Commissioner Of Income Tax I Chennai. Appellant v. M/S.five Star Marine Exports (P) Limited

In the High Court of Judicature at Madras Dated : 20.04.2009Coram :-THE HONOURABLE MR.JUSTICE K.RAVIRAJA PANDIANandTHE HONOURABLE MR.JUSTICE M.M.SUNDRESH Tax Case (Appeal) No.264 of 2009 Commissioner of Income Tax IChennai. Appellant v.M/s.Five Star MarineExports (P) LimitedNo.55, Venkatesa StreetChindadripetChennai � 600 002. Respondent Tax Case Appeal filed under section 260A of the Income Tax Act against the order dated 18.9.2008of the Income Tax Appellate Tribunal, Madras 'A' Bench in I.T.A.No.814/Mds/2005. For Appellant : Mrs.Pushya Sitaraman,Sr.Standing Cousnelfor Income-tax. JUDGMNET (Judgment of the Court was delivered byK.RAVIRAJA PANDIAN, J.) The appeal is at the instance of the revenue against the order dated 18.9.2008 of the Income TaxAppellate Tribunal, Madras 'A' Bench in I.T.A.No.814/Mds/2005 relating to the assessment year2001-02 by formulating the following questions of law: "1. Whether on the facts and circumstances of the case, the Tribunal was right in remitting thematter to the assessing officer to await the outcome of the writ petition, without deciding whetherthe delay in filing the first appeal was condonable? 2. Whether the Tribunal can straightaway go into the merits of the case, where the lower appellateauthority has dismissed the appeal on grounds of delay and not on merits? 2. The facts of the case are as follows: The assessee is engaged in the business of export of sea food. The assessing officer has made anaddition on account of DEPB expenses and donations made by the assessee in his assessment orderdated 29.1.2004. Aggrieved by the order of the assessing officer, the assessee filed an appeal beforethe Commissioner of Income Tax (Appeals) with a delay of 255 days. The Commissioner of Income- tax (Appeals) did not accept the reason given by the assessee at the time taken in pursuing arectification petition before the assessing officer, as he found that the assessee had taken a furtherperiod of six months even after the receipt of the rectification order. The appeal was dismissed onthe ground of barred by limitation without going into the merits of the case. Aggrieved by the same,the assessee filed an appeal before the Income-tax Appellate Tribunal, wherein it was brought to thenotice of the Tribunal that the amendment brought about by the Taxation Laws Amendment Act,2004 in the provisions of Section 80HHC has been challenged before various High Courts and thejurisdictional High Court has also admitted a writ petition in W.P.No.9031 of 2006 and pending forconsideration. In that view of the matter, the Tribunal set aside the order of the Commissioner(Appeals) and remitted back the matter to the assessing officer to pass appropriate order after thedecision rendered by the High Court in the writ petition. The correctness of the same is nowcanvassed in this appeal on the ground that in the appeal before the Tribunal, the correctness of theorder of the Commissioner of Income-tax (Appeals) in rejecting the application to condone the delaywas only questioned and it has not been argued on merits. When such being the position, theTribunal would not have set aside the order and remitted back the matter to the assessing officerwith a direction to await for the decision of the High Court in the writ petition pendingconsideration. 3. We heard the argument of the learned counsel for the revenue and perused the material onrecord. 4. As could be seen from the order of the Tribunal, it could be seen that only the Departmentalrepresentative stated that a similar issue has been set aside by the Tribunal, Chennai Benchdirecting the assessing officer to decide the issue in dispute after decision of the High Court in theaforesaid case. It is also further recorded by the Tribunal that the proposition was put up by both theparties and both the parties agreed that the issue in dispute has been set aside to the file of theassessing officer to decide the same after final order on the issue is decided by the jurisdictionalHigh Court. 3. We heard the argument of the learned counsel for the revenue and perused the material onrecord. 4. As could be seen from the order of the Tribunal, it could be seen that only the Departmentalrepresentative stated that a similar issue has been set aside by the Tribunal, Chennai Benchdirecting the assessing officer to decide the issue in dispute after decision of the High Court in theaforesaid case. It is also further recorded by the Tribunal that the proposition was put up by both theparties and both the parties agreed that the issue in dispute has been set aside to the file of theassessing officer to decide the same after final order on the issue is decided by the jurisdictionalHigh Court. 5. Now learned counsel for the revenue contended before us that in the appeal before the Tribunal,what was argued is the correctness of the order of the Commissioner (Appeals) rejecting theapplication filed to condone the delay in filing the appeal. Hence, the Tribunal would have set asidethe order of assessment. 6. A similar issue in an appeal before the Tribunal against the Appellate Assistant Commissioner,who refused to condone the delay in presentation and also against the order refusing the condonethe delay in revision was considered by the Division Bench of this Court in a pari materia provisionin the Sales Tax Act in the case of STATE OF TAMIL NADU VS. P.M.MADHAVAN NAIR ANDOTHERS, (1982) 49STC 244, wherein it was held by a Division bench of this Court that refusal tocondone delay would tantamount to confirming the order of assessment. Hence, the appeal ismaintainable and the appeal can be decided on merits for which proposition the Division Bench hasalso taken into consideration of the order of the Supreme Court in the case of MELA RAM ANDSONS VS. COMMISSIONER OF INCOME TAX, PUNJAB, (1956) XXIX ITR 667, wherein the threeJudges Bench of the Supreme Court having regard to Section 30(2) of the old Income-tax Act heldthat there was no sufficient reason for excusing delay and rejecting the appeal under Section 32 ofthe Income-tax Act as time-barred is an order passed under Section 31 and an appeal lies from thatorder to the Appellate Tribunal and the Tribunal can well go into the merits of the case as the orderof the Commissioner (Appeals) would tantamount to confirming the order of assessment. 7. In view of the above said decisions, we do not find that the Tribunal has committed any error insetting aside the matter and remitting it back to the assessing officer with a direction to pass final order as per the outcome of the decision of the High Court. Further, the learned Departmentalrepresentative has agreed before the Tribunal that the issue similar to the one in dispute has beenset aside to the file of the assessing officer to decide the same after final order on the issue isdecided by the jurisdictional High Court. As a matter of fact, the remittal order in a similar issue wasbrought to the notice of the Tribunal only by the Departmental representative. In such a situation,we do not find any reason to entertain the appeal and the appeal is liable to dismissed andaccordingly the same is dismissed. (K.R.P.,J.) (M.M.S.,J.)20.04.2009Index:YesInternet:Yesusk K.RAVIRAJA PANDIAN,J.andM.M.SUNDRESH,Jusk