THE COMMISSONER OF INCOME TAX vs. SRI PRAKASH B NICHANI

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 18TH DAY OF AUGUST, 2015

PRESENT THE HON’BLE MR. JUSTICE VINEET SARAN

AND

THE HON’BLE MR. JUSTICE B MANOHAR

ITA No.399/2009 BETWEEN:

CENTRAL CIRCLE, C R BUILDING, QUEENS ROAD, BANGALORE

.. APPELLANTS

(BY SRI K V ARAVIND, ADV A/W SRI. E.I. SANMATHI, ADV.)

AND:

SHRI PRAKASH B NICHANI S-2, “K” BLOCK, GOLDEN ORCHID, LAVELLE ROAD BANGALORE SINCE DEAD BY L.Rs.

W/O PRAKASH B NICHANI

AGED 40 YEARS. R

AGED 15 YEARS.

SINCE MINOR REPRESENTED BY

NATURAL GUARDIAN,

SMT.NISHA NICHANI.

AGED 13 YEARS.

SINCE MINOR REPRESENTED BY

NATURAL GUARDIAN,

SMT.NISHA NICHANI.

(AS PER COURT ORDER DATED

DATED 8.7.2014)

.. RESPONDENTS

(BY SRI. A. SHANKAR, ADV.)

THIS ITA IS FILED UNDER SECTION 260A OF INCOME TAX ACT, 1961 ARISING OUT OF ORDER DATED 27.02.2009 PASSED IN ITA NO.809/BNG/2008 FOR THE ASSESSMENT YEAR 1998-99 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN AND TO ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT, BANGALORE IN ITA NO.809/BNG/2008 DATED 27.02.2009 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1(3), BANGALORE.

THIS ITA COMING ON FOR HEARING THIS DAY, VINEET SARAN,, J., DELIVERED THE FOLLOWING:

J U D G M E N T

For the assessment year 1998-99, which is in question, the assessee is said to have filed a return of income on 11.1.2000, for which he claims to have a valid receipt from the Income-Tax

Department. No order of assessment was passed on the said return for the assessment year 1998-99 and according to the assessee, the income was deemed to have been accepted under Section 143(1) of the Income Tax Act, 1961 (for short `the Act’). However, a notice dated 30.3.2005 was issued under Section 148 of the Act for reopening assessment under Section 147 of the Act. In pursuance to the said notice, an assessment order dated 31.3.2006 was passed, whereby the return of income dated 11.1.2000, re-filed by assessee in response to the notice issued under Section 148 of the Act, has been accepted in toto. The assessee challenged the said order dated 31.3.2006 by filing an appeal before the Commissioner of Income-Tax (Appeals), wherein the very notice for reopening assessment was also challenged. The said appeal by the assessee was filed with a delay of 331 days. The Appellate Commissioner dismissed the appeal on the ground of delay, which order was challenged by the assessee in appeal before the Tribunal. By impugned order dated 27.2.2009, the Tribunal, after condoning the delay in filing the appeal before the Appellate Commissioner, allowed the appeal of the assessee and remanded the

matter for fresh decision on merits to the Appellate Commissioner. Aggrieved by the said order, this appeal has been filed by the Revenue, which was admitted on two substantial questions of law, but the learned counsel for parties have jointly stated that the only one question of law arises for determination in this appeal, which is as follows: “Whether the Tribunal was correct in proceeding to set aside the order of the Appellate Commissioner by condoning the delay of 331 days without examining the reasons for such condonation and consequently recorded a perverse finding?

erroneous and prejudicial to the interest of revenue. In pursuance thereof, the order dated 4.4.2007 was passed by the Revisional Commissioner, which was against the assessee. It was in such circumstances that after notice under Section 263 of the Act was issued, the appellant filed an appeal on 27.3.2007 (which was prior to the order of Revisional Commissioner) challenging the assessment order dated 31.3.2006 passed by the Assessing Officer. Along with the appeal, an application for condonation of 331 days delay was filed, which was rejected by the Appellate Commissioner.

Sd/- JUDGE

Sd/- JUDGE Bkm