THE COMMISSIONER OF INCOME TAX V. SRI P B SRINIVAS

ITA/512/2007

AI Insights

The appeals in question arose from orders passed by the ITAT concerning block assessments for the years 1988-89 to 1998-99. The central legal issue was the application of Section 292C of the Income Tax Act, 1961, which was amended by the Finance Act, 2007, with retrospective effect from October 1, 1975. This amendment was not in effect at the time the ITAT made its original decision on November 30, 2006. The Supreme Court's precedent in Commissioner of Income Tax, Hyderabad vs. M.J. Swamy was cited, which suggested that retrospective amendments affecting the issues in appeal necessitate a re-examination of the case. Consequently, the High Court directed the ITAT to reconsider the appeals in light of this amendment.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 742870 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 25-02-2014
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax, Hyderabad vs. M.J.Swamy
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: A SHANKAR; M LAVA
• Assessee Lawyers: K V ARAVIND
• Keywords: Block assessment; Income Tax; Retrospective effect; Substantial questions of law
• Section: 292C; 260-A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BANGALORE DATED THIS THE 25th DAY OF FEBRUARY 2014 PRESENT THE HON’BLE MR. JUSTICE DILIP B BHOSALE AND THE HON’BLE MR. JUSTICE B MANOHAR ITA.NO.512/2007 C/W ITA.NO.540/2007 IN ITA.NO.512/2007 BETWEEN 1. THE COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, C.R.BUILDING QUEENS ROAD, BANGALORE 2. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE IV BANGALORE ... APPELLANTS (BY SRI K V ARAVIND, ADV.,) AND SRI P B SRINIVAS F-61, 7TH CROSS, IST MAIN GAYATHRI NAGAR BANGALORE ... RESPONDENT (BY SRI A SHANKAR & SRI M LAVA, ADVS.,) THIS I.T.A. FILED U/S.260-A OF I.T.ACT 1961 ARISING OUT OF ORDER DATED 30-11-2006 PASSED IN ITA(SS)A 103/BANG/2002 FOR THE BLOCK ASSESSMENT YEAR 1988-89 TO 1998-1999, PRAYING TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN, II. ALLOW THE APPEAL 2 AND SET ASIDE THE ORDERS PASSED BY THE ITAT, BANGALORE IN IT(SS)A 103/BANG/2002 DATED 30-11-2006 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DY., COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-IV, BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. IN ITA.NO.540/2007 BETWEEN 1. THE COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, C.R.BUILDING QUEENS ROAD, BANGALORE 2. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE IV, C.R. BUILDING QUEENS ROAD, BANGALORE ... APPELLANTS (BY SRI K V ARAVIND, ADV.,) AND SRI P B RAMAMURTHY NO.C-20, I CROSS, 8TH MAIN VASANTHANAGAR BANGALORE ... RESPONDENT (BY SRI A SHANKAR & SRI M LAVA, ADVS.,) THIS ITA FILED U/S.260-A OF I.T.ACT, 1961 ARISING OUT OF ORDER DATED 30-11-2006 PASSED IN IT(SS)A 90/BANG/2002 FOR THE BLOCK ASSESSMENT PERIOD 1988-89 TO 1998-99, PRAYING 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 IT(SS)A 90/BANG/2002 DATED 30-11-2006 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF 3 INCOME TAX, CENTRAL CIRCLE-IV, 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 Income Tax Appeals are against the order dated 30.11.2006 passed by Income Tax Appellate Tribunal (for short ‘the Tribunal’) in IT(SS)A No.90(Bang)/2002 for the block period 1988-89 to 1998-99 and in ITA(SS)A No.103(Bang)/2002 for the block period 1988-89 and 1998-99. The substantial questions of law raised in these appeals are centered round Section 292C, inserted vide Finance Act, 2007 in the Income Tax Act, 1961 (for short ‘the IT Act’). The Finance Act came into force in 2007 whereby Section 292C was inserted in the IT Act with effect from 1st day of October, 1975. Date of the common order of the Tribunal, which is impugned in these appeals, is 30.11.2006. It is thus, very obvious that the amendment came into force vide Finance Act, 2007 after the order of the Tribunal. It is, in this view of the matter, our attention was invited to the Judgment of 4 the Supreme Court in Commissioner of Income Tax, Hyderabad –vs- M.J.Swamy (2002) 10) SCC 128. In this judgment, the Supreme Court expressed a view that if the amendment which is given retrospective effect has any bearing on the issue involved in the appeal, it requires re- consideration. In view thereof, learned counsel appearing for the parties have agreed for setting aside the order of the Tribunal and remand of the appeals to the Tribunal for its consideration in the light of insertion of Section 292C of the Finance Act, 2007 with retrospective effect from 01.10.1975. Learned counsel for the parties are ad-idem that the amendment by which Section 292C was inserted has bearing on merits of the case. 2. In the circumstances, we deem it proper to set aside the order of the Tribunal without entering into merits of the case. Order accordingly. The appeals which were decided by the impugned order stand restored to file. The Tribunal shall consider the appeals afresh in the light of the Finance Act, 2007. It 5 is needless to mention that the Tribunal shall consider the appeals afresh on merits in accordance with law and without being influenced by its earlier order and by this order. All contentions of the parties are left open. The Tribunal shall endeavour to decide the appeals as expeditiously as possible and preferably, within a period of eight months from the date of receipt of this order. With these directions, the appeals are disposed of. No costs. Sd/- JUDGE Sd/- JUDGE TL "