Madhya Pradesh High Court Judgments — 2024

The High Court held that no substantial question of law arises from the order of the ITAT. The Court agreed with the concurrent findings of the CIT(A) and the ITAT that the assessee was a member of an AOP/BOI (syndicates) where the share of members was determinate and known. Since these syndicates were chargeable to tax at the maximum marginal rate, the assessee's share of profit/income fell under clause (a) of the first proviso to Section 86 read with Section 67A of the Act. Therefore, the AO was not justified in making additions in the hands of the assessee for their share in the profits or inadmissible expenses of the syndicates. The Court found no perversity in the ITAT's well-reasoned order, which considered all material on record and dealt with all grounds raised by the appellant. Interference with the concurrent findings was not warranted, and the appeals were dismissed in limine.

The High Court held that no substantial question of law arises from the order of the ITAT. It agreed with the concurrent findings of the CIT(A) and the ITAT that the income derived by the syndicates was required to be assessed in the hands of the syndicates themselves, and a direct assessment in the hands of the assessee (members) was not permissible. The Court reasoned that as per Section 86(a) read with Section 67A of the Income Tax Act, 1961, if the share of a member in an AOP/BOI is determinate and the AOP/BOI is chargeable to tax at the maximum marginal rate or higher, the member's share of profit/income is not includible in their total income. The Court found that the ITAT had considered all grounds raised by the appellant and passed a well-reasoned order, and there was no perversity in its findings. Therefore, interference by the High Court was not warranted.

The High Court held that no substantial question of law arises from the order of the ITAT. The Court agreed with the concurrent findings of the CIT(A) and the ITAT. The reasoning was based on the established legal position that income derived by syndicates (AOP/BOI) should be assessed in the hands of the syndicates. Furthermore, as per Section 86(a) read with Section 67A of the Act, if the syndicate is chargeable to tax at the maximum marginal rate, the share of income received by a member from such syndicate is not to be included in the member's total income. The Court found that the CIT(A) and ITAT had correctly applied this principle, noting that separate assessments had already been framed for some syndicates and the income determined. Therefore, the AO was not justified in making additions in the hands of the assessee for their share in syndicate profits and inadmissible expenses. The appeals were dismissed in limine.

The High Court held that no substantial question of law arises from the order of the ITAT. The Court agreed with the concurrent findings of the CIT(A) and the ITAT. The reasoning was based on the established legal position that income derived by syndicates (AOP/BOI) should be assessed in the hands of the syndicates. Furthermore, as per Section 86(a) read with Section 67A of the Act, if the syndicate is chargeable to tax at the maximum marginal rate, the share of income received by a member from such syndicate is not to be included in the member's total income. The Court found that the CIT(A) and ITAT had correctly applied this principle, noting that separate assessments had already been framed for some syndicates and the income determined. Therefore, the AO was not justified in making additions in the hands of the assessee for their share in syndicate profits and inadmissible expenses. The appeals were dismissed in limine.

The High Court held that the ITAT was justified in setting aside the revisional order. The ITAT had found that the statutory notice under Section 142(1) was issued by the AO with a specific query about the Nardana Claims, and the assessee provided a cogent reply. The AO's acceptance of the assessee's explanation was not an unsustainable view, as the liability could have been recognized as income in AY 2018-19. The amount received against a 100% bank guarantee was correctly shown as a liability. The income was offered in the subsequent year after the court's favorable order. The Court relied on the Apex Court's decision in CIT v/s Hindustan Housing & Land Development Trust Limited, which states that income cannot be said to have accrued or arisen as long as there is a dispute or litigation. Therefore, the approach of the assessee and the AO was not erroneous-cum-prejudicial to the interest of revenue. The proposed questions of law were not substantial questions of law, and there was no ground to interfere with the ITAT's order.

The High Court held that the appeal filed by the Principal Commissioner of Income Tax-I is dismissed. The Court found no question of law involved. The reasoning was based on the concurrent findings of the CIT(A) and the ITAT. The CIT(A) had noted that the AO made the addition by including the closing balance of the previous year which also encompassed the opening balance of the provision. The CIT(A) detailed the calculations for both surplus/obsolete/unserviceable stores and non-moving items, showing how the closing balances were arrived at scientifically. The ITAT confirmed this, specifically stating that the AO committed a factual mistake by clubbing both the opening and closing balances of inventories instead of considering the provision made by the assessee during the year. Given these concurrent findings, the High Court was not inclined to interfere.

