THE COMMISSIONER OF INCOME TAX V. M/S A S K BROTHERS LTD

ITA/619/2007

AI Insights

The case involves two income tax appeals (ITA No. 619/2007 and ITA No. 618/2007) filed by the Commissioner of Income Tax and the Deputy Commissioner of Income Tax against M/s A S K Brothers Ltd. The appeals were directed against the orders of the ITAT, Bangalore, which had remanded the matter back to the Assessing Officer for the assessment years 2002-03 and 2003-04. The High Court found the ITAT's order to be cryptic and lacking independent consideration on merits, leading to the decision to remand the appeals back to the ITAT for a thorough re-examination.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 729081 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 04-02-2014
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: A SHANKAR; M LAVA
• Assessee Lawyers: E R INDRAKUMAR; E I SANMATHI
• Keywords: Appeal; Assessment Year; Income Tax; Remand; Tribunal
• Section: 260-A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BANGALORE DATED THIS THE 4th DAY OF FEBRUARY 2014 PRESENT THE HON’BLE MR. JUSTICE DILIP B BHOSALE AND THE HON’BLE MR. JUSTICE B MANOHAR ITA.NO.619/2007 & ITA.NO.618/2007 BETWEEN 1. THE COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, C.R.BUILDING QUEENS ROAD, BANGALORE 2. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2(1), C R BUILDING QUEENS ROAD, BANGALORE ... COMMON APPELLANTS (BY SRI E R INDRAKUMAR, SR. STANDING COUNSEL FOR SRI E I SANMATHI, ADV.,) AND M/S A S K BROTHERS LTD (THE ATRIA) NO.1 PALACE ROAD BANGALORE ... COMMON RESPONDENT (BY SRI A SHANKAR & SRI M LAVA, ADVS) THIS ITA.NO.619/2007 FILED U/S.260-A OF I.T.ACT, 1961 ARISING OUT OF ORDER DATED 02-03-2007 PASSED IN ITA NO.1075/BANG/2006 FOR THE ASSESSMENT YEAR 2003- 04, PRAYING THAT THIS HON'BLE COURT MAY BE PLEASED TO: 2 I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN, II. ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT, BANGALORE IN ITA NO.1075/BANG/2006 DATED 02-03-2007 & CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX,CENTRAL CIRCLE- 2(1), BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. THIS ITA.NO.618/2007 FILED U/S.260-A OF I.T.ACT, 1961 ARISING OUT OF ORDER DATED 02-03-2007 PASSED IN ITA NO.1074/BANG/2006 FOR THE ASSESSMENT YEAR 2002- 03, PRAYING THAT THIS HON'BLE COURT MAY BE PLEASED TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN, II. ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT, BANGALORE IN ITA NO.1074/BANG/2006 DATED 02-03-2007 & CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE- 2(1), BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. THESE ITAS COMING ON FOR HEARING, THIS DAY, DILIP B. BHOSALE J. DELIVERED THE FOLLOWING: PC: These two income tax appeals are directed against the order dated 22nd March 2007 rendered by Income Tax Appellate Tribunal, Bangalore Bench “A” (for short “the Tribunal”) in ITA Nos.1074 & 1075 pertaining to 3 assessment orders 2002-03 and 2003-04 whereby, the Tribunal allowed the appeals in part and remanded the matter to Assessing Officer to consider it afresh in the light of the observations made therein. 2. Appeals before the Tribunal were directed against the order dated 31-10-2006 passed by the Office of the Commissioner of Income Tax (Appeals)-VI Bangalore (for short “the Appellate Authority”) for the assessment year 2002-03 and 2003-04. By this order the Appellate Authority dismissed the appeals filed by the respondent- assessee against the assessment order dated 09-03-2005. 3. We have heard learned counsel for the parties for some time and with their assistance gone through the orders passed by the Tribunal, the first Appellate Authority and the Assessing Officer. Insofar the order of Tribunal is concerned, in our opinion, it is cryptic. The reasons recorded by the Tribunal for remanding the matter find place only in paragraph 4. Paragraph No.4 read thus : 4 “4. In view of the above submissions, we are remanding the issue to the file of the Assessing Officer to verify the claim of the assessee with regard to the investment made in 12% preference shares on which dividend income is not earned by the assessee and to the extent, they are being not exempted income, the expenditure is allowable. Similarly, the expenditure incurred on any other investment on which dividend income is receivable but not received, the Assessing Officer shall verify and allow the expenditure to that extent.” 4. In the order of Tribunal, which run into hardly 3-4 pages, we do not find that the Tribunal has considered the case independently on merits, as against the order passed by the Assessing Officer. The Tribunal, in our opinion, whether or not it agreed with the reasons of the Assessing Officer, ought to have recorded its reasons and considered the matter independently in the light of relevant provisions of the Income Tax Act, 1961. In the course of argument, when we so expressed, learned counsel for the parties fairly agreed for remand of these appeals to the Tribunal for their consideration afresh. Hence, without recording 5 any further reasons, we dispose of the appeals by the following order: Order passed by the Tribunal in both the appeals dated 22nd March 2007 is set-aside and ITA Nos.1074 & 1075 are restored to file. The Tribunal shall consider these appeals afresh and dispose them of as expeditiously as possible and preferably within a period of four months from the date of receipt of this order. Learned counsel for the revenue shall communicate this order to the Tribunal within a period of four weeks from today. The Tribunal shall consider the appeal on merits in accordance with law and shall pass a speaking order on merits of the case. All contentions of the parties are kept open. In view of this, we have not addressed and answered the substantial questions of law, as formulated in the memorandum of appeal. The Tribunal may deal with them and dispose of the appeals within the stipulated time. At this stage, learned counsel for the revenue, fairly states that the Assessing Officer shall not take any coercive action against 6 the assessee till disposal of the appeals by the Tribunal. His statement is accepted. These appeals are accordingly disposed of. No costs. Sd/- JUDGE Sd/- JUDGE Ia "