THE PRINCIPAL COMMISSIONER OF INCOME TAX, PANAJI., vs. BRITTO AMUSEMENT PVT. LTD.,

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TXA/73/2017HC BombayHCBM05003868201613 June 2018Author: HON'BLE SHRI JUSTICE N. M. JAMDAR,HON'BLE SHRI JUSTICE PRITHVIRAJ K. CHAVAN3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the second substantial question of law did not arise for consideration. The Court noted that for a question of law to arise, particularly one alleging a failure of the Tribunal to give a decision, the issue must have been at least pleaded before the Tribunal. The Court found that nothing was shown to contradict the Respondent's submission that the issue concerning the shareholders was never urged before the ITAT. The grounds of appeal filed before the Tribunal were only in respect of the liability of the Respondent company. Therefore, the Court concluded that there was no finding by the Tribunal that interfered with the liberty granted by the CIT(Appeals) to take action in the hands of the shareholders. Since both substantial questions of law did not arise, the appeal was disposed of.

What were the facts?

The Revenue, Principal Commissioner of Income Tax, Panaji, appealed against an order of the Income Tax Appellate Tribunal (ITAT) concerning assessment year(s) not explicitly stated. The ITAT's order was dated 28 July 2016, following an appeal from the Commissioner of Income Tax (Appeals) order dated 30 October 2015, which in turn followed an assessment order dated 16 December 2011 passed by the Assessing Officer against the assessee, Britto Amusement Pvt. Ltd. The core of the dispute involved additions made by the Assessing Officer, which were deleted by the CIT(Appeals) in the hands of the assessee company, with liberty to the Assessing Officer to take action in the hands of shareholders. The Revenue contended that the ITAT failed to record a finding regarding amounts assessable under Section 2(22)(e) in the hands of shareholders Dr. William Britto and Mrs. Muriel Britto.

What were the issues?

The High Court had to decide two substantial questions of law. The first question of law was determined not to arise by the Court in prior orders dated 6 November 2017 and 6 December 2017. The second question of law concerned whether the Tribunal failed to record a finding regarding the amount assessable under Section 2(22)(e) of the Income Tax Act, 1961, in the hands of shareholders Dr. William Britto and Mrs. Muriel Britto. The assessee (Respondent) argued that this second question of law did not arise because the issue regarding the shareholders was never raised before the Income Tax Appellate Tribunal. The assessee's grounds of appeal before the Tribunal were solely in respect of the liability of the Respondent company. The Revenue (Appellant) contended that the Tribunal did not record a finding on this specific issue concerning the shareholders.

Which sections of the Income-tax Act were involved?

Section 2(22)(e)

AI-generated summary — verify with the full judgment below

vinita - 1 - txa 73-17 dt 13.6. 18. IN THE HIGH COURT OF BOMBAY AT GOA TAX APPEAL NO. 73 OF 2017. The Principal Commissioner of Income Tax, Panaji., ... Appellant. Versus Britto Amusement Pvt. Ltd., ... Respondent. Ms. S. Linhares, Standing Counsel for the Appellant. Mr. Gaurang D. Panandiker, Advocate for the Respondent. Coram:- N. M. JAMDAR & PRITHVIRAJ K. CHAVAN, JJ. Date:- 13 June 2018. P.C.:- This appeal is raising following two substantial questions of law. As regards the first question of law, we have recorded in the orders dated 6 November 2017 and 6 December 2017 that the first question of law does not arise.

2.

As regards the second question of law is concerned, the Appellant has sought to agitate that the Tribunal did not record a finding regarding the amount assessable under Section 2(22)(e) of the Income Tax Act in the hands of shareholders, Dr. William Britto and vinita - 2 - txa 73-17 dt 13.6. 18. Mrs. Muriel Britto.

3.

An order of assessment was passed by the Assessing Officer in respect of the Respondent -Britto Amusement Pvt. Ltd. This order dated 16 December 2011 was appealed before the Commissioner of Income Tax(Appeals). The appeal was disposed of on 30 October 2015. Thereafter, the Revenue filed an appeal before the Income Tax Appellate Tribunal, which was disposed of on 28 July 2016. 4. While disposing of the appeal by the Commissioner of Income Tax (Appeals) in paragraph 4.16 recorded as under:- "Respectfully, following the said decision int he appellant's own case for A.Y. 2004-04, in this case also, addition in the hands of the appellant company is deleted. However, this leaves it open for the Assessing Officer to take necessary action in the hands of the shareholders as deemed fit as per law and as interpreted by the superior Courts.(Ground No.6 to 13 are allowed." The learned Counsel for the Respondent has submitted that the issue regarding two shareholders i.e Dr. William Britto and Mrs. Muriel Britto, after the decision of the CIT(Appeals) was never raised before the Income Tax Appellate Tribunal and the grounds of appeal filed before the Tribunal will show that appeal was only in respect of vinita - 3 - txa 73-17 dt 13.6.18. liability of the Respondent's/assessee. The learned Counsel for the Respondent submitted that the second question (b) does not arise, as there was no question of the Tribunal recording a finding since this issue was never urged before the Tribunal.

5.

Nothing is shown as to how this objection of the Respondent is incorrect or that this issue was raised. For the question of law to arise, it should atleast be pleaded before the Tribunal, more particularly, if the question of law is that, that there is a failure of the Tribunal to give a decision. All that we say is that there is no finding by the Tribunal to show that the liberty granted by the CIT (Appeals), as above, has been interfered with.

6.

In this circumstances, since both the questions do not arise for our consideration, the appeal is disposed of. PRITHVIRAJ K. CHAVAN, J. N. M. JAMDAR, J.

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