The High Court held that the interim order passed by the Principal Chief Commissioner of Income Tax on 12.06.2024, which had stayed the outstanding demand for three months, deserved to be extended. The Court noted that the appeals were pending and it was uncertain how long they would take to be decided. Therefore, the Court extended the order passed by the Principal Chief Commissioner dated 12.06.2024 until the decision of the appeal. The Court explicitly stated that it had not dwelled on the merits of the cases and that the respondents were free to decide the appeals expeditiously in accordance with law. The writ petitions were disposed of accordingly.

The High Court held that the interim order passed by the Principal Chief Commissioner of Income Tax on 12.06.2024, which had stayed the outstanding demand for three months, deserved to be extended. The Court noted that the appeals were pending and it was uncertain how long they would take to be decided. Therefore, the Court extended the order passed by the Principal Chief Commissioner dated 12.06.2024 until the decision of the appeal. The Court explicitly stated that it had not dwelled on the merits of the cases and that the respondents were free to decide the appeals expeditiously in accordance with law. The writ petitions were disposed of accordingly.

The High Court held that the interim order passed by the Principal Chief Commissioner of Income Tax on June 12, 2024, which stayed the outstanding demand, deserved to be extended. The Court reasoned that the Principal Chief Commissioner had already granted a three-month stay, and given the uncertainty regarding the time it would take to decide the pending appeals, extending the existing interim order was appropriate. The Court explicitly stated that it had not delved into the merits of the cases. The respondents were directed to decide the appeals expeditiously and in accordance with law. The operative direction was to extend the order of the Principal Chief Commissioner dated June 12, 2024, until the decision of the appeal.

The High Court held that the interim order passed by the Principal Chief Commissioner of Income Tax on June 12, 2024, which granted a stay on the outstanding demand for three months, deserved to be extended. The Court noted that the stay had already been granted and that it was unclear how long the pending appeals would take to be decided. Consequently, the Court extended the order passed by the Principal Chief Commissioner of Income Tax dated June 12, 2024, until the decision of the appeal. The Court explicitly stated that it had not considered the merits of the cases and that the respondents were free to decide the appeals expeditiously and in accordance with law. The operative direction was to extend the existing stay order.

The High Court dismissed all the writ petitions. The Court held that the process of refining crude soyabean oil into refined soyabean oil results in the emergence of a new, commercially different commodity, which constitutes 'manufacture' for the purpose of Entry Tax. The Court relied on the principle that 'manufacture' means bringing into existence a new substance, not merely bringing about a change. It was noted that refined soyabean oil is a consumable product used in cooking, unlike crude oil, and its production involves a significant manufacturing process. Therefore, the crude soyabean oil was considered to be consumed or used in the State before the sale of the finished refined oil to other States. Even if the revisional authority held that refining was not manufacturing under a specific notification (No.18 dated 01.04.1995), it was leviable for Entry Tax under another notification (No.82 dated 06.09.2001). The Court found no grounds to interfere with the orders of the Assessment Authority and the Revisional Authority, concluding that Entry Tax was rightly imposed for consumption, use, or sale within the local area.

The Tribunal held that after the ITAT order, the respondents are bound to refund the amount to the petitioner with interest without requiring the petitioner to complete any formalities. The non-functionality of the TRACES Portal cannot be a ground for denying the benefit arising from the statutory provisions of the Income Tax Act. TRACES is an online portal designed to facilitate stakeholders and cannot operate contrary to the Act. The rights granted to the assessee under the Act cannot be withheld due to the portal's non-functionality. If the portal does not function in accordance with the Act and Rules, it requires modification. The Act provides for refunds with interest and set-off against tax payable. The petitioner is ready for either. It is for the competent Income Tax Officer to decide whether to refund or adjust the amount. The entire exercise is to be completed within 30 days from the production of a certified copy of the order. The writ petitions are disposed of with these observations.

The Tribunal held that after the ITAT order, the respondents are bound to refund the amount to the petitioner with interest without requiring the petitioner to complete any formalities. The non-functionality of the TRACES Portal cannot be a ground for denying the benefit arising from the statutory provisions of the Income Tax Act. TRACES is an online portal designed to facilitate stakeholders and cannot operate contrary to the Act. The rights granted to the assessee under the Act cannot be withheld due to the portal's non-functionality. If the portal does not function in accordance with the Act and Rules, it requires modification. The Act provides for refunds with interest and set-off against tax payable. The petitioner is ready for either. It is for the competent Income Tax Officer to decide whether to refund or adjust the amount. The entire exercise is to be completed within 30 days from the production of a certified copy of the order. The writ petitions are disposed of with these observations.

