THE COMMISSIONER OF INCOME TAX-III vs. SRI K PRAKASH SHETTY

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ITA/470/2014HC KarnatakaKAHC01040735201406 March 2015Bench: S.SUJATHA,VINEET SARAN2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The Court noted that the Tribunal had set aside the penalty imposed on the assessee by following a judgment of the High Court in the case of Commissioner of Income-Tax & another –vs- Manjunatha Cotton and Ginning Factory. The Court found no justification to interfere with the impugned order of the Tribunal. However, acknowledging that the Revenue had preferred an appeal before the Supreme Court against the Manjunatha Cotton and Ginning Factory judgment, the Court reserved liberty for the Revenue to revive this appeal in the event of succeeding in the Supreme Court. The operative direction was to dismiss the appeal with the aforementioned observation.

What were the facts?

The Revenue, comprising the Commissioner of Income Tax-III and the Assistant Commissioner of Income Tax, Central Circle 1(3), Bangalore, filed an appeal under Section 260-A of the Income Tax Act, 1961. This appeal challenged an order dated 05/06/2014 passed by the Income Tax Appellate Tribunal (ITAT) in ITA No. 267/Bang/2014. The ITAT had set aside the imposition of penalty on the assessee, Sri K Prakash Shetty, for the Assessment Year 2009-10. The ITAT's decision was based on a previous judgment of the High Court in the case of Commissioner of Income-Tax & another –vs- Manjunatha Cotton and Ginning Factory. The Revenue noted that an appeal against this High Court judgment was pending before the Supreme Court.

What were the issues?

1. Whether the Tribunal was justified in setting aside the imposition of penalty on the assessee for the Assessment Year 2009-10, by following the High Court's judgment in Commissioner of Income-Tax & another –vs- Manjunatha Cotton and Ginning Factory. Assessee's Contention: The judgment does not record any specific contentions made by the assessee. The Tribunal's order was based on a High Court precedent. Revenue's Contention: The Revenue is challenging the Tribunal's order which relied on the Manjunatha Cotton and Ginning Factory judgment. The Revenue has preferred an appeal before the Hon'ble Supreme Court against the said judgment, and it is still pending.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 6TH DAY OF MARCH 2015

PRESENT

THE HON'BLE MR. JUSTICE VINEET SARAN

AND

THE HON’BLE MRS. JUSTICE S.SUJATHA

ITA NO 470 OF 2014

BETWEEN

1.

THE COMMISSIONER OF INCOME TAX-III C R BUILDING, QUEENS ROAD BANGALORE-560 001.

2.

THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1 (3) BANGALORE.

... APPELLANTS

(BY SRI. E I SANMATHI, ADV.)

AND

SRI K PRAKASH SHETTY NO. 9, ALI ASKAR ROAD CUNNIGHAM ROAD CROSS BANGALORE PAN: AGAPS5631F

... RESPONDENT

(BY SRI. A SHANKAR & SRI. M LAVA, ADVS.)

This ITA filed Under Sec.260-A of Income Tax Act 1961, arising out of order dated: 05/06/2014 passed in ITA No.267/Bang/2014, for the Assessment year 2009-10.

THIS ITA COMING ON FOR ORDERS THIS DAY, VINEET SARAN J. DELIVERED THE FOLLOWING:

JUDGMENT

The Revenue has preferred this appeal challenging the order passed by the Tribunal which has set aside the imposition of penalty following a judgment of this Court passed in the case of Commissioner of Income-Tax & another –vs- Manjunatha Cotton and Ginning Factory in (2013) 359 ITR 565. Therefore, we do not see any justification to interfere with the impugned order and allow this appeal. However, it is submitted that the Revenue has preferred an appeal before the Hon’ble Supreme Court against the said judgment of this Court and it is still pending. In the event of the revenue succeeding in the appeal, liberty is reserved to the revenue to revive this appeal. With the said observation, the appeal is dismissed.

Sd/-

JUDGE

Sd/- TL

JUDGE

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