DESMOND SAVIO THEODORE FERNANDES,MUMBAI vs. ITO FACELESS ASSESSMENT, MUMBAI

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ITA 2072/MUM/2021Status: DisposedITAT Mumbai17 May 2022AY 2017-182 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that appeals against penalty orders under section 270A passed by the Assessing Officer are appealable before the Commissioner (Appeals) under section 246A(1)(q). The appeal filed before the ITAT was therefore not maintainable.

What were the facts?

The assessee filed an appeal directly before the ITAT against a penalty order passed by the Assessing Officer under section 270A. The Departmental Representative objected, stating the appeal should have been filed before the Commissioner (Appeals) first.

What were the issues?

The primary issue was the correct forum for filing an appeal against a penalty order under section 270A passed by the Assessing Officer. The Tribunal had to determine the interplay between sections 246A and 253 of the Income Tax Act.

Which sections of the Income-tax Act were involved?

Section 270A,Section 246A,Section 253

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI D BENCH, MUMBAI

Per Pramod Kumar VP 1. When this appeal was called out for hearing, Shri Shankar, learned Departmental Representative, pointed out that this appeal is filed against the penalty order under section 270A of the Income Tax Act, 1961, passed by the Assessing Officer, directly before us whereas the assessee ought to have approached the learned Commissioner (Appeals) first. Learned counsel for the assessee, on the other hand, submits that Section 246A, which lists out the appealable orders before the CIT(A) does not refer to an order passed by the Assessing Officer under section 270A, whereas Section 253(1)(a), which sets out provisions for appeals before the Income Tax Appellate Tribunal, does specifically refer to the orders passed under section 270A. Learned counsel thus submits that in his humble understanding the appeal has been rightly filed before the Tribunal. He, however, hastens to submit that he is a relatively new to the tax appeals, and he prays for our guidance to make any amends, if so necessary. 2. The objection taken by the learned Departmental Representative is indeed correct. Section 246A(1)(q) specifically includes, in orders appealable before the learned Commissioner (Appeals), “an order imposing a penalty under chapter XXI”, and chapter XXI of the Income Tax Act, 1961 covers Sections 270 to 275- Section 270A, dealing with underreporting

1.

Assessment year: 2017-18 Page 2 of 2 and misreporting of income, is thus covered by the said provision. Clearly, therefore, the appeal against an order imposing penalty under section 270A, as passed by the Assessing Officer, is appealable before the Commissioner (Appeals). As for the reference to the order passed under section 270A being appealable before this Tribunal, under section 253(1)(a), is specifically with reference to such orders being passed by the Commissioner (Appeals), and that is the limited extent to which general provisions of the Section 246A(1)(q) must make way for the specific provisions of the Section 253(1)(a). The order sought to be impugned in this appeal is passed by the Assessing Officer, and, therefore, this exception does not come into play. Learned counsel’s understanding of the legal position, even if bonafide- particularly considering his young age and limited experience, is clearly incorrect. The appeal filed before us is thus indeed not maintainable in law.

3.

When the above legal position was explained to the learned counsel for the assessee, he sought liberty to file the appeal before the CIT(A) and submitted that the error was in good faith and it should not prejudice the legitimate interests of the assessee concerned.

4.

It is for the learned counsel to file the appeal, alongwith condonation petition setting out the requisite details resulting in the delay in filing of appeal before the CIT(A), as soon as possible now, and it is for the learned CIT(A) to take a call thereon in accordance with the law, by way of a speaking order and after giving a due and reasonable opportunity to the assessee. As on now, there is no cause of action for our interference in the matter, nor do we hope that it will be necessary. We leave it at that for the time being.

5.

In the result, the appeal is dismissed as non-maintainable. Pronounced in the open court today on the 17th day of May, 2022.

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