The High Court dismissed the appeal, holding that the ITAT had rightly dismissed the Revenue's appeal. The Court noted that the appellant (Revenue) had conveniently avoided answering the observations made by the CIT and ITAT regarding the finality of assessments for AYs 2011-12, 2015-16, and 2016-17. The Revenue failed to distinguish the facts of the present case from those proceedings. The Court agreed with the ITAT that no different yardstick can be applied to the assessee for different assessment years, especially when the Department had not preferred any appeal in those years where similar issues were considered. All other issues had already been considered in the assessment proceedings for AYs 2011-12, 2015-16, and 2016-17, where no appeal was filed by the Department. Therefore, no grounds were found to admit the appeal.

The High Court held that no substantial question of law arises from the order of the Tribunal. The Court observed that the appellant (Revenue) raised questions of fact and disputed the fact findings of the ITAT under the garb of substantial questions of law, which is not permissible. The Court noted that the ITAT dealt with all grounds raised by the appellant in a well-reasoned and speaking order, considering all material on record. As the ITAT is the final fact-finding authority, and there was no demonstrated perversity in its findings, interference by the High Court was not warranted. The Court cited several Supreme Court judgments, including *Santosh Hazari*, *Hero Vinoth (Minor)*, *Madan Lal*, *Narendra Gopal Vidyarthi*, *Commissioner of Customs (Preventive)*, *Metroark Ltd.*, *West Bengal Electricity Regulatory Commission*, and *K.Ravindranathan Nair*, to emphasize that High Courts should not interfere with concurrent findings of fact unless there is perversity or a substantial question of law is involved. The Court concluded that the appeal lacked merit as making additions/deletions cannot be said to be erroneous and prejudicial to the interest of revenue, and therefore, the appeal did not involve any substantial question of law under Section 260A of the Act. The appeal was dismissed in limine.

The High Court held that no substantial question of law arises from the order of the Tribunal. The Court observed that the appellant (Revenue) raised all questions of fact and disputed the fact-findings of the ITAT under the guise of substantial questions of law, which is impermissible. The Court found no perversity in the ITAT's order, which dealt with all grounds and passed a well-reasoned order considering all material on record. As the Tribunal is the final fact-finding authority, and no perversity was demonstrated, interference by the High Court was not warranted. The Court cited legal principles from Santosh Hazari, Hero Vinoth (Minor), Madan Lal, Narendra Gopal Vidyarthi, Commissioner of Customs (Preventive), Metroark Ltd., West Bengal Electricity Regulatory Commission, and K.Ravindranathan Nair to emphasize that findings of fact by the Tribunal can only be gone into if they are perverse or based on no evidence, or if legal principles are misapplied. The appeal was dismissed in limine as it did not involve any substantial question of law under Section 260A of the Act.

The High Court held that since the petitioner had already availed the statutory remedy by filing an appeal before the Commissioner of Income Tax (Appeals), no further adjudication was necessary in the writ petition. The Court disposed of the writ petition with a direction to the CIT (Appeals) to decide the petitioner's grievance as expeditiously as possible, preferably within three months. The Court explicitly stated that it had not expressed any opinion on the merits of the case. The primary reasoning was that the petitioner had recourse to the appellate authority, rendering the writ petition premature or unnecessary for the High Court to intervene at that stage, other than to ensure timely disposal of the pending appeal.

The High Court held that no substantial question of law arises from the order of the ITAT. The Court referred to Section 260-A of the Income Tax Act, 1961, emphasizing that an appeal lies to the High Court only if it is satisfied that the case involves a substantial question of law. Citing various Supreme Court judgments, the Court reiterated that a substantial question of law must be debatable, not previously settled, and have a material bearing on the decision. Findings of fact by the Tribunal can only be gone into by the High Court if the question referred is whether the finding is perverse, meaning it could not reasonably have been arrived at on the material placed before the Tribunal. In the present case, the appellant (Revenue) raised questions of fact and disputed the fact findings of the ITAT in the garb of substantial questions of law, which is not permissible. The Court found no perversity in the ITAT's order, which had dealt with all grounds and passed a well-reasoned order. As the Tribunal is the final fact-finding authority, and no perversity was demonstrated, interference with the concurrent findings of the CIT(A) and ITAT was not warranted. Consequently, the appeal was dismissed in limine.

