Kelavani Mandal Thorkhan, AMRELI V. The Asstt. Commr. Income Tax, CPC, Bangalore

ITA 378/RJT/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6728 (ITAT-RAJKOT)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Appeal Filed On: 04-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAVIN VERMA SR DR
• Assessee Lawyers: DM RINDANI
• Keywords: Opportunity of being heard; Maximum Marginal Rate
• Section: 12A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [ CONDUCTED THROUGH E-COURT AT AHMEDABAD ] BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER ./ I.T.A. NO.378/RJT/2016 ( / ASSESSMENT YEAR : 2013-14) KELAVANI MANDAL THORKHAN AT: THORKHAN, TALUKA :BABRA AMRELI / VS. THE ACIT (CPC) BANGALORE ./ ./ PAN/GIR NO. AAATK 1956 F ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI D.M. RINDANI, AR ! / RESPONDENT BY : SHRI PRAVIN VERMA, SR.DR ' #$% ! & / DATE OF HEARING 01/02/2017 '( ! & / DATE OF PRONOUNCEMENT 02/02/2017 / O R D E R PER PRADIP KUMAR KEDIA, AM : THE CAPTIONED APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-3, RAJKOT [CIT(A) IN SHORT] DATED 08/08/2016 PERTAINING TO ASSESSMEN T YEAR (AY) 2013-14. 2. THE GROUNDS OF APPEAL READS AS UNDER:- ITA NO.378 /RJT /2016 KELAVANI MANDAL THORKHAN VS. ACIT ASST.YEAR 2013-14 - 2 - 1. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS )-3, RAJKOT ERRED IN CONFIRMING ACTION OF CPC U/S.143(1) IN APPLYING MAXIMUM MARGINAL RATE ON TOTAL INCOME OF T HE APPELLANT AS AGAINST INDIVIDUAL SLAB RATE APPLIED B Y THE APPELLANT. 2. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) -3, RAJKOT ERRED IN NOT FOLLOWING BOARD CIRCULAR NO.320 DATED 11-01-1982 AND JUDICIAL PRECEDENTS CITED BEFORE HIM BY THE APPELLANT. 3. THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS)- 3, RAJKOT FAILED TO APPRECIATE THAT THE ADJUSTMENT MAD E B Y CPC WAS BEYOND PURVIEW OF THE SCHEME OF SEC. 143(1) OF THE ACT. 3. BRIEFLY STATED, THE ASSESSEE FILED ITS RETURN OF INCOME DECLARING TOTAL INCOME AT RS.96,640/- IN THE STATUS OF AOP (TRUST) . THE TRUST IS STATED TO BE DULY REGISTERED UNDER SECTION 12A OF THE INCO ME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT') VIDE CERTIFI CATE DATED 01/06/1987. PUSUANT TO THE RETURN FILED BY THE ASSESSEE, AN INT IMATION UNDER SECTION 143(1) OF THE ACT DATED 17/03/2015 WAS ISSUED BY TH E CENTRAL PROCESSING CENTRE BANGALORE (CPC). AS PER THE SAID INTIMATION , TAX WAS LEVIED ON THE ASSESSEE AT A MAXIMUM MARGINAL RATE ON THE RETU RNED INCOME OF RS.96,640/- AS AGAINST NIL TAX COMPUTED BY ASSESSEE . 4. IT IS THE CASE OF THE ASSESSEE THAT THE AO (CPC) HAS COMMITTED ERROR IN APPLYING MAXIMUM MARGINAL RATE ON TOTAL IN COME OF RS.96,640/- ITA NO.378 /RJT /2016 KELAVANI MANDAL THORKHAN VS. ACIT ASST.YEAR 2013-14 - 3 - AND HAS THUS ERRED IN RAISING TAX DEMAND THEREON. IT IS THE CASE FURTHER OF THE ASSESSEE THAT TAX ON TOTAL INCOME OF THE AOP (T RUST) IS REQUIRED TO BE COMPUTED AS PER RATES APPLICABLE TO AN INDIVIDUAL A SSESSEE AND NOT AT MAXIMUM MARGINAL RATE. 5. THE LD.AR FOR THE ASSESSEE RELIED UPON THE CBDT CIRCULAR NO.320 DATED 11/01/2982 IN SUPPORT OF ITS CASE. THE LD.AR FURTHER SUBMITTED THAT CHANGE IN THE RATE OF TAX DEPENDS UPON THE STA TUS & NATURE OF ASSESSEE AND INTERPRETATION OF THE PROVISIONS OF TH E ACT AND HENCE THE SAME WOULD FALL OUTSIDE THE PURVIEW OF AN INTIMATIO N PROCESSED UNDER SECTION 14391) OF THE ACT. FOR THIS PROPOSITION, T HE LD.AR PLACED RELIANCE UPON THE JUDGEMENT OF THE HONBLE RAJASTHAN HIGH CO URT IN THE CASE OF J.K.S. EMPLOYEES WELFARE FUND VS. ITO (1992) REPORT ED IN 1999 ITR 765 (RAJ.). 6. THE LD.DR RELIED UPON THE ORDER OF THE CIT(A). 7. WE HAVE PERUSED THE ORDER OF THE CIT(A) AND FIND THAT THE CIT(A) HAS REJECTED THE RELIEF CLAIMED BY THE ASSESSEE ON THE GROUND THAT PROCESSING UNDER SECTION 143(1) DOES NOT ENTAIL EXE RCISE TOWARDS TAX RATE AS APPLICABLE ON EXEMPTED CATEGORY OR NON-EXEMPTED CATEGORY. THE CPC CANNOT BE BLAMED FOR TAX DEMAND IF THE APPROPRI ATE BOXES ARE NOT ITA NO.378 /RJT /2016 KELAVANI MANDAL THORKHAN VS. ACIT ASST.YEAR 2013-14 - 4 - TICKED IN WHILE FILING THE RETURN ELECTRONICALLY. HE ACCORDINGLY REFUSED TO GRANT THE RELIEF AS SOUGHT. 8. WE ARE NOT CONVINCED BY THE REASONINGS OF THE CI T(A). IT IS TRITE THAT NO TAX CAN BE LEVIED OR COLLECTED WITHOUT THE AUTHORITY OF LAW IN TERMS OF ARTICLE 265 OF THE CONSTITUTION OF INDIA. WE ALSO FIND THAT THE CBDT CIRCULAR AND THE JUDGEMENT OF THE HONBLE RAJ ASTHAN HIGH COURT REFERRED TO BY ASSESSEE PRESENT A STRONG CASE IN F AVOUR OF ASSESSEE FOR REVERSAL OF THE ORDER OF THE CIT(A). ACCORDINGLY, WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE IT BACK TO ITS FILE FOR R EDETERMINATION OF THE GRIEVANCE OF ASSESSEE AFTER TAKING INTO ACCOUNT TH E CBDT CIRCULAR AND THE RATIO OF THE HONBLE RAJASTHAN HIGH COURT IN AC CORDANCE WITH LAW AFTER GIVING PROPER OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE IN THIS REGARD. PERTINENT TO SAY, IT WILL BE OPEN TO THE CIT(A) TO EXAMINE THE APPROPRIATE RATE OF TAX CLAIMED APPLICABLE BY ASSES SEE HAVING REGARD TO STATUS AND NATURE OF ASSESSEE. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 02/02/2 017 AT AHMEDABAD. SD/- SD/- ( MAHAVIR PRASAD) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD ; DATED 02/02/2017 ..#, $.,#../ T.C. NAIR, SR. PS