THE COMMISSIONER OF INCOME TAX vs. SHRI V. MOHAN KUMAR

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ITA/824/2007HC KarnatakaKAHC01058545200728 August 2012Bench: B.MANOHAR,K.SREEDHAR RAO3 pages
AI SummaryRemanded

What did the High Court hold?

The tribunal noted that the rate of tax for block assessment depends on the Supreme Court's decision in Vatika Township. The applicability of a monetary limit circular to pending cases also awaits a Supreme Court decision.

What were the facts?

The Assessing Officer levied tax for block assessment period at the rate applicable for the year of search. A question arose whether an amendment to Section 113 of the IT Act was retrospective or prospective.

What were the issues?

The primary issue was the retrospective or prospective applicability of an amendment to Section 113 of the Income Tax Act concerning the rate of tax for block assessments.

Which sections of the Income-tax Act were involved?

Section 113

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT OF KARNATAKA, BANGALORE

DATED THIS THE 28TH DAY OF AUGUST, 2012

PRESENT

THE HON'BLE MR. JUSTICE K.SREEDHAR RAO

AND

THE HON'BLE MR. JUSTICE B.MANOHAR

I.T.A. No. 824 OF 2007

BETWEEN:-

1.

The Commissioner of Income Tax, Central Circle, C.R. Building, Queens Road, Bangalore.

2.

The Assistant Commissioner of Income Tax, Central Circle-1(4), C.R. Building, Queens Road, Bangalore. Appellants (By Sri K.V. Aravind, Advocate)

AND:-

Shri V. Mohan Kumar, No.315, “Maple”, C Block, Raheja Apartments, 5th Block, Koramangala, Bangalore. Respondent (By Sri S. Parthasarathi, Advocate)

2 This I.T.A. is filed U/s.260-A of the I.T. Act, 1961 arising out of Order dated 22.06.2007 passed in IT(SS)A No.32/Bang/2005, for the Block Assessment Period 01.04.1996 to 02.05.2002, praying that this Hon’ble Court may be pleased to: (i) formulate the substantial questions of law stated therein and (ii) allow the appeal and set aside the order passed by the ITAT, Bangalore in IT(SS) No.32/Bang/2005, dated 22.06.2007 confirming the order of the Appellate Commissioner and confirm the order passed by the Asst. Commissioner of Income Tax, Central Circle-1(4), Bangalore in the interest of justice and equity.

This appeal is coming on for final hearing this day, SREEDHAR RAO, J., delivered the following:

J U D G M E N T In respect of the block assessment, the Assessing Officer levied the tax for the previous years at the rate applicable for the year in which search took place. In respect of the amendment effected to Sec.113 of the I.T. Act, the question arose whether the amendment was retrospective or prospective. The Supreme Court has held that in the case of Commissioner of Income Tax Vs. Suresh Gupta the amendment is by way of clarification and the law as it stood even before the amendment permitted to levy of tax at the rate applicable for the year of search. The decision of the Supreme Court in Suresh Gupta’s case is referred to the Larger Bench in Commissioner of Income Tax Vs. Vatika

3 Township Pvt. Ltd., which is pending decision. In view of the above facts, it is to be noted that the rate of tax applicable for the block assessment should be dependant upon the decision of the Supreme Court in Vatika Township and other connected cases referred to the larger Bench.

2.

In respect of monetary limit as prescribed under the Circular No.3/11 whether it applies to pending cases should also be the subject to the decision of the Supreme court in Ranka and Ranka Case pending in Special Leave Petition. In the event the decision of the Supreme Court is in favour of the revenue, the appellant is permitted to make an application for revival of the appeal for disposal in accordance with the decision of the Supreme Court. Accordingly, for the present the appeal is disposed of.

Sd/- JUDGE

Sd/- JUDGE psg*

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