The High Court, considering the pendency of the appeal for over 1.5 years and the Supreme Court's order in SLP No.12272/2023, disposed of the writ petition with specific directions. The court directed the Revenue Authorities to decide the application for waiver of pre-deposit and the application for urgent hearing expeditiously, preferably within one month from the receipt of the certified copy of the order, and to pass a reasoned and speaking order. Furthermore, no coercive action was to be taken against the petitioner until then. The Revenue Authorities were also directed to decide the pending appeal itself, without further delay, as expeditiously as possible, preferably within three months from the receipt of the certified copy of the High Court's order. The ratio is that in cases of extreme delay and hardship, and where appellate authorities fail to act on Supreme Court directions, the High Court may intervene to ensure timely adjudication and prevent irreparable harm, while still emphasizing the need for the appellate process to conclude.

The High Court held that a pure question of law can be examined at any stage, even before the High Court, if the factual foundation has been laid and the legal consequences have not been examined. The Court referred to the Supreme Court's decision in K. Lubna vs. Beevi & ors. and Lord Watson's observation in Connecticut Fire Insurance Co. v. Kavanagh. The Court found that the Revenue had raised substantial questions of law which were not decided by the ITAT because there were no averments or arguments to that effect before the ITAT. Therefore, the High Court was of the view that the appeal deserved to be remanded back to the ITAT for fresh adjudication. The order dated 10.08.2022 passed by the ITAT was quashed, and the appeal was remanded back to the ITAT with directions to decide the appeal afresh after giving an opportunity of hearing to the parties and passing a speaking and well-reasoned order on merits within two months.

The High Court held that no substantial question of law arises from the order of the ITAT. The Court referred to Section 260-A of the Income Tax Act, 1961, which allows appeals to the High Court only if a substantial question of law is involved. The Court cited various Supreme Court judgments, including *Hero Vinoth (Minor) Vs. Seshamma* (2006) 5 SCC 545 and *K.Ravindranathan Nair vs. CIT* (2001) 1 SCC 135, emphasizing that High Courts generally do not interfere with concurrent findings of fact by lower authorities unless there is perversity, ignoring material evidence, acting on no evidence, drawing wrong inferences, or wrongly casting the burden of proof. The Court found that the appellant (Revenue) had raised questions of fact and disputed the fact-findings of the ITAT under the guise of substantial questions of law, which is not permissible. The ITAT was considered the final fact-finding authority, and its order was deemed well-reasoned and speaking, taking into consideration all material on record. The Court concluded that there was no demonstrated perversity in the ITAT's findings and therefore, interference was not warranted. The appeal was dismissed in limine.

The High Court allowed the writ petitions and set aside the impugned notice dated 30.03.2006 issued under Section 148 of the Income Tax Act, 1961, as well as the consequential reassessment orders for AY 1999-2000 and AY 2000-2001. The Court reasoned that the petitioner had disclosed all unrecorded sales and transactions, and the original assessment had applied a GP rate of 8% after considering the materials. The Court found no allegation that the petitioner had suppressed any material or failed to disclose income. The reopening was based solely on the AO's opinion that the 8% GP rate was on the lower side, which amounted to a change of opinion. The Court emphasized that under Section 147, reopening after four years requires a failure on the part of the assessee to disclose material facts, which was not established. The Court relied on the principle laid down in *CIT v. Kelvinator of India Limited* that reopening based on a mere change of opinion is not permissible. Therefore, the notices and orders were set aside.

The High Court held that the writ petitions succeed and the impugned notice dated 30.03.2006 issued under Section 148 of the Income Tax Act, as well as the final assessment orders for AY 1999-2000 and AY 2000-2001, are set aside. The Court reasoned that the petitioner had disclosed all unrecorded sale transactions for both years. The Assessing Officer had assessed the gross profit at 8%, and there was no suppression of income or failure on the part of the petitioner to disclose material facts that would give the AO reason to believe that income had escaped assessment. The Court relied on the Supreme Court judgment in *Kelvinator of India* (supra) and *CEAT Ltd.* (supra), stating that Section 147 of the Income Tax Act should not grant arbitrary power to the AO to reopen assessments based on a mere change of opinion. The Court also noted that Explanation 2 to Section 147 must be read in conjunction with the proviso to Section 147, which requires a failure on the part of the assessee to disclose fully and truly all material facts. Since no such failure was established, the reopening was not justified.

The High Court held that no substantial question of law arises from the order of the ITAT. The Court noted that the ITAT's order was not passed on merits but was an interpretation of Section 249(4)(a) of the Act concerning the deposit of tax amount, whether prior to or after filing the appeal. The ITAT had remanded the matter back to the CIT(A) for adjudication on merits, relying on the law laid down in Vijay Prakash D. Mehta and CIT Vs. K Satish Kumar Singh. The High Court found no merit in the appeal filed by the revenue, stating that the ITAT's decision to remand the matter for adjudication on merits, based on its interpretation of the law regarding the admission of appeals, was not erroneous or prejudicial to the interest of the revenue. Therefore, the appeal was dismissed in limine. The specific finding on whether the assessee had paid the tax due on the returned income was not decided on merits by the High Court, as it found no substantial question of law.

