PRINCIPAL COMMISSIONER OF INCOME TAX, vs. RAM KISHAN VERMA

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ITA/90/2023HC RajasthanRJHC02041217202322 May 2025Bench: AVNEESH JHINGAN,MUKESH RAJPUROHIT4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeals filed by the Principal Commissioner of Income Tax. The substantial question of law was answered against the revenue. The Court relied on its prior decision in Principal Commissioner of Income Tax versus Harish Jain & other connected matters, reported in [2025: RJ-JP;9218-DB], which dealt with an identical issue. In that case, the Court had held against the revenue on the substantial question of law concerning the interference by the ITAT with the revisional order under Section 263. The reasoning was that the ITAT's finding that the assessment order was not erroneous and prejudicial to the interest of the revenue was justified. The ratio decidendi is that if a prior High Court judgment addresses an identical issue on similar facts, subsequent appeals on the same point should follow that precedent, especially when the revenue cannot distinguish the present case from the cited one. The operative direction is the dismissal of the appeals.

What were the facts?

The appeals arise from a search conducted on 07.09.2017 at the premises of Resonance Group, Kota, leading to a notice under Section 153A of the Income Tax Act, 1961 (the Act) issued to the respondent-assessee on 05.07.2018. The assessee filed a return declaring income of Rs. 71,22,29,910/- and agriculture income of Rs. 3,22,500/-. The assessment was finalized under Section 143(3) read with Section 153A of the Act. The Assessing Officer (AO) initiated penalty proceedings under Section 271(1)(c) of the Act. The revisional authority, under Section 263 of the Act, directed the AO to initiate penalty proceedings under Section 271(1)(c) after recording independent satisfaction. The Income Tax Appellate Tribunal (ITAT) set aside the revisional order, accepting the assessee's appeal.

What were the issues?

1. Whether the ITAT was justified in interfering with the order passed under Section 263 of the Act by the Principal Commissioner of Income Tax, holding that the assessment order was not erroneous and prejudicial to the interest of the revenue? (Question of law) Assessee's Contention: The assessee relies on the order of the High Court dated 03.03.2025 in Principal Commissioner of Income Tax versus Harish Jain & other connected matters, which dealt with an identical issue and answered the substantial question of law against the revenue. Revenue's Contention: The learned counsel for the appellant (revenue) was not in a position to distinguish the present case from the decision cited by the assessee.

Which sections of the Income-tax Act were involved?

Section 260-A,Section 153-A,Section 143(3),Section 263,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

[2025:RJ-JP:21679-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 89/2023 Principal Commissioner Of Income Tax, (Central), Rajasthan , Fourth Floor, Lic Building, Bhawani Singh Road, Ambedkar Circle, Jaipur ----Appellant Versus Ram Kishan Verma, 33 A, Talwandi, Kota- 324005 (Pan/gir No. Addpk1093R) ----Respondent Connected With D.B. Income Tax Appeal No. 88/2023 Principal Commissioner Of Income Tax, (Central), Rajasthan , Fourth Floor, Lic Building, Bhawani Singh Road, Ambedkar Circle, Jaipur ----Appellant Versus Ram Kishan Verma, 33 A, Talwandi, Kota-324005 (Pan/gir No. Addpk1093R) ----Respondent D.B. Income Tax Appeal No. 90/2023 Principal Commissioner Of Income Tax, (Central), Rajasthan 4Th Floor, Lic Building, Bhawani Singh Road, Ambedkar Circle, Jaipur. ----Appellant Versus Ram Kishan Verma, 33 A, Talwandi, Kota-324005 (Pan/gir No. Addpk1093R) ----Respondent D.B. Income Tax Appeal No. 94/2023 Principal Commissioner Of Income Tax, (Central) Rajasthan, 4Th Floor, Lic Building, Bhawani Singh Marg, Ambedkar Circle, Jaipur ----Appellant Versus Ram Kishan Verma, 33 -A, Talwandi, Kota-324005 (Pan/gir No. - Addpk1093R).

[2025:RJ-JP:21679-DB] (2 of 4) [ITA-89/2023] ----Respondent D.B. Income Tax Appeal No. 95/2023 The Principal Commissioner Of Income Tax, (Central) Rajasthan, 4Th Floor, Lic Building, Bhawani Singh Marg, Ambedkar Circle, Jaipur ----Appellant Versus Manoj Kumar Sharma, 4 -G-20, Talwandi, Kota-324005 (Pan/gir No.-Afops0623J). ----Respondent For Appellant(s) : Mr. Sarvesh Jain & Mr. Meyhul Mittal for Mr. Siddharth Bapna For Respondent(s) : Mr. Mahendra Gargieya with Mr. Tarak Ahuja, Mr. Hemang Gargieya HON'BLE MR. JUSTICE AVNEESH JHINGAN HON'BLE MR. JUSTICE MUKESH RAJPUROHIT Order 22/05/2025 1. These appeals are decided by common order as the facts and issues involved are similar. For the sake of convenience, the facts are being taken from DBITA No.89/2023. 2. This appeal is filed under Section 260-A of the Income Tax Act, 1961 (for short ‘the Act’) against the order of Income Tax tribunal dated 25.11.2022 passed. 3. The brief facts are that consequent to the search conducted on 07.09.2017 at the residential/business premises of Resonance Group, Kota, notice under section 153-A of the Act was issued on 05.07.2018 to the respondent-assessee (hereinafter referred to as ‘assessee’). The assessee filed return declaring income of

[2025:RJ-JP:21679-DB] (3 of 4) [ITA-89/2023] Rs.71,22,29,910/- and agriculture income of Rs.3,22,500/-. The assessment was finalised vide order dated 30.12.2019 under section 143(3) read with 153-A of the Act. In the assessment order, the assessing officer (hereinafter referred to as ‘AO’) recorded satisfaction for initiation of penalty proceedings under section 271-AAB(1A) of the Act but initiated penalty proceedings under section 271(1)(c). The revisional authority under section 263 of the Act vide order dated 23.03.2022 directed the AO to initiate penalty Proceedings under section 271(1)(c) of the Act after recording due satisfaction independently. The appeal of the assessee was accepted by the tribunal and revisional order was set aside. 4. The appeal was admitted on 08.11.2023 on following substantial question of law:- (i) Whether the Ld. ITAT justified in interfering with the order passed under Section 263 of the I.T. Act by the Principal Commissioner of Income Tax holding that present was not a case of an erroneous order of assessment being prejudicial to the interest of revenue?” 5. Learned counsel for the respondent submits that the tribunal had decided appeals of the three assessees by a common order and one of them is the assessee. Relies upon order of this court dated 03.03.2025 titled as Principal Commissioner of Income Tax versus Harish Jain & other connected matters reported in [2025: RJ-JP;9218-DB], wherein the identical issue has been decided and the substantial question of law has been answered against the revenue. 6. Learned counsel for the appellant is not in a position to distinguish the present case from the decision cited above.

[2025:RJ-JP:21679-DB] (4 of 4) [ITA-89/2023] 7. In view of the decision of this Court in Harish Jain (supra), the appeals are dismissed. 8. The substantial question of law is answered against the revenue. (MUKESH RAJPUROHIT),J (AVNEESH JHINGAN),J Chandan/81-85

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