N.R.S. Ganesan, Judicial Member. - All the six appeals of the assessee relate to assessment years 1997-98, 1998-99 and 1999-2000 against the common order passed by CIT(A) confirming the order of the Assessing Officer under section 201(1) and 201(1A) of the Income-tax Act. Since common issue arises for consideration in all the six appeals, we heard the same together and disposing of the same by this common order.

2. Mr. R. Vijayaraghavan, the learned counsel for the assessee submitted that the assessee paid charges to International Airport Authority of India towards landing and parking charges. The learned counsel for the assessee further submitted that the assessee has also paid charges for navigational facilities. However, the assessee has not deducted tax at source before making the payment. According to the learned counsel, the recipient of the amount namely International Airport Authority of India has paid the entire tax due on the amount paid by the assessee. Therefore, the assessee cannot be treated as assessee-in-default under section 201(1) of the Income-tax Act. According to the learned counsel, the Assessing Officer treated the payment made by the assessee towards landing and parking charges as rent and ultimately concluded that the assessee ought to have deducted 20% of the amount paid to International Airport Authority of India as tax at source under section 194-I of the Income-tax Act. Since the assessee has not deducted tax at source before making the payment, the Assessing Officer has also levied interest under section 201(1A) of the Income-tax Act. According to the learned counsel, interest under section 201(1A) could be levied from the date of actual payment of the money till the date of payment of taxes by the International Airport Authority of India. The learned counsel for the assessee further submitted that the very same issue of landing and parking charges to International Airport Authority of India was considered by the Delhi Bench of this Tribunal in the case of Dy. CIT v. Japan Airlines [2005] 92 TTJ 687¹ and submitted that the Tribunal after considering the characteristics of the payment found that the landing and parking charges cannot be construed as payment of rent so as to bring the payment within the purview of section 194-I of the Income-tax Act. The learned counsel for the assessee further submitted that since there was a contract between the assessee and the International Airport Authority of India, the payment of landing and parking charges would be covered under the provisions of section 194C of the Income-tax Act. Therefore, the assessee is liable to deduct tax at source at the rate of 2% and not at the rate of 20%. Since the liability to deduct tax is reduced to the extent of 2% on the amount paid, the interest shall also be computed only on the amount of 2% and not on the amount of 20%. Therefore, according to the learned counsel, in respect of landing and parking charges, the interest has to be levied on the amount of 2% till the taxes are paid by the International Airport Authority of India.

3. Coming to the payment relating to navigational charges, the learned counsel for the assessee submitted that navigational facilities are almost like the services provided by cell phone operators. Since the assessee has availed the navigational facilities by utilizing the equipment installed by the International Airport Authority of India, it does not amount to providing technical services to the assessee. The learned counsel for the assessee further submitted that the Madras High Court in the case of Skycell Communications Ltd. v. Dy. CIT [2001] 251 ITR 53² considered the provisions of cellular mobile telephone facility and it was found that the provision of facility by the cellular mobile companies cannot be construed as offering technical services. Therefore, it was held that deduction of tax at source need not be made from the cell phone subscribers under section 194J. On a specific query from Bench whether the assessee is utilizing the equipments installed by the International Airport Authority of India or getting any other service apart from using the equipments, the learned counsel for the assessee Mr. R. Vijayaraghavan very fairly conceded that the assessee apart from using equipments for navigation, also getting other technical services for which the payments were made. According to the learned counsel, the technical services are like getting weather report, instruction to over flights to fly over Indian territories, such other technical services which are needed to fly the aircraft on the Indian territory. The learned counsel for the assessee Mr. R. Vijayaraghavan clarified that the navigational facilities are not just like using the cell phone subscribers, the sophisticated equipments installed by cell phone companies for the purpose of communication. Therefore, he very fairly conceded the judgment of the Madras High Court in the case of Skycell Communications Ltd. (supra) may not be applicable to the facilities and technical services offered by International Airport Authority of India to the assessee-company.

