THE COMMISSIONER OF INCOME TAX vs. SHRI BABU OOMMEN

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ITA/348/2010HC KeralaKLHC01027040201013 March 2012Bench: HONOURABLE MR. JUSTICE BABU MATHEW P.JOSEPH,HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court held that the issue of whether a subsequent amendment to the statute with retrospective effect justifies the rectification of a completed assessment under Section 154 of the Act is covered by the Division Bench judgment of this Court in ITA No. 1508/2009 dated March 23, 2010. Following this precedent, the High Court allowed the appeals filed by the Revenue. The Court reversed the orders of the ITAT and restored the rectified assessments. The ratio decidendi is that a completed assessment can indeed be rectified under Section 154 if a subsequent amendment to the statute is made retrospective, as established by the High Court's prior ruling. The operative direction was to allow the appeals and restore the rectified assessments.

What were the facts?

This case involves appeals by the Commissioner of Income Tax (Central), Cochin, against orders of the Income Tax Appellate Tribunal (ITAT), Cochin Bench. The respondent is Shri Babu Oommen, representing Alphonsa Cashew Industries. The appeals challenge the ITAT's order dated May 19, 2010, which was issued in appeal No. 999/2008. The core of the dispute revolves around the validity of rectifying a completed assessment under Section 154 of the Income Tax Act, 1961, following a subsequent amendment to the statute with retrospective effect. The procedural history includes an assessment order, orders from the Commissioner of Income Tax (Appeals), and multiple orders from the ITAT.

What were the issues?

1. Whether a completed assessment can be rectified under Section 154 of the Income Tax Act, 1961, based on a subsequent amendment to the statute with retrospective effect? (Question of law) Assessee's Contention: The judgment does not record any specific contentions made by the assessee. The appeal is by the Revenue. Revenue's Contention: The Revenue contended that a subsequent amendment to the statute, made retrospective, justifies the rectification of a completed assessment under Section 154 of the Act. The Revenue relied on a Division Bench judgment of the High Court of Kerala in ITA No. 1508/2009 dated March 23, 2010.

Which sections of the Income-tax Act were involved?

Section 154

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR & THE HON'BLE MR. JUSTICE BABU MATHEW P.JOSEPH TUESDAY, THE 13TH DAY OF MARCH 2012/23RD PHALGUNA 1933 ITA.No. 348 of 2010 ( ) ----------------------- AGAINST ORDER IN ITA.999/2008 DATED 19/05/2010 of I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT(S):/ RESPONDENT ------------ THE COMMISSIONER OF INCOME TAX, (CENTRAL) COCHIN. BY ADV.SHRI.PKR MENON, SR.SC FOR INCOME TAX ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT(S):/APPELLANT -------------- SHRI.BABU OOMMEN, ALPHONSA CASHEW INDUSTRIES, PUTHOOR.P.O., KOTTARAKKARA, KOLLAM, PIN - 691 509.

BY SRI.DALE P.KURIEN THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 13-03-2012, ALONG WITH ITA. 362/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

ITA NO.348/2010 APPENDIX APPELLANT'S EXHIBITS ANNEXURE-A : COPY OF ASSESSMENT ORDER DATED 21/02/2003. ANNEXURE-B : COPY OF ORDER OF CIT(A)-III, TRIVANDRUM DATED 22/10/2003. ANNEXURE-C : COPY OF ITAT, COCHIN BENCH'S ORDER DATED 31/05/2005. ANNEXURE-D : COPY OF ORDER UNDER SECTION 154 DATED 28/02/2008 OF A.O. ANNEXURE-E : COPY OF ORDER OF CIT (A)-III, KOCHI DATED 26/09/2008. ANNEXURE-F : COPY OF ITAT, COCHIN BENCH'S ORDER DATED 19/05/2010. ANNEXURE-G : COPY OF JUDGMENT OF HON'BLE HIGH COURT OF KERALA IN ITA NO.1508/2009 DATED 23/03/2010. //TRUE COPY// PA TO JUDGE. jg

C.N.RAMACHANDRAN NAIR & BABU MATHEW P. JOSEPH, JJ. .................................................................... I.T.A.Nos.348 & 362 of 2010 .................................................................... Dated this the 13th day of March, 2012. J U D G M E N T Ramachandran Nair, J. The issue raised is whether the subsequent amendment to the statute with retrospective effect justify rectification of completed assessment under Section 154 of the Act is covered by the Division Bench judgment of this Court in I.T.A.No.1508/2009 dated 23/03/2010. In fact, this judgment is issued against an order of the Tribunal based on which the Tribunal has issued the impugned order. Following the above referred judgment, we allow the appeals by reversing the orders of the Tribunal and by restoring the rectified assessments. Registry will attach a copy of the judgment in ITA No.1508/2009 dated 23/03/2010 to form part of this judgment. (C.N.RAMACHANDRAN NAIR, JUDGE) (BABU MATHEW P. JOSEPH, JUDGE) jg

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