SHRI. S.ARUNKUMAR vs. COMMISSIONER OF INCOME TAX

TCA.No.172 of 2021 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 26.2.2021 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM and THE HONOURABLE MS.JUSTICE R.N.MANJULA Tax Case Appeal No.172 of 2021 Shri S.Arunkumar ...Appellant Vs The Commissioner of Income Tax, Madurai ...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 against the order dated 19.6.2017 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai made in I.T.A.No.95/Mds/2017 for the assessment year 2009-10. For Appellant : Mr.N.Devanathan For Respondent : Mr.M.Swaminathan, SSC assisted by Ms.V.Pushpa, JSC Judgment was delivered by

T.S.SIVAGNANAM

This appeal has been filed by the assessee under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity) challenging the order 1/5 https://www.mhc.tn.gov.in/judis/ TCA.No.172 of 2021 dated 19.6.2017 made in I.T.A.No.95/Mds/2017 on the file of the Income Tax Appellate Tribunal, Chennai, 'B' Bench ('the Tribunal' for brevity) for the assessment year 2009-10. 2. The assessee has filed this appeal by raising the following substantial questions of law: “1. Whether the order of the ITAT in law is not only perverse but also against rule of law? 2. Whether the imposition of penalty in law is not barred by limitation? 3. Whether the Income Tax Tribunal was right in law in confirming the penalty under section 271D having regard (i) the provision is not automatic and subject to provisions of section 273B hence jurisdictional fact was assumed; (ii) the transaction being genuine, bonafide, reasonable cause on account of business exigency; (iii) when credit was proved after due enquiry and proved beyond reasonable doubt before the assessing officer and hence in the absence of satisfaction whether invocation of Section 271D of the Income Tax Act is valid in the eyes of law? (iv) not applying the purposive approach 2/5 https://www.mhc.tn.gov.in/judis/ TCA.No.172 of 2021 behind introduction of the provision and in the light of circular issued by CBDT to the effect by its letter dated 25th March 2004 the CBDT has advised that penalties uls 271D for violation of Section 269SS respectively should not be imposed indiscriminately and provisions of Section 273B should be taken in view before imposing the penalty? (v) (a) whether the JCIT in law was right in law passing the order after four years by way breaching the provisions of Section 275 and (a) also reviewing the order of the Assessing officer without due enquiry and (b) absence of tangible materials and (c) erred in not applying the binding precedents (cited above at (h) at page 13) of the jurisdictional High Court and when the transaction is genuine?” 3. We have heard Mr.N.Devanathan, learned counsel for the appellant/assessee and Mr.M.Swaminathan, learned Senior Standing Counsel assisted by Ms.V.Pushpa, learned Junior Standing Counsel appearing for the the respondent/Revenue. 4. The learned counsel on behalf of the assessee submits that the assessee already filed the declaration/undertaking under the Vivad Se Vishwas Scheme on 30.1.2021 and is awaiting orders to be passed 3/5 https://www.mhc.tn.gov.in/judis/ TCA.No.172 of 2021 in Form No.3. 5. In the light of the subsequent event, the Competent Authority shall process the application/declaration in accordance with the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of 2020) and pass appropriate orders as expeditiously as possible. The assessee is given liberty to restore this appeal in the event the ultimate decision to be taken on the declaration filed by the assessee under Section 4 of the said Act is not in favour of the assessee. If such a prayer is made, the Registry shall entertain the prayer without insisting upon any application to be filed for condonation of delay in restoration of the appeal and on such request made by the assessee by filing a miscellaneous petition for restoration, the Registry shall place such petition before the appropriate Division Bench for orders. 6. The tax case appeal stands disposed of with the aforementioned liberty. Consequently, the substantial questions of law raised are left open. No costs. 26.2.2021

RS 4/5 https://www.mhc.tn.gov.in/judis/ TCA.No.172 of 2021 T.S.SIVAGNANAM,J AND R.N.MANJULA,J RS To 1.The Income Tax Appellate Tribunal, 'B' Bench, Chennai. 2.The Commissioner of Income Tax, Madurai TCA.No.172 of 2021 26.2.2021 5/5 https://www.mhc.tn.gov.in/judis/