GAURAV JAIN vs. PRINCIPAL COMMISSIONER OF INCOME TAX

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR S.B. Civil Writ Petition No. 7764 / 2017 Gaurav Jain, Son of Shri Suresh Jain, Resident of 31/A3, Geejgarh Vihar, Jaipur in the State of Rajasthan ----Petitioner Versus Principal Commissioner of Income Tax, Jaipur-1, New Central Revenue Building, Statue Circle, Bhagwan Das Road, C-Scheme, Jaipur ----Respondent Connected With S.B. Civil Writ Petition No. 7765 / 2017 Prem Jain, Wife of Shri Suresh Jain, Resident of 90 Bapu Bazar, Jaipur in the State of Rajasthan. ----Petitioner Versus Principal Commissioner of Income-tax, Jaipur-1, New Central Revenue Building, Statue Circle, Bhagwan Das Road, C-Scheme, Jaipur. ----Respondent _____________________________________________________ For Petitioner(s) : Mr. Siddharth Ranka For Respondent(s) : Mr. Anuroop Singhi with Mr. Saurabh Jain _____________________________________________________ HON'BLE MR. JUSTICE M.N.BHANDARI Judgment 06/09/2017

By these writ petitions, a challenge is made to the order dated 29th March, 2017 passed by the Principal Commissioner of Income Tax-1, Jaipur. Learned counsel submits that after submission of the return, the petitioner made disclosure under self-assessment on 24th August, 2015. He had paid the tax arising out of it. It was over

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and above the tax paid earlier pursuant to the return for the assessment year 2013-14. The petitioner made an application under Section 183 of the Act of 1961 before the Principal Commissioner of Income Tax-I. The undisclosed income of Rs.1,72,50,100/- was shown which was earlier disclosed in the self-assessment with payment of tax. The petitioner prayed for set- off the tax already paid under self-assessment but the prayer aforesaid has been rejected despite instruction of CBDT. Thus impugned order be set aside with a direction to consider the application made by the petitioner after set-off of the tax already paid pursuant to self-assessment. The petitioner was not liable to pay tax again on the income while maintaining the application under Section 183 of the Income Tax Act, 1961 (for short “the Act of 1961”). A reference of the judgment of Delhi High Court in the case of Kumudam Publications Pvt. Ltd. Vs. Central Board of Direct Taxes, reported in (2017) Taxmann.com 466 (Delhi) has been given. Learned counsel for respondent has contested the writ petition. It is submitted that an application under Section 183 of the Act of 1961 is maintainable when there exists undisclosed income. Since the petitioner had already made disclosure of his income while submitting return and subsequently in the self- assessment, income disclosed therein cannot be taken to be undisclosed income under Section 183 of the Act of 1961. Section 183 makes a reference of the undisclosed income and it means

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other than the income already disclosed. In view of the above, application filed by the petitioner under Section 183 of the Act of 1961 was not even maintainable. Learned counsel for petitioner at this stage submitted that issue about maintainability of the application has not been dealt in the impugned order. The limited issue decided by the Principal Commissioner of Income Tax as to whether tax paid pursuant to the income disclosed under self-assessment can be set-off for compliance of the provision of Section 183 of the Act of 1961. It is held that amount of tax already paid would not be set-off pursuant to the disclosure earlier made by the petitioner. I have considered the rival submissions made by learned counsel for the parties and perused the record. The facts of the case have been referred and perusal of the order passed by the Principal Commissioner of Income Tax-I reveals discussion of the issue as to whether tax already paid pursuant to self-assessment can be set-off for compliance of application under Section 183 of the Act of 1961. The issue has been decided against the petitioner. Learned counsel for respondent, however, raised another issue and it goes in roots of the case. It is about maintainability of the application under Section 183 of the Act of 1961. According to him, income of Rs.1,72,50,100/- was disclosed in self-assessment and tax was paid thereupon. The same income cannot be said to be undisclosed income to maintain application under Section 183 of the Act of 1961. The issue aforesaid has not been determined by

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the Principal Commissioner of Income Tax-I though goes in roots of the case. In view of the aforesaid, the matter needs to be remanded back to the Principal Commissioner of Income Tax-I to consider the issue about maintainability of the application under Section 183 of the Act of 1961. If the issue is decided in favour of the assessee then to consider the issue afresh for set-off tax for maintaining the application under Section 183 of the Act of 1961. The parties are directed to appear before the Principal Commissioner of Income Tax-I on 15th September, 2017. In view of remand of the case, impugned order is set aside, however, it would not be taken adverse to the respondent, rather, remand of the case is for consideration of the issue about maintainability of the application under Section 183 of the Act of 1961 and only for other reason. The writ petitions are disposed of with the aforesaid. A copy of this order be placed in each connected file. (MN BHANDARI) J. FRBOHRA