4. Regarding the levy of interest under section 201(1A), the learned counsel for the assessee submitted that the interest could be levied till the tax due has been paid either by the assessee or by the recipient of the amount. The Assessing Officer, however, levied interest till October, 1999 by which time the recipient International Airport Authority of India had paid all the taxes on the income. The learned counsel placed his reliance on the CBDT Circular in F. No. 275/201/95-IT (B), dated 29-1-1997 and submitted that according to this circular once tax has been paid by the recipient, tax under section 201(1) need not be recovered and interest under section 201(1A) has to be collected till the tax due has been paid. According to the learned counsel, the Assessing Officer by an order of rectification under section 154 cancelled the levy of tax under section 201(1) and levied interest under section 201(1A) till the end of the relevant previous year. However, the first Appellate Authority held that the Assessing Officer cannot reduce the interest under section 201(1A) in an order of rectification and restore the original levy of interest. The learned counsel placed his reliance on the order of this Tribunal in the case of Chennai Metropolitan Water Supply & Sewerage Board v. ITO [I.T. Appeal No. 2232 (Mad.) of 2003 and submitted that the interest cannot be levied once the entire tax was paid by the recipient. The learned counsel for the assessee also placed his reliance on the judgment of the Gujarat High Court in the case of Commissioner Of Income-Tax v. Rishikesh Apartments Co-Operative Housing Society Ltd. [2002] 253 ITR 310¹ and submitted that once the recipient paid the advance tax and tax on self-assessment, the interest cannot be levied under section 201(1A) of the Act.

5. On the contrary, Mr. K. Srinivasan, the learned Departmental Represen-tative (D.R.) submitted that the assessee is a foreign company operating airlines in India. In the course of its business, the assessee paid landing and parking charges and also charges for navigational facilities to International Airport Authority of India. According to the learned D.R., landing and parking charges are nothing but rent, therefore, the provisions of section 194-I would be squarely applicable. Therefore, according to the learned D.R., the assessee ought to have deducted 20% of the amount paid to International Airport Authority of India as tax at source. Moreover, the amount paid for getting navigational facilities has to be treated as fees paid on technical services. Therefore, the assessee has to deduct tax at source at the time of making payment under section 194J.

6. Coming to the levy of interest under section 201(1A), the learned D.R. submitted that since the assessee has not deducted tax at source either under section 194-I in respect of landing and parking charges or under section 194J in respect of navigational charges, the Assessing Officer rightly levied tax till the month of October 1999.

7. We have considered the rival submissions on either side, and also perused the material available on record. The first issue is regarding the liability of the assessee for deduction of tax at source with respect to payment for landing and parking facilities. The only contention of the Revenue is that the landing and parking facilities provided by International Airport Authority of India is in the nature of providing a space for rent, therefore, the payment has to be treated as payment of rent. This issue has been elaborately discussed by the Delhi Bench of this Tribunal in the case of Japan Airlines ( supra). After considering the entire factual situation in the case of landing and parking of aircraft in the airport, a co-ordinate Bench of this Tribunal in the case of Japan Airlines (supra), came to a conclusion that the International Airport Authority of India never intended to give out exclusive possession of any part of the landed property in relation to landing and parking area. Since the International Airport Authority of India granted permission for landing and parking without providing any exclusive right or interest in any specific portion of the land, the payment made by airline company cannot be construed as payment of rent. Therefore, the co-ordinate Bench of this Tribunal came to the conclusion that section 194-I is not applicable with regard to payment of landing and parking charges. However, the Delhi Bench of this Tribunal found that the payment attracts the provisions of section 194C since there was a contract between the assessee-company and the International Airport Authority of India. Therefore, the assessee is liable to deduct tax at the rate of 2%. By following the decision of Delhi Bench of this Tribunal in the case of Japan Airlines (supra) and for the very same reasons stated therein, we hold that the payment of landing and parking charges cannot be termed as payment of rent. Therefore, the provisions of section 194-I is not attract. As held by the Delhi Bench of this Tribunal, the payment attracts the provisions of section 194C. Therefore, the assessee is liable to deduct tax at the rate of 2%.

