COMMISSIONER OF IT - I vs. M/S AGG EXPORTS PVT LTD

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ITA/522/2005HC Punjab & HaryanaPHHC01075664200529 March 2016Bench: MR. JUSTICE SATPAL,THE TAXING OFFICER2 pages
AI SummaryWithdrawn

What did the High Court hold?

The Revenue's counsel informed the High Court that in view of Circular No. 21/2015 and Circular No. 279/Misc/M-142/2007-ITJ (Part), the Revenue did not wish to press the appeal as the tax effect was less than ₹20 lacs. The High Court dismissed the appeal as not pressed, granting liberty to the Revenue to file an application for revival if something survives. The Court clarified that the withdrawal would not be an affirmation of the Tribunal's order on merits, and the legal issue was left open for adjudication in an appropriate case. No finding was reached on the substantial question of law regarding the validity of Section 147 proceedings.

What were the facts?

The Revenue, Commissioner of Income Tax-I, Ludhiana, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 9.5.2005 passed by the Income Tax Appellate Tribunal, Chandigarh Bench (B). The appeal pertained to assessment year 1995-96 and challenged the Tribunal's decision to set aside the Assessing Officer's order. The core of the dispute revolved around the validity of proceedings initiated under Section 147 of the Act. The amount in dispute was less than ₹20 lacs, as indicated by the Revenue's counsel.

What were the issues?

1. Whether, on the facts and circumstances of the case, the Income Tax Appellate Tribunal was justified in setting aside the order of the Assessing Officer by holding that the initiation of proceedings under Section 147 of the Income Tax Act was invalid, without appreciating the provisions of Explanation 2 to Section 147 of the IT Act? Assessee's Contentions: Not recorded in the judgment. Revenue's Contentions: The Revenue argued that the Tribunal erred in invalidating the Section 147 proceedings without properly considering Explanation 2 to Section 147. The Revenue relied on Circular No. 21/2015 dated 10.12.2015 and Circular No. 279/Misc/M-142/2007-ITJ (Part) dated 8.3.2016, issued by the Central Board of Direct Taxes, which indicated a policy to not press appeals where the tax effect is less than ₹20 lacs.

Which sections of the Income-tax Act were involved?

Section 260A,Section 147

AI-generated summary — verify with the full judgment below

ITA No. 522 of 2005 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 522 of 2005 (O&M) Date of Decision: 29.03.2016 Commissioner of Income Tax-I, Ludhiana .......Appellant Versus M/s A.G.G. Exports Pvt. Ltd. ......Respondent CORAM: HON'BLE MR. JUSTICE RAJESH BINDAL HON'BLE MR. JUSTICE HARINDER SINGH SIDHU Present: Mr. Rajesh Katoch, Advocate for the appellant. RAJESH BINDAL,J. This appeal has been filed under Section 260 A of the Income Tax Act, 1961 (for short 'the Act'), against the order dated 9.5.2005 passed by the Income Tax Appellate Tribunal, Chandigarh Bench (B), in ITA No.457/2002, for the assessment year 1995-96, raising the following substantial question of law: (i) Whether on the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was justified to set aside the order of the Assessing Officer by holding that the initiation of the proceedings u/s 147 of the I.T. Act, was invalid, without appreciating the provisions of explanation 2 to section 147 of the IT Act? REEMA SAINI 2016.04.04 13:52 I attest to the accuracy and authenticity of this document High Court, Chandigarh

ITA No. 522 of 2005 (O&M) -2- Learned counsel for the appellant-revenue submitted that in view of circular No.21/2015 dated 10.12.2015 read with circular No.279/Misc/M-142/2007-ITJ (Part) dated 8.3.2016, issued by Central Board of Direct Taxes, he does not wish to press the present appeal, as the tax effect involved is less than ` 20 lacs. However, he prays that liberty be granted to the revenue to file an application for revival of the appeal in case something survives therein. Dismissed as not pressed with liberty as prayed for. It is however, clarified that withdrawal of the appeal by the revenue shall not be taken as affirmation of order of the Tribunal on merits. The legal issue as claimed by the revenue is left open to be adjudicated in an appropriate case. (RAJESH BINDAL)

JUDGE (HARINDER SINGH SIDHU) 29.03.2016 JUDGE reema REEMA SAINI 2016.04.04 13:52 I attest to the accuracy and authenticity of this document High Court, Chandigarh

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