TaxTMI 
TaxTMI 
2024 (8) TMI 1135
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....in law, the Order u/s. 92CA(3) of the Act passed by the Additional Commissioner of Income-tax, Transfer Pricing - ll(2), Mumbai (Addl. CIT) is without jurisdiction and bad in law inasmuch as the "Transfer Pricing Officer" means a Joint Commissioner or Deputy Commissioner or Assistant Commissioner authorized by the Board to perform all or any of the functions of an Assessing Officer specified in sections 92C and 92D in respect of any person or class of persons, as per Explanation to section 92CA of the Income-tax Act, 1961 ("the Act")." To support admission of additional ground, the assessee placed reliance on the following decisions: (i) Jute Corporation of India Ltd. , 187 ITR 688 (SC). (ii) National Thermal Power Company, 229 ITR 383(SC) (iii) Pruthvi Brokers and Share Holders, 349 ITR 351 (Bom) 3. After examining the aforesaid additional ground raised by the assessee, we are of the considered view that the jurisdictional issue raised by way of additional ground goes to the root of validity of order passed by the Transfer Pricing Officer (TPO) and subsequent proceedings arising therefrom. Hence, the additional ground raised by the assessee by way ....
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....are not the authorities in same class. He further referred to the definition of Additional Commissioner u/s. 2(1C) of the Act. He submitted that Additional Commissioners have been defined separately u/s. 2(1C) and Joint Commissioners have been defined u/s. 2(28C) of the Act. The definition of Additional Commissioner was inserted by the Finance Act, 2007 with retrospective effect from 01/06/1994, whereas the definition of Joint Commissioner was inserted by Finance (No.2) Act, 1998 w.e.f. 01/10/1998. The aforesaid definitions of two different authorities were inserted at different point of time, hence, by no stretch of explanation it can be said that Additional Commissioners and Joint Commissioners are one and the same. He further referred to the definition of Assessing Officer u/s. 2(7A) of the Act to contend that in the definition of the Assessing Officer, Joint Commissioner was included by the Finance (No.2) Act of 1998, whereas the Additional Commissioner was inserted by the Finance (No.2) Act of 2007 w.r.e.f 01/06/1994. The insertion of these two authorities in the definition of Assessing Officer at two different point of time would clearly show that these authorities fall under....
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....eedings arising therefrom are bad in law. To support his argument he placed reliance on the decision in the case of Virtura Consulting Services Pvt. Ltd. Vs. DRP & Ors, 139 taxmann.com 361 (Madras). 6. Au contraire, Ms. Vatsala Jha representing the Department submitted that there is no difference in the work assigned to Joint Commissioner and Additional Commissioner. Both, the Joint Commissioner and the Additional Commissioner are Authorities at same level and head the Range. The Joint Commissioners after four years of service in the same rank are re-designated as Additional Commissioners with no change in nature of work or functions. In other words, time scale Joint Commissioners are designated as Additional Commissioners. The ld. Departmental Representative referring to the definition of Joint Commissioner in Sec.2(28C) of the Act contended that the said definition makes it clear that Joint Commissioner includes Additional Commissioner of Income Tax under section 117(1) of the Act. It can thus be seen that Joint Commissioner as mentioned in Explanation to section 92CA of the Act includes Additional Commissioner of Income Tax. Thus, an Additional Commissioner of Income Tax, is ....
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....clear that the definition of Additional Commissioner was inserted only as a clarificatory amendment to the definition of Assessing Officer defined in section 2(7A) of the Act. She pointed that Joint Commissioner has been defined u/s. 2(28C) of the Act which includes Additional Commissioner u/s. 117 of the Act. The Ld. Departmental Representative referring to the decision in the case of DCIT vs. BBC Worldwide India Pvt. Ltd.112 taxmann.com 380 (Del-Trib) submitted that an additional ground challenging jurisdiction of Additional Commissioner to act as TPO was raised in the said appeal. The decision of Delhi High Court in the case of Pawan Kumar Garg (supra) was also relied upon by the ld.Counsel for the assessee therein. The Tribunal distinguished the said decision and dismissed the additional ground raised by the assessee. 7. We have heard extensive submissions made by rival sides and have considered the Notifications & decisions on which reliance has been placed by the respective sides on the jurisdictional issue i.e. "Whether Additional Commissioner can be the TPO?" 8. The ld. Counsel for the assessee has made two pronged arguments challenging validity of order passed u/s. 9....
