Mookambika Associates V. The Assistant Commissioner of Income Tax, Central Circle 2 (1) and The Commissioner of Income-Tax, Central Circle

ITA/239/2015

AI Insights

The case involves M/s Mookambika Associates, the appellant, who faced a tax assessment dispute for the year 2007-08 following a search operation by the Income Tax Department. Initially, the appellant declared an income of Rs.1,56,00,000 and a tax liability of Rs.96,46,814. However, the assessed income was later determined to be Rs.2.06 crore with a tax liability of Rs.1,26,75,366. The appellant's appeals were dismissed by the Appellate Commissioner and the Tribunal primarily due to non-payment of the self-assessment tax, which was allegedly not deposited due to the attachment of the appellant's properties by the Department post-search. The High Court of Karnataka, upon hearing the matter, decided to remand the case back to the Tribunal after the appellant managed to deposit the required tax amount.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 793981 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 11-12-2015
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: M V SESHACHALA; ARAVIND CHAVAN
• Keywords: Appeal Dismissal; Assessment Year 2007-08; Income Tax; Search and seizure; Self-assessment tax
• Section: 153A; 153C; 260A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF DECEMBER, 2015 PRESENT THE HON'BLE MR. JUSTICE VINEET SARAN AND THE HON’BLE MRS. JUSTICE S.SUJATHA ITA NO. 239/2015 BETWEEN: M/S MOOKAMBIKA ASSOCIATES NO.14, LAKSHMI COMPLEX, 3RD CROSS, JOURNALIST COLONY, BANGALORE-560 002. … APPELLANT (BY SRI. M.V. SESHACHALA-SR COUNSEL FOR SRI. ARAVIND.V.CHAVAN) AND: 1. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2 (1), C.R. BUILDINGS, QUEENS ROAD, BENGALURU-560 001. 2. THE COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE), C.R. BUILDINGS, QUEENS ROAD, BENGALURU-560 001. … RESPONDENTS (BY SRI. E.I.SANMATHI-ADV.,) THIS ITA IS FILED UNDER SECTION 260A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED: 05.01.2015 PASSED IN ITA NO. 98/BANG/2013 AND THE ORDER PASSED BY THE APPELLATE COMMISSIONER BEARING ITA NO.378/ACIT/CC2(1)/CIT(A)-VI/BANG/2010-11, DATED: 21.12.2012 PRODUCED AS ANNEXURES-A & B FOR THE ASSESSMENT YEAR 2007-2008 AND FORMULATE THE 2 SUBSTANTIAL QUESTIONS OF LAW AS STATED ABOVE AND ETC. THIS ITA COMING ON FOR ADMISSION THIS DAY, VINEET SARAN J., DELIVERED THE FOLLOWING: JUDGMENT The present appeal relates to assessment year 2007-08. The admitted facts of this case are that a search was conducted in the premises of the appellant on 06.01.2010. Thereafter, the appellant-assessee filed return of income under Section 153A read with Section 153C of the Income Tax Act, 1961 (for short ‘Act’) declaring income of Rs.1,56,00,000/- and admitted the tax liability of Rs.96,46,814/-. The assessment was thereafter made and the income for the period in question was assessed at Rs.2.06 crore and the tax liability was found to be Rs.1,26,75,366/-. Challenging the said order, the assessee filed an appeal, which was dismissed by the Appellate Commissioner on the ground that the self assessment tax has not been paid. The appeal filed by the assessee before the Tribunal was also dismissed as the assessee did not deposit the admitted tax even after several opportunities had been granted to the assessee. 2. We have heard Sri M.V.Seshachala, learned Senior counsel along with Sri. Aravind V. Chavan, appearing 3 on behalf of the appellant as well as Sri E.I.Sanmathi, learned counsel for the respondents and perused the record. With consent of learned counsel for the parties, this appeal has been disposed of at the admission stage itself. 3. The contention of learned counsel for the appellant is that the admitted tax could not be deposited because the entire properties of the assessee had been attached by the Department after the search was conducted at its premises. 4. Learned counsel has submitted that somehow the appellant has now managed to deposit the entire admitted tax amount along with interest vide challan dated 20.01.2015, a copy of which has been filed at Annexure-‘F’. It is, thus, contended that the appeal filed by the assessee may be heard and decided on merits. 5. It is settled law that the endeavour of the authorities should always to decide the matter on merits instead of dismissing the same on technical grounds. The appeal had been filed by the appellant without depositing the requisite admitted tax, which was for the reasons beyond the control of the appellant as its entire properties had been attached by the Department. 4 Admittedly, the tax is deposited on 20.01.2015, which is within a fortnight of decision of the Tribunal. 6. In view of the aforesaid, as the admitted tax is now said to have been deposited, we remand the matter to the Tribunal to consider the appeal of the appellant afresh, after taking into account the amount of tax deposited on 20.01.2015, and giving a finding as to whether the amount of tax so deposited by the appellant is the total amount that was required to be deposited. The appeal shall then be heard on merits and in case if it is found to be the adequate amount of tax has been deposited by the assessee, then necessary directions shall be given by the Tribunal to the Appellate Commissioner to restore the appeal which had been filed before it, and the Appellate Commissioner shall then decide the same on merits, and in accordance with law. 7. In the light of the aforesaid discussion, the questions of law are answered in favour of the assessee. The appeal stands allowed to the extent as indicated above. Sd/- JUDGE Sd/- JUDGE TL "