TAMIL NADU WAREHOUSING vs. THE ASSISTANT COMMISSIONER

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TCA/732/2017HC Madras04 July 2022Bench: Hon`ble Mr Justice R. MAHADEVAN6 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court did not decide the substantial questions of law on merits. The learned counsel for the appellant/assessee filed a memo stating that the assessee had availed the benefit under the Direct Tax Vivad Se Vishwas Act, 2020, and had been issued Form 3. Consequently, the assessee submitted that nothing further survived for adjudication and sought permission to withdraw the appeal. In view of these submissions, the Court dismissed the tax appeal as withdrawn. No specific findings were made on the issues of reassessment validity, reopening after four years, or the allowability of leave encashment provision. The operative direction was to dismiss the appeal as withdrawn.

What were the facts?

The assessee, Tamilnadu Warehousing Corporation Limited, filed a Tax Case Appeal before the High Court of Judicature at Madras, challenging an order dated 04.05.2017 passed by the Income Tax Appellate Tribunal (ITAT), Chennai, in I.T.A.No.323/Mds/2016 for the Assessment Year 2008-2009. The appeal was admitted on substantial questions of law concerning the validity of reassessment, the cancellation of reopening after four years, and the allowability of provision for leave encashment. During the hearing, the assessee's counsel submitted a memo stating that the assessee had availed the benefit under the Direct Tax Vivad Se Vishwas Act, 2020, and had been issued Form 3, rendering further adjudication unnecessary.

What were the issues?

The High Court had to decide the following substantial questions of law: 1. Whether the ITAT was right in upholding the reassessment despite the Assessing Officer failing to pass a speaking order on the objections raised by the assessee against the reopening. 2. Whether the ITAT was right in not cancelling the reopening after four years from the end of the assessment year, given no failure on the part of the assessee to disclose material facts leading to escaped assessment. 3. Whether the ITAT was right in holding that the provision for leave encashment is not an allowable expenditure under Section 43B(f) of the Income Tax Act, 1961. 4. Whether the ITAT was right in deciding the issue of allowability of provision for leave encashment against the assessee when the same issue was decided in favour of the assessee by the same Tribunal for earlier assessment years. The assessee contended that the reassessment was invalid due to the lack of a speaking order and that reopening after four years was unjustified. The revenue's contentions are not explicitly recorded in the provided text.

Which sections of the Income-tax Act were involved?

Section 260A,Section 43B

AI-generated summary — verify with the full judgment below

Tax Case Appeal No.732 of 2017 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 04.07.2022 CORAM : THE HON'BLE MR. JUSTICE R. MAHADEVAN AND THE HON'BLE MR. JUSTICE MOHAMMED SHAFFIQ Tax Case Appeal No.732 of 2017 Tamilnadu Warehousing Corporation Limited, 82, Anna Salai, Guindy, Chennai – 600 032. [PAN: AAACT 2474Q] ... Appellant Vs.

The Assistant Commissioner of Income Tax, Corporate Circle 3 (1), Chennai – 600 034. ... Respondent

Tax Case Appeal filed under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, “A” Bench, Chennai, dated 04.05.2017 passed in I.T.A.No.323/Mds/2016. For Appellant : Ms.S.Sreelakshmi Valli For Mr.G.Baskar For Respondent : Mr.M.Swaminathan Standing Counsel Page 1/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.732 of 2017 J U D G M E N T (Judgment was delivered by R. MAHADEVAN, J.) This Tax Case Appeal has been filed by the appellant / assessee challenging the order dated 04.05.2017 passed by the Income Tax Appellate Tribunal, Bench 'A', Chennai ('the Tribunal', for brevity) in I.T.A.No.323/mds/2016 for the Assessment Year 2008-2009. 2.The above appeal was admitted on 22.12.2017 on the following substantial questions of law : “(i) Whether the Income Tax Appellate Tribunal is right in law in upholding the reassessment even when the Assessing Officer failed to pass a speaking order on the objections raised by the appellant against reopening of assessment? (ii) Whether on the facts and circumstances of the case, the Income Tax Appellate Tribunal is right in law in not cancelling the reopening after four years from the end of the assessment year, as there was no failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment, due to which, any income chargeable to tax has escaped assessment? Page 2/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.732 of 2017 (iii) Whether on the facts and circumstances of the case, the Income Tax Appellate Tribunal is right in holding that the provision for leave encashment is not an allowable expenditure under provisions of Section 43B(f) of the Income Tax Act, 1961? and (iv) Whether the Income Tax Appellate Tribunal is right in deciding the issue of allowability of provision for leave encashment against the appellant, when the same issue had been decided in favour of the appellant by the same Tribunal in the appellant's own case for the assessment years 2005-06 and 2010-11?” 3. When the matter was taken up for hearing, the learned counsel for the appellant filed a memo dated 29.10.2021, wherein, it is stated that the appellant / assessee has already availed the benefit conferred under the Direct Tax Vivad Se Vishwas Act, 2020 and Form 3 has also been issued to them and hence, nothing survives for further adjudication herein. Stating so, the learned counsel sought permission of this court to withdraw this appeal. Page 3/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.732 of 2017 4. In view of the above submissions made by the learned counsel for the appellant / assessee, this tax appeal case is dismissed as withdrawn. No costs. [R.M.D, J.] [M.S.Q, J.] 04.07.2022

r n s Internet : Yes.

Index : Yes / No. Page 4/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.732 of 2017 To 1. The Commissioner of Income Tax (Appeals – II), Chennai. 2. The Assistant Commissioner of Income Tax, Corporate Circle 3 (1), Chennai – 600 034. 3.The Income Tax Appellate Tribunal, Chennai, “A” Bench. Page 5/6 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.732 of 2017 R. MAHADEVAN, J. and MOHAMMED SHAFFIQ, J. r n s Tax Case Appeal No.732 of 2017

04.07.2022 Page 6/6 https://www.mhc.tn.gov.in/judis

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