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NC: 2024:KHC:39422-DB ITA No. 254 of 2022
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23RD DAY OF SEPTEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO. 254 OF 2022 BETWEEN:
THE PR. COMMISSIONER OF INCOME TAX 5TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU-560095
THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE -6(3)(1) 2ND FLOOR BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560095 …APPELLANTS (BY SRI. RAVI RAJ Y V.,ADVOCATE A/W SRI. DILIP M, ADVOCATE)
AND:
SHRI SANJAY SHENOY NO.333, NOVA MILLER, T THIMMAIAH ROAD, BENGALURU-560051 PAN AWOPS 3523J …RESPONDENT (BY SMT. JYOTHI RATNA ANUMOLU.,ADVOCATE)
THIS ITA / INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN, ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED
Digitally signed by BHARATHI S Location: HIGH COURT OF KARNATAKA
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NC: 2024:KHC:39422-DB ITA No. 254 of 2022
BY THE INCOME TAX APPELALTE TRIBUNAL, BENGALURU IN ITA NO. 2356/BANG/2018 DATED 27/10/2021 FOR ASSESSMENT YEAR 2007- 2008 ANNEXURE-E CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-6(3)(1), BENGALURU AND ETC.
THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S.G.PANDIT and HON'BLE MR JUSTICE C.M. POONACHA
ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT)
Heard the learned counsel Sri Raviraj Y.V, along with learned counsel Sri Dilip M, for appellants/Revenue and learned counsel Smt Jyothi Ratna Anumolu, for the respondent/assessee.
The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short, ‘the Act’) questioning the correctness and legality of order dated 27.10.2021 passed by the Income Tax Appellate Tribunal, ‘B’ Bench, Bengaluru (for short, ‘Appellate Authority’) in ITA.No.2356/Bang/2018 for the assessment year 2007-08, raising the following substantial questions of law:
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NC: 2024:KHC:39422-DB ITA No. 254 of 2022
“1. Whether on the facts and in the circumstances of the case, the Tribunal order can be said as perverse in nature in deleting penalty levied under section 271D and 271E when the evidences gathered during search and post search enquiries clubbed with materials gather in assessment proceedings clearly proved that the assessee had received loans from Shri.P.Dayanand Pai and has repaid the said loan in cash in contravention to provisions of Section 269SS and 269T of the Act?.
Whether on the facts and in the circumstances of the case, the Tribunal is right in law in setting aside penalty order passed in case of assessee when all the conditions prescribed in section 271D and 271E of the Act are satisfied?”
Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue.
On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid
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NC: 2024:KHC:39422-DB ITA No. 254 of 2022
Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024.
In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the questions of law are kept open to be adjudicated in an appropriate proceeding.
Sd/- (S.G.PANDIT) JUDGE
Sd/- (C.M. POONACHA) JUDGE
ND List No.: 3 Sl No.: 33