PRINCIPAL COMMISSIONER OF vs. MANGAL TECH PARK PVT LTD

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TCA/200/2017HC Madras01 August 2022Bench: Hon`ble Mr Justice R. MAHADEVAN5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court noted that during the pendency of the appeal, the assessee had availed the benefit of the Direct Tax Vivad Se Vishwas Act, 2020. The assessee filed necessary declarations, which were accepted, and an order for full and final settlement of tax arrears was issued by the Income Tax Department on 09.04.2021. This subsequent development was fairly conceded by the learned standing counsel for the Revenue. Consequently, the Court was of the opinion that nothing survived for adjudication in the appeal. Recording the submissions of both sides, the Tax Case Appeal was disposed of. The Court did not decide the substantial questions of law on merits.

What were the facts?

The Revenue, Principal Commissioner of Income Tax 4, Chennai, filed a Tax Case Appeal under Section 260A of the Income Tax Act, 1961, against an order dated 17.06.2016 passed by the Income Tax Appellate Tribunal (ITAT), Chennai 'B' Bench. The appeal pertained to assessment year 2008-2009 and challenged the ITAT's decision to delete an addition made under Section 35AC. The High Court admitted the appeal on substantial questions of law. During the pendency of the appeal, the assessee, M/s. Mangal Tech Park Pvt. Ltd., availed the benefit of the Direct Tax Vivad Se Vishwas Act, 2020, filed necessary declarations, and received an order for full and final settlement of tax arrears on 09.04.2021.

What were the issues?

The High Court had to decide two substantial questions of law: 1. Whether the ITAT erred in entertaining an appeal against an order of the CIT(A) which was dismissed because the assessee stated it was not pressing the appeal, without considering that only an aggrieved assessee can file an appeal under Section 253(1) of the Income Tax Act and that the same Director of the assessee company had filed a letter before the CIT(A) and also filed the present appeal before the ITAT. 2. Whether the ITAT was right in deleting the addition under Section 35AC after the expiry of six years, for cross-examining a witness, when the outcome of the inquiry was put to the assessee's Director in 2010, and the assessee neither denied the finding nor asked for cross-examination. The Revenue argued that the ITAT should not have entertained the appeal as the assessee had withdrawn it before the CIT(A), and that the deletion of the addition under Section 35AC was erroneous given the timeline and the assessee's conduct. The Assessee contended that they had settled the dispute under the Vivad Se Vishwas Act, 2020.

Which sections of the Income-tax Act were involved?

Section 260A,Section 253(1),Section 35AC

AI-generated summary — verify with the full judgment below

Tax Case Appeal No.200 of 2017 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 01.08.2022 CORAM : THE HONOURABLE MR. JUSTICE R. MAHADEVAN and THE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQ Tax Case Appeal No.200 of 2017 Principal Commissioner of Income Tax 4, No.121, Mahatma Gandhi Road, Nungambakkam, Chennai. ... Appellant Versus M/s. Mangal Tech Park Pvt. Ltd., Spencer Plaza, No.769, Anna Salai, Chennai - 600 002. PAN: AAE CM 6101 F ... Respondent

Appeal preferred under Section 260A of the Income Tax Act, 1961, against the order dated 17.06.2016 passed by the Income Tax Appellate Tribunal, “B” Bench, Chennai, in I.T.A.No.1439/Mds/2014. For Appellant : Mr.Karthik Ranganathan Senior Standing Counsel Page 1/5 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.200 of 2017 For Respondent : Mr.N.V.Balaji JUDGMENT (Judgment of this Court was delivered by R.MAHADEVAN, J.) This tax case appeal has been filed by the appellant / Revenue, challenging the order dated 17.06.2016 passed by the Income Tax Appellate Tribunal, Chennai 'B' Bench, relating to the assessment year 2008-2009. 2.By order dated 06.04.2017, this court admitted the aforesaid tax case appeal on the following substantial questions of law: "(i) Whether on the facts and in the circumstances of the case and in law, Tribunal erred in entertaining the appeal against the order of CIT (A), which was dismissed, since assessee gave in writing that it is not pressing the appeal without noting that only an aggrieved assessee can file appeal under section 253(1) of the Income Tax Act and further without taking cognizance of the fact that the very same Director of assessee company filed letter before CIT (A) and filed the present appeal before ITAT? (ii) Whether on the facts and circumstances of the case and in law, Tribunal was right and justified in deleting the Page 2/5 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.200 of 2017 addition under section 35AC after expiry of six year, for cross examining the witness when the outcome of the enquiry was put to Shri Balasubramaniam, Director of assessee company in the year 2010 itself as evident from the assessment order, and the assessee neither denied such finding nor asked for cross-examining such persons?" 3.When the matter was taken up for consideration, the learned counsel appearing for the respondent / assessee submitted that during the pendency of this tax case appeal, the assessee has availed the benefit conferred under the Direct Tax Vivad Se Vishwas Act, 2020 and filed necessary declarations, which were accepted and Form 5 / order for full and final settlement of tax arrears, was also issued by the Income tax department, on 09.04.2021. The learned counsel has also filed Form 5 dated 09.04.2021 to that effect. 4.The aforesaid submission made by the learned counsel for the respondent/assessee has also been fairly conceded by the learned standing counsel appearing for the appellant/ Revenue. 5.In view of the subsequent development, this court is of the opinion Page 3/5 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.200 of 2017 that nothing survives for adjudication in this appeal. Recording the submission so made by the learned counsel on either side, the Tax Case Appeal stands disposed of. No costs. [R.M.D,J.] [M.S.Q, J.] 01.08.2022

Internet : Yes

Index : Yes / No av To 1. The Income Tax Appellate Tribunal, Chennai 'B' Bench, 2. The Principal Commissioner of Income Tax 4, No.121, Mahatma Gandhi Road, Nungambakkam, Chennai. 3. The Deputy Commissioner of Income-tax, Company Circle IV(1), Chennai. Page 4/5 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.200 of 2017 R. MAHADEVAN, J. and MOHAMMED SHAFFIQ, J. av Tax Case Appeal No.200 of 2017

01.08.2022 Page 5/5 https://www.mhc.tn.gov.in/judis

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