage of tax exemption under section 10 (15A). 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreements were identical with those in the original agreements. Also the same aircrafts have remained in continued possession of Jet Airways without break of even a single day. 10. The new agreements are in effect, the same old agreements with only change in the name of the aircraft owner and as the original agreements were entered into when the benefit of Sec. 10 (15A) was not available therefore the 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 purp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e respondents 1 and 2, also contended that in the first round before this court, while disposing of the earlier writ petition (CWP 1067/2003), this court did not grant the reliefs of directing the respondents to accord approval under Section 10 (15A) as also of directing refund to the petitioners. As such, these prayers cannot be granted in the present writ petition also. A reading of the order 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 reconsidere ..... X X X X Extracts X X X X X X X X Extracts X X X X
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