Delhi High Court
Pr. Commissioner Of Income Tax-7 vs Rajdarbar Heritage Venture Ltd. ... on 6 October, 2022
$~S-53&54
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 376/2022
PR. COMMISSIONER OF INCOME TAX-7 ..... Appellant
Through: Mr.Puneet Rai, Sr.Standing Counsel
with Ms.Adeeba Mujahid, Jr.Standing
Counsel and Mr.Nikhil Jain,
Advocate.
versus
RAJDARBAR HERITAGE VENTURE LTD. (FORMERLY
KNOWN AS GLOBAL HERITAGE VENTURE LTD.)
..... Respondent
Through: None.
+ ITA 377/2022
PR. COMMISSIONER OF INCOME TAX-7 ..... Appellant
Through: Mr.Puneet Rai, Sr.Standing Counsel
with Ms.Adeeba Mujahid, Jr.Standing
Counsel and Mr.Nikhil Jain,
Advocate.
versus
RAJDARBAR HERITAGE VENTURE LTD. (FORMERLY
KNOWN AS GLOBAL HERITAGE VENTURE LTD.)
..... Respondent
Through: None.
% Date of Decision: 06th October, 2022
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:07.10.2022
20:07:40 ITA 376&377/2022 Page 1 of 4
JUDGMENT
MANMOHAN, J (Oral):
CM APPL.43152/2022 in ITA 376/2022 (Exemption)
CM APPL.43154/2022 in ITA 377/2022 (Exemption)
1. Allowed, subject to all just exceptions.
2. Accordingly, the applications stand disposed of.
CM APPL.43153/2022 in ITA 376/2022
CM APPL.43155/2022 in ITA 377/2022
3. Keeping in view the averments in the applications, the delay in filing
the present appeals is condoned.
4. Accordingly, the applications stand disposed of.
ITA 376/2022
ITA 377/2022
5. Present Income Tax Appeals have been filed challenging the common
Impugned Order dated 5th October, 2020 passed by the Income Tax
Appellate Tribunal ('ITAT') in ITA Nos.262/Agra/2016 and 387/Agra/2017
for the Assessment Years 2012-13 & 2013-14.
6. Learned Counsel for the Appellant states that the ITAT has erred in
deleting the additions of Rs.8,57,25,871/- & Rs.16,15,54,801/- for the
Assessment Years 2012-13 & 2013-14 respectively made by the Assessing
Officer, ignoring the fact that the FDR is in the name of the Assessee and
interest has accrued and been credited in the name of the Assessee only and
the share of the disputed parties in the interest will arise only after payment
of due taxes.
7. Learned counsel for the appellant emphasizes that the dispute between
the parties was with regard to 100 crores, whereas the amount deposited was
in excess of Rs.190 crores. He also states that under the final settlement
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:07.10.2022
agreement dated 20th January, 2015 between the Assessee Company and M/s
Pramerica ASPF II Cyprus Holding Ltd. Assessee Company paid Rs.70
crore to M/s Pramerica ASPF II Cyprus Holding Ltd. from the FDR amount
and that this agreement was accepted by the Delhi High Court Mediation
and Conciliation Centre on 8th April, 2015, pursuant to which a final order
dated 9th April 2015 was passed by this Court.
8. Having perused the paperbook, this Court finds that in the present
cases, the FDRs were made in the name of the respondent-assessee by virtue
of a consensual order dated 7th October, 2021 passed by the Arbitral
Tribunal comprising three retired judges. The relevant portion of the said
order is reproduced hereinbelow:-
"The Ld. Counsel for the parties have agreed and requested for the
following agreement of theirs being taken on record:-
(i) That the amount of Rs.1,90,25,12,694.09 which is lying in
current account with Punjab National Bank in Tribunal's
Bank Account No.2254002100017121 may be converted
into a Fixed Deposit in the name of the Respondent
company i.e. Global Heritage Venture Ltd. The fixed
deposit shall be for a period of 60/61 days. This is being
done solely for the consideration that the amount may earn
interest. The interest would go with the deposit or be
distributed between the parties as the Tribunal may direct.
(ii) That such deposit shall be subject to the following
conditions:-
a) The FDR shall soon on being ready would be
handed over to the Presiding Arbitrator and shall
remain in his custody unless otherwise ordered by
the Tribunal.
b) Though the FDR is in the name of the Respondent
company, but the Bank holding the fixed deposit
shall note that the amount of FDR is not to be
released nor to be made available for 'use in any
manner whatsoever except by prior permission of
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:07.10.2022
the Tribunal or unless otherwise directed by the
Tribunal."
9. Consequently, this Court in agreement with the finding of the two
Appellate Authorities below that till the final award was passed by the
Arbitral Tribunal determining the ownership of the fixed deposits and
interest, it could not be said that the interest income had crystallized in the
respondent's hands and the same cannot be held to be income of the
respondent-assessee under Section 5(1) of the Income Tax Act, 1961 ('the
Act').
10. Accordingly, no substantial question of law arises for consideration in
the present appeals and the same are dismissed.
MANMOHAN, J
MANMEET PRITAM SINGH ARORA, J
OCTOBER 6, 2022
TS
Signature Not Verified
Digitally Signed By:JASWANT
SINGH RAWAT
Signing Date:07.10.2022