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....tax and Joint Director of Income-tax respectively. The above changes in designation made it necessary to amend the various sections of the Income-tax Act so that the statutory powers continue to be exercised by the substituted authorities as a result of redesignation. 5.2 The following substitution of income-tax authorities has been globally made in the Income-tax Act: Table From To Assistant Commissioner Assistant Commissioner or Deputy Commissioner Assistant Director Assistant Director or Deputy Director Deputy Commissioner Joint Commissioner Deputy Director Joint Director 5.3 Clause (74) of section 2 of the Income-tax Act containing the definition of Assessing Officer has been amended to include the redesignated authorities as above. 5.4 Clause (94) of section 2 of the Income-tax Act has been amended to include Deputy Commissioner in the definition of Assistant Commissioner. 5.5 Clauses (194) and (19C) of section 2 of the Income-tax Act have been amended to exclude the authorities of Additional Commissioner of Income-tax and Additional Director of Income- tax from the definitions of Deputy Commissioner and Depu....
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....(28C) and (28D) of the section(2) respectively. However, in order to further clarify the intension of the legislature with regard in the meaning of the term "Assessing Officer", the following amendments have been carried out through the Finance Act, 2007- (i) ......... (ii) ........ (iii) Clause (1C) has been inserted in section 2 so as to provide that "Additional Commissioner" means a person appointed to be an Additional Commissioner of Income-tax under sub-section (1) of section 117. This amendment will take retrospective effect and will be effective from 1st June, 1994. (iv) ............. (v) .............. (vi) ............. (vii) Clause (b) of sub-section (4) of section 120 has been amended so as to provide that the powers and functions conferred on or assigned to the Assessing Officer may also be exercised or performed by an Additional Commissioner. This amendment will retrospective effect and will be effective from 1st June,-1994." The definition of Joint Commissioner in section 2(28C) makes it unambiguous that Joint Commissioner means a person appointed to be Joint Commissioner or Additional Commissioner. The....
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....onal Commissioner was included in the definition of Deputy Commissioner u/s.2(19A) of the Act. By virtue of amendment by the Finance (No.2) Act, 1998 the words Additional Commissioner were omitted from the definition of Deputy Commissioner in Section.2(19A) of the Act and Additional Commissioner was included in the definition of Joint Commissioner. Thus, Additional Commissioner was never separately defined. The Additional Commissioner was initially bracketed with Deputy Commissioner (upto 01/10/1998) and thereafter with Joint Commissioner w.e.f. 01/10/1998. In the backdrop of these amendments we can say that the designation of Additional Commissioner was not per se authority superior/at a different level to the DCIT prior to the amendment or Joint Commissioner after the amendment of 1998. 11. We find that the Co-ordinate Bench in the case of BBC Worldwide (India) Pvt. Ltd. (supra) had an occasion to deal with similar legal issue wherein the assessee had challenged the validity of order passed u/s. 92CA by the Additional Commissioner. The objection of assessee therein was that the order passed by TPO is not valid as the same has not been passed by the prescribed authority under t....
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.... as per provisions of section 151, obtained approval from Commissioner and issued notice under section 148, said notice was invalid. Reliance placed by the authorised representative on the case of Pawan Kumar Gupta (supra) wherein the issue was that the second warrant of authorization in respect of the said locker was issued by the Additional Director, Income-tax (Investigation). The Additional Director does not find mention in the provisions of section 132(1). However, it was contended by the learned counsel for the revenue that the Additional Director would be covered in the expression 'Joint Director' in view of the provisions of section 2(28D) of the said Act. The court held that Even assuming that the expression 'Joint Director' as used in section 132(1) includes an Additional Director, such Additional Director or Joint Director would have to have initial empowerment by the Board to issue warrants of authorization in view of the provisions of section 132(1)(B). Therefore the only issue before the honourable Delhi High Court was whether the warrant issued by the additional director who was not empowered by the central board of direct taxes is a valid warrant or ....