The High Court held that in view of the prior decisions of coordinate benches in ITA No. 271/2022 (decided on 16.08.2023) and ITA No. 263/2022 (decided on 02.02.2024), no substantial question of law arises for consideration. The reasoning is that the issue has already been decided by the High Court in similar appeals. The ratio decidendi is that if a coordinate bench has already ruled on a specific question of law, a subsequent appeal raising the same question may not warrant further consideration by the High Court, especially when the prior decision is not disputed. The operative direction is that the appeal is dismissed.

The High Court directed the respondents to pay the refundable tax amount along with statutory interest within fifteen days from the date of the order. This direction was issued in the presence of the respondents' representative. The Court further stipulated that if the payment was not made within the stipulated period, the respondents would be liable to pay a cost of Rs. 50,000/- to the petitioner, in addition to the statutory interest. The Court did not explicitly mention any specific section of the Income Tax Act being violated, but the direction implies a failure to adhere to the timely refund provisions. The petition was disposed of with these directions.

The High Court held that in the given facts, as no incriminating documents were found during the course of the search, the order under appeal could not be considered to suffer from any illegality that would give rise to the substantial question of law raised. The Court relied on a previous decision by a Division Bench of the same High Court at Gwalior Bench in Principal Commissioner of Income Tax Vs. Gahoi Foods Private Ltd. (ITA No. 21/2019, ITA No. 31/2019 and ITA No. 32/2019) dated 12.07.2019, which dealt with an identical substantial question of law. In that case, the Court had dismissed the appeals, holding that the orders did not suffer from illegality when no incriminating documents were found during the search. Consequently, the present appeal was also dismissed for failing to raise a substantial question of law.

The High Court, in view of the Supreme Court's judgment dated 28.02.2024 in Civil Appeal No. 7257/2011 (Bharti Cellular Ltd. Now Bharti Airtel Limited vs. Assistant Commissioner of Income Tax, Circle 57, Kolkata and another), held that the assessees would not be under a legal obligation to deduct tax at source on the income/profit component in the payments received by distributors/franchisees from third parties/customers, or while selling/transferring pre-paid coupons or starter-kits to the distributors. The Supreme Court concluded that Section 194H of the Act is not applicable to the facts and circumstances of such cases. Consequently, appeals filed by the assessee challenging High Court judgments that held them liable were allowed and set aside, while appeals by the Revenue challenging High Court judgments that held Section 194H not applicable were dismissed. The High Court noted that nothing survived for adjudication in the present appeal filed by the Revenue.

The High Court dismissed the appeal filed by the Revenue. The Court noted that this appeal was part of a bunch of appeals, and the main case was ITA No.56 of 2021. The Court had already dismissed the appeals filed by the Revenue in that main case vide a common order dated 30.04.2024. Therefore, in view of the aforesaid, the present appeal was dismissed, and the order passed in ITA No.56 of 2021 was made applicable mutatis mutandis to the facts and circumstances of the present case. The specific reasoning of the ITAT that led to the deletion of additions, or the findings on each of the substantial questions of law, were not detailed in this order as it relied on a previous common order. The operative direction was the dismissal of the appeal.

The High Court dismissed the appeal filed by the Income Tax Department. The Court noted that this issue had come up for consideration in a bunch of appeals, with the main case being ITA No.56 of 2021. The High Court had dismissed the revenue's appeals in that batch of cases vide a common order dated 30.04.2024. Therefore, in view of the aforesaid, the present appeal was also dismissed, and the order passed in ITA No.56 of 2021 was made applicable mutatis mutandis to the facts and circumstances of the present case. The specific reasoning of the ITAT or the High Court's reasoning for dismissing the earlier batch of appeals is not detailed in this judgment, other than stating that the appeals were dismissed.

The High Court dismissed the appeal filed by the Revenue. It noted that the issue had been considered in a batch of appeals, with the main case being ITA No. 56 of 2021. In that main case, the High Court had dismissed the appeals filed by the Revenue vide a common order dated 30.04.2024. Therefore, the present appeal was also dismissed, and the order passed in ITA No. 56 of 2021 was made applicable mutatis mutandis to the facts and circumstances of the present case. The specific reasoning of the ITAT or the arguments presented by the parties on the merits of the penny stock issue were not elaborated upon in this order, as the dismissal was based on a prior common order. No issue was expressly left undecided.

