THE PR. COMMISSIONER OF INCOME TAX V. M/S SREE SHIVALINGESHWARA ARECANUT TRADERS

ITA/266/2022

AI Insights

This case involves an income tax appeal filed by the Principal Commissioner of Income Tax and the Deputy Commissioner of Income Tax against M/s. Sree Shivalingeshwara Arecanut Traders. The appeal was directed against the order of the Income Tax Appellate Tribunal, Bengaluru, which had set aside the order passed under section 263 of the Income Tax Act, 1961. The Tribunal's decision was challenged on the grounds that the conditions for passing an order under section 263 were satisfied, as the original assessing authority's order was claimed to be both prejudicial and erroneous. However, the appeal was dismissed due to the monetary threshold not being met as per the recent circular, leaving the substantial questions of law unresolved.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 729296 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 02-09-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: G S NAGHARISH
• Assessee Lawyers: RAVI RAJ
• Keywords: Assessment Year 2014-2015; Income tax appeal; Monetary limit; Section 260-A; Section 263
• Section: 263; 260-A

Judgement Text

" - 1 - NC: 2024:KHC:35623-DB ITA No. 266 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF SEPTEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO.266 OF 2022 BETWEEN: 1. THE PR. COMMISSIONER OF INCOME TAX, CIT(A) CENTRAL CIRCLE C R BUILDING, QUEENS ROAD BENGALURU - 560 001 2. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE NO.55/1, SHILPASHREE VIDHYARANYA COMPLEX VISHVESHWARANAGAR MYSURU - 570 008. …APPELLANTS (BY SRI. RAVI RAJ Y.V., ADVOCATE) AND: M/S. SREE SHIVALINGESHWARA ARECANUT TRADERS 21, L BLOCK, APMC YARD SHIVAMOGGA - 577 204 PAN. AALFS 3372E …RESPONDENT (BY SRI. G S NAGHARISH, ADVOCATE) Digitally signed by BHARATHI S Location: HIGH COURT OF KARNATAKA - 2 - NC: 2024:KHC:35623-DB ITA No. 266 of 2022 THIS INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 07/12/2021 PASSED IN ITA NO. 141/BANG/2021, FOR THE ASSESSMENT YEAR 2014-2015 AND PRAYING TO (I). FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN (II). ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, BENGALURU IN ITA NO. 141/BANG/2021 DATED 07/12/2021 FOR ASSESSMENT YEAR 2014-2015 ANNEXURE-C AND CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, MYSURU (III). TO PASS SUCH OTHER SUITABLE ORDERS AS THIS HON'BLE COURT DEEMS FIT TO GRANT IN THE FACTS AND CIRCUMSTANCES OF THE CASE IN THE INTEREST OF JUSTICE AND EQUITY ETC. THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.G.PANDIT and HON'BLE MR JUSTICE C.M. POONACHA - 3 - NC: 2024:KHC:35623-DB ITA No. 266 of 2022 ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) This appeal is filed under Section 260-A of the Income Tax Act, 1961 (for short 'the Act') questioning the correctness or otherwise of order passed by the Income Tax Appellate Tribunal, Bengaluru in ITA No.141/Bang/2021 dated 07.12.2021 for the Assessment Year 2014-15 (Annexure-C). 2. The appeal was admitted on 06.09.2022 to examine the questions of law raised by the appellants which are extracted below: 1. \"Whether on the facts and in the circumstances of the case, the Tribunal order can be said as perverse in nature in holding that the conditions prescribed for passing order under section 263 of the Act are not satisfied when the CIT has given elaborate findings to demonstrate that the order passed by assessing authority was prejudicial as well as erroneous order\"? 2. \"Whether on the facts and in the circumstances of the case, the Tribunal is right in law in allowing appeal preferred by assessee by setting aside order passed under section 263 of the Act ignoring that assessing authority had not derived gross profits from unaccounted sales and purchases recorded in seized documents and - 4 - NC: 2024:KHC:35623-DB ITA No. 266 of 2022 assessing authority further failed to make proper enquiry before making additions\"? 3. \"Whether on the facts and in the circumstances of the case, the Tribunal's order setting aside order passed under section 263 of the Act holding that the assessing authority was correct in determining the unaccented income on the basis of GP rate in disclosed transactions as per regular books of accounts ignoring findings of Commissioner of Income Tax\"?. 3. This appeal was filed on 23.05.2022 and Monetary value involved is Rs.29,29,383/-. Subsequent to filing of the appeal, Circular bearing No.5/2024 [F.No.279/Misc.142/2007- ITJ(PT.)] dated 15.3.2024 is issued under Section 265(A) of the Income Tax Act, 1961 prescribing monetary limit and the exceptions to prefer an appeal before the High Court. 4. In view of the above Circular, the above appeal would not be maintainable since monetary value involved in this appeal is less than rupees one crore. Therefore, the above appeal would not survive for consideration and the same is dismissed. - 5 - NC: 2024:KHC:35623-DB ITA No. 266 of 2022 5. In view of the above, the substantial questions of law raised in the appeal are kept open to be considered in an appropriate case. Sd/- (S.G.PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE SMJ "