PR. COMMISSIONER OF INCOME TAX, PANCHKULA vs. MS. RAJINDER KAUR, R/O HOUSE NO. 133, SECTOR-6, PANCHKULA

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ITA/336/2017HC Punjab & HaryanaPHHC01117543201725 March 2019Author: MR. JUSTICE AJAY KUMAR MITTAL,MRS. JUSTICE MANJARI NEHRU KAUL3 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court dismissed the appeal as withdrawn, with liberty granted to the revenue to file an application for revival of the appeal if something survives. The Court clarified that the withdrawal by the revenue would not be considered an affirmation of the ITAT's order on merits. The legal issues raised by the revenue were expressly left open to be adjudicated in an appropriate case. The revised tax effect of ₹44,67,837 was noted, which was below the threshold specified in CBDT Circular No. 03/2018, prompting the revenue's decision to withdraw.

What were the facts?

The appeal was filed by the Principal Commissioner of Income Tax, Panchkula (revenue) against an order dated 21.12.2016 passed by the Income Tax Appellate Tribunal (ITAT), Chandigarh Bench, for the assessment year 2008-09. The ITAT's order was in favour of the assessee, Rajinder Kaur. The tax effect initially stated was ₹53,56,436. However, an application under Section 154 of the Income Tax Act, 1961, led to a revised tax effect of ₹44,67,837. The revenue sought to withdraw the appeal based on Circular No. 03/2018 of the CBDT, as the revised tax effect was below the threshold for filing appeals.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in holding the proceedings under Section 147 of the Income Tax Act, 1961, as bad in law due to lack of tangible material, ignoring that the same value was used for calculating capital gains in the case of a co-owner? (Assessee's contention not recorded; Revenue's contention: ITAT erred by not considering the co-owner's valuation). 2. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in holding that no reopening can be made merely on the basis of a DVO's report, when no such reference was made in the reasons recorded, and the assessment in the co-owner's case for the same assessment year was processed on the same value for determining the taxability of the assessee's share? (Assessee's contention not recorded; Revenue's contention: ITAT erred by disregarding the DVO report and the co-owner's assessment). 3. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in accepting the appeal of the assessee, ignoring that the assessee participated in the proceedings without challenging the reopening, the DVO's report, and the valuation adopted in the co-owner's case? (Assessee's contention not recorded; Revenue's contention: Assessee waived objection by participating). 4. Whether, on the facts and in the circumstances of the case, the order passed by the ITAT is perverse and against law, as it overlooked the scheme of the Income Tax Act, 1961, and material on record? (Assessee's contention not recorded; Revenue's contention: ITAT's order is legally flawed and factually incorrect).

Which sections of the Income-tax Act were involved?

Section 260A,Section 147,Section 154

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 222 ITA-336-2017 (O&M) Date of decision : 25.03.2019 CORAM: HON'BLE MR. JUSTICE AJAY KUMAR MITTAL HON'BLE MR. JUSTICE MANJARI NEHRU KAUL Present:- Mr.Yogesh Putney, Senior Standing Counsel for the appellant. Mr. Rohit Kaura, Advocate for Mr. Deepak Gupta, Advocate for the respondent. *** AJAY KUMAR MITTAL, J. (Oral) The present appeal has been filed by the revenue under Section 260A of the Income Tax Act, 1961 (for short, 'the Act') against the order dated 21.12.2016 passed by the Income Tax Appellate Tribunal, Chandigarh Bench, in ITA No.765/CHD/2015 for the assessment year 2008-09, claiming the following substantial questions of law :- (i)Whether on the facts and in the circumstances of the case the Ld. ITAT is right in law in holding the proceedings under Section 147 of the Income Tax Act, 1961 as bad in law based on the premise that there was no tangible material available on record to justify reopening of the assessment ignoring the aspect that the same value in the case of co-owner was taken -38- ANJU 2019.03.29 10:21 I attest to the accuracy and integrity of this document phhc

ITA-336-2017 (O&M) -2- for the purpose of calculating the capital gains? (iii) Whether on the facts and in the circumstances of the case the Ld. ITAT is right in law in holding that no reopening can be made merely on the basis of valuation report of the DVO, whereas there is no such reference to the report of the DVO in the reasons recorded on 26.03.2013 after framing the assessment in the case of co-owner for the same Assessment year on 25.03.2013, on the same value, the processing of the assessment being for the purpose of determining the issue of taxability on the share of the Assessee? (iv)Whether on the facts and in the circumstances of the case the Ld. ITAT is right in law in accepting the Appeal of the Assessee ignoring the material aspect that the Assessee participated in proceedings without challenging the Reopening, Report of the DVO and the Valuation adopted in the case of the Co-owner? (v) Whether on the facts and in the circumstances of the case, the order passed by the Ld. Income Tax Appellate Tribunal is perverse in nature and against law as it grossly overlooked the scheme of the Income Tax Act, 1961 and material available on record?

2.

At the outset learned counsel for the respondent submits that the tax effect involved in this appeal is `53,56,436/-. However during the pendency of the appeal, the assessee moved an application under Section 154 of the Act before Assessing Officer and the order dated 28.01.2019 has -39- ANJU 2019.03.29 10:21 I attest to the accuracy and integrity of this document phhc

ITA-336-2017 (O&M) -3- been passed wherein the total tax effect has been determined at `44,67,837/-. A copy of the order passed under Section 154 of the Act has been produced in Court and the same is taken on record.

3.

The said fact is not disputed by learned counsel for the appellant who has filed a copy of letter received from the Income Tax Department, Aayakar Bhawan, Panchkula showing that the tax effect is less than `50,000,00/-.

4.

Learned counsel for the appellant-revenue states that since the tax effect involved is `44,67,837/-, he has instructions to withdraw the present appeal in view of circular No.03/2018, dated 11.07.2018 issued by ITA-178-2016 Board of Direct Taxes, New Delhi. However, he has prayed that liberty be granted to the revenue to file an application for revival of the appeal, in case something survives therein.

5.

Dismissed as withdrawn with liberty as prayed for. It is, however, clarified that withdrawal of the appeal by the revenue shall not be taken to be affirmation of order of the Tribunal on merits. Further, the legal issue as claimed by the revenue is being left open to be adjudicated in an appropriate case. (AJAY KUMAR MITTAL) JUDGE

(MANJARI NEHRU KAUL ) 25.03.2019 JUDGE anju Whether speaking/reasoned? Yes/No Whether reportable? Yes/No -40- ANJU 2019.03.29 10:21 I attest to the accuracy and integrity of this document phhc

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