M/S RAGHU EXPORTS INDIA P. LTD THRH PARVEEN KUM. vs. COMMISSIONER OF INCOME TAX-1, JALANDHAR

ITA/37/2012HC Punjab & HaryanaPHHC01099400201226 July 2012Author: MR. JUSTICE AJAY KUMAR MITTAL,MR. JUSTICE GURMEET SINGH SANDHAWALIA4 pages
AI SummaryRemanded

What were the facts?

The assessee, M/s Raghu Exports India P. Ltd., filed an appeal before the Punjab and Haryana High Court against an order dated December 24, 2010, passed by the Income Tax Appellate Tribunal (ITAT), Amritsar Bench. The appeal pertained to assessment year 2004-05. The ITAT had dismissed the assessee's appeal, reversing its own earlier order. The assessee contended that the ITAT had failed to consider arguments and had wrongly followed a Special Bench decision of the Mumbai ITAT in the case of M/s Topman, and a judgment of the Bombay High Court, without allowing proper arguments. The assessee argued that the High Court's own earlier order, which had set aside the matter to the ITAT, was not fully appreciated by the ITAT.

What did the High Court hold?

The High Court allowed the appeal. It noted that the assessee's counsel contended that the issue was no longer res integra and was covered by the Supreme Court judgment in M/s Topman Exports and this Court's judgment in M/s Turbo Impex. The revenue's counsel could not controvert this submission. Accordingly, the High Court allowed the appeal, set aside the impugned ITAT order dated December 24, 2010, and remanded the matter back to the Assessing Officer. The Assessing Officer was directed to compute the deduction under Section 80HHC of the Act in accordance with law and in light of the Supreme Court's judgment in M/s Topman Exports. The High Court did not expressly leave any issue undecided, but the remand implies a fresh determination by the Assessing Officer.

What were the issues?

1. Whether the ITAT was justified in dismissing the assessee's appeal and reversing its earlier order by blindly following the Special Bench of Mumbai ITAT in M/s Topman and the Bombay High Court's judgment, without considering arguments or allowing rebuttal, violating principles of law and natural justice? (Relates to procedural fairness and application of precedents). 2. Whether the ITAT was justified in dismissing the appeal by observing that the Punjab and Haryana High Court had agreed with the Bombay High Court, without properly appreciating that the High Court's earlier order had only agreed in part and remanded the issue of the value of DBK, DEPB, and DFRC to the ITAT for fresh decision? (Relates to the scope of High Court's earlier remand order and ITAT's jurisdiction). 3. Whether the ITAT was justified in dismissing the appeal without allowing arguments, erroneously holding that the High Court's agreement with the Bombay High Court left no scope for the ITAT to consider arguments, which is against principles of law and natural justice, given the High Court's earlier remand? (Similar to issue 1, emphasizing procedural fairness and the effect of the remand). 4. Alternatively, whether the ITAT was justified in concurring with the Bombay High Court that the entirety of the sale consideration of DEPB falls within Section 28(iiid) without reducing its face value from the total sale consideration for arriving at profits on transfer? (Relates to the computation of income under Section 28(iiid)). 5. Whether the orders of the ITAT are legally unsustainable, bad in law, and perverse? (A general question on the validity of the ITAT's order). Assessee's Contentions: The matter is covered by the Apex Court judgment in M/s Topman Exports v. CIT and this Court's judgment in M/s Turbo Impex v. CIT. The substantial questions of law should be answered in terms of these judgments. Revenue's Contentions: The revenue's counsel could not controvert the submissions made by the assessee's counsel, acknowledging that the issue was concluded by the cited judgments.

Which sections of the Income-tax Act were involved?

Section 260A,Section 80HHC,Section 28(iiid)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 37 of 2012 (O&M) Date of Decision: July 26, 2012 M/s Raghu Exports India P. Ltd. …Appellant Versus Commissioner of Income Tax-I, Jalandhar …Respondent CORAM: HON’BLE MR. JUSTICE AJAY KUMAR MITTAL HON’BLE MR. JUSTICE G.S. SANDHAWALIA Present: Mr. Rajiv Sharma, Advocate, for Mr. S.K. Mukhi, Advocate, for the appellant-assessee. Mr. Vivek Sethi, Sr. Standing Counsel, for the respondent-revenue. AJAY KUMAR MITTAL, J.

1.

This appeal has been filed by the assessee under Section 260A of the Income Tax Act, 1961 (for brevity, ‘the Act’), against the order dated 24.12.2010 (Annexure A-6) passed by the Income Tax Appellate Tribunal, Amritsar Bench (for brevity, ‘the Tribunal’) in ITA No. 54 (ASR) 2009, for the assessment year 2004-05, claiming the following questions of law:- “i. Whether ITAT was justified in dismissing the appeal of the appellant and thereby reversing its own earlier order by following the judgment of Special Bench of Mumbai ITAT in the case of M/s Topman by blindly following and confirming the judgment of Hon’ble Bombay High Court without considering or even allowing the counsels to argue and rebut the ITA No.

The order continues below.

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