The High Court dismissed the appeal filed by the Revenue. The Court noted that this appeal was part of a bunch of appeals, and the main case was ITA No. 56 of 2021. The High Court had already dismissed the appeals filed by the Revenue in a common order dated 30.04.2024. Therefore, the present appeal was also dismissed, and the order passed in ITA No. 56 of 2021 was made applicable mutatis mutandis to the facts and circumstances of the present case. The specific reasoning of the ITAT for deleting the addition or the arguments presented by the assessee were not detailed in this High Court order, as the dismissal was based on a prior common order concerning similar appeals.

The High Court dismissed the appeal. It noted that this issue came up for consideration in a bunch of appeals, with ITA No.56 of 2021 being the main case. The High Court had already dismissed the appeals filed by the revenue in that main case vide a common order dated 30.04.2024. Therefore, in view of the aforesaid, the present appeal was also dismissed, and the order passed in ITA No.56 of 2021 was made applicable mutatis mutandis to the facts and circumstances of the present case. The specific reasoning of the ITAT for deleting the addition or the arguments presented by the assessee were not detailed in this order, as the dismissal was based on a previous common order.

The High Court held that no substantial question of law arises from the ITAT's order. The Court found that the Revenue's appeal was based on disputing factual findings of the ITAT, which is not permissible under Section 260A of the Act. The Court noted that the ITAT had thoroughly examined the facts and legal principles, and its order was reasoned and considered all available material. The ITAT, being the final fact-finding authority, its findings were not perverse. The Court relied on precedents like Mangalore Ganesh Beedi Works v. Commissioner of Income-tax, Mysore, emphasizing that High Courts can interfere with factual findings only if they are perverse and a specific question to that effect is framed. Since no such perversity was demonstrated and the question framed was essentially factual, the appeal was dismissed.

The High Court dismissed the appeal filed by the revenue. The Court noted that this issue had come up for consideration in a bunch of appeals, with the main case being ITA No.56 of 2021. The High Court had previously dismissed the revenue's appeals in that batch of cases via a common order dated 30.04.2024. Therefore, in view of the aforesaid, the present appeal was also dismissed, and the order passed in ITA No.56 of 2021 was made applicable mutatis mutandis to the facts and circumstances of the present case. The specific reasoning of the order dated 30.04.2024 is not detailed in this judgment, but it led to the dismissal of the revenue's appeals on similar grounds. No issue was expressly left undecided.

The High Court held that the impugned order dated 13.03.2024 was passed in utter violation of the principles of natural justice. A perusal of the impugned order revealed that in paragraph 4.4, the conclusion was drawn on the ground that in the absence of any reply or detailed/supporting documents, the assessee had nothing to explain regarding transactions with unregistered GST entities. This conclusion directly contradicted the fact that the assessee had filed a reply on 08.03.2024, as evidenced by the acknowledgement number and the subsequent submissions by both parties. The Court, relying on the ratio of Whirlpool Corporation Vs. Registrar of Trademarks, Mumbai, Magadh Sugar & Energy Ltd. Vs. State of Bihar & others, and Dinesh Kumar Chhaganbhai Nandani Vs. Income Tax Officer, found that an exception to the rule of alternate remedy arose due to the violation of natural justice. Consequently, the impugned order was quashed, with liberty to the assessing officer to pass a fresh order in accordance with law within one month. The assessee was also granted liberty to supplement its partial reply with a detailed one within one week.

The High Court held that the Review Petition was not maintainable. It referred to Order XLVII Rule 1 of the Code of Civil Procedure, 1908, which allows review on grounds of discovery of new and important matters, mistake or error apparent on the face of the record, or any other sufficient reason. The Court cited Apex Court judgments emphasizing that review is a serious step and not a routine procedure, requiring a material error manifest on the face of the order that undermines its soundness or results in miscarriage of justice. An error apparent must be self-evident and not require detailed examination or reasoning. The Court found that none of the grounds for review under Order XLVII Rule 1 CPC were made out. The petitioner failed to demonstrate an error contemplated by Order 47 Rule 1 CPC that was apparent on the face of the record, rather than an error to be 'fished out'. The Court concluded that a decision or order cannot be reviewed merely because it is erroneous or a different view could have been taken. Therefore, there was no error apparent on the face of the record warranting interference with the impugned order. The Review Petition was dismissed.

