COMMISSIONER INCOME TAX vs. CHANDI RAM

PDF · subscribers
ITA/466/2007HC Punjab & HaryanaPHHC01073168200725 September 2008Bench: MR. JUSTICE ADARSH KUMAR GOEL,MR. JUSTICE AJAY TEWARI2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that since the assessee's appeal concerning the quantum of income (ITA No.4 of 2005) had been allowed by the ITAT on February 25, 2008, no grounds for the imposition of penalty survived. Consequently, the questions proposed by the Revenue could not be considered substantial questions of law. The court found that the allowance of the quantum appeal rendered the penalty proceedings infructuous. Therefore, the appeal filed by the Revenue was dismissed without delving into the merits of the penalty initiation or the assessee's status. The operative direction was the dismissal of the Revenue's appeal.

What were the facts?

The Revenue, Commissioner of Income Tax, Faridabad, filed an appeal before the High Court of Punjab and Haryana at Chandigarh against an order dated January 18, 2007, passed by the Income Tax Appellate Tribunal (ITAT), Delhi. The appeal challenged the ITAT's decision regarding the initiation of penalty proceedings under Section 271(1)(c) of the Income Tax Act, 1961, and the assessment status of the assessee. The assessee is Sh. Chandi Ram. The assessment year(s) are not explicitly stated but relate to the penalty proceedings. The procedural history indicates that the quantum appeal filed by the assessee (ITA No.4 of 2005) had been allowed by the ITAT on February 25, 2008.

What were the issues?

The High Court was presented with the following substantial questions of law: 1. Whether the ITAT was correct in holding that the Assessing Officer had not recorded his satisfaction for initiating penalty proceedings under Section 271(1)(c), despite mentioning it in the assessment order? 2. (a) Whether the ITAT was correct in holding that the penalty was levied on the assessee with the status of 'individual' when the original assessment was made with the 'HUF' status? (b) Without prejudice to (a), whether the ITAT was correct in overlooking that the status of the assessee was held as 'individual' and not 'HUF' by the CIT(A) and the ITAT in the quantum appeal? The Revenue contended that the Assessing Officer had recorded his satisfaction for penalty initiation in the assessment order. The Revenue also argued that the assessee's status was correctly determined as 'individual' by the CIT(A) and the ITAT in the quantum appeal. The judgment does not record specific arguments from the assessee on these points, other than the fact that the quantum appeal was allowed.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

I.T.A No. 466 of 2007 ::1:: IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH I.T.A No. 466 of 2007 Date of decision : September 25, 2008 Commissioner of Income Tax, Faridabad ...... Appellant. through Mr. Yogesh Putney, Sr. Standing counsel. v. Sh. Chandi Ram, ...... Respondent CORAM : HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY TEWARI *** 1. Whether Reporters of Local Newspapers may be allowed to see the judgment ? 2. To be referred to the Reporters or not ? 3. Whether the judgment should be reported in the Digest ? *** AJAY TEWARI, J This appeal has been filed by the revenue against the order dated 18.1.2007 passed by the Income Tax Appellate Tribunal, Delhi, proposing the following substantial questions of law :- “ 1. Whether, on the facts and circumstances of the case, the learned ITAT is right in holding that the Assessing Officer had not recorded his satisfaction for initiating the penalty u/s 271(1)(c), even though the Assessing Officer had mentioned the same in the assessment order ? (2)(a) Whether, on the facts and circumstances of the case, the learned ITAT is right in holding that the penalty

I.T.A No. 466 of 2007 ::2:: has been levied on the assessee with the status as `individual' though the original assessment was made with the `HUF' status ? (2)(b) Without prejudice to 2(a) above, whether the learned ITAT is right in overlooking the fact that the status of the assessee was held as `individual' and not `HUF' by the learned CIT(A) and also by learned ITAT in the quantum appeal in this case of the assessee ? It is not disputed before us that the appeal of the assessee with regard to quantum bearing No. ITA No.4 of 2005 has been allowed on 25.2.2008. Consequently, no ground for imposition of penalty survives. In this view of the matter, the questions proposed cannot be held to be substantial questions of law. The appeal is dismissed. ( AJAY TEWARI ) JUDGE

( ADARSH KUMAR GOEL )

JUDGE September 25, 2008

'kk'

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →