S. MURALIDHAR, J.

( 1 ) THIS writ petition under Article 226 of the Constitution of India seeks a mandamus to the respondents

"to give appeal effect to the order of the tribunal and grant refund to the petitioner along with interest thereon till the date of grant of refund. "

Background Facts

( 2 ) THE facts leading to the filing of this petition are that the petitioner is a company engaged in the business of manufacture and sale of fast moving consumer products. The petitioner itself did not have any employee other than a Company Secretary. The administrative services relating to marketing, finance, human resource, secretarial services etc. were provided by Glaxo Smith kline Consumer Healthcare Limited ('gskch'), a widely held public limited company.

( 3 ) THE agreement between the GSKCH and the petitioner was that the petitioner would reimburse the costs incurred by GSKCH for providing the various services to the petitioner plus 5% (referred to as "cross charges" ). Since in the said agreement, there was no basis laid down for allocation of costs incurred towards the various services provided to the petitioner, it was decided to engage the services of M/s. Price Waterhouse and Coopers ('pwc'), a leading firm of Chartered Accountants to carry out a study to determine the basis for allocation of costs reimbursable by the petitioner to GSKCH. A Report was submitted by PWC during the month of September 1997 and was made effective from 1. 1. 1997.

( 4 ) IN the previous year pertaining relevant to the Assessment Year ('ay')1998-99, the administrative expenses ("cross charges") were worked out on the basis of the report of PWC. However, the Assessing Officer ('ao') held that the increase in payment of cross charges by the petitioner to GSKCH was not fully and exclusively for the purpose of business of the petitioner and therefore could not be justified in terms of legitimate business requirements of the petitioner. The AO held that the payment of cross charges/administrative expenses to the extent of 7% of net sales alone was justified and disallowed the balance cross charges/administrative expenses. This order of the AO was confirmed by the Commissioner of Income Tax (Appeals) ['cit (A)']. The same approach was adopted by the AO as well as the CIT (A) for the AY 1999-2000 as well.

( 5 ) THE petitioner"s appeal to the Income Tax Appellate Tribunal ('tribunal') was allowed by an order dated 11. 6. 2004 It was found by the tribunal that "there is no provision to disallow any expenditure on the ground that such expenditure is excessive or unreasonable unless the case of the assessee falls within the scope of Section 40a (2 ). It is not the case of the department that provisions of Section 40a (2) are attracted in the present case. There is no material on record to show that such provisions could be attracted. " accordingly, the Tribunal deleted the disallowance made in the AYs 1998-99 and 1999-2000. The consequential appeal filed by the Revenue to this Court was dismissed on 20. 7. 2005. It was held that in view of the clear findings of fact recorded by the Tribunal, there was no substantial question of law involved.

( 6 ) FOR the subsequent AY 2001-02, the AO continued to disallow the cross charges/administrative expenses claimed by the petitioner on the basis of the formula worked by the PWC. By an order dated 16. 2. 2005, the AO raised a demand of Rs. 7,05,04,101. This amount was recovered by attaching the bank accounts of the petitioner on the very next day, i. e. 17. 2. 2005. Against this order dated 17. 2. 2005, the petitioner filed an application before the Tribunal seeking refund of the amount recovered and for a stay of the demand of Rs. 7. 05 crores, pending disposal of appeal by the Tribunal. By an order dated 3. 3. 2005, the tribunal directed the Revenue to refund the amount of Rs. 7,05,04,101 to the petitioner within two weeks from the date of the receipt of the order.

( 7 ) THE order dated 3. 3. 2005 of the Tribunal