(Judgment of the Court was delivered by K.RAVIRAJA PANDIAN, J.) The revenue on appeal against the order of the Income Tax Appellate Tribunal, Madras 'A' Bench, Chennai, dated 31.03.2006 passed in ITA No.2075/Mds/2005 in respect of the assessment year 2002-03.
2. The assessment was completed under Section 143(3) r/w 147. Later the order was revised under
Section 154. Consequent to the order of the Commissioner of Income Tax (Appeals) the Assessing Officer while giving effect to the appellate order, denied the adjustment of the MAT credit. Aggrieved against the order of the Assessing Officer, the assessee filed an appeal before the Commissioner of Income Tax (Appeals), who following the decision of the Tribunal directed the Assessing Officer to allow MAT credit first on par with TDS/Advance tax. The revenue filed a second appeal to the Income Tax Appellate Tribunal. The Tribunal allowed the appeal in favour of the assessee following its earlier order in the case of Chemplast Sanmar Limited for the assessment year 2002-03 and held that MAT credit had to be adjusted before calculating interest under section 234B and 234 C. Aggrieved by the same, the revenue filed the present appeal by formulating the following questions of law:-
"1. Whether in the facts and circumstances of the case, the Tribunal was right in holding that MAT credit is to be set off from the tax payable before setting off the Tax deducted at Source and Advance tax paid?
2. Whether on the facts and circumstances of the case the MAT credit can be given priority of set off against tax payable, contrary to the scheme of Schedule G of Form 1?
3. Whether the interest under Section 234 B and 234 C had to be calculated after giving the MAT credit against the tax payable on the basis of normal computation?
3. We heard the arguments of the learned counsel for the appellant and perused the materials available on record.
4. The very same issues have been considered by the Division Bench of this Court in T.C.A.Nos.887 of 2004 etc. batch on 09.04.2009. In respect of the 3rd question of law, the Division Bench has answered in favour of the assessee and against the revenue by observing as follows:-
"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.
5. In respect of the 1st and 2nd questions of law, the Division Bench has observed as follows:-
"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, 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.
Thus all the questions of law have been answered against the revenue in favour of the assessee.
6. The questions of law in this case also are identical as the one considered by the Division Bench. Following the Division Bench Judgment cited supra, the appeal is dismissed.
rg To
1. The Commissioner of Income Tax Chennai
2. The Income Tax Appellate Tribunal, Chennai 'B' Bench, Chennai