C I T JAIPUR vs. THE SOLUTION

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ITA/80/2012HC RajasthanRJHC02067667201218 September 20172 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the Tribunal ought to have considered the factual matrix and verified whether the tax due on the returned income had been paid by the assessee. The Tribunal's decision to allow the appeal was based on a provision that was in force prior to an amendment, without this crucial verification. The Court found that the amendment to Section 249(4) of the Income Tax Act, 1961, which came into force, needed to be considered. Therefore, the High Court remitted the matter back to the Tribunal to decide the issues afresh after considering the factual aspects and the amended provisions. The Court explicitly stated that both issues were answered in favour of the department. The judgment also clarified that if an assessment order is passed after the remand, it will not be disturbed. The appeal was allowed to the extent of remanding the matter for fresh adjudication.

What were the facts?

The appellant, Commissioner of Income Tax, Jaipur-II, challenged an order of the Income Tax Appellate Tribunal (ITAT) that remanded the matter back to the Assessing Officer without deciding on the merits. The assessee is 'The Solution'. The appeal before the High Court concerns the maintainability of the assessee's appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. The core issue revolves around whether the assessee had paid the tax due on the returned income at the time of filing the appeal before the CIT(A), and the applicability of the amended proviso to Section 249(4) of the Income Tax Act, 1961.

What were the issues?

The High Court framed two substantial questions of law: 1. Whether the ITAT was justified in holding that the appeal filed by the respondent-assessee before the CIT(A) was maintainable without considering the effect and import of the amendment to the proviso to Section 249(4) of the Income Tax Act, 1961, effective from 01.04.1989? 2. Whether, at the time of filing the appeal before the CIT(A), the assessee had not paid the tax due on the income returned by him, and consequently, the CIT(A) had rightly declined to entertain the appeal for non-compliance with Section 249(4)(a) of the Income Tax Act, 1961? The revenue (appellant) contended that the Tribunal ought to have considered the factual matrix and verified whether the tax had been paid. The revenue argued that the Tribunal allowed the appeal relying on a provision that was prior to an amendment, without verifying the factual compliance. The judgment does not record any specific contentions from the respondent-assessee.

Which sections of the Income-tax Act were involved?

Section 249(4),Section 148(9)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 80 / 2012 COMMISSIONER OF INCOME TAX, JAIPUR-II ,JAIPUR ----Appellant Versus THE SOLUTION , 77 , DEVI PATH, TAKHTE SHAHI ROAD, JAIPUR ----Respondent _____________________________________________________ For Appellant(s) : Mr. R.B. Mathur with Mr. K.D. Mathur For Respondent(s) : _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE VIJAY KUMAR VYAS

Order 18/09/2017

1.

By way of this appeal, the appellant has assailed the judgment and order of the Tribunal whereby the Tribunal has remanded back the matter without going into merits.

2.

This Court while admitting the matter framed the following substantial questions of law:- “i) Whether on the facts and in circumstances of the case, the ITAT was justified in law in holding that the appeal filed by the respondent- assessee before the CIT(A) was maintainable without considering the effect and import of the amendment to the proviso to Section 249(4) of the Income Tax Act, 1961 w.e.f. 01.04.1989? ii) Whether at the time of filing the appeal before the CIT(A), the assessee had not paid the tax due on the income returned by him and hence, the CIT(A) had rightly declined to entertain the appeal as not maintainable for want of compliance of the provisions of Section (2 of 2) [ITA-80/2012] 249(4)(a) of the Income Tax Act, 1961. 3. Taking into consideration, the contention raised by Mr. Mathur which is required to be accepted that while considering Section 249(4), the Tribunal ought to have considered the factual matrix and should have verified tax whether it has been paid or not. Without verifying the same relying on the provision which was prior to amendment in Section 148(9), the appeal was allowed.

4.

In that view of the matter, after amendment the view is required to be considered by the Tribunal since the amendment come into force under Section 148(9) and for this purpose the matter is remitted back to the Tribunal to decide the same afresh.

5.

In view of the above, both the issues are answered in favour of the department.

6.

It is made clear that after the remand if the assessment order is passed it will not be disturbed.

7.

The appeal is allowed to the extent aforesaid. (VIJAY KUMAR VYAS),J. (K.S. JHAVERI),J. A.Sharma/25

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