Chandra Manohar Haval, Kolhapur V. ITO (Central), Kolhapur

ITA 1239/PUN/2010

• Counselvise Citation: 123924514 RSA 2010
• Duration Of Justice: 1 year(s) 3 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 22-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARESHWAR SHARMA
• Keywords: Set aside
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI I C SUDHIR, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTAN T MEMBER S.NO ITA NO ASSTT.YEAR APPELLANT RESPONDENT 1 1239/PN/10 2007-08 CHANDRAKANT M HAVAL, KOLHAPUR INCOME-TAX OFFICER (CEN) KOLHAPUR 2 1240/PN/10 2007-08 AMAL CHNDRAKANT HAVAL,KOLHAPUR -DO- 3 1241/PN/10 2007-08 NARAYAN MANOHAR HAVAL, KOLHAPUR -DO- 4 1242/PN/10 2006-07 -DO- -DO- 5 1243/PN/10 2005-06 M/S KAMALKAR M HAVAL & BROS. KOLHAPUR -DO- 6 1244/PN/10 2004-05 -DO- -DO- 7 1245/PN/10 2006-07 SUDHAKAR M HAVAL, KOLHAPUR -DO- APPELLANT BY : SHRI C H NANIWADEKAR RESPONDENT BY : SHRI HARESHWAR SHARMA DATE OF HEARING : 02.01.2012 DATE OF PRONOUNCEMENT : 04.01.2012 ORDER PER BENCH : THESE ARE SEVEN APPEALS BY THE MEMBERS OF THE SAME F AMILY AND INVOLVE A COMMON ISSUE AND, THEREFORE, THEY HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSED OF BY A CONSOLIDATED ORDER FOR THE SAKE OF BREVITY AND CONVENIENCE. 2. FIRST WE SHALL TAKE UP SIX APPEALS COMPRISING OF ITA NO S 1239 TO 1244/PN/2010 WHEREIN FACTS AND CIRCUMSTANCES AND THE ISSUE I NVOLVED ARE IDENTICAL. IN ALL THESE APPEALS, THE COMMISSIONER OF INCO ME-TAX (APPEALS) HAS DISMISSED THE APPEALS OF THE ASSESSEE AS NON-MAINTAINABLE F OR VIOLATION OF PROVISIONS OF SECTION 249(4) OF THE ACT. AS PER THE COMMI SSIONER OF INCOME- TAX (APPEALS), ON THE DATE OF FILING OF THE APPEALS, TAXES DUE ON THE RETURNED INCOME WERE NOT PAID AND, THEREFORE, THE APPEALS ARE NON-MAINTAINABLE IN TERMS OF SECTION 249(4) OF THE ACT. 3. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE HAS F URNISHED A CHART TO POINT OUT THAT ALL THE TAXES DUE WERE ACTUALLY PAI D BY THE ASSESSEE BEFORE THE HEARING OF THE APPEALS BY THE COMMISSIONER OF INCO ME-TAX (APPEALS) AND THAT, THEREFORE, THE SAME BE CONSIDERED AS SUFFICIENT CO MPLIANCE WITH THE PROVISIONS OF SECTION 249(4) OF THE ACT. THE LEARNED CO UNSEL POINTED OUT THAT IDENTICAL ISSUE HAD ARISEN IN THE CASE OF ANOTHER FAMILY MEMBER, VIDE MILIND KARMALKAR HAVEL IN ITA NOS 1234, 1235 & 1238/PN/2010 WHEREIN THE TRIBUNAL VIDE ITS ORDER DATED 31.1.2011 HAD UPHELD T HE PLEA OF THE ASSESSEE. A COPY OF THE ORDER IN THIS REGARD WAS FURNISHED AT THE TIME OF HEARING. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE O THER HAND, HAS NOT CONTROVERTED THE FACTUAL MATRIX BROUGHT OUT BY THE LE ARNED COUNSEL FOR THE ASSESSEE IN THE LIGHT OF THE PRECEDENT IN THE CASE OF MIL IND KARMALKAR HAVEL (SUPRA). 