ACIT 14(3), MUMBAI V. NARAYANDAS SUGNOMAL, MUMBAI

ITA 552/MUM/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 8595 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-01-2011
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 27-01-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 22-01-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DR P DANIEL
• Section: 143(3)

Judgement Text

I.T.A NO.552/ MUM/2010 NARAYANDAS SUGNOMAL 1 IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH, MUMBAI. [ CORAM: D.MANMOHAN, V.P. AND PRAMOD KUMAR, AM ] I.T.A NO.552/ MUM/2010 ASSESSMENT YEAR: 2001-02 ASST. COMMISSIONER OF INCOME TAX-14(3) .. APPEL LANT 6 TH FLOOR, EARNEST HOUSE, NARIMAN POINT, MUMBAI-21. VS NARAYANDAS SUGNOMAL, ,. RESPONDEN T 26, JAY MAHAL ESTATE, 39, KITCHEN GARDEN LANE, MUMBAI-2 PA NO.AAAFN 3165 F APPEARANCES: HARI GOVIND SINGH, FOR THE APPELLANT DR. P. DANIEL, FOR THE RESPONDENT O R D E R PER PRAMOD KUMAR : 1. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CHA LLENGED CORRECTNESS OF CIT(A)S ORDER DATED 12 TH NOVEMBER, 2009, IN THE MATTER OF ASSESSMENT UNDER SECT ION 143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2001-02, ON THE FOLLOWING GROUNDS: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN HOLDING THAT THE ENTIRE AMOUNT RECEIVED ON DEPB ENT ITLEMENT DOES NOT REPRESENT PROFIT CHARGEABLE U/S.28(IIID) OF THE ACT. 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN HOLDING THAT THE PROFIT REFERRED TO THE SECTION 28(I IID) REQUIRES ONLY ARTIFICIAL COST TO BE INTERPOLATED. I.T.A NO.552/ MUM/2010 NARAYANDAS SUGNOMAL 2 2. LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITS THAT TH E ISSUE IS ALREADY DECIDED, AGAINST THE ASSESSEE, BY THE HONBLE JURISDICT IONAL HIGH COURT IN ASSESSES OWN CASE VIDE ORDER DATED 6 TH AUGUST, 2010. 3. LEARNED COUNSEL FOR THE ASSESSEE DOES NOT DISPUTE THE F ACT THAT THE AFORESAID ISSUE HAS INDEED BEEN DECIDED AGAINST THE ASSESSEE BY HONB LE JURISDICTIONAL HIGH COURT. HE, HOWEVER, SUBMITS THAT FOR THOSE ASSESSMENT YEA RS, I.E. ASSESSMENT YEARS 1999-2000, 2000-01 AND 2002-03, THE ASSESSEE HAS FILED A PPEALS UNDER SECTION 261, BY WAY OF SPECIAL LEAVE PETITIONS AND AGAINST THE JUDG MENTS OF HONBLE JURISDICTIONAL HIGH COURT, BEFORE HONBLE SUPREME COURT. THE DET AILS OF THESE SLPS ARE SUBMITTED AS FOLLOWS: ASST YEARS SLP (C) NO. DATE OF FILING 1999-2000 32384 OF 2010 18.10.2010 2000-2001 32308 OF 2010 18.10.2010 2002-03 32339 OF 2010 18.10.2010 4. IT IS SUBMITTED THAT IN ACCORDANCE WITH THE SCHEME OF SECTION 158A, THE ASSESSEE WISHES TO AVOID REPETITIVE LITIGATION, AND PRAY S THAT IN CASE THE ISSUE IS SETTLED IN FAVOUR OF THE ASSESSEE FOR THESE ASSESSMENT YEAR S, THE SAME SHOULD BE APPLIED HERE AS WELL. LEARNED DEPARTMENTAL REPRESENTA TIVE, WHO WAS HANDED OVER A COPY OF PETITION UNDER SECTION 158A DURING THE COURSE OF THE HEARING BEFORE US, DOES NOT OBJECT TO THE PRAYER OF THE ASSESSEE. 5. HAVING HEARD THE RIVAL CONTENTIONS AND HAVING P ERUSED THE MATERIAL ON RECORD, AND RESPECTFULLY FOLLOWING THE ESTEEMED VIEW S OF HONBLE BOMBAY HIGH COURT IN ASSESSEES OWN CASE, WE UPHOLD THE GRIEVANCE OF THE ASSESSING OFFICER AND ALLOW THE APPEAL IN FAVOUR OF THE ASSESSEE. AS REGARDS T HE PETITION UNDER SECTION 158A, WE HAVE NOTED THAT AS REGARDS MATTERS PENDING B EFORE HONBLE SUPREME COURT, POST 1 ST OCTOBER 1998, STRICTLY SPEAKING IT CAN COME INTO PLA Y ONLY WHEN MATTER IS PENDING BEFORE HONBLE SUPREME COURT UNDER SECTION 261, BUT SECTION 261 I.T.A NO.552/ MUM/2010 NARAYANDAS SUGNOMAL 3 PROVIDES THAT AN APPEAL SHALL LIE TO THE SUPREME CO URT FROM ANY JUDGMENT OF THE HIGH COURT, DELIVERED BEFORE THE ESTABLISHMENT OF THE NATIONAL TAX TRIBUNAL, ON A REFERENCE MADE UNDER SECTION 256 AGAINST AN ORDER MAD E UNDER SECTION 254 BEFORE THE 1ST DAY OF OCTOBER, 1998 OR AN APPEAL MADE TO HI GH COURT IN RESPECT OF AN ORDER PASSED UNDER SECTION 254 ON OR AFTER THAT DATE IN ANY CASE WHICH THE HIGH COURT CERTIFIES TO BE A FIT ONE FOR APPEAL TO THE SUPREME COURT (EMPHASIS SUPPLIED BY US BY UNDERLINING). A VIEW, THEREFORE, SEEM POSSIBLE TH AT SLPS ARE NOT COVERED BY SECTION 261 OF THE ACT, BUT HAVING REGARD TO THE FA IR APPROACH ADOPTED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE, WE SEE NO NEED TO GO INTO THIS TECHNICAL ASPECT. IN ANY EVENT, HOWEVER, IT DOES NOT MAKE ANY M ATERIAL DIFFERENCE TO THE SITUATION, BECAUSE THE ASSESSEE IS AT LIBERTY TO MOVE AN A PPLICATION UNDER SECTION 254(2) TO BRING THIS ORDER IN CONFORMITY WITH THE LA W LAID DOWN BY HONBLE SUPREME COURT, IN CASE HONBLE SUPREME COURT INDEED REVERSES T HE LAW LAID DOWN BY HONBLE HIGH COURT WHICH WE HAVE FOLLOWED IN THIS APPEAL AS WELL. FOR THE REASONS SET OUT ABOVE, WE ALLOW THE APPEAL FILED BY THE ASSESSING OFFIC ER, AS ALSO ASSESSEES PETITION UNDER SECTION 158A. PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARI NG ON 27 TH JANUARY, 2011 SD/- (D.MANMOHAN ) (VICE PRESIDENT) SD/- (PRAMOD KUMAR) (ACCOUNTANT MEMBER) MUMBAI, DATED 27 TH JANUARY, 2011 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS),25, MUMBAI 4. COMMISSIONER OF INCOME TAX, 14 , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH B, MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI I.T.A NO.552/ MUM/2010 NARAYANDAS SUGNOMAL 4