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.... the instance case it is not so. The definition of Joint Commissioner includes Additional Commissioner as well. Both, the Joint Commissioner and the Additional Commissioner perform functions in the same level of hierarchy in the Income- tax Department. Precisely for this very reason the definition of Joint Commissioner in section 2(28D) includes Additional Commissioner, hence, the case of Dr.Nalini Mahajan does not support the cause of assessee. Similar were the facts in the case of Pawan Kumar Garg (supra). The warrants were required to be issued by Director whereas, the warrants were issued by lower authority i.e. Additional Director. Therefore, the Hon'ble Court followed the decision in the case of Dr.Nalini Mahajan. 11.2 The second limb of the arguments advanced by the ld.Counsel for the assessee is that Shri Vatsalya Saxena, Additional Commissioner is not authorized by the Board to act as TPO. The arguments of ld.Counsel is that Explanation to Section 92CA requires Joint Commissioner/Deputy Commissioner/ Assistant Commissioner to be authorized by the Board to perform the functions of a TPO and such an authorization is in a particular manner. He referred to one such authoriz....
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.... distribute the working amongst the Transfer Pricing Officers working under then while exercising their powers and performing theirs functions." A perusal of the above notification would show that the Board in exercise of powers conferred by section 120(1) & (2) of the Act has amended RBI Notification dated 09/09/2004 and has authorized the officers designated in column (2) to have territorial jurisdiction (mentioned in column (4)over the person or class of persons mentioned in column (5). The Note in the end of the said notification clarifies that Board has empowered Director General of Income-tax (International Taxation) or Director Income-tax (Transfer Pricing) to distribute the work amongst the TPOs working under them. The Ld. Departmental Representative has placed on record order No.59 of 2011 dated 04/04/2011 vide which Board has transferred the officers in the grade of Joint Commissioner/Additional Commissioner in the Directorate of International Taxation and Transfer Pricing. The name of Shri Vatsalya Saxena figures in the list of 'Officers who are being posted to other station/region' at Sl.No.11. Thus, he was transferred in the charge of Director General of Income Tax ....
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....n has been claimed u/s. 37(1) of the Act. The A.O accepted the same and no disallowance was made in the assessment order. He submitted that since, the claim of assessee has been accepted in the past the same cannot be disallowed in the impugned assessment year merely for the reason that the claim was made in the notes to the Return of Income and not in the return of income. The ld Counsel further pointed that in A.Y. 2007-08 the claim of assessee was allowed by the Tribunal in ITA NO.5600/Mum/2011 decided on 25/04/2019, the Tribunal directed the A.O to consider assessee's claim of deduction in line with earlier assessment years. The A.O while passing the order giving effect to the Tribunal order allowed the claim of assessee. 14. We find that in A.Y 2007-08 the assessee had made claim on account of pro-rata amount of leasehold land by way of Note No.4 to the computation of income. The A.O and the DRP rejected the claim of assessee citing Goetz (India) Ltd., 284 ITR 323(SC). The Tribunal admitted the claim of assessee and restored the issue back to the file of A.O holding as under:- "13. We have considered rival submissions and perused material on record. It is evident, ....
