COMMISSIONER OF INCOME TAX-I vs. ADMIRACLE ADVERTISING PVT LTD

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TAXAP/538/2011HC GujaratGJHC24025311201128 June 2012Bench: HONOURABLE MR. JUSTICE VIJAY MANOHAR SAHAI,HONOURABLE MR. JUSTICE N.V.ANJARIA2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the Tax Appeal. The Court noted that the ITAT had confirmed the penalty imposed by the Commissioner (Appeals), which had been reworked and reduced. The ITAT's reasoning was that a penalty for concealment of income cannot be levied on estimated income. The Court found no infirmity in the ITAT's order and concluded that there was no reason for the department to file the appeal. The Revenue's counsel conceded that the appeal was filed under a mistake. Therefore, the appeal was dismissed.

What were the facts?

The Commissioner of Income Tax-I (the Revenue) filed a Tax Appeal before the High Court of Gujarat challenging an order of the Income Tax Appellate Tribunal (ITAT). The ITAT's order, dated September 27, 2010, pertained to ITA No. IT(SS) 07/RJT/2010 for the Assessment Year 1999-2000. The appeal concerned a penalty levied under Section 271(1)(c) of the Income Tax Act. The penalty originally imposed was Rs. 31,52,258, which was reduced by the Commissioner (Appeals) and further confirmed by the ITAT. The Revenue sought to challenge the ITAT's decision to restrict the penalty.

What were the issues?

1. Whether the Appellate Tribunal is right in law and on facts in restricting the penalty levied under Section 271(1)(c) from Rs. 31,52,258 to Rs. 2,30,796? Assessee's Contention: The judgment does not record any specific contentions made by the assessee before the High Court. However, the reasoning of the ITAT, as stated in the judgment, indicates that the Tribunal confirmed the penalty imposed by the Commissioner (Appeals) on the ground that no concealment penalty can be levied on estimated income. Revenue's Contention: The Revenue, through its learned counsel, argued that the Tax Appeal was filed under some mistake.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

TAXAP/538/2011 1/2 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL No. 538 of 2011 For Approval and Signature: HONOURABLE MR.JUSTICE V. M. SAHAI

HONOURABLE MR.JUSTICE N.V. ANJARIA ========================================================= 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? ========================================================= COMMISSIONER OF INCOME TAX-I Versus ADMIRACLE ADVERTISING PVT LTD ========================================================= Appearance : MRS MAUNA M BHATT for Appellant(s) : 1, None for Opponent(s) : 1, ========================================================= CORAM : HONOURABLE MR.JUSTICE V. M. SAHAI and HONOURABLE MR.JUSTICE N.V. ANJARIA Date : 28/06/2012 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE V. M. SAHAI) 1.0 We have heard Mr.M. R. Bhatt, learned standing counsel for Mrs. Mauna Bhatt, learned counsel for the department in this Tax Appeal.

TAXAP/538/2011 2/2 JUDGMENT 2.0 The substantial question of law sought to be raised is as under: “Whether the Appellate Tribunal is right in law and on facts in   restricting   the   penalty   levied   u/s   271(1)(c)   of Rs.31,52,258/­ to Rs.2,30,796/­?”' 3.0 The order of the Tribunal dated 27th September 2010 passed in ITA No.IT(SS)   07/RJT/2010   (Assessment   Year   1999­2000)   has   been challenged. We do not find any infirmity in this Tax Appeal where the Tribunal   has   confirmed   the   penalty   imposed   by   the   Commissioner Income­Tax   (Appeals)   which   was   reworked   and   reduced   by   the Commissioner   (Appeals)   on   the   ground   that   there   cannot   be   any concealment penalty levied on the estimated income.  Therefore, there was no reason for the department to file this Tax Appeal No.538 of 2011 to challenge the order of the Tribunal. 4.0 Learned counsel for the appellant states that this Tax Appeal has been filed under some mistake. 5.0 We, therefore, dismiss this Tax Appeal accordingly. [V. M. SAHAI, J.] [N. V. ANJARIA, J.] Amit

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