The High Court held that no substantial question of law arises from the order of the ITAT for consideration. The Court found no merit in the appeals. The reasoning was that the assessees had fulfilled the conditions for exemption under Section 10(38) by ensuring shares were listed, purchased through the stock exchange and banking channels, and STT was paid. The Court noted that the revenue failed to appreciate that shares issued by a company incorporated under the Companies Act, following prescribed procedures, cannot be termed bogus. The mere increase in share prices does not automatically render shares bogus, especially when they are listed and traded. The Court also acknowledged the assessees' contention regarding the non-provision of the Investigation Wing's report, which violated natural justice principles. Furthermore, the Court referred to various ITAT and High Court decisions, including the dismissal of SLPs by the Apex Court, which supported the assessees' position. The Court concluded that the appeals did not meet the criteria for admission under Section 260A of the Income Tax Act, 1961.

The High Court held that no substantial question of law arises from the order of the ITAT for consideration. The Court found no merit in the appeals, stating that the appeals do not involve any substantial question of law as required under Section 260A of the Income Tax Act, 1961. The assessees' arguments regarding compliance with Section 10(38) conditions, the genuine issuance of shares by the company, the violation of natural justice due to reliance on an unprovided report, and favorable precedents from other ITAT benches and High Courts were implicitly accepted by the court's dismissal of the revenue's appeals. The court found the revenue's grounds insufficient to warrant admission of the appeal. Therefore, the appeals were dismissed.

The High Court held that no substantial question of law arises from the order of the ITAT requiring its consideration under Section 260A of the Income Tax Act, 1961. The Court found no merit in the appeals. The reasoning was based on the assessees' submission that all conditions for exemption under Section 10(38) were met, including shares being listed, purchased through the exchange via banking channels, and STT paid. The Court noted the assessees' argument that the revenue failed to provide the investigation report, violating natural justice, and that various ITAT benches and High Courts had ruled in favour of assessees on similar issues concerning M/s Sunrise Asian Limited shares. The High Court also referenced the dismissal of SLPs by the Apex Court against Gujarat High Court orders on similar matters. Therefore, the appeals were dismissed as they did not involve any substantial question of law.

The High Court held that no substantial question of law arises from the order of the ITAT requiring its consideration under Section 260A of the Income Tax Act, 1961. The Court found no merit in the appeals. The reasoning was based on the assessees' submission that all conditions for exemption under Section 10(38) were met, including shares being listed, purchased through the exchange via banking channels, and STT paid. The Court noted the assessees' argument that the revenue failed to provide the investigation report, violating natural justice, and that various ITAT benches and High Courts had ruled in favour of assessees on similar issues concerning M/s Sunrise Asian Limited shares. The High Court also referenced the dismissal of SLPs by the Apex Court against Gujarat High Court orders on similar matters. Therefore, the appeals were dismissed as they did not involve any substantial question of law.

The High Court held that no substantial question of law arises from the order of the ITAT requiring its consideration under Section 260A of the Income Tax Act, 1961. The Court found no merit in the appeals. The reasoning was based on the assessees' submission that all conditions for exemption under Section 10(38) were met, including shares being listed, purchased through the exchange via banking channels, and STT paid. The Court noted the assessees' argument that the revenue failed to provide the investigation report, violating natural justice, and that various ITAT benches and High Courts had ruled in favour of assessees on similar issues concerning M/s Sunrise Asian Limited shares. The High Court also referenced the dismissal of SLPs by the Apex Court against Gujarat High Court orders on similar matters. Therefore, the appeals were dismissed as they did not involve any substantial question of law.

The High Court held that no substantial question of law arises from the order of the ITAT requiring its consideration under Section 260A of the Income Tax Act, 1961. The Court found no merit in the appeals. The reasoning was based on the assessees' submission that all conditions for exemption under Section 10(38) were met, including shares being listed, purchased through the exchange via banking channels, and STT paid. The Court noted the assessees' argument that the revenue failed to provide the investigation report, violating natural justice, and that various ITAT benches and High Courts had ruled in favour of assessees on similar issues concerning M/s Sunrise Asian Limited shares. The High Court also referenced the dismissal of SLPs by the Apex Court against Gujarat High Court orders on similar matters. Therefore, the appeals were dismissed as they did not involve any substantial question of law.

The High Court held that no substantial question of law arises from the order of the ITAT requiring consideration by the High Court. The Court found no merit in the appeals filed by the Revenue. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38) of the Income Tax Act, 1961. The shares were listed on the Bombay Stock Exchange, purchased through a demat account with payments via banking channels, and STT was paid. The Court accepted the argument that the Income Tax Act does not mandate the Assessing Officer to investigate the genuineness of listed shares, especially when the issuing company has complied with all statutory formalities under the Companies Act. The Court also noted the assessees' argument that the reliance on an unprovided Investigation Wing report violated principles of natural justice and that various ITAT benches and High Courts had decided similar issues in favor of assessees. The Court concluded that the appeals did not meet the provisions of Section 260A of the Income Tax Act, 1961, for admission.