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....nd 2005-06 TFL claimed deduction in respect of provision for doubtful debts as business expenditure. Accordingly, certain reversal of provision of Rs. 14,24,06,933/- made during the year out of provision made in A.Y. 2004-05 and 2005-06 was offered to tax by the assessee in A.Y. 2008-09 in the return of income. He submitted that this was also mentioned in the Note (No.3) filed along with the computation of income. However, there were certain mistakes while offering the income to tax in the impugned assessment year. The correct amount of reversal of provision during the year was only Rs. 8,48,77,596/-. During assessment proceedings the assessee requested the Assessing Officer to exclude difference of Rs. 5,75,29,337/- i.e.(Rs. 14,24,06,933 - Rs. 8,48,77,596). The assessee inadvertently offered to tax Rs. 14,24,06,933/- as against actual provision reversed pertaining to assessment year 2004-05 and 2005-06 Rs. 8,48,77,596/-. He pointed that details of write back of doubtful debts were submitted to the A.O along with certificate from Chartered Accountant. He referred to the submissions made before the A.O and the certificate of the Chartered Accountant at pages 491 to 505 of the paper ....
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....g assessment proceedings the assessee furnished details of write back of doubtful debts along with certificate from Chartered Accountant. We find that in A.Y. 2006-07, similar claim made by the assessee was denied by the A.O. The matter travelled to the Tribunal. The Tribunal restored the issue back to the file of A.O holding as under: "15. Brief facts are, in the course of assessment proceedings the Assessing Officer found that in Note no.9 to computation of income, the assessee had claimed that in the assessment year 2004-05 and 2005-06, Tata Finance Ltd., which got amalgamated with the assessee in assessment year 2006-07, had claimed deduction in respect of provisions of doubtful debts / advances. It was stated that in the impugned assessment year, the assessee had reversed the provisions made in assessment years 2004-05 and 2005-06 and offered it to tax. It was submitted, though the actual reversal of provision during the year was Rs. 7,17,70,032, however, in the return of income the assessee had inadvertently offered an amount of Rs. 11,03,04,467. In this context, the assessee furnished a year-wise break-up of provisions made towards doubtful debts / advances. Further....
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....hdrawn. The Assessing Officer and the DRP rejected assessee's claim on the ground that the assessee has not made such claim in the revised return of income, hence, in view of the decision of Hon'ble Apex Court in the case Goetze (India) Ltd (supra) the claim of assessee cannot be entertained. 20. The facts narrated above regarding interest allowed u/s. 244A in intimation u/s. 143(1) of the Act and subsequently partial withdrawal of interest by the Assessing Officer in proceedings u/s. 154 of the Act vide order dated 15/04/2013 is not disputed by the Department. The assessee has offered to tax interest received u/s. 244A Rs. 16,43,50,232/-, which was subsequently restricted to Rs. 12,20,33,651/-. It is undisputed that the assessee after finalization of interest amount in proceedings u/s. 154 has not filed revised return of income, nevertheless the assessee in computation of income by way of Note No.2 has mentioned that in case interest amount is reduced or withdrawn, subsequently on completion of assessment the interest chargeable to tax for the year should be considered accordingly. Or in alternate the assessee reserve the right to claim interest withdrawn by the Department ....
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....as made by the assessee for earning of exempt income. The Assessing Officer applied rule 8D and made disallowance on account interest expenditure Rs. 43.50 crores. The contention of the assessee is that own funds of the assessee are much more than the investments, hence, no disallowance u/r.8D(2)(ii) is warranted. It is no more res-integra that where the assessee has mixed bag of funds comprising of own interest free funds and borrowed interest bearing funds and if, own interest free funds of the assessee are sufficient to cover the investment made, it shall be presumed that the investments are made by the assessee from available interest free funds.[Re.HDFC Bank Ltd. vs. CIT, 383 ITR 529(Bom)]. The assessee has substantiated availability of own interest free funds in the form of Share Capital and Reserves & Surplus from the Balance Sheet as on 31/03/2008 (at page 32 of Paper Book) and Funds Flow Statement ( page 318 of the Paper Book). In view of the above, disallowance u/r.8D(2)(ii) is directed to be deleted. In respect of disallowance u/s. 8D(2)(iii) the ld.Counsel for the assessee has made two fold submissions. The first submissions of ld.Counsel for the assessee is that the....