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND FIND THAT IN THE CASE OF MILIND KARMALKAR HAVEL (SUPRA), IDENTICAL SITUATI ON WAS CONSIDERED BY THE TRIBUNAL IN THE FOLLOWING WORDS: 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFU LLY. SECTION 249(4) OF THE ACT PRESCRIBES THAT NO APPEAL SHALL B E ADMITTED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) UNLESS AT THE TIME OF FILING OF THE APPEAL THE ASSESSEE HAS PAID THE TAXES DUE ON THE I NCOME RETURNED BY HIM OR WHERE NO RETURN HAD BEEN FILED BY THE ASSESS EE, THE ASSESSEE HAS PAID AN AMOUNT EQUAL TO THE AMOUNT OF ADVANCE TAX W HICH WAS PAYABLE BY HIM. IN THIS CASE, ADMITTEDLY AT THE TIME OF FILING OF THE APPEALS BEFORE THE COMMISSIONER OF INCOME-TAX (APPEALS) THE TAX DUE ON THE INCOME RETURNED WAS NOT PAID. HOWEVER, THE CLAIM OF THE AS SESSEE IS THAT REQUISITE TAXES ALONGWITH THE TAX DEMAND RAISED CON SEQUENT TO THE ASSESSMENT, HAS BEEN PAID BEFORE THE FINAL HEARING OF THE APPEAL BY THE COMMISSIONER OF INCOME-TAX (APPEALS) AND, THEREFORE , IT CONSTITUTES A SUFFICIENT COMPLIANCE WITH THE PROVISIONS OF SECTIO N 249(4) OF THE ACT. IN THIS CONTEXT, CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA) HAS OBSERVED THAT THE OBJECTI VE BEHIND SECTION 249(4) IS TO ENSURE PAYMENT OF TAX ON INCOME RETURN ED BEFORE THE ADMISSION OF AN APPEAL. AS PER OUR CO-ORDINATE BENC H, IF THE APPEAL IS FILED WITHOUT PAYMENT OF TAX ON RETURNED INCOME, BU T SUBSEQUENTLY THE REQUIRED AMOUNT OF TAX IS PAID, THE APPEAL SHALL BE ADMITTED ON PAYMENT OF TAX AND TAKEN UP FOR HEARING BY THE COMMISSIONER OF INCOME-TAX (APPEALS). IT HAS BEEN OBSERVED THAT WHERE THE TAX IS PAID AFTER THE FILING OF APPEAL BUT BEFORE IT IS TAKEN UP FOR DISPOSAL, I T WOULD BE SUFFICIENT TO VALIDATE THE DEFECTIVE APPEAL. THE REASONING MADE O UT BY THE CO-ORDINATE BENCH IS THAT THE STIPULATION AS TO THE PAYMENT OF PRESCRIBED TAX ANTE FILING OF FIRST APPEAL IS ONLY DIRECTORY AND NOT MA NDATORY. IN OTHER WORDS, ACCORDING TO THE CO-ORDINATE BENCH WHEREAS THE PAY MENT OF PRESCRIBED TAX IS MANDATORY BUT THE REQUIREMENT OF SECTION 249 (4) OF PAYING OF SUCH TAX BEFORE FILING OF APPEAL IS ONLY DIRECTORY. IN T HE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA), THE ASSESSEE PAID THE TAXES ON RETURNED INCOME AFTER THE DISPOSAL OF APPEAL BY THE COMMISSIONER OF INCOME-TAX (APPEALS). UNDER THESE CIRCUMSTANCES ALSO, THE TRIB UNAL HELD THAT THE DEFECT IN APPEAL DUE TO NON-COMPLIANCE OF A DIRECTO RY REQUIREMENT OF PAYING SUCH TAX BEFORE FILING OF THE APPEAL STOOD R EMOVED AND, THEREFORE, THE FIRST APPELLATE AUTHORITY OUGHT TO HAVE REVIVED SUCH AN APPEAL. UNDER THESE CIRCUMSTANCES, THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DISMISSING THE APPEAL OF THE ASSESSEE WAS SET ASIDE AND THE MATTER RESTORED BACK FOR DISPOSAL ON MERITS. 5. IN THE PRESENT CASE, THE CLAIM OF THE ASSESSEE IS THAT IT HAS PAID REQUISITE TAXES BEFORE HEARING OF APPEAL BY THE COM MISSIONER OF INCOME- TAX (APPEALS) AND, THEREFORE, FOLLOWING THE PARITY OF REASONING IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA), THE APPEALS OF T HE ASSESSEE COULD NOT BE DISMISSED AS NON-MAINTAINABLE UNDER SECTION 249( 4) OF THE ACT. AS A RESULT THEREOF, THE IMPUGNED ORDER OF THE COMMISSIO NER OF INCOME-TAX (APPEALS) IS SET ASIDE AND THE APPEALS OF THE ASSES SEE ARE ALLOWED. