ROYAL CRYSTAL DEALERS PRIVATE LIMITED vs. INCOME TAX OFFICER

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CW/7610/2022HC RajasthanRJHC02038746202223 May 2022Bench: MANINDRA MOHAN SHRIVASTAVA,SAMEER JAIN2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, without commenting on the merits of the case, acknowledged the ground raised by the petitioner that the impugned penalty order might have been passed on an incorrect factual premise concerning the decision of the appeal, which was disputed by the petitioner. Considering this, the Court directed the competent authority to decide the rectification application filed under Section 154 within a period of one month from the date of the order. Furthermore, the Court ordered that no coercive action would be taken against the petitioner until the decision on the rectification application. The writ petition was disposed of with these directions.

What were the facts?

The petitioner, Royal Crystal Dealers Private Limited, filed a writ petition before the Rajasthan High Court, Jaipur Bench, challenging an order dated 25.03.2022 passed under Section 271(1)(c) of the Income Tax Act, 1961. The petitioner contended that the penalty order was based on an incorrect premise that their appeal had been decided by the appellate authority, whereas the appeal was still pending. The petitioner also stated that an application for rectification under Section 154 had been filed on 25.04.2022 and remained undecided. The petitioner apprehended coercive action pursuant to the penalty order.

What were the issues?

1. Whether the penalty order under Section 271(1)(c) of the Income Tax Act, 1961, was passed on an incorrect factual premise regarding the decision of the assessee's appeal? (Question of fact and law) Assessee's Contentions: - The penalty order erroneously stated that the appeal had been decided by the appellate authority, when in fact, the appeal was still pending. - An application for rectification under Section 154, filed on 25.04.2022, remained undecided, and the assessee apprehended coercive action. Revenue's Contentions: - The judgment records no specific contentions from the revenue regarding the factual premise of the penalty order or the pending rectification application.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 154

AI-generated summary — verify with the full judgment below

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Civil Writ Petition No. 7610/2022 Royal Crystal Dealers Private Limited, Principal Place Of Business At D-Block, Multimetals Limited Campus, 6-7 Heavy Industrial Area, Kansua Road, Kota - 324003 Rajasthan Through Its Director Rajesh Kumar Patil, S/o Sh. Raja Ram Patil, Aged About 55, R/o H.no. A 249, Shelke Sadan, Opp. Bala Ji Market, Rangbari Road, Veersavarkar Nagar , Kota-324005, Rajasthan ----Petitioner Versus 1. Income Tax Officer, Ward - 2(1), Dainik Navjyoti Building, Rawatbhata Road, Kota, Rajasthan. 2. National Faceless Assessment Centre, 4Th Floor, Mayur Bhawan, Conaught Place/circus, New Delhi-110001 ----Respondents For Petitioner(s) : Mr. Prakul Khurana, Adv. For Respondent(s) : Ms. Parinitoo Jain, Adv., through VC HON'BLE THE ACTING CHIEF JUSTICE MR. MANINDRA MOHAN SHRIVASTAVA HON'BLE MR. JUSTICE SAMEER JAIN Order 23/05/2022 Heard. The petition has been filed by the petitioner-assessee aggrieved by impugned order dated 25.03.2022 whereby the competent authority has passed an order under Section 271(1) (c) of the Income Tax Act, 1961 in the matter of penalty. Learned counsel for the petitioner would submit that the order proceeds on incorrect factual premise that the appeal has been decided by the appellate authority, whereas according to the petitioner the appeal is still pending because he has not received any final order passed by the appellate authority. His next

(2 of 2) [CW-7610/2022] submission is that he has moved an application for rectification on 25.04.2022 but the application till date remains pending and assessee is apprehending coercive process that may be taken against him pursuant to impugned order of penalty. We find that rectification application under Section 154 has already been filed which also remains pending. Without commenting on merits, taking into consideration the ground raised that impugned order proceeds on factual incorrect premise of the decision of appeal which is seriously disputed by the appellant himself, we would direct the authority to decide the rectification application within a period of one month from today. Till the decision of the rectification application no coercive action shall be taken against the petitioner. Accordingly, the writ petition is disposed off. (SAMEER JAIN),J (MANINDRA MOHAN SHRIVASTAVA),ACTING CJ JKP/Arun/25

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