COMMISSIONER OF INCOME TAX vs. M/S.PHOOL CHAND MANGALCHAND

TCA/91/2020HC Madras09 March 2021Bench: Hon`ble Mr Justice T. S. SIVAGNANAM4 pages

AI SummaryWithdrawn

What did the High Court hold?

The High Court disposed of the Tax Case Appeal with liberty granted to the assessee to restore the appeal in the event the ultimate decision on their declaration filed under the Vivad Se Vishwas Scheme is not in their favour. If such a prayer is made, the Registry is directed to entertain it without insisting on a condonation of delay application. The substantial questions of law framed for the appeal were left open. Consequently, no decision was rendered on the merits of the substantial questions of law. The operative direction was to dispose of the appeal with the aforementioned liberty, and the substantial questions of law were expressly left undecided.

What were the facts?

The Revenue, Commissioner of Income Tax, Non Corporate Circle 14(3), Chennai, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 16.9.2019 passed by the Income Tax Appellate Tribunal, Chennai ('the Tribunal'). The Tribunal's order was in I.T.A.No.1495/Chny/2019 for the assessment year 2014-15. The appeal was admitted on 19.2.2020. The respondent assessee, M/s. Phool Chand Mangal Chand, was served but did not appear. The Revenue's counsel presented the case. The assessee's counsel informed the court that the assessee had filed a declaration under the Vivad Se Vishwas Scheme, and orders were passed on 18.12.2020.

What were the issues?

1. Whether the Income Tax Appellate Tribunal was right and justified in setting aside the order passed by the Assessing Officer to re-examine the matter when the Assessing Officer had already duly examined the matter before passing the assessment order? (Question of law and fact, concerning the Tribunal's power to remand/set aside). 2. Whether the Income Tax Appellate Tribunal was right and justified in remitting the issue back to the file of the Assessing Officer and shifting the onus to the Revenue with a direction that the Assessing Officer shall bring on record the role of the assessee in promoting the company and the relationship of the assessee, if any with the promoters, role of the assessee in inflating the price of shares, etc.? (Question of law and fact, concerning the burden of proof and scope of inquiry upon remand). Revenue's Contentions: The Revenue argued that the Tribunal was not justified in setting aside the Assessing Officer's order and remitting the matter back, especially when the Assessing Officer had already conducted a due examination. The Revenue contended that the Tribunal wrongly shifted the onus onto the Revenue to bring on record specific details regarding the assessee's role and relationships. Assessee's Contentions: The assessee did not appear to argue their case. However, it was stated that the assessee had filed a declaration under the Vivad Se Vishwas Scheme.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

TCA.No.91 of 2020 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 09.3.2021 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM and THE HONOURABLE MS.JUSTICE R.N.MANJULA Tax Case Appeal No.91 of 2020

The Commissioner of Income Tax, Non Corporate Circle 14(3), Chennai. ...Appellant Vs M/s.Phool Chand Mangal Chand ...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 against the order dated 16.9.2019 passed by the Income Tax Appellate Tribunal, Madras 'B' Bench, Chennai made in I.T.A.No.1495/Chny/2019 for the assessment year 2014-15. For Appellant: Mr.M.Swaminathan, SSC assisted by Mrs.V.Pushpa, JSC Respondent : served and no appearance Judgment was delivered by

T.S.SIVAGNANAM

This appeal has been filed by the Revenue under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity) challenging the order 1/4 https://www.mhc.tn.gov.in/judis/ TCA.No.91 of 2020 dated 16.9.2019 made in I.T.A.No.1495/Chny/2019 on the file of the Income Tax Appellate Tribunal, Chennai, 'B' Bench ('the Tribunal' for brevity) for the assessment year 2014-15. 2. The appeal was admitted on 19.2.2020 on the following substantial questions of law : ““i. Whether the Income Tax Appellate Tribunal was right and justified in setting aside the order passed by the Assessing Officer to re-examine the matter when the Assessing Officer has already duly examined the matter before passing the assessment order ? and ii. Whether the Income Tax Appellate Tribunal was right and justified in remitting the issue back to the file of the Assessing Officer and shifting the onus to the Revenue with a direction that the Assessing Officer shall bring on record the role of the assessee in promoting the company and the relationship of the assessee, if any with the promoters, role of the assessee in inflating the price of shares, etc.?” 3. We have heard Mr.M.Swaminathan, learned Senior Standing Counsel assisted by Mrs.V.Pushpa, learned Junior Standing Counsel for the appellant/Revenue. Though the respondent is served and their name printed in the cause list, none appears for the respondent. 4. The learned counsel for the assessee submits that the 2/4 https://www.mhc.tn.gov.in/judis/ TCA.No.91 of 2020 assessee already filed the declaration/undertaking under the Vivad Se Vishwas Scheme and orders were passed on 18.12.2020 in Form No.3. 5. In the light of the subsequent event, the assessee is given liberty to restore this appeal in the event the ultimate decision 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 framed are left open. 09.3.2021 To The Income Tax Appellate Tribunal, 'B' Bench, Chennai. RS 3/4 https://www.mhc.tn.gov.in/judis/ TCA.No.91 of 2020 T.S.SIVAGNANAM,J AND R.N.MANJULA,J RS

TCA.No.91 of 2020 09.3.2021 4/4 https://www.mhc.tn.gov.in/judis/

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