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAD REF ERRED TO THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT IN THE CA SE OF S. ALAGARSWAMY (SUPRA) IN SUPPORT OF THE IMPUGNED ORDE R. NO DOUBT, THE PAYMENT OF TAX DUE ON THE INCOME RETURNED BY THE AS SESSEE BEFORE FILING OF AN APPEAL AGAINST THE ASSESSMENT ORDER, IS A CON DITION PRECEDENT AND AS PER THE HONBLE HIGH COURT, SUCH A NON-COMPLIANC E RENDERS THE APPEAL NON-MAINTAINABLE IN TERMS OF SECTION 249(4A) OF THE ACT. THE SAID PROPOSITION IS NOT IN DISPUTE, SO, HOWEVER, IN THE PRESENT CASE THE CASE MADE OUT BY THE ASSESSEE IS THAT THE REQUIRED TAXES HAVE BEEN PAID BEFORE HEARING OF THE APPEAL BY THE COMMISSIONER OF INCOME-TAX (APPEALS) AND IN TERMS OF RATIO OF THE TRIBUNAL IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA), THE SAME CONSTITUTED A SUFFI CIENT COMPLIANCE WITH THE CONDITION PRESCRIBED UNDER SECTION 249(4)(A) OF THE ACT. THUS, THE DECISION OF THE HONBLE HIGH COURT IN THE CASE OF S . ALAGARSWAMY (SUPRA) DOES NOT MILITATE AGAINST THE PLEAS OF THE ASSESSEE . AS A RESULT, THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DATED 3 0.6.2010 IS SET ASIDE AND CONSEQUENTLY THE ORDERS OF THE COMMISSION ER OF INCOME-TAX (APPEALS) DATED 12.3.2010 FOR THE CAPTIONED ASSESSM ENT YEARS ARE RESTORED. 6. IN TERMS OF THE AFORESAID PRECEDENT, WHICH CONTINUES TO HOLD THE FIELD, THE IMPUGNED ORDERS OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DATED 03.06.2010 ARE SET ASIDE AND THE APPEALS ARE RESTORED BACK TO HIS FILE TO BE ADJUDICATED AFRESH ON MERITS OF THE VARIOUS GROUNDS OF APPEAL RAISED BEFORE HIM. 7. IN THE RESULT, ALL THE SIX APPEALS ARE TREATED AS AL LOWED. 8. IN SO FAR AS ITA NO 1245/PN/10 IN THE CASE OF SHRI S UDHAKAR MANOHAR HAVAL IS CONCERNED, THIS APPEAL IS DIRECTED AGAINST THE OR DER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DATED 30.06.2010 W HICH HAS BEEN PASSED UNDER SECTION 154 OF THE ACT AMENDING HIS EARLIER ORDER DATED 12.3.2010 AND TREATING THE APPEAL FILED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2006-07 AS NON-MAINTAINABLE. HEREIN ALSO, THE CO MMISSIONER OF INCOME- TAX (APPEALS) HAS HELD THAT AS ON THE DATE OF FILING O F THE ORIGINAL APPEAL TAXES WERE NOT PAID ON THE TOTAL INCOME RETURNED AND, THER EFORE, THE APPEAL WAS NON-MAINTAINABLE IN TERMS OF SECTION 249(4) OF THE ACT . ACCORDINGLY, THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ORIGI NALLY ON 12.3.2010 HAS BEEN AMENDED AND THE APPEAL TREATED AS NON-MAINTA INABLE, VIDE THE IMPUGNED ORDER DATED 30.6.2010. 9. ON THIS ASPECT, FOLLOWING THE PARITY OF REASONIN G LAID DOWN IN THE CASE OF SHRI MILIND KARMALKAR HAVEL (SUPRA), TH E ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DATED 30.6.2010 IS HEREBY SET ASIDE AND CONSEQUENTLY THE ORDER OF THE COMMISSIONER OF INCO ME-TAX (APPEALS) DATED 12.3.2010 FOR THE CAPTIONED YEAR IS HEREBY RESTO RED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED , AS ABOVE. DECISION PRONOUNCED IN THE OPEN COURT ON 04 TH DAY OF JANUARY, 2012. SD/- SD/- (I C SUDHIR) (G.S . PANNU) JUDICIAL MEMBER ACCOUNTANT MEMB ER PUNE DATED:04 TH JANUARY, 2012 B COPY TO:- 1) ASSESSEES 2) ITO (CEN) KOLHAPUR 3) THE CIT (A), KOLHAPUR 4 THE CIT-I/II KOLHAPUR 5) DR, A BENCH, I.T.A.T.,PUNE. 6) GUARD FILE TRUE COPY BY ORDER SR. PS, ITAT PUNE