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.... pointed that the issue is squarely covered by the decision in the case of CIT vs. Secure Meters Ltd.,321 ITR 611(Raj). The SLP filed by the Department i.e. SLP (C) No. 10548 of 2009 against the said decision was dismissed vide order dated 11/08/2009. The ld.Counsel for the assessee submitted that similar issue was considered by the Tribunal in assessee's own case in Assessment Year 2006-07 in ITA NO.8926/Mum/2010. The Tribunal vide order dated 28/01/2019 allowed the expenditure. The ld.Counsel for the assessee further submitted that without prejudice to the primary submission the Authorities Below have erred in not appreciating the fact that FCCN was never converted into shares and the debt was repaid on maturity. It was further submitted that FCCN were convertible to shares, at the option of the holder. 28. Per contra, the ld. Departmental Representative strongly supporting the findings of the Assessing Officer submitted that the Special Bench in the case of Ashima Syntex Ltd. vs. ACIT, 100 ITD 247 has held that the expenditure incurred on issuance of convertible debentures is not allowable as revenue expenditure. 29. We have heard the submissions made by rival sides. W....
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....d. The TPO observed that in some of the cases sales made to AEs by the assessee were at a rate much less (i.e. below 5% tolerance price) than those charged from Non-AEs and accordingly, the TPO made adjustment in respect of such transactions. The TPO specifically pointed two instances: Instance One: (Product 207 Di31) (i) Third Party price (Non-AEs) - Rs. 2,72,670/- (ii) Price sold to AEs - Rs. 2,57,861/- (iii) Adjustment for difference in price in respect of 12 Units - Rs. 1,77,714/- Instance Two: (Product 207-4x4 -483) (i) Third Party price(Non-AEs) - Rs. 4,53,915/- (ii) Price sold to AEs: No. Units Average price 1. Tata Africa Holdings (Ghana) Ltd. 280 400228 1,50,32,445 2. Tata De Mozambique Limited 25 415942 9,49,325 3. Tata Africa Holdings (Tanzania) Ltd. 25 417218 9,17,425 4.Tata Zambia Ltd. 6 416953 2,21,774 (iii) Adjustment made - Rs. 1,71,20,979/- The ld.Counsel for the assessee submits that the TPO has cherry picked only one transaction to make adjustment. Th....
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.... 284,434,887 304,633 Tata Africa Holdings (Kenya) Ltd. 77 20,403,534 264,981 Tata Africa Holdings (Tanzania) Ltd. 78 20,474,178 262,489 Tata Uganda Ltd. 12 3,904,326 257,861 Tata Zambia Ltd 22 5,768,425 262,201 Total 1,103 328,175,350 297,530 Average sales price per unit 297,530 Comparable transaction (Non-AE) Nitol Motors Ltd. 73 19,904,907 272,670 Diesel& Motor Engine 868 220,771,761 254,345 Total 941 240,676,668 255,767 Average sales price per unit 255,767 The TPO in respect of product 207-D-31 picked the transaction with one AE i.e. Tata Uganda Ltd. having average FOB of Rs. 257,861 and compared it to a transaction with non-AE Nitol Motors Ltd. with an average FOB of 272670. The Assessing Officer /TPO while cherry picking transactions with AE turn blind eye to the other transactions with Non-AE, where the average FOB is lower and number....
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....tions, the adjustment made in respect of export of vehicles deserves to be deleted. Hence, ground No.8 of appeal is allowed. Ground No. 10: Adjustment u/s.92CA(3) of the Act in respect of transaction with Hispano Carrocera, S.A (in short 'Hispano') : 35. In ground No.9 to 13 of appeal, the assessee has assailed adjustment made by TPO in respect of international transactions between the assessee and Hispano. In ground No.10. the assessee has claimed that since, Hispano is not an Associated Enterprise(AE) within the meaning of section 92A of the Act, no adjustment could have been made by the TPO on the issues assailed in ground No.9, 11, 12 and 13. Therefore, before we advert to decide the issue raised in ground No. 9, 11 to 13, we thought fit to first adjudicate the issue, Whether Hispano is an AE of the assessee? The ld.Counsel for the assessee at the outset submitted that Hispano is not an AE of the assessee. Once it is established that Hispano is not AE, there is no question of making any adjustment on account of any transaction between assessee and the AE, therefore, Ground No. 9, 11, 12 & 13 would become academic. 36. The ld. Departmental Representative submitted that ....
