Ita/103/2012 Of The Commissioner Of Income Tax-Ii,Cochin v. P.sreenivasan,Chennai

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN & THE HONOURABLE MR.JUSTICE ASHOK MENON THURSDAY, THE 17TH DAY OF JANUARY 2019 / 27TH POUSHA, 1940 I.T.A.No.103 of 2012 AGAINST THE ORDER IN ITA.(SS) NO.214/COCH/2005 OF I.T.A.TRIBUNAL,COCHIN BENCH, COCHIN, DATED 06.01.2012.[BLOCK PERIOD 1990-91 TO 1999-2000 UPTO 27.03.2000] APPELLANT/APPELLANT: THE COMMISSIONER OF INCOME TAX-II,COCHIN. BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX RESPONDENT/RESPONDENT: P.SREENIVASAN, FLAT NO. 421, ARIHANT MAGESTIC TOWER, KOYEMBEDU, CHENNAI-600 107. OTHER PRESENT: SRI P.K.R.MENON, SENIOR COUNSEL, GOI (TAXES) THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 17.01.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: JUDGMENT Vinod Chandran, J. Yet another case which reveals the haphazardmanner in which the revenue officials follow up proceedingsbefore this Court and the Tribunal. The respondent hereinis alleged to be the partner of a firm against which anassessment order was passed as per Annexure-A. The firmfiled an appeal, the memorandum of which is produced atAnnexure-B, against the assessment order. The appeal filedbefore the first appellate authority was dismissed byAnnexure-C order dated 12.02.2004 for reason only of theassessee having not paid the admitted tax. No considerationon merits was made. 2. The respondent herein was made aware of thedetermination of income and demand raised, only whenrecovery steps were initiated. The respondent was alsoproceeded against for reason of he being a partner of thefirm. The respondent asserted that he was not a partner andto stall the recovery proceedings, the respondentapproached this Court with W.P.(C) No.13544 of 2005 on18.04.2005. Despite that contention, the respondent alsofiled an appeal from the assessment order, as seen from thememorandum produced at Annexure-D, on 28.05.2005. The writ petition was disposed of by Annexure-H order dated23.08.2005, which directed the CIT (Appeals) to peruse therecords, hear the writ petitioner and the concernedAssessing Officer and dispose of the appeal within sixweeks from the date of receipt of a copy of the judgment.There was also a stay granted against the sale of attachedproperties until the appeal was disposed of. Later, byAnnexure-E order dated 27.09.2005, the first appeal filedby the respondent was disposed of, making some quantumadjustments. The Revenue filed an appeal to the Tribunal[Annexure-I] and also approached this Court with a reviewpetition in the writ petition, numbered as R.P.No.52 of2006, which was disposed of by Annexure-L dated 05.04.2006. 3. The review of the Revenue raised a ground thatthe appeal of the firm was rejected and there could not beany subsequent appeal filed by the Partner before the firstappellate authority. The assessment stands confirmed by thefirst appellate authority, which order has acquiredfinality was the sole ground raised. Immediately we have tonotice that the first appeal filed by the firm wasdismissed only for reason of the admitted tax having notbeen paid and there was no consideration on merits. 4. The learned Senior Counsel, Government of India(Taxes) points out that the right given to a partner to 3. The review of the Revenue raised a ground thatthe appeal of the firm was rejected and there could not beany subsequent appeal filed by the Partner before the firstappellate authority. The assessment stands confirmed by thefirst appellate authority, which order has acquiredfinality was the sole ground raised. Immediately we have tonotice that the first appeal filed by the firm wasdismissed only for reason of the admitted tax having notbeen paid and there was no consideration on merits. 