Chennai v. Shi Mithalal Bhanmal

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM and THE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN T.C.A.No.343 of 2020 The Principal Commissioner of Income Tax, Chennai. Versus Shi Mithalal Bhanmal..Respondent Prayer:- Tax Case Appeal filed under Section 260-A of the IncomeTax Act, 1961, against the order of the Income Tax AppellateTribunal,Madras'A'Bench,ChennaimadeinI.T.A.No.3522/Chny/2018 dated 01.01.2020 relating to theAssessment Year 2015-16. against the order of the Commissioner of Income Tax(Appeals)-5Chennaidated28.09.2018andmadeinI.T.A.No.337/CIT(A)-5/2017-2018. Against the order dated 22.12.2017 made in under Section 143(3) of Income Tax Act, 1961 PAN No. on the file ofthe Income Tax Officer, Non Corporate Ward 5(3) Chennai 6 forthe Assessment year 2015-2016. For Respondent : Mr.P.Hari [Order of the Court was made by T.S.SIVAGNANAM, J.] This appeal has been filed by the Revenue under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity), isdirected against the order dated 01.01.2020 passed by the IncomeTax Appellate Tribunal, Madras 'A' Bench, Chennai ('theTribunal' for brevity) in I.T.A.No.3522/Chny/2018 for theAssessment Year 2015-16. This appeal was admitted on 01.10.2020on the following Substantial Questions of Law: https://hcservices.ecourts.gov.in/hcservices/ “1.Whether on the facts and in the circumstancesof the case, the Tribunal was right in setting asidethe well reasoned order passed by the Assessingofficer for re-examination, especially when theAssessing Officer had duly examined all the materialplaced while passing the assessment order? 2. Whether on the facts and in the circumstancesof the case, the Tribunal was right in remitting theissue back to the file of the Assessing Officer byquoting the decision in the case of Kanhaiyal and Sons(HUF) in ITA.No.1849/Chny/2014 Sunil Kumar Lalwani andthat Aashesh Kumar Lalwani wherein the onus has beenshifted to the Revenue with a direction that theAssessing Officer is to bring on record the role ofthe Assessee in promoting the Company and the relationof the Assessee, if any with that of the promoters androle of inflating of prices etc., which exercise hadalready been done by the Assessing Officer and theSEBI? And 3. Is not the finding of the Tribunal perverseespecially when the decision of the Tribunal iscontrary to the time tested principle that the person,who asserts a fact has to discharge the initial burdencast upon him to show that the said facts are true andonly thereafter the burden would shift to theDepartment?” 2. We have heard Mr.T.Ravikumar, learned Senior Standingcounsel for the appellant/Revenue and Mr.P.Hari, learned counselfor the respondent/assessee. 3. It may not be necessary for this Court to decide theSubstantial Questions of Law framed for consideration on accountof certain subsequent developments. The Government of Indiaenacted the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of2020) to provide for resolution of disputed tax and for mattersconnected therewith or incidental thereto. The Act of theParliament received the assent of the President on 17[th] March2020 and published in the Gazette of India on 17[th] March 2020. 4. In terms of the said Act, the assessee has been given anoption to put an end to the tax disputes, which may be pendingat different levels either before the First Appellate Authorityor before the Tribunal or before the High Court or before theHon'ble Supreme Court of India. Under Section 2(j) “disputedtax” has been defined. In terms of Section 3, where a declarantmeans a person, who files a declaration under Section 4 on orbefore the last date files a declaration to the designatedauthority in accordance with the provisions of Section 4 in https://hcservices.ecourts.gov.in/hcservices/ 4. In terms of the said Act, the assessee has been given anoption to put an end to the tax disputes, which may be pendingat different levels either before the First Appellate Authorityor before the Tribunal or before the High Court or before theHon'ble Supreme Court of India. Under Section 2(j) “disputedtax” has been defined. In terms of Section 3, where a declarantmeans a person, who files a declaration under Section 4 on orbefore the last date files a declaration to the designatedauthority in accordance with the provisions of Section 4 in https://hcservices.ecourts.gov.in/hcservices/ respect of tax arrears, then, notwithstanding anythingcontained in the Income Tax Act or any other law for the timebeing in force, the amount payable by the declarant shall bedetermined in terms of Section 3(a-c) thereunder. 5. The First Proviso to Section 3 states that in case, wherean Appeal or Writ Petition or Special Leave Petition is filed bythe Income Tax authority on any issue before the AppellateForum, the amount payable shall be one-half of the amount in thetable stipulated in Section 3 calculated on such issue, in sucha manner as may be prescribed. The second proviso deals with thecases, where the matter is before the Commissioner (Appeals) orbefore the Dispute Resolution Panel. The third proviso dealswith cases, where the issue is pending before the Income TaxAppellate Tribunal. The filing of the declaration is as perSection 4 of the Act and the particulars to be furnished arealso mentioned in the Sub Sections of Section 4. Section 5 ofthe Act deals with the time and manner of the payment andSection 6 deals with Immunity from initiation of proceedings inrespect of offence and imposition of penalty in certain cases.Section 9 of the Act deals with cases, where the Act 3 of 2020will not be applicable. 6. We are informed by the learned counsel for therespondent/assessee that the assessee has already filed thedeclaration under Section 4 of the Act on 03.11.2020. 7. In the light of the fact that the assessee has alreadyavailed the benefit under the Act, no useful purpose would beserved in keeping this appeal pending. At the same time,safeguarding the interest of the assessee in the event the orderto be passed by the Department under the Act is not in favour ofthe assessee. Accordingly, the Tax Case Appeal stands disposedof on the ground that the assessee has already filed adeclaration and the Department shall process the application atthe earliest in accordance with the said Act and communicate thedecision to the assessee at the earliest. As observed, theassessee is given liberty to restore this appeal in the eventthe ultimate decision to be taken on the declaration filed bythe assessee under Section 4 of the said Act is not in favour ofthe assessee. If such a prayer is made, the Registry shallentertain the prayer without insisting upon any application tobe filed for condonation of delay in restoration of the appealand on such request made by the assessee by filing aMiscellaneous Petition for Restoration, the Registry shall placesuch petition before the Division Bench for orders. 8. With this observation, the Tax Case Appeal standsdisposed of with the aforementioned liberty and Consequently,the Substantial Questions of Law are left open. No costs. s/d- Assistant Registrar True Copy Sub-Assistant RegistrarKakTo1.The Deputy/Assistant Registrar The Income Tax Appellate Tribunal, 'A' Bench, Chennai.2.The Commissioner of Income Tax (Appeals)-5Chennai3.The Income Tax OfficerNon Corporate Ward 5(3) Chennai-6.+1 Cc to Mr.T.Ravikumar, Advocate sr 36035.T.C.A.No.343 of 2020GP(CO)SP(15/12/2020)