Principal Commissioner Of Income Tax 1 vs. Shri Gurvinder Singh Bhatia

RP/443/2020HC Madhya Pradesh23 July 2021Author: HON'BLE SHRI JUSTICE SUJOY PAUL3 pages

For Petitioner: Vashistha Narayan Dubey

AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the review petitions. The Court noted that the power of review is limited and can only be exercised for an error apparent on the record or other ingredients consistent with Order 47 Rule 1 of the Code of Civil Procedure. The Court repeatedly questioned the learned counsel for the review petitioners regarding the preparation of the scrutiny report and whether it fell within the ambit of Clause 10(e) of the Circular. However, no response was received, and no argument was advanced to bring the matter within the principles of review jurisdiction. Consequently, the Court found no basis to exercise its review powers and dismissed the petitions.

What were the facts?

The Principal Commissioner of Income Tax (PCIT) filed multiple review petitions before the High Court of Madhya Pradesh challenging orders previously passed by the Court. The review petitions sought to revisit the Court's earlier decisions, which were based on CBDT Circular No. 3/2018 and subsequent clarifications regarding monetary limits for filing appeals before High Courts. The PCIT argued that the cases involved organized tax evasion and thus fell under an exception to the monetary limit, specifically citing Clause 10(e) of the Circular dated 20.8.2018, which pertains to additions based on information from law enforcement agencies like the Directorate General of GST Intelligence (DGGI). The Court noted that the PCIT failed to provide details on when a relevant scrutiny report was prepared or demonstrate how it fell within the ambit of review jurisdiction.

What were the issues?

1. Whether the review petitions are maintainable on the ground that the additions made by the Assessing Officer were based on information received from law enforcement agencies, specifically the DGGI, thereby attracting Clause 10(e) of CBDT Circular No. 3/2018, allowing appeals irrespective of monetary limits, despite the High Court's earlier orders based on monetary limits? Assessee (PCIT) Contention: The PCIT argued that a scrutiny report prepared after the High Court's order under review indicated that the respondent was associated with the Signet Group and involved in organized tax evasion, with information originating from the Indore Tax Department and DG, Central Excise Intelligence, Indore. This, they contended, brought the case within the exception provided by Clause 10(e) of the Circular dated 20.8.2018. Revenue (Respondents) Contention: No specific argument was recorded for the respondents in the judgment.

Which sections of the Income-tax Act were involved?

Order 47 Rule 1 CPC

AI-generated summary — verify with the full judgment below

HIGH COURT OF MADHYA PRADESH Review Petition No.442/2020 (Principal Commissioner of Income Tax-1 Vs. Gurvinder Singh Bhatia) Review Petition No.443/2020 (Principal Commissioner of Income Tax-1 Vs. Gurvinder Singh Bhatia) Review Petition No.451/2020 (Principal Commissioner of Income Tax-1 Vs. Amandeep Singh Bhatia) Review Petition No.469/2020 (Principal Commissioner of Income Tax-1 Vs. Amandeep Singh Bhatia) Review Petition No.500/2020 (Principal Commissioner of Income Tax (Central) Vs. Swan Holdings Pvt. Ltd.) Review Petition No.502/2020 (Principal Commissioner of Income Tax (Central) Vs. Saurabh Sangla) Review Petition No.505/2020 (Principal Commissioner of Income Tax (Central) Vs. Swan Holdings Pvt. Ltd.) Review Petition No.513/2020 (Principal Commissioner of Income Tax (Central) Vs. M/s Swan Petrochemicals Pvt. Ltd.) Review Petition No.515/2020 (Principal Commissioner of Income Tax (Central) Vs. Mukesh Sangla) Indore, Dated : 23.7.2021 Heard through video conferencing. Ms. Veena Mandlik, learned counsel for the review petitioners submits that since similar singular ground has been taken in all the review petitions seeking review of the orders, the matters may be analogously heard on admission. The reasonable prayer is accepted.

For the reasons stated in the IAs, all the applications for condonation of delay are allowed. Delay is condoned. (O R D E R) 1/ Learned counsel for the review petitioners submits that this Court on the basis of Circular No.3/2018 dated 20.8.2018 and Circular dated 8.8.2019 opined that monetary limit was enhanced up to Rs.1 Crore in respect of the High Court. A further clarificatory HIGH COURT OF MADHYA PRADESH circular was issued on 6.9.2019 and Department has been permitted, irrespective of valuation, to file an appeal on merits in cases involved in organized tax evasion activity. In view of aforesaid, learned counsel for the appellant prayed for and permitted to withdraw the appeal. 2/ The review is prayed for in the teeth of Para 10(e) of the Circular dated 20.8.2018, which reads as under:- “10(e). Where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI/ED/DRI/ SFIO / Directorate General of GST Intelligence (DGGI).” 3/ Ms. Mandlik, learned counsel for the review petitioners submits that during the course of submission of scrutiny report (obtained after the order under review passed by the High Court), it was observed by the assessing officer i.e. ACIT, Indore that the search and seizure operation was conducted by the Indore Tax Department and DG, Central Excise Intelligence, Indore which concluded that respondent is associated with Signet Group of Indore and was involved in organized activities of tax evasion, which led ultimately the addition made by the AO. Thus, Clause 10(e) aforesaid is attracted. 4/ On more than one occasion, the Bench put a question to Ms. Mandlik when this scrutiny report was prepared and whether any such material in this regard is produced to show that such report falls within the ambit of Para-10(e) but no response is received by the Bench. Despite repeated query, learned counsel for the petitioners has not chosen to answer as to how the aforesaid falls within the ambit of review jurisdiction. 5/ This is trite that the power of review is limited. Unless it is shown that there exists an error apparent on the record or any other HIGH COURT OF MADHYA PRADESH ingredients which are in consonance with Order 47 Rule 1 CPC, interference in review jurisdiction cannot be made. Unfortunately no argument is advanced to bring the present matter within the ambit of principles analogous to Order 47 Rule 1 CPC. In absence thereof, the question of exercising the review jurisdiction does not arise. 6/ The review petitions fail and are hereby dismissed. 7/ Signed order be kept in the file of RP No.442/2020 and a copy thereof be placed in the file of RP Nos.443/20, 451/20, 469/20, 500/20, 502/20, 505/20, 513/20, 515/20. (Sujoy Paul) (Shailendra Shukla) Judge Judge trilok/-

Recent GST High Court judgments

Search GST case law →