8. With regard to the navigational facilities, the learned counsel for the assessee, during the course of hearing, very fairly conceded that it is not a mere utilisation of equipments installed by the International Airport Authority of India. The assessee is in fact getting technical service which is required for flying the aircraft over the Indian territory. The learned representative also very fairly conceded that the judgment of the Madras High Court in the case of Skycell Communications Ltd. (supra) may not be applicable to the factual situation of this case. In view of the above clarification made by the learned counsel for the assessee that the assessee was in fact getting technical services apart from using the equipments for the purpose of communication between the aircraft and the air traffic controller, in our opinion, the provisions of section 194J would be applicable. Accordingly the assessee ought to have deducted tax as provided under section 194J in respect of payment made for navigational facility.

9. Now coming to the application of section 201(1) and 201(1A), admittedly, the assessee failed to deduct tax at source and it is also an admitted fact that the International Airport Authority of India had paid taxes on the amount received from the assessee-company also. Hence, in our opinion, the assessee need not be treated as assessee-in-default. Under the scheme of the Income-tax Act, the deduction of tax at source is only to ensure collection of tax on behalf of Government. Once the recipient paid the tax, the purpose or object sought to be achieved under the scheme of the Act is achieved. Therefore, the tax need not be once again recovered from the assessee. The question of declaring the assessee as assessee-in-default would arise when the recipient failed to pay the tax. Since the recipient company, admittedly, paid the tax, in our opinion, any further recovery from assessee would amount to double taxation which is not permissible under the Act. Accordingly, we hold that there is no justification to treat the assessee as assessee-in-default. When the Assessing Officer himself revised the order by making a rectification under section 154, in our opinion, there is no justification on the part of the first Appellate Authority to restore the original order with respect to section 201(1).

10. Now coming to levy of interest, the Department is entitled to recover the interest on the amount of tax from the date on which such tax was deductible till the tax was actually paid. In this case, it is an admitted case of both parties that the tax was paid by the International Airport Authority of India in respect of amount paid by the assessee. Therefore, at best the assessee may liable to pay interest till the date on which the International Airport Authority of India paid the taxes in respect of the amount received from the assessee.

11. We have also carefully gone through the judgment of the Gujarat High Court in the case of Rishikesh Apartments Co-operative Housing Society Ltd. (supra). The Gujarat High Court held that if the Revenue is permitted to levy interest under section 201(1A) of the Act even in a case where the person liable to pay tax has paid the tax on the date due for the tax the Revenue would derive undue benefit or advantage by getting interest on the amount of tax which had already been paid on the due date. According to the Gujarat High Court, such a position cannot be permitted. The CBDT has also clarified in the circular (supra) that interest has to be recovered till the taxes are paid. In view of the above, we do not find any justification for levying tax till the month of October 1999. Since the actual date of payment of tax by the International Airport Authority of India is not available on the file of this Tribunal, the Assessing Officer may verify the actual date on which the taxes were paid by International Airport Authority of India and thereafter compute the interest from the date on which the deduction has to be made till the date of actual payment at the rate applicable as per the statutory provision.

12. In the result, the order of the lower authority is set aside with regard to treating the assessee as assessee-in-default under section 201(1) and levying interest under section 201(1A). The issue of levy of interest under section 201(1A) is remitted back to the file of the Assessing Officer. The Assessing Officer shall recompute the interest on the amount of tax as per the order of this Tribunal from the date on which deduction has to be made till the date of actual payment of tax by International Airport Authority of India after giving sufficient opportunity to the assessee in accordance with law.

13. In the result, all the appeals filed by the assessee are partly allowed. However, there will be no order as to cost.