SRI RAMAKANT SINGH vs. COMMISSIONER OF INCOME TAXCEN

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CWJC/2795/2010HC PatnaBRHC01068225201017 February 20103 pages
AI SummaryRemanded

What did the High Court hold?

The High Court noted that the case was covered by an inter-parte order in a similar writ petition. The Revenue submitted that the assessee had appeared before the Commissioner, filed a reply, and the Commissioner had passed a final order under Section 263. The assessee had appealed to the ITAT, which remanded the matter back to the Commissioner. The ITAT's order, as reproduced, stated that due to the absence of the questionnaire issued by the Assessing Officer (AO) and the assessee's reply, it was impossible to ascertain the nature and extent of inquiries conducted by the AO. Therefore, the ITAT set aside the Commissioner's order and remanded the issue back for fresh decision after allowing the assessee a proper opportunity of being heard. The High Court, in view of these submissions and the ITAT's order, was not inclined to interfere at that stage. The Court directed the Commissioner to dispose of the matter within three months and postponed the hearing date of 17.02.2010 to a further reasonable date.

What were the facts?

The petitioner, Sri Ramakant Singh, filed a writ petition before the Patna High Court challenging a notice dated 19.09.2007 issued under Section 263 of the Income Tax Act, 1961, by the Commissioner of Income Tax (Central), Patna. The petitioner contended that the notice was flawed as the Commissioner had not recorded that the assessing officer's order was erroneous and prejudicial to the revenue. The Revenue submitted that the petitioner had appeared before the Commissioner, filed a show-cause reply, and a final order was passed under Section 263. The petitioner had then appealed to the Income Tax Appellate Tribunal (ITAT), which remanded the matter back to the Commissioner. This procedural history was not disputed by the petitioner.

What were the issues?

1. Whether the notice issued under Section 263 of the Income Tax Act, 1961, was valid, considering the Commissioner had not recorded that the assessing officer's order was erroneous and prejudicial to the interest of the revenue (question of law)? Assessee's Contention: The notice was susceptible to challenge as the prerequisite recording by the Commissioner was absent. Revenue's Contention: The assessee had participated in the proceedings before the Commissioner, and an appeal was filed before the ITAT, which had already remanded the matter. The Revenue did not explicitly argue on the validity of the initial notice but highlighted the subsequent proceedings and remand order. 2. Whether the ITAT's order remanding the matter to the Commissioner was justified (question of mixed law and fact)? Assessee's Contention: Not explicitly stated in the provided text, but the fact that the ITAT remanded the matter suggests the assessee's plea before the ITAT was considered significant. Revenue's Contention: Not explicitly stated, but the Revenue did not dispute the ITAT's order.

Which sections of the Income-tax Act were involved?

Section 263

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.2795 of 2010 *

Sri Ramakant Singh, son of Late Ram Khelawan Singh, aged about 56 years, residing at 101, Lotus Apartment, New Patliputra Colony, Patna 800 013, P.O. New Patliputra Colony, P.S. Patliputra in the town and district of Patna.

Petitioner Versus 1. Commissioner of Income Tax (Central), Patna. 2. Assistant Commissioner of Income Tax, Central Circle 1, Patna. 3. Union of India through the Secretary, Department of Revenue, Ministry of Finance, Government of India, Central Secretariat, North Block, New Delhi- 110 001. Respondents -----------

For the Petitioner : Mr. Vikash Jain, Advocate For the Revenue : Mr. Harshwardhan Prasad, Advocate

Mrs. Archana Sinha, Advocate For the UOI : Miss Kalpana, Advocate ----------

17.02.2010 It is fairly agreed at the Bar that this case is squarely covered by an inter-parte order dated 16.2.2010 in C.W.J.C. No. 2647 of 2010, which reads as follows:-

“By this writ petition the petitioner has prayed for issue of a writ of certiorari for quashment of the notice dated 19.9.2007 issued under Section 263 of the Income tax Act, 1961 (for brevity „the Act‟) by the Commissioner of Income Tax (Central) on the ground that the notice to show cause is sensitively susceptible inasmuch as the Commissioner has not recorded that the order passed by the assessing officer is erroneous as well as prejudicial to the interest of revenue.

Ordinarily, we would have dwelled upon the said issue but Mr. Harshwardhan Prasad,

learned senior standing counsel for Revenue has submitted that the assessee petitioner had appeared before Commissioner and participated by filing a show-case and the Commissioner had passed a final order under Section 263 of the Act and against the said order the assessee had preferred an appeal before the Income tax Tribunal (for short „the Tribunal‟) which has remanded matter to Commissioner of Income Tax (Central). This fact is not disputed by Mr. Jain, learned counsel for the assessee-petitioner.

In this context, we may reproduce paragraph 10 of the order passed by the Tribunal:-

“10. So far as, present case is concerned, we are of the opinion that assessee having not placed a copy of questionnaire dated 17.11.2006 issued by the A.O. and also a copy of assessee‟s reply dated 18.09.2006, it is not possible for us to decide as to was the nature or extent of enquiries/investigation, if any conducted by the A.O. and with respect to which issues the questionnaire was issued, we are unable to decide the assessee‟s plea and since the assessee‟s plea is vital and goes to the roots of cause, we consider it, in the interest of justice, justified to set aside the combined order of CIT and refer the issue back to his file with the directions that issue raised by him by way of show cause notice be decided afresh in accordance with law relating to provisions of section 263 after allowing the assessee a proper opportunity of being heard.”

In view of the aforesaid, we are not inclined to interfere with the order at this stage. However, it is directed that the Commissioner of Income Tax (Central) shall dispose of the matter

within a period of three months from today.

As we have been apprised the said authority has fixed the date on 17.2.2010, as agreed to by learned counsel for the parties, the same should be postponed to a further reasonable date and the matter shall be heard and disposed of in terms of the directions given by the Tribunal within the time frame stipulated hereinabove.

The writ petition is accordingly disposed of.”

In view of the aforesaid concession, this writ petition also stands disposed of in identical terms of the aforesaid order passed in C.W.J.C. No. 2647 of 2010 but without any order as to costs.

Pawan/

(Dipak Misra, CJ)

(Mihir Kumar Jha, J)

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