THE COMMISSIONER OF INCOME TAX AHMEDABAD- I vs. NARENDRA K SONI

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TAXAP/1150/2007HC GujaratGJHC24041028200711 December 2014Bench: HONOURABLE MR. JUSTICE KS JHAVERI,HONOURABLE MR. JUSTICE K.J.THAKER3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court did not decide the substantial questions of law on merits. Instead, the Court noted that the amount involved and the revenue effect were less than Rs. 1 lakh. Citing CBDT Instruction No. 1979 dated March 27, 2000, and Instruction No. 02 of 2005, the Court held that the revenue ought not to have filed an appeal when the total revenue effect was below Rs. 1 lakh. Consequently, the appeal was not entertained and was dismissed on the ground of the smallness of the amount. The questions of law were answered in favour of the assessee and against the revenue. Liberty was granted to the revenue to revive the appeal in case of difficulty. No issue was expressly left undecided, as the appeal was dismissed on a procedural ground.

What were the facts?

The appellant, the Commissioner of Income Tax, Ahmedabad-I, has challenged an order dated January 31, 2007, passed by the Income-tax Appellate Tribunal (ITAT), Ahmedabad Bench, in ITA No. 1088/Ahd/2004. This order pertains to the assessment year 1983-84 and concerns the assessee, Narendra K. Soni. The ITAT had cancelled a penalty levied under Section 271(1)(c) of the Income Tax Act. The High Court admitted the appeal on October 23, 2007, and framed substantial questions of law. The revenue effect in this case is stated to be less than Rs. 1 lakh.

What were the issues?

The High Court had to decide the following substantial questions of law: 1. Whether the Appellate Tribunal was right in cancelling the penalty levied under Section 271(1)(c) of the Income Tax Act, considering the facts of the case. 2. Whether the Appellate Tribunal was right in holding that a penalty under Section 271(1)(c) cannot be levied on a legal heir. The appellant-revenue argued that the Tribunal was incorrect in cancelling the penalty. The respondent-assessee's arguments are not recorded in the judgment. The judgment does not mention any specific authorities, circulars, or precedents relied upon by either side.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

O/TAXAP/1150/2007 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 1150 of 2007

FOR APPROVAL AND SIGNATURE:

HONOURABLE MR.JUSTICE KS JHAVERI

and HONOURABLE MR.JUSTICE K.J.THAKER

================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ THE COMMISSIONER OF INCOME TAXAHMEDABAD- I....Appellant(s) Versus NARENDRA K SONI....Opponent(s) ================================================================ Appearance: MRS MAUNA M BHATT, ADVOCATE for the Appellant(s) No. 1 RULE SERVED for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER Page 1 of 3

O/TAXAP/1150/2007 JUDGMENT

Date : 11/12/2014

ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. By way of this appeal, the appellant-revenue has challenged the order dated 31.01.2007 passed by the Income-tax Appellate Tribunal, Ahmedabad Bench in ITA No. 1088/Ahd/2004 for the assessment year 1983-84. 2. While admitting this appeal on 23.10.2007, this Court has framed the following substantial question of law: (A) Whether the Appellate Tribunal is right in and on facts in cancelling the penalty levide u/s 271(1) (c) of the Act? (B) Whether the Appellate Tribunal is right in law and on facts in holding that penalty u/s 271(1)(c) cannot be levied on a legal heir? 3. In our view, the amount involved in the present case is a small one and the revenue effect is less than Rs. 1 lakh, and therefore, as per CDBT Instruction No. 1979 dated 27th March, 2000 and 02 of 2005, the revenue ought not to have come in appeal where the total revenue effect is less than Rs. 1 lakh, and therefore, this appeal is not entertained. The questions are answered in favour of the assessee and against the revenue. This appeal is dismissed on the ground of smallness of amount. Liberty to revive in case of difficulty. Page 2 of 3

O/TAXAP/1150/2007 JUDGMENT (K.S.JHAVERI, J.) (K.J.THAKER, J) divya Page 3 of 3

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