The High Court held that no substantial question of law arises from the order of the ITAT requiring consideration by the High Court. The Court found no merit in the appeals filed by the Revenue. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38) of the Income Tax Act, 1961. The shares were listed on the Bombay Stock Exchange, purchased through a demat account with payments via banking channels, and STT was paid. The Court accepted the argument that the Income Tax Act does not mandate the Assessing Officer to investigate the genuineness of listed shares, especially when the issuing company has complied with all statutory formalities under the Companies Act. The Court also noted the assessees' argument that the reliance on an unprovided Investigation Wing report violated principles of natural justice and that various ITAT benches and High Courts had decided similar issues in favor of assessees. The Court concluded that the appeals did not meet the provisions of Section 260A of the Income Tax Act, 1961, for admission.

The High Court held that no substantial question of law arises from the order of the ITAT requiring consideration by the High Court. The Court found no merit in the appeals filed by the Revenue. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38) of the Income Tax Act, 1961. The shares were listed on the Bombay Stock Exchange, purchased through a demat account with payments via banking channels, and STT was paid. The Court accepted the argument that the Income Tax Act does not mandate the Assessing Officer to investigate the genuineness of listed shares, especially when the issuing company has complied with all statutory formalities under the Companies Act. The Court also noted the assessees' argument that the reliance on an unprovided Investigation Wing report violated principles of natural justice and that various ITAT benches and High Courts had decided similar issues in favor of assessees. The Court concluded that the appeals did not meet the provisions of Section 260A of the Income Tax Act, 1961, for admission.

The High Court held that no substantial question of law arises from the order of the ITAT requiring consideration by the High Court. The Court found no merit in the appeals filed by the Revenue. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38) of the Income Tax Act, 1961. The shares were listed on the Bombay Stock Exchange, purchased through a demat account with payments via banking channels, and STT was paid. The Court accepted the argument that the Income Tax Act does not mandate the Assessing Officer to investigate the genuineness of listed shares, especially when the issuing company has complied with all statutory formalities under the Companies Act. The Court also noted the assessees' argument that the reliance on an unprovided Investigation Wing report violated principles of natural justice and that various ITAT benches and High Courts had decided similar issues in favor of assessees. The Court concluded that the appeals did not meet the provisions of Section 260A of the Income Tax Act, 1961, for admission.

The High Court held that no substantial question of law arises from the order of the ITAT requiring consideration by the High Court. The Court found no merit in the appeals filed by the Revenue. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38) of the Income Tax Act, 1961. The shares were listed on the Bombay Stock Exchange, purchased through a demat account with payments via banking channels, and STT was paid. The Court accepted the argument that the Income Tax Act does not mandate the Assessing Officer to investigate the genuineness of listed shares, especially when the issuing company has complied with all statutory formalities under the Companies Act. The Court also noted the assessees' argument that the reliance on an unprovided Investigation Wing report violated principles of natural justice and that various ITAT benches and High Courts had decided similar issues in favor of assessees. The Court concluded that the appeals did not meet the provisions of Section 260A of the Income Tax Act, 1961, for admission.

The High Court held that no substantial question of law arises from the order of the ITAT for consideration. The Court found no merit in the appeals. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38), including shares being listed, purchased through the stock exchange and banking channels, and STT paid. The Court noted that the assessees had relied on multiple High Court decisions and an Apex Court dismissal of an SLP, which dealt with similar issues and favoured the assessees. The Court also acknowledged the assessees' argument regarding the violation of natural justice due to the non-provision of the investigation wing report. Consequently, the appeals were dismissed as they did not involve any substantial question of law warranting admission under Section 260A of the Income Tax Act, 1961.

The High Court held that no substantial question of law arises from the order of the ITAT for consideration. The Court found no merit in the appeals. The reasoning was based on the assessees' contention that they had fulfilled all conditions for exemption under Section 10(38), including shares being listed, purchased through the stock exchange and banking channels, and STT paid. The Court noted that the assessees had relied on multiple High Court decisions and an Apex Court dismissal of an SLP, which dealt with similar issues and favoured the assessees. The Court also acknowledged the assessees' argument regarding the violation of natural justice due to the non-provision of the investigation wing report. Consequently, the appeals were dismissed as they did not involve any substantial question of law warranting admission under Section 260A of the Income Tax Act, 1961.