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....ee has disclosed the name of Hispano Carrocera -S.A at Sl.No.7 in Annexure -I and against the column nature of relationship with AE it is mentioned "Direct/Indirect participation in capital, control and management". Thus, in view of self declaration made by the assessee in Form-3CEB there is no element of doubt that Hispano is an AE of assessee. Hence, ground No.10 of appeal is dismissed. Ground No.9 : Adjustment u/s. 92CA(3) of the Act in respect of interest on loans granted to AE- Rs. 79,91,563/- : 39. The assessee has advanced loans to its AEs i.e. Tata Motor European Technical Centre PLC (TMETC), UK, Tata Precision Industries PTE Ltd., Singapore(TPI) and Hispano Carrocera, Spain. The assessee has received interest of Rs. 5,63,46,328/- on the aforesaid loans advanced to its AEs. The rate of interest charged by the assessee from its AEs is as under: TMETC, UK @ 3months GBP Libor + 0.5%. TPI, Singapore @3 months Sibor + 0.5%. Hispano, Spain @12 months Euribo + 1.25% The TPO did not accept the rate of interest charged by the assessee from its AEs. The TPO held that the assessee has borrowed funds in the domestic market at the rate ranging from 6% per annu....
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....bor + 12.5% (Effective = 5.575) European Central Bank (ECB) Interest Rate - 5.00% Tata Motors European Technical Centre GBP 1000000 3 months GBP Libor 0.5% (Effective = 7.54%) Average interest Rate in UK-4.50% Third Party borrowing rate of LIBOR plus 0.3% Tata Precision Industries Ltd. SGD 2500000 3 months Sibor + spread (Effective = 3.81%) Singapore Inter Bank Offered Rate ('SIBOR') - 2.69% The assessee has also brought to our attention table at page -16 of the assessment order indicating contracted rate, the base Libor/Euribor rates and the rate applied by the DRP. The assessee has also referred to effective base rates as per European Central Bank at page 303 of the paper book. From perusal of aforesaid table prima facie it appears that the rates charged by the assessee from its AEs is higher than the base LIBOR/EURIBOR rates. Similar adjustments were made by the TPO in the preceding Assessment Years, the DRP restricted the rate of interest to LIBOR + 200bps. The Tribunal in Assessment Year 2007-08 deleted the adjustment and restored the issue back to the file of Assessing Officer to re-adjudicate the issue after considering submissions of the assess....
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....er book. The TPO rejected valuation report stating it to be not reliable and adopted Insurable Value of the property Euro 12.99 million stated in the valuation certificate. Thus, the TPO made adjustment of Rs. 76,00,29,744/- (Rs.160,07,98,815 - Rs. 84,07,69,071/-). The DRP rejected assessee's objections against the aforesaid adjustment. 44. The ld.Counsel for the assessee assailing the findings of the TPO and the DRP submitted that the assessee purchased the property comprising of land and building from Hispano for Euro 24.7 million. Referring to the valuation report he pointed that the value of land alone is Euro 17.58 million, in addition the value of building/projections as per the valuation report is Euro 7.15 million. The primary reason for rejecting the valuation report by the TPO is that Valuer did not have any comparable instances to value the property and he did not deduct value of encumbrances. Thus, the value of property is overstated. The ld.Counsel for the assessee referring to the submissions made before the TPO in respect of land and building purchased from Hispano pointed that the assessee had furnished quarterly report on value of construction cost and various t....
