Rajasthan High Court Judgments — 2018

The High Court held that the ends of justice would be met if the appellant is directed to move a rectification application before the ITAT. The purpose of this application would be to request the ITAT to formally set aside the CIT(A)'s order dated 12.04.2017. This action is intended to ensure that a fresh adjudication of the appeal takes place before the CIT(A) without any prejudice or influence from its earlier judgment. The Court did not decide on the merits of the original issues raised before the ITAT, focusing solely on the procedural aspect of the remand order. The operative direction is for the assessee to seek rectification from the ITAT.

The High Court, after hearing both parties and perusing the material on record, deemed it appropriate to set aside the judgment passed by the ITAT. The Court noted that the sale deed (Annexure-4) and its confirmation letter pertained to the relevant period and showed the sale of property by the assessee to M/s. City Star Hospitality Pvt. Ltd. Consequently, the matter was remitted back to the ITAT to examine the same afresh in light of these documents and pass a fresh judgment in accordance with the law. The Court did not decide on the merits of the additions or deletions but rather on the procedural aspect of allowing the ITAT to consider newly presented evidence. The appeal was disposed of in view of this remittance.

The Tribunal dismissed the appeal, upholding the findings of the Assessing Officer and CIT(A). The assessee had developed his share of agricultural land into 34 residential plots, ranging from 900 sq. ft. to 2964 sq. ft., and sold them to various purchasers. Stamp duty was paid on the conveyance deeds. Development, including the creation of an approach road, took place approximately 12 months prior to the Inspector's visit in March 2015. An Inspector's report indicated that 40-50 residential plots were built upon, roads were laid, and a hospital and school were operating in the area, indicating the development of a residential colony. Stamp duty authorities recognized these as residential plots. The Tribunal concluded that these facts demonstrated affirmative steps taken by the assessee to convert agricultural land into residential stock-in-trade for business profit. The change in the land's nature from agricultural to residential was deemed irreversible. The Tribunal relied on the Supreme Court judgment in Smt. Sarifabibi Mohmed Ibrahim vs. CIT. The High Court found no substantial question of law arising due to concurrent factual findings by the lower authorities, citing Vijay Kumar Talwar vs. CIT(A).

The Tribunal held that the AO had made additions primarily based on the statements of Shri Praveen Kumar Jain and Shri Uttam Singh Hinger. However, these individuals had subsequently retracted their statements through specific affidavits. The Tribunal found that the Revenue had not produced any other evidence to demonstrate that cash was paid by the assessee company to Shri Praveen Kumar Jain or any other person for accommodation entries. Consequently, the assessee succeeded in proving the identity and bonafide of the shares and the transactions. Since this was considered a pure question of fact, the Tribunal found no reason to interfere with the impugned order of the ITAT. The additions made by the AO were therefore deleted.

The High Court granted the appellant's (Revenue's) request to withdraw the appeals. The reasoning was explicitly based on Circular No. 3/18 dated 11.07.2018, which pertains to the tax effect of appeals. As the tax effect in these appeals was less than Rs. 50 lacs, the Revenue was permitted to withdraw them. The ratio decidendi is that appeals with a tax effect below the threshold specified in the relevant circular can be withdrawn by the Revenue. The operative direction was that the appeals are dismissed as withdrawn. No issues were expressly left undecided.

The High Court granted the permission sought by the appellant (Revenue) to withdraw the appeals. The reasoning for this decision was explicitly based on Circular No. 3/18 dated 11.07.2018, which stipulated a monetary limit for filing appeals. Since the tax effect in the present appeals was stated to be less than Rs. 50 lacs, the Court found it appropriate to allow the withdrawal. Consequently, the appeals were dismissed as withdrawn. No specific findings on the merits of the income tax issues were made, as the appeals were disposed of on a procedural ground based on the departmental circular.

The Tribunal granted permission to the appellant (Revenue) to withdraw the appeal(s). The reasoning for this decision was explicitly stated as being in view of Circular No. 3/18 dated 11.07.2018, which mandates withdrawal of appeals where the tax effect is less than Rs. 50 lacs. Since the tax effect in the present appeal was recorded as being less than Rs. 50 lacs, permission was granted. Consequently, the appeals were dismissed as withdrawn. No specific findings on the merits of the original assessment or the grounds of appeal were made, as the appeals were disposed of on a procedural basis. The ratio decidendi is that appeals falling below the monetary threshold stipulated in the relevant CBDT circular should be withdrawn by the Revenue.

The High Court admitted the appeal and settled six questions of law for consideration. The judgment does not record the ITAT's findings or reasoning on these issues, nor does it provide the ratio decidendi for any of the points. The operative directions are not specified, as the High Court has only admitted the appeal and framed the questions of law. The judgment does not mention any issue being left undecided. The specific relief granted or denied by the ITAT, which the High Court is now reviewing, is not detailed in this excerpt. The core of the judgment is the admission of the appeal and the framing of substantial questions of law for adjudication, indicating that the merits of the ITAT's decision are yet to be examined by the High Court.