Madhya Pradesh High Court Judgments — 2024

The High Court dismissed the petition. Regarding the refund amount, the court found no error in the calculation of the refundable amount and the interest paid. The respondents had allowed interest at 0.5% per month from 27.10.2010 to 25.04.2019 on the refundable amount of Rs. 2,05,030, totaling Rs. 1,08,650, and paid a net amount of Rs. 3,13,680. This calculation was found to be in accordance with Section 244A(1)(b) of the IT Act. The court noted that the Chartered Accountant's report also calculated interest at the same rate. Concerning the claim for 18% p.a. interest, the court held that the petitioner had not suggested any provision entitling him to such a rate, nor had he demonstrated how the refund amount would fetch interest at 18% p.a. if considered a judgment debt. Therefore, no direction could be issued for payment of interest at a higher rate than prescribed by the statute. The court concluded that the Income Tax Department had not committed any mistake in the calculation of interest as per the directions issued in the previous writ petition.

The High Court of Madhya Pradesh at Jabalpur held that no substantial question of law arises in the present appeal. The Court's decision was based on the submission made by the respondent's counsel that a co-ordinate bench of the same High Court had already considered and decided the identical question of law in ITA No. 271/2022, wherein the appeal was dismissed. The revenue's counsel was unable to distinguish the prior order. Consequently, the Tribunal found itself unable to hold that any substantial question of law warranted a decision in this appeal. The appeal was accordingly dismissed. No specific operative directions were issued as the appeal was dismissed on the preliminary ground of no substantial question of law.

The High Court dismissed the miscellaneous civil case. The court found no good ground to recall the order of dismissal of the Income Tax Appeal. The reasoning was based on the significant delay of 883 days in filing the restoration application, the absence of any application for condonation of this delay, and the petitioner's apparent lack of interest in prosecuting the matter. The court observed that even after the appeal was dismissed in 2017, it took the petitioner three years to file for restoration, and on the day of hearing, no interest was shown. Therefore, the petition was dismissed.

The High Court held that the notice issued under Section 148 of the Income Tax Act, 1961, in the name of a dead assessee is null and void, being without jurisdiction. The Court noted that the fact of the assessee's death on 09.11.2020 was not disputed. Citing Delhi, Madras, and Mumbai High Courts in Savita Kapila, Alamelu Verappan, and Sumit Balkrishna Gupta respectively, the Court emphasized that issuing a notice to a correct, living person is a foundational requirement for acquiring jurisdiction to reopen an assessment, not merely a procedural requirement. Section 292B of the Act cannot be invoked to correct such a substantial error. The Court also referred to its own recent order in W.P. No. 9697/2022, which held similar proceedings unsustainable. Consequently, the impugned notice dated 08.04.2022 and the order dated 07.04.2022 were quashed. The Court granted liberty to the respondents to reinitiate proceedings against the petitioner as the legal heir, if advised.

The High Court held that the review petitioner, as an appellant before the Appellate Authority, should not be denied the right to raise any ground admissible in law and permissible under the relevant statute for filing an appeal. The Court acknowledged that the scope of interference under Article 226 of the Constitution differs from that available in an appeal. Therefore, the review petition was disposed of by granting liberty to the review petitioner to raise all possible and permissible contentions as per law under Section 246A of the Income Tax Act while assailing the assessment order dated 31.05.2023. The Court explicitly stated that it had declined to enter into the merits of the matter in the earlier order.

The High Court held that the issue regarding the submission and receipt of documents dated April 1 and 3, 2023, constituted a disputed question of fact, which could not be adjudicated in a writ petition. Regarding the rejection of the application under Annexure P-7, the Court referred to Rule 28-AA of the Income Tax Rules, emphasizing that the Assessing Officer's satisfaction must be objective and based on the four factors enumerated in sub-rule (2) of Rule 28-AA. The Court noted that the impugned orders, particularly Annexure P-7, did not demonstrate that these four factors were taken into account. Citing the Delhi High Court judgment in Cloudtail India Private Limited, the Court reiterated that Rule 28-AA is statutory and mandatory. The Court found that the decision-making process adopted by the respondents was faulty and in violation of Rule 28-AA, as relevant factors were not considered. Consequently, both impugned orders (Annexures P-5 and P-7) were set aside. The matter was remitted back to Respondent No. 2 (Assistant Commissioner of Income Tax) to reconsider the petitioner's claim in accordance with law and pass a fresh speaking order within 30 days. The Court explicitly stated that it had not expressed any opinion on the merits of the case.