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.... TPO adopted insured value. 46. We have heard the submissions made by rival sides. The TPO made adjustment in respect of the land and building purchased by the assessee from HC on the ground that the assessee has over paid the real value of property. As against book value of property at Euro 9.95 million, the assessee has made a purchase agreement with Hispano on 28/03/2008 for purchase of plot of land along with constructed structure thereon for a consideration of Euro 2,47,40,014. The value of aforesaid property has been arrived at on the basis of valuation certificate from an independent valuer. The valuation certificate is at page 540 of the paper book. A perusal of the said certificate reveals that the value of land is Euro17.587 million and the value of projections/constructed area is Euro 7.152 millions. The insured value of the property is 12.99 millions. The valuer has categorically stated in the report that the value of encumbrances, taxes and possible hidden defects will have to be deducted from the value determined. The valuer has further referred to the encumbrances on the property, the value of which has to be deducted from the total value of the property. Thus, it....
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....of property value as the ALP. The ld.Counsel for the assessee referred to the Lease Agreement of the premises dated 28/03/2008 at page 531 of the paper book. The recitals of Lease Agreement show that the property has been leased out on monthly rent of Euro 80,000, excluding Value Added Tax charged by the State. The said rent has been calculated at Euro rate of 4% in accordance with stringent market conditions. Thus, in view of specific clause of rent in the lease agreement we observe that the findings of the TPO on this issue are contrary to the facts on record. Hence, the adjustment made on account of notional rent @10% of value of property is unsustainable, accordingly, we direct the TPO/Assessing Officer to delete the same. In the result, ground No.13 of appeal is allowed. Ground No.14 - Short TDS credit of Rs. 2,94,05,368/- : 49. The ld.Counsel for the assessee submits that the Assessing Officer has erred in granting short credit of TDS by Rs. 2.94 crores. The Assessing Officer is directed to examine TDS in the case of assessee during the relevant period and allow the credit of short amount, if any, in accordance with law. Thus, ground No.14 of appeal is allowed for stati....
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....nd is admitted for adjudication. 53. The only basis for raising the additional ground by the assessee is the decision of Madras High Court in the case of Vedanta Limited (supra). The Co- ordinate Bench in the case of Lanxess India (P) Ltd. Vs. ACIT, 142 taxamann.com 542 (Mum-Trib) after considering the decision rendered in the case of Vedanta Limited (supra) dismissed similar ground by observing as under:- "8.7 We find that both, the Division Bench of the Hon'ble Andhra Pradesh High Court and Single Bench of the Hon'ble Madras High Court in the case of Vedanta Ltd., has given contrary finding and so the issue before us is which findings should be followed. We find that there is no decision on the issue of the jurisdictional High Court. The judicial discipline demand that decision of the higher forum should be followed. Since the decision of the Hon'ble Andhra Pradesh High Court is of the division bench whereas the decision of the Hon'ble Madras High Court in the case of Vedanta Ltd. (supra) is of the single bench, and therefore we are inclined to follow the decision of the Hon'ble Andhra Pradesh High Court in the case of Zuari Cement Ltd. (supra), wh....
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....was) in Dr. K.C. Nambiar v. State of Madras AIR 1953 Mad. 351, which were approved by a Full Bench of our High Court in M. Subbarayudu v. State AIR 1955 Andhra 87... A single Judge is bound by a decision of a Division Bench exercising appellate jurisdiction. If there is a conflict of Bench decisions, he should refer the case to a Bench of two Judges who may refer it to a Full Bench. A single Judge cannot differ from a Divisional Bench unless a Full Bench or the Supreme Court overruled that decision specifically or laid down a different law on the same point". Of course, as we have already noticed in our discussions earlier, so far as Hon'ble High Courts are concerned, the decisions of one of the Hon'ble High Court do not bind the other High Court, and all the Hon'ble High Courts being in the same tier of judicial hierarchy, it is not the call of judicial discipline either that one High Court follows the other High Court. What is undisputed, however, is the fact that a full bench decision is to be placed at a level higher than a division bench decision and that a division bench decision from the same forum, is to be placed at a level above the single judge bench decision forum. Ther....