COMMISSIONER OF INCOME TAX-III vs. SHRI M J BALACHANDER

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ITA/219/2013HC KarnatakaKAHC01051577201321 February 2023Bench: P.S.DINESH KUMAR,RAMACHANDRA D. HUDDAR3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Karnataka disposed of the appeal. The Court noted the submission by the respondent-assessee's counsel that the assessee was assessed on a protective basis and that the department had made similar additions on a substantive basis in the hands of M/s. Venkatesha Education Society. The counsel further submitted that M/s. Venkatesha Education Society had paid the disputed tax under the Vivad se Vishwas scheme, and the High Court had dismissed the department's appeals in that regard. The respondent-assessee argued that in light of FAQ No. 35 to Circular No. 9/2020, the department should pass a rectification order deleting the protective additions. The Revenue did not dispute these submissions. Consequently, the Court directed the Assessing Officer to pass a rectification order, thereby disposing of the appeal.

What were the facts?

This case involves an appeal filed by the Commissioner of Income Tax-III and the Deputy Commissioner of Income Tax (Revenue) against an order of the Income Tax Appellate Tribunal (ITAT), Bangalore Bench, dated December 21, 2012, in ITA Nos. 92/Bang/2012 and 97/Bang/2012, for the Assessment Year 2007-08. The assessee is Shri M.J. Balachander. The High Court of Karnataka is hearing the appeal under Section 260-A of the Income Tax Act, 1961. The respondent-assessee's counsel submitted a memo stating that the assessment was made on a protective basis. The department had made similar additions on a substantive basis in the hands of M/s. Venkatesha Education Society, which was a subject of appeal before the same court. M/s. Venkatesha Education Society had paid the disputed tax under the Vivad se Vishwas scheme, and the High Court had dismissed the department's appeals concerning that assessee.

What were the issues?

1. Whether the present appeal filed by the Revenue survives for consideration, given that the assessee was assessed on a protective basis and the substantive additions made in the hands of M/s. Venkatesha Education Society have been resolved under the Vivad se Vishwas scheme and dismissed by this Hon'ble Court. The Revenue's contentions are not recorded in the judgment. The Assessee's contentions are: - The Respondent (assessee) was assessed on a protective basis. - The department made the same additions on a substantive basis in the hands of M/s. Venkatesha Education Society, in which the department was in appeal before this Hon'ble Court in ITA Nos. 248/2013, 254/2013, 255/2013, 257/2013, 258/2013. - M/s. Venkatesha Education Society paid the disputed tax under the Vivad se Vishwas scheme. - This Hon'ble Court dismissed the department's appeals concerning M/s. Venkatesha Education Society by an order dated January 10, 2023. - In view of FAQ No. 35 to Circular No. 9/2020, the department has to pass a rectification order deleting the protective additions. - Therefore, the appeals of the department should be dismissed.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

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ITA No. 219/2013

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF FEBRUARY, 2023 PRESENT THE HON'BLE MR JUSTICE P.S.DINESH KUMAR AND THE HON'BLE MR JUSTICE RAMACHANDRA D. HUDDAR INCOME TAX APPEAL NO. 219 OF 2013

BETWEEN:

COMMISSIONER OF INCOME TAX-III CENTRAL REVENUE BUILDINGS QUEENS ROAD BANGALORE - 560 001

2.

DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-1(2) BANGALORE …APPELLANTS

(BY SHRI. E.I. SANMATHI, STANDING COUNSEL)

AND:

SHRI. M.J. BALACHANDER 16, 1ST MAIN ROAD VASANTH NAGAR BANGALORE …RESPONDENT

(BY SHRI. S. SHARATH, ADVOCATE)

THIS ITA IS FILED UNDER SEC.260-A OF I.T. ACT, 1961, ARISING OUT OF ORDER DATED 21.12.2012 PASSED IN ITA NO.92/BANG/2012 AND ITA NO.97/BANG/2012, FOR THE ASSESSMENT YEAR 2007-08, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN AND SET ASIDE THE APPELLATE ORDER DATED 21.12.2012 PASSED BY THE ITAT, 'B' BENCH, BANGALORE IN APPEAL PROCEEDINGS ITA NO.92 & 97/BANG/2012 DATED 21.12.2012, AS SOUGHT FOR IN THIS APPEAL.

Digitally signed by ANUSHA V Location: HIGH COURT OF KARNATAKA

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ITA No. 219/2013

THIS ITA, COMING ON FOR HEARING, THIS DAY, P.S.DINESH KUMAR, J., DELIVERED THE FOLLOWING:

JUDGMENT

Shri Sharath, learned advocate appearing for the respondent has filed a memo of even date and it reads as follows: “It is submitted that the Respondent in the above Appeals were assessed on protective basis. The department made very same additions on substantive basis in the hands of M/s. Venkatesha Education Society, where the department was in Appeal before this Hon’ble Court in ITA Nos. 248/2013, 254/2013, 255/2013, 257/2013, 258/2013. The Assessee M/s. Venkatesha Education Society paid the disputed tax under vivad se vishwas scheme.

This Hon’ble Court dismissed the department appeals of the Assessee viz., M/s. Venkatesh Education Society by order dated 10.01.2023. Thus, the Respondent Assessee being assessed on protective basis, in view of FAQ No.35 to Circular No.9/2020 the department has to pass the rectification order deleting the protective additions.

In this regard the Respondent prays before this Hon’ble Court to dismiss the Appeals of the department. ”

2.

Shri Sharath submitted that other assessee, M/s. Venkatesha Education Society, has paid tax under vivad se vishwas scheme. Therefore, this appeal does not survive for consideration. He further submitted that

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ITA No. 219/2013

this appeal arises out of protective assessment and the only thing remains to be done by the AO1 is to pass rectification order as per question No.25 in Circular No.9/2020. The same is not disputed by Shri E.I.Sanmathi.

3.

In view of the above, this appeal stands disposed of with a direction to the AO to pass rectification order.

No costs.

Sd/- JUDGE

Sd/- JUDGE

AV List No.: 1 Sl No.: 25

1 Assessing Officer

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