NARENDER KAUR,KURUKSHETRA, HARYANA vs. INCOME TAX OFFICER WARD-1 , KURUKSHETRA

ITA 165/CHANDI/2025Status: DisposedITAT Chandigarh11 November 2025AY 2018-1968 pages
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What did the Tribunal hold?

The Tribunal held that it is bound by the decisions of the High Courts and cannot sit in appeal over them or test them for per incuriam. Consequently, the Tribunal rejected the assessee's argument that the High Court judgments upholding the applicability of Section 56(2)(viii) post-amendment were per incuriam. The Tribunal found the Assessing Officer's stand of non-compliance with appellate orders, based on the pendency of appeals or attempts to distinguish Supreme Court decisions, to be wrong and highly objectionable. It emphasized the binding nature of Supreme Court judgments under Article 141 of the Constitution. As a result, the common legal ground raised was decided against the assessees, rendering the individual grounds academic. All appeals filed by the assessees were dismissed, and the orders of the Assessing Officer were restored and upheld. Appeals filed by the Revenue were allowed, and their respective orders were sustained.

What were the facts?

This judgment consolidates numerous appeals filed by various assessees and the Revenue before the Income Tax Appellate Tribunal, Chandigarh Bench 'A'. The appeals pertain to assessment years ranging from 2012-13 to 2018-19 and 2014-15 to 2025. The core issue revolves around the applicability of Section 56(2)(viii) of the Income Tax Act, 1961, post-amendment, and the binding nature of High Court judgments and Supreme Court decisions on subordinate authorities. The Tribunal had to decide whether to follow High Court judgments that upheld the applicability of the said section, even if the assessee argued they were rendered per incuriam. The procedural history indicates that Assessing Officers had taken a stance of non-compliance with higher appellate orders, citing pending appeals or attempts to distinguish Supreme Court rulings.

What were the issues?

1. Whether the Income Tax Appellate Tribunal is bound by High Court judgments upholding the applicability of Section 56(2)(viii) of the Income Tax Act, 1961, post-amendment, even if the assessee contends these judgments were rendered per incuriam? (Question of law) Assessee's contentions: The assessee argued that certain High Court judgments were per incuriam, meaning they were decided without considering relevant prior decisions or statutes, and therefore, should not be followed. They also contended that Assessing Officers were not bound to implement orders under appeal if the issue had not attained finality, citing the Supreme Court's decision in SMIFS (1 supra) and the pendency of appeals against the Tribunal's own decisions. Revenue's contentions: The Revenue argued that the Assessing Officer was bound by the decisions of the High Courts and the Supreme Court. They contended that subordinate authorities cannot disregard binding precedents and that the Assessing Officer's refusal to implement appellate orders was objectionable and contrary to judicial discipline and Article 141 of the Constitution of India.

Which sections of the Income-tax Act were involved?

Section 56(2)(viii)

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Cases cited in this judgment(27)Show list

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Heard together (3 matters)

ITA No. 463/Chd/2023
ITA No. 1043 /Chd/2019
ITA No. 1044/Chd/2019

Read from the judgment's own cause title. This page is filed under one of them.

आयकर अपीलीय अधिकरण, चण्डीगढ़ न्यायपीठ “ए”, चण्डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE/HYBRID MODE/VIRTUAL MODE श्री ललित कुमार, न्यायिक सदस्य एवं श्री कृणवन्त सहाय, लेखा सदस्य BEFORE: SHRI. LALIET KUMAR, JM & SHRI. KRINWANT SAHAY, AM Shri Ajay Kumar आयकर अपील सं. / ITA No. 463/Chd/2023 निर्धारण वर्ष / Assessment Year: 2018-19 341, Matana, Fatehabad, Haryana-125050 बनाम The ITO Ward-1, Fatehabad स्थायी लेखा सं./PAN NO: AYJPK1793R अपीलार्थी/Appellant प्रत्यर्थी / Respondent निर्धारिती की ओर से / Assessee by : राजस्व की ओर से / Revenue by : Shri Suraj Bhan Nain, Advocate Shri Manav Bansal, CIT, DR आयकर अपील सं. / ITA No. 1043 /Chd/2019 निर्धारण वर्ष / Assessment Year : 2012-13 Amrinder Singh Khubber S/o Shri Dilbagh Singh, Vill: Shahpur, Ambala Cantt बनाम The ITO Ward-5, Ambala स्थायी लेखा सं./PAN NO: CAYPK4198R अपीलार्थी/Appellant प्रत्यर्थी/Respondent आयकर अपील सं. / ITA No. 1044/Chd/2019 निर्धारण वर्ष / Assessment Year: 2013-14 Amrinder Singh Khubber S/o Shri Dilbagh Singh, Vill: Shahpur, Ambala Cantt बनाम The ITO Ward-5, Ambala स्थायी लेखा सं./ PAN NO: CAYPK4198R अपीलार्थी/Appellant प्रत्यर्थी/Respondent निर्धारित

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