COMMISSIONER OF INCOME TAX V. VIJAY PARKASH

ITA/215/2001

AI Insights

The case involves appeals by the Commissioner of Income Tax (Central), Ludhiana, challenging the Tribunal's decision which restored the assessment to the file of the Assessing Officer concerning the genuineness of gifts received by Sh. Vijay Parkash Maheshwari and his brothers from Sh. Surinder Kumar Maheshwari. The main legal issues revolved around the Tribunal's authority to direct a reconsideration of the genuineness of the gifts and the offset of any sustained additions against the income surrendered by the firm in which the assessee was a partner. The High Court upheld the Tribunal's decision, finding no legal error in its jurisdictional exercise.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 729288 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 18-12-2014
• Assessment Year: misc
• Other Referred Cases: Lal Chand Kalra Vs. CIT
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: PANKAJ JAIN; SACHIN BHARDWAJ
• Assessee Lawyers: RAJESH KATOCH
• Keywords: Assessment; Gifts; Income Tax; Jurisdiction; Remand

Judgement Text

"ITA No. 215 of 2001 ITA No. 215 of 2001 ITA No. 215 of 2001 ITA No. 215 of 2001 1 IN THE HIGH COURT OF PUNJAB AND HARYANA IN THE HIGH COURT OF PUNJAB AND HARYANA IN THE HIGH COURT OF PUNJAB AND HARYANA IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH AT CHANDIGARH AT CHANDIGARH AT CHANDIGARH ITA No. 215 of 2001. ITA No. 215 of 2001. ITA No. 215 of 2001. ITA No. 215 of 2001. Date of Decision : 18.12.2014. Date of Decision : 18.12.2014. Date of Decision : 18.12.2014. Date of Decision : 18.12.2014. Commissioner of Income Tax (Central), Ludhiana Commissioner of Income Tax (Central), Ludhiana Commissioner of Income Tax (Central), Ludhiana Commissioner of Income Tax (Central), Ludhiana ...Appellant ...Appellant ...Appellant ...Appellant Versus Versus Versus Versus Sh. Vijay Parkash Maheshwari Sh. Vijay Parkash Maheshwari Sh. Vijay Parkash Maheshwari Sh. Vijay Parkash Maheshwari ...Respondent ...Respondent ...Respondent ...Respondent CORAM: CORAM: CORAM: CORAM: HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE B.S. WALIA HON'BLE MR. JUSTICE B.S. WALIA HON'BLE MR. JUSTICE B.S. WALIA HON'BLE MR. JUSTICE B.S. WALIA Present: Mr. Rajesh Katoch, Advocate for the appellant. Mr. Pankaj Jain, Senior Advocate with Mr. Sachin Bhardwaj, Advocate for the respondent. *** Rajive Bhalla, J. Rajive Bhalla, J. Rajive Bhalla, J. Rajive Bhalla, J. By way of this order, we shall decide ITA No. 215 of 2001 (Commissioner of Income Tax (Central), Ludhiana Vs. Sh. Vijay Parkash Maheshwari, ITA No. 218 of 2001 (Commissioner of Income Tax (Central), Ludhiana Vs. Ravinder Kumar Maheshwari and ITA No. 200 of 2001 (Commissioner of Income Tax (Central), Ludhiana Vs. Subhash Chander Maheshwari), filed by the revenue challenging order dated 04.12.2000 restoring the assessment to file of the Assessing Officer on the following substantial questions of law :- “i) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding the gifts made by Sh. Surinder Kumar Maheshwari to the Assessee and his two brothers almost in equivalent amounts to each to be genuine without adjudicating upon the capacity of the donor? ii) Whether, on the facts and in the circumstances of the KANCHAN 2014.12.24 15:23 I attest to the accuracy and authenticity of this document Chandigarh ITA No. 215 of 2001 ITA No. 215 of 2001 ITA No. 215 of 2001 ITA No. 215 of 2001 2 case, the Tribunal was right in law in directing the A.O. to reconsider the genuineness of the gifts when the addition made by treating the gift as not genuine is justified in view of the judgment of the Hon'ble jurisdictional Punjab & Haryana High Court in the case of Lal Chand Kalra Vs. CIT 22 CTR 135 (P&H). iii) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in directing that if any addition is sustained in the hands of the Assessee, the same should be off-set with the surrender in the firm in which the Assessee is a partner to the extent of his share.” Counsel for the revenue submits that as the Assessing Officer had recorded a legally valid opinion as to the nature of foreign gifts, the Income Tax Appellate Tribunal (hereinafter referred to as the 'Tribunal') had no jurisdiction while remitting the matter, to record that in case the addition is confirmed, it would be set off against the income surrendered by the firm. The Tribunal should have left this matter open for the Assessing Officer to determine. Counsel for the assessee submits that as appeals filed by the assessee pertaining to the same order have been dismissed by confirming the order of remand, no exception can be made to the order passed by the Tribunal. The directions issued by the Tribunal may be affirmed whether pertaining to the genuineness of the gifts or the manner in which surrendered income may be treated. We have heard counsel for the parties, perused the impugned order and would necessarily have to make reference to certain relevant facts that have occurred during pendency of these appeals. After remand by the Tribunal, the Assessing Officer framed a fresh assessment. The assessment was once again set-aside by the Tribunal. The Assessing Officer proceeded to frame a third assessment which is subject matter of ITA Nos. 99, 128 and 204 of 2013, which shall KANCHAN 2014.12.24 15:23 I attest to the accuracy and authenticity of this document Chandigarh ITA No. 215 of 2001 ITA No. 215 of 2001 ITA No. 215 of 2001 ITA No. 215 of 2001 3 be decided by a separate order. The order passed by the Tribunal having been implemented by the Assessing Officer and having once again been set-aside, the controversy involved in the present petition has been rendered infructuous/academic, particularly in the light of the fact that we have affirmed the order of remand dated 04.12.2000 passed in appeals filed by the assessee. We, therefore, answer the first and second question against the revenue by holding that there is no error of law in the exercise of jurisdiction by the Tribunal. With respect to the third question, the Assessing Officer has already recorded a finding based upon directions issued by the Tribunal in its order dated 04.12.2000 which is subject matter of ITA Nos. 99, 128 and 204 of 2013 and shall be answered while deciding these appeals. The first and the second questions having been answered against the revenue, we leave the third question open to be answered in the aforesaid appeals. The appeals are disposed of accordingly. (RAJIVE BHALLA) (RAJIVE BHALLA) (RAJIVE BHALLA) (RAJIVE BHALLA) JUDGE JUDGE JUDGE JUDGE (B.S. WALIA) (B.S. WALIA) (B.S. WALIA) (B.S. WALIA) JUDGE JUDGE JUDGE JUDGE December 18, 2014. December 18, 2014. December 18, 2014. December 18, 2014. kanchan KANCHAN 2014.12.24 15:23 I attest to the accuracy and authenticity of this document Chandigarh "