COMMISSIONER OF INCOMET AX JALANDHAR-II vs. M/S SAROOP TANNERIES

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ITA/53/2013HC Punjab & HaryanaPHHC01105263201309 April 2015Bench: MR. JUSTICE A.B. CHAUDHARI,MR. JUSTICE M.M. AGGARWAL2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeal under Section 260A of the Income Tax Act, 1961, is not maintainable against an order passed by the Tribunal under Section 254(2). This decision is based on the Division Bench judgment in Rani Paliwal Vs Commissioner of Income Tax, which held that appeals under Section 260A lie against orders passed under Section 254(1), not Section 254(2). The Tribunal itself had noted that the matter of applicability of the Supreme Court judgment should have been dealt with under Section 254(1). The respondent agreed that any order passed under Section 254(1) would be appealable. Therefore, the revenue is not without a remedy and can appeal an order passed under Section 254(1) if it is adverse. The operative direction is that the appeal is dismissed as not maintainable. No issue was left undecided; the appeal was decided on the preliminary ground of maintainability.

What were the facts?

The appeal was filed by the Commissioner of Income Tax, Jalandhar-II (the appellant/revenue) against M/s Saroop Tanneries Ltd. (the respondent/assessee). The appeal challenged an order dated 19.11.2012 passed by the Income Tax Appellate Tribunal (ITAT). This order dismissed an application filed by the appellant under Section 254(2) of the Income Tax Act, 1961. The application under Section 254(2) was made against an earlier order dated 30.06.2010 passed by the ITAT in M.A. No. 46 (ASR)/2009. The ITAT had noted that the applicability of a Supreme Court judgment could not be adjudicated under Section 254(2) but rather under Section 254(1). The respondent agreed that an order under Section 254(1) would be appealable under Section 260A.

What were the issues?

1. Whether an appeal under Section 260A of the Income Tax Act, 1961 is maintainable against an order passed by the Income Tax Appellate Tribunal under Section 254(2) of the Act? (Question of law) Assessee's Contention: The assessee argued that an appeal under Section 260A is not maintainable against an order passed under Section 254(2) of the Act, citing the Division Bench judgment of the same High Court in Rani Paliwal Vs Commissioner of Income Tax, (2004) 190 CTR (P&H) 566. Revenue's Contention: The revenue did not explicitly argue on the maintainability of the appeal. However, they filed the appeal, implying a belief in its maintainability. The judgment notes that the appellant is not without a remedy if an order under Section 254(1) is passed adversely.

Which sections of the Income-tax Act were involved?

Section 260A,Section 254(2),Section 254(1)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

ITA-53-2013 Date of decision:- 09.04.2015

The Commissioner of Income Tax, Jalandhar-II, Jalandhar.

...Appellant Versus

M/s Saroop Tanneries Ltd. ...Respondent

CORAM: HON'BLE MR. JUSTICE S.J. VAZIFDAR, ACTING CHIEF JUSTICE

HON’BLE MR. JUSTICE G.S. SANDHAWALIA

Present: Mr. Vivek Sethi, Advocate,

for the appellant.

Mr. Ravish Sood, Advocate,

for the respondent. * * * * S.J. VAZIFDAR, A.C.J. (ORAL)

The appeal is liable to be dismissed only on the ground that it is not maintainable in view of the judgement of the Division Bench of this Court in Rani Paliwal Vs Commissioner of Income Tax, (2004) 190 CTR (P&H) 566. The Division Bench held that an appeal under Section 260A of the Income Tax Act, 1961 (in short the Act) is not maintainable against the order passed by the Tribunal under Section 254(2). 2. The Tribunal had passed an order dated 30.06.2010 in M.A. No. 46 (ASR)/2009. The Tribunal corrected a mistake on account of not having noticed the judgement of the Supreme Court in CIT Vs M/s Amalgamations Private Limited (1997) 226 ITR 188. The Tribunal expressly recorded that the applicability of the decision cannot be adjudicated under the provisions of Section 254(2), as the same is covered under Section 254(1) of the Act. The respondent agrees that as and when an order is ultimately passed under Section 254(1) in accordance with the order dated 30.06.2010 under Section 254(2), the same would be appealable under AMODH SHARMA 2015.04.10 16:48 I attest to the accuracy and authenticity of this document chandigarh

ITA-53-2013 2ٰ

Section 260A. The appellant, therefore, is not without a remedy in the event of the order under Section 254(1) being adverse to it. 3. The appellant filed M.A. No. 12 (ASR)/2011 under Section 254(2) of the Act against the order dated 30.06.2010 which was dismissed by the impugned order and judgement dated 19.11.2012. In view of what we have mentioned earlier, the appellant is in any event not without a remedy. However, this order in an application under Section 254(2) is not appealable. 4. Needless to add that the decision in ITA-472-2009, if decided before the Tribunal decides the matter under Section 254(1), would have its own effect.

(S.J. VAZIFDAR) ACTING CHIEF JUSTICE

(G.S. SANDHAWALIA)

JUDGE 09.04.2015 Amodh

AMODH SHARMA 2015.04.10 16:48 I attest to the accuracy and authenticity of this document chandigarh

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