THE COMMISSIONER OF INCOME TAX vs. THE PERIA KARAMALI TEA & PRODUCE CO.LTD.

ITA/179/2009HC KeralaKLHC01024940200924 May 2016Author: HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU,HONOURABLE MR.JUSTICE ANTONY DOMINIC4 pages
AI SummaryAllowed

What were the facts?

The Revenue, Commissioner of Income Tax, Coimbatore, filed three appeals (ITA Nos. 179, 193, and 247 of 2009) before the High Court of Kerala. These appeals challenged orders passed by the Income Tax Appellate Tribunal (ITAT), Cochin Bench, for assessment years 1987-88, 1988-89, and 1989-90. The ITAT had decided the issues in favour of the assessee, The Periakaramalai Tea & Produce Co. Ltd., Coimbatore. The ITAT's decision was based on a Division Bench judgment of the High Court in Commissioner of Income Tax v. Kothagiri Tea and Coffee Estate Co. Ltd. [(2005) 273 ITR 278]. The appeals were heard along with other related matters.

What did the High Court hold?

The High Court held that the issues raised in the appeals were covered by a Full Bench judgment of the Court in Parry Agro Industries Ltd. v. Commissioner of Income Tax [(2006) 285 ITR 440]. This Full Bench judgment had reversed the Division Bench judgment in Commissioner of Income Tax v. Kothagiri Tea and Coffee Estate Co. Ltd. [(2005) 273 ITR 278], which the ITAT had relied upon. Consequently, the High Court answered the questions of law in favour of the Revenue. The impugned orders of the ITAT were set aside. The appeals filed by the Revenue were allowed.

What were the issues?

1. Whether the Income Tax Appellate Tribunal erred in deciding the issue in favour of the assessee, following the Division Bench judgment of this Court in Commissioner of Income Tax v. Kothagiri Tea and Coffee Estate Co. Ltd. [(2005) 273 ITR 278]? (Question of law) The Revenue contended that the ITAT's decision was flawed because it relied on a judgment that was subsequently reversed by a Full Bench of the High Court. The Revenue argued that the Full Bench judgment in Parry Agro Industries Ltd. v. Commissioner of Income Tax [(2006) 285 ITR 440] should be applied, which overturned the earlier Division Bench ruling. The assessee's arguments are not explicitly recorded in the judgment, but their position was that the ITAT's order, based on the Division Bench ruling, was correct at the time it was passed.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE ANTONY DOMINIC & THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU TUE AY, THE 24TH DAY OF MAY 2016/3RD JYAISHTA, 1938 ITA.No. 179 of 2009 ( ) ------------------------ AGAINST THE ORDER/JUDGMENT IN ITA 380/COCH/1991 of I.T.A.TRIBUNAL,COCHIN BENCH DATED 27-06-2003 APPELLANT(S)/RESPONDENT: ------------ THE COMMISSIONER OF INCOME TAX, COIMBATORE.

BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT(S)/APPELLANT: -------------- THE PERIAKARAMALAI TEA & PRODUCE CO. LTD., COIMBATORE.

THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 24-05-2016, ALONG WITH ITA.193/09 AND ITA.247/09, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

APPENDIX IN ITA.179/09 APPELLANTS' EXHIBITS: ANNEXURE A:OF THE ASSESSMENT ORDER DATED 30.8. 89. ANNEXURE B: COPY OF THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) DATED 28.2. 91. ANNEXURE C: CERTIFIED COPY OF THE ORDER OF THE TRIBUNAL DATED 27.6.2003. // PS TO JUDGE

ANTONY DOMINIC & DAMA SESHADRI NAIDU, JJ. ----------------------------------- I.T.A.Nos.179, 193 & 247 of 2009 --------------------------------

The order continues below.

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