Ita/302/2010 Of A.younus Kunju, Younous Cashew Industrie v. The Commissioner Of Income Tax, Tvpm

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HON'BLE THE CHIEF JUSTICE DR. MANJULA CHELLUR & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE TUESDAY, THE 3RD DAY OF DECEMBER 2013/12TH AGRAHAYANA, 1935 ITA.No. 302 of 2010 ( ) ------------------------------- AGAINST THE ORDER IN ITA 215/ COCH/2007 of INCOME TAX APPELLATE TRIBUNAL,COCHIN BENCH, DATED 26-02-2009 ------------ APPELLANT(S)/APPELLANT/ASSESSEE: --------------------------------------------------------- A.YOUNUS KUNJU, YOUNOUS CASHEEW INDUSTRIES, VADAKKEVILA, KOLLAM. BY ADVS.SRI.S.ARUN RAJ SMT.C.T.SUJA SRI.P.DANIEL RESPONDENT(S)/RESPONDENT/REVENUE: ------------------------------------------------------------- COMMISSIONER OF INCOME TAX, THIRUVANANTHAPURAM. BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING COME UP FOR ADMISSION ON 03-12-2013, ALONG WITH ITA. 303/2010, ITA. 310/2010, ITA. 311/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: PJ APPENDIX PETITIONERS' ANNEXURES ---------------------------------------- ANNEXURE A: COPY OF THE SETTLEMENT COMMISSIONS ORDER DATED 29/6/93 PASSED UNDER SECTION 245D (4) OF THE ACT. ANNEXURE B: COPY OF THE ORDER UNDER SECTION 154 OF THE ACT DATED 18/7/2006 ISSUED BY THE ASSESSING OFFICER18/7/2006 ISSUED BY THE ASSESSING OFFICER ANNEXURE C: COPY OF THE ORDER DATED 8/12/2006 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-III, TRIVANDRUM. ANNEXURE D: CERTIFIED COPY OF THE ORDER DATED 26/2/2009 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH COCHIN FOR THE ASSESSMENT YEAR 1985-86. RESPONDENTS' ANNEXURE ----------------------------------------- NIL. / TRUE COPY / P.S. TO JUDGE Manjula Chellur, C.J. & A.M. Shaffique, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - I.T.A. No. 302 OF 2010 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 3[rd] day of December, 2013 Manjula Chellur, C.J. JUDGMENT The relevant assessment year involved in the above appeal is 1985-86. The issue revolves around the completionof assessment subsequent to disposal of an application filed bythe appellant assessee under Section 245C by the SettlementCommission at Chennai. Original assessment came to becompleted under Section 143(3) of the Income Tax Act on28.03.1988 so far as this particular assessment year.Meanwhile, Settlement Commission after admitting theapplication filed by the assessee settled the matter as perorder dated 29.06.1993. 2. In pursuance of the order of the SettlementCommission, Chennai, the assessing officer completed the assessment proceedings and passed an order dated26.06.1994. A notice came to be issued by the assessingofficer under Section 154 and proceeded to levy interest apart ITA No. 302 of 2010 from indicating the correct share of income from a partnershipfirm in which assessee was a partner and opined that noobjection statement came to be filed by the appellant assessee.This order of the assessing officer, i.e. the rectification order afterlevying interest under Section 220(2) further withdrawing theinterest earlier granted under Section 244(1)A came to bechallenged before the Commissioner of Income Tax(Appeals). 2. In pursuance of the order of the SettlementCommission, Chennai, the assessing officer completed the assessment proceedings and passed an order dated26.06.1994. A notice came to be issued by the assessingofficer under Section 154 and proceeded to levy interest apart ITA No. 302 of 2010 from indicating the correct share of income from a partnershipfirm in which assessee was a partner and opined that noobjection statement came to be filed by the appellant assessee.This order of the assessing officer, i.e. the rectification order afterlevying interest under Section 220(2) further withdrawing theinterest earlier granted under Section 244(1)A came to bechallenged before the Commissioner of Income Tax(Appeals). 3. The Commissioner of Income Tax(Appeals)dismissed the appeal considering the grievance of the appellantassessee with regard to levying interest under Section 220(2) ina detailed discussion at paragraph 5 of the order ofCommissioner of Income Tax(Appeals). This order came to bechallenged before the Appellate Tribunal raising several grounds.However, without touching the merits of the orders passed by theCommissioner of Income Tax(Appeals), Tribunal opined that theproceedings initiated by the assessing officer were theconsequence of orders by Settlement Commission and Tribunalcannot examine any of the issues involving the matter subjected ITA No. 302 of 2010 to the assessment. This order of the Tribunal is under challengebefore us. 4. The relevant provision that has to be considered is Section 246A(1)(c) which reads as under: “246A.Appealableordersbefore Commissioner(Appeals).- (1) Any assessee aggrievedby any of the following orders (whether made before orafter the appointed day) may appeal to theCommissioner(Appeals) against- xxxxxxxx (c) an order made under Section 154 or Section155 having the effect of enhancing the assessment orreducing a refund or an order refusing to allow the claimmade by the assessee under either of the said sections;” 5. It is very clear from reading of the above provision that the assessee, aggrieved by an order made under Section154, can file appeal only before Commissioner of Income Tax(Appeals) which the appellant assessee has adopted in the abovecase and the Commissioner of Income Tax(Appeals) has alsoconsidered the appeal on merits and disposed of the same as ITA No. 302 of 2010 -:4:- indicated above. Hence, we are of the opinion, there was nojustification on the part of the Tribunal to opine that the appealbefore the Tribunal was not maintainable. As indicated above,the appeal filed before the Commissioner of Income Tax(Appeals)was under Section 154 of the Act and the Commissioner ofIncome Tax(Appeals) correctly disposed of the matter havingjurisdiction, therefore, the Tribunal ought to have decided theappeal on merits after entertaining the same. With these observations, the order of the Tribunaldated 26.02.2009 is set aside remitting back the matter toTribunal for consideration on merits. Manjula Chellur, Chief Justice. A.M. Shaffique, Judge. ttb/03/12 ITA No. 302 of 2010