THE COMMISSIONER OF INCOME TAX vs. M/S/ PUNJAB COMM LTD MOHALI

ITA/227/2003HC Punjab & HaryanaPHHC01046997200327 October 2006Author: MR. JUSTICE RAJESH BINDAL,MR. JUSTICE ADARSH KUMAR GOEL3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeals filed by the revenue. This dismissal was based on a letter filed by the Deputy Commissioner of Income-tax stating that the revenue's appeals had already been dismissed by the ITAT on merits. The ITAT's decision on merits, which the department had accepted, relied on the judgment of the Hon'ble Supreme Court in Commissioner of Income-Tax, West Bengal-I v. Indian Aluminium Co. Ltd. (1977) 108 ITR 367. Consequently, the questions of law raised by the revenue in their appeals to the High Court became infructuous. The court took the letter on record as Mark-'X' and disposed of all the appeals accordingly. No specific finding was given on the merits of the procedural issues raised by the revenue, as the appeals were dismissed based on the subsequent development of the ITAT's decision on merits and the department's acceptance thereof.

What were the facts?

The appeals were filed by the revenue against the Income Tax Appellate Tribunal's (ITAT) orders for assessment years 1992-93, 1994-95, 1995-96, and 1996-97. The assessee, M/s Punjab Communication Ltd., claimed deduction under Section 80-I for expansion of its DTL unit. This deduction was initially allowed under Section 143(1)(a) but later disallowed under Section 143(1)(b) read with Section 154, on the grounds that the expansion was a reconstruction and splitting of the existing business. The CIT(A) allowed the claim, and the ITAT upheld this view, suggesting reconsideration if the revenue's appeal on merits was allowed. Subsequently, the revenue filed a letter stating that the ITAT had dismissed their appeals on merits, and the department accepted this decision.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in rejecting the revenue's appeal against the CIT(A)'s order passed under Section 143(1)(b)/154 before deciding the revenue's appeal on merit against the order under Section 143(3) for assessment year 1992-93. 2. Whether, on the facts and in the circumstances of the case, the ITAT was right in law in stating that the revenue may consider the issue afresh under Section 143(1)(b) read with Section 154 of the Act for the year under consideration if the issue is decided by the ITAT on merits in favour of the revenue, whereas Section 143(1)(b), a procedural section, was deleted by the Finance Act, 1999 w.e.f. 1.6.99. Assessee's contentions: Not recorded. Revenue's contentions: The revenue contended that the ITAT erred in its procedural handling of the appeals and in its observation regarding reconsideration under a deleted section. The revenue relied on the judgment in Commissioner of Income-Tax, West Bengal-I v. Indian Aluminium Co. Ltd. (1977) 108 ITR 367.

Which sections of the Income-tax Act were involved?

Section 80-I,Section 143(1)(a),Section 143(1)(b),Section 143(3),Section 154

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. I.T.A. Nos.227, 228, 229, 230 & 231 of 2003 Date of decision: 27.10.2006 The Commissioner of Income-tax, Chandigarh-II. ---Appellant Vs. M/s Punjab Communication Ltd., Mohali. -----Respondent CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOEL HON'BLE MR JUSTICE RAJESH BINDAL Present: Mr. S.K. Garg Narwana, Advocate for the appellant. -----

ORDER: These appeals have been preferred by the revenue against the order of the Income Tax Appellate Tribunal, Chandigarh dated 17.02.2003 in I.T.A. Nos. 228/Chandi/2000, 514/Chandi/1999, 514/Chandi/1999, 517/Chandi/1999 and 519/Chandi/1999 in respect of the assessment years 1996-97, 1992-93, 1992-93, 1994-95 and 1995-96 respectively proposing following questions of law:- “1.

Whether on the facts and in the circumstances of the case, the ITAT was right in law in rejecting the appeal of the revenue filed against the order of the CIT(A) in respect of order passed u/s 143(1)(b)/154 before deciding the appeal of the revenue on merit already filed against the order of CIT(A) in respect of order u/s 143(3) for the assessment years 1992-93. 2. Whether on the facts and in the circumstances of the case

The order continues below.

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