4. The learned Senior Counsel, Government of India(Taxes) points out that the right given to a partner to file an appeal under Section 247 of the Income Tax Act,1961 was omitted by Finance Act, 1992 with effect from01.04.1993. However, such a ground was never raised beforethe learned Single Judge even in the review petition. Inany event, the learned Single Judge noticed that theRevenue had already approached the Tribunal against theorder of the first appellate authority in the appeal filedby the Partner and, hence, directed the Tribunal toconsider whether the appeal was maintainable before thefirst appellate authority. The Tribunal considered theappeal filed by the Revenue, by Annexure-J order dated06.01.2012.5. As noticed from Annexure-J, the date of hearingwas 03.01.2012. We see from the order of the Tribunal thatthough an objection was raised with respect to themaintainability of the appeal by the Revenue before theTribunal, on the very same grounds as raised in the ReviewPetition, the Tribunal refused to consider the same sincethe High Court had already directed consideration onmerits. It is unfortunate that the Revenue did not placethe order of the learned Single Judge in the ReviewPetition passed six years prior, before the Tribunal. Thelearned Senior Counsel, Government of India (Taxes) wouldsubmit that since the CIT (Appeals) at the second instance had acted without jurisdiction, the order is non est inlaw. However, we do not find any reason to hold so in anappeal since the Revenue has not raised such contentionsbefore the first appellate authority or before the Tribunalnor even before this Court in the Review Petition. 6. We also notice that the original demand as isrevealed from Annexure-C was only Rs.15,02,720/-, which isfar lesser than that prescribed in the litigation policy.The appeal is one of the year 2012 and though the appealstood admitted in 2012 itself, there was no appearance forthe respondent since notice was not served. Paperpublication was taken out only in 2018. We are of theopinion that this is a fit case to be rejected on theground of litigation policy. We reject the appeal with noorder as to costs. Sd/-K.VINOD CHANDRANJUDGE Sd/-ASHOK MENONJUDGE Vku/- APPENDIX APPELLANT'S ANNEXURES: ANNEXURE-A COPY OF ASST. ORDER U/S. 158BC R.W.S. 143(3) DATED 25/03/2002 OF THE B.P.90-91 TO99-00 UPTO 27/03/2000.143(3) DATED 25/03/2002 OF THE B.P.90-91 TO99-00 UPTO 27/03/2000. ANNEXURE-BCOPY OF APPEAL MEMORANDUM FILED BY FIRM. ANNEXURE-C COPY OF THE ORDER DATED 12/02/2004 OF THE COMMISSIONER OF INCOME TAX (APPEALS).COMMISSIONER OF INCOME TAX (APPEALS). ANNEXURE-DCOPY OF APPEAL MEMORANDUM FILED BY SRI. SREENIVASAN, EX-PARTNER.SREENIVASAN, EX-PARTNER. ANNEXURE-ECOPY OF THE ORDER DATED 27/09/2005 OF THE COMMISSIONER OF INCOME TAX (APPEALS).COMMISSIONER OF INCOME TAX (APPEALS). ANNEXURE-F COPY OF WRIT PETITION FILED BY SREENIVASAN.COPY OF COUNTER AFFIDAVIT FILED BY REVENUE.COPY OF COUNTER AFFIDAVIT FILED BY REVENUE. ANNEXURE-G ANNEXURE-H COPY OF JUDGMENT DATED 23/08/2005 OF HON'BLE COURT IN WPC NO.13544/2005 (K)HON'BLE COURT IN WPC NO.13544/2005 (K) ANNEXURE-ICOPY OF APPEAL MEMORANDUM FILED BY REVENUE BEFORE ITAT.BEFORE ITAT. ANNEXURE-JCOPY OF THE ORDER DATED 06/01/2012 OF THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCHIT(SS)A NO.214/COCH/2005.INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCHIT(SS)A NO.214/COCH/2005. ANNEXURE-DCOPY OF APPEAL MEMORANDUM FILED BY SRI. SREENIVASAN, EX-PARTNER.SREENIVASAN, EX-PARTNER. ANNEXURE-ECOPY OF THE ORDER DATED 27/09/2005 OF THE COMMISSIONER OF INCOME TAX (APPEALS).COMMISSIONER OF INCOME TAX (APPEALS). ANNEXURE-F COPY OF WRIT PETITION FILED BY SREENIVASAN.COPY OF COUNTER AFFIDAVIT FILED BY REVENUE.COPY OF COUNTER AFFIDAVIT FILED BY REVENUE. ANNEXURE-G ANNEXURE-H COPY OF JUDGMENT DATED 23/08/2005 OF HON'BLE COURT IN WPC NO.13544/2005 (K)HON'BLE COURT IN WPC NO.13544/2005 (K) ANNEXURE-ICOPY OF APPEAL MEMORANDUM FILED BY REVENUE BEFORE ITAT.BEFORE ITAT. ANNEXURE-JCOPY OF THE ORDER DATED 06/01/2012 OF THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCHIT(SS)A NO.214/COCH/2005.INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCHIT(SS)A NO.214/COCH/2005. ANNEXURE-KCOPY OF REVIEW PETITION FILED BY REVENUE BEFORE THE HON'BLE HIGH COURT 22/12/2005.BEFORE THE HON'BLE HIGH COURT 22/12/2005. ANNEXURE-L COPY OF JUDGMENT RP NO.52/2006 DATED 05/04/2006 OF HON'BLE HIGH COURT AGAINST THE REVIEW PETITION BY THE REVENUE.05/04/2006 OF HON'BLE HIGH COURT AGAINST THE REVIEW PETITION BY THE REVENUE. [true copy]