THE PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL), AHMEDABAD vs. M/S GANESH PLANTATION LTD.

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SCA/13695/2022HC GujaratGJHC24044034202226 July 2022Bench: HONOURABLE MR. JUSTICE N.V.ANJARIA,HONOURABLE MR. JUSTICE BHARGAV D. KARIA2 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court of Gujarat, while hearing the Special Civil Application, noted that the petitioner (revenue) had already preferred an appeal under Section 260A of the Income Tax Act against the ITAT's order dated 6.12.2016. The Court observed that the dismissal of the Special Civil Application was solely on the ground that a substantive appeal was pending. The Court held that all contentions of the petitioner would be open to be raised in accordance with law in the pending appeal proceedings. Therefore, the present petition was disposed of without deciding the merits of the review application. The operative direction was to dispose of the petition, leaving all contentions open for the appeal.

What were the facts?

The assessee, M/s Ganesh Plantation Ltd., filed its return for assessment year 2008-09, claiming a loss of Rs. 4 crores in its contract account. The Assessing Officer disallowed this claim, citing the assessee's failure to prove the genuineness of transactions with Jay Corporation. The Commissioner of Income Tax (Appeals) upheld this disallowance. The Income Tax Appellate Tribunal (ITAT), however, set aside the lower authorities' orders and allowed the claim. Subsequently, the revenue filed a Miscellaneous Application (MA) No. 115 of 2017 for review of the ITAT's order dated 6.12.2016. The ITAT dismissed this review application on 6.7.2021. The Principal Commissioner of Income Tax (Central), Ahmedabad, has now filed a Special Civil Application (SCA) No. 13695 of 2022 challenging the ITAT's order dated 6.7.2021.

What were the issues?

1. Whether the Income Tax Appellate Tribunal erred in dismissing the review application filed by the revenue against its order dated 6.12.2016, which had allowed the assessee's claim of loss in contract account. Assessee's contentions: The judgment does not record any specific contentions made by the assessee in the Special Civil Application. However, the underlying issue pertains to the ITAT's initial decision to allow the claim of loss in contract account. Revenue's contentions: The revenue, through its learned senior advocate, argued that the review application ought to have been allowed by the Tribunal. The revenue's primary contention is that the ITAT's order dated 6.12.2016, which allowed the claim, was erroneous and should have been reviewed. The revenue has also preferred a substantive appeal under Section 260A of the Income Tax Act against the ITAT's order dated 6.12.2016.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

C/SCA/13695/2022 ORDER DATED: 26/07/2022 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 13695 of 2022 ========================================================== THE PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL), AHMEDABAD Versus M/S GANESH PLANTATION LTD. ========================================================== Appearance: MR M.R.BHATT, SR.ADVOCATE, MR KARAN SANGHANI for M R BHATT & CO.(5953) for the Petitioner(s) No. 1 for the Respondent(s) No. 1 ========================================================== CORAM:HONOURABLE MR. JUSTICE N.V.ANJARIA and HONOURABLE MR. JUSTICE BHARGAV D. KARIA

Date : 26/07/2022

ORAL ORDER (PER : HONOURABLE MR. JUSTICE N.V.ANJARIA) Heard learned senior advocate Mr.Manish R. Bhatt for M.R.Bhatt and Co. for the petitioner. 2. By filing this petition under Article 226 and 227 of the Constitution what is prayed is to set aside order dated 6.7.2021 passed by the Income Tax Appellate Tribunal in Miscellaneous Application No.1520 of 2013. It was an application for review of the judgment and order passed by the Income Tax Appellate Tribunal. 3. The facts in brief stated in the petition are inter alia that the respondent herein filed its return in respect of the assessment year 2008-09 declaring its total income. He claimed Rs.4 crores under the head loss in contract account which claimed was disallowed by the Assessing Officer in its assessment order dated 22.12.2010. The ground weighed with the Assessing Officer was that the respondent failed to prove Page 1 of 2

C/SCA/13695/2022 ORDER DATED: 26/07/2022 genuineness of the transaction with one Jay Corporation in respect of which the loss had occurred. The Commissioner of Income Tax (Appeals) confirmed the order of the Assessing Officer. When the respondent approached the Tribunal to challenge the appellate authority’s order, the tribunal set aside the said orders and allowed the claim of the aforesaid amount under the head of loss in contract account. 3.1 It appears that the said judgment and order of the Income Tax Appellate Tribunal dated 6.12.2016 was sought to be reviewed by filing Miscellaneous Application No.115 of 2017 which was dismissed by the Tribunal on 6.7.2021, which is the order impugned herein. 4. While learned senior advocate raised various contentions to urge the court that the review application ought to have been allowed by the Tribunal, he fairly admitted the factum that the department has already preferred appeal under Section 260A of the Income Tax Act against the aforementioned judgment and order of the Tribunal dated 6.12.2016. 5. The dismissal of the Special Civil Application by this court is only on the ground that the petitioner department has preferred substantive appeal before this court. It goes without saying that all the contentions of the petitioner will be open to be raised in accordance with law in the appeal proceedings. Accordingly, the present petition is disposed of. (N.V.ANJARIA, J) (BHARGAV D. KARIA, J) Manshi Page 2 of 2

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