Ita/582/2023 Of The Pr Commissioner Of Income Tax v. Sri Rajkumar C (Huf)

Digitallysigned by BLAVANYALocation:HIGHCOURT OFKARNATAKA IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 1 DAY OF OCTOBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO.582 OF 2023 BETWEEN: 1. THE PR. COMMISSIONER OF INCOME-TAX, 5 FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560 095. 2. THE DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE 7(1), PRESENT ADDRESS: ITO, WARD 4(3)(2), 2 FLOOR, 2 FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560 095. 80 FEET ROAD, KORMANGALA, BENGALURU-560 095. …APPELLANTS (BY SRI. DILIP M., ADVOCATE ALONG WITH SRI. RAVIRAJ Y.V., ADVOCATE) SRI. RAVIRAJ Y.V., ADVOCATE) NC: 2024:KHC:41161-DB ITA No. 582 of 2023 AND: SRI RAJKUMAR C (HUF) NO 259/B, 7 CROSS, HSR LAYOUT, SECTOR 1, BENGALURU-560 102 PAN: AAMHR 4074B …RESPONDENT (SERVED) THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF INCOME TAX ACT, 1961, PRAYING TO ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME-TAX APPELLATE TRIBUNAL, BENGALURU IN ITA NO.1381/BANG/2014 DATED 31.10.2022 FOR ASSESSMENT YEAR 2007-2008 (ANNEXURE-A) AND CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE INCOME TAX OFFICER, WARD-4(3)(2), BENGALURU AND ETC. THIS APPEAL IS COMING ON FOR FURTHER 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 ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard the learned counsel Sri.Dilip.M., along with Sri. Raviraj.Y.V., learned counsel for appellants/Revenue. 2. The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short ‘the Act’) questioning the correctness and legality of order dated 31.10.2022 passed by the Income Tax Appellate Tribunal, ‘A’ Bench, Bengaluru (for short ‘Appellate Authority’) in ITA.No.1381/Bang/2014 for the assessment year 2007-08, raising the following substantial questions of law: 1. "Whether on the facts and in the circumstances of the case, the Tribunal's order can be said as perverse in nature in law in quashing re-assessment order earlier re-assessment order on the ground that conditions for invoking Section 147 of the Act was not satisfied and subsequently after remand holding that re-assessment order in case of HUF cannot be made as per section 171 of the Act giving contradictory judgment"? 2. "Whether on the facts and circumstances of the case and in law in holding that as re-assessment order is in accordance with Section 150 and 153 of the Act has held that same is invalid by invoking section 171 of the Act when no such direction was given by this Honb'le Court to examine the case in the light of Section 171 of the Act"? 3. "Whether on the facts and in the circumstances of the case, the Tribunal's order can be said as perverse in nature not appreciating that assessing authority has the power to disbelieve oral and documentary evidence produced in support of the partition, if the circumstances exist to support such an inference"? 4. "Whether on the facts and in the circumstances of the case, the Tribunal's order is perverse in holding HUF was not existing as on date of passing assessment order when said alleged partition was between husband, wife and minor children which tool adopted by assesse to evade tax under section 171 of the Act"? 5. "Whether on the facts and in the circumstances of the case, the Tribunal's order can be said as perverse in nature in not appreciating that conduct of assesse that assesse challenged assessment order passed in case of Individual also and now has taken up stand that HUF was not existing when assessment order is passed in case of HUF by contending that HUF was disrupted"? - 5 - 4. "Whether on the facts and in the circumstances of the case, the Tribunal's order is perverse in holding HUF was not existing as on date of passing assessment order when said alleged partition was between husband, wife and minor children which tool adopted by assesse to evade tax under section 171 of the Act"? 5. "Whether on the facts and in the circumstances of the case, the Tribunal's order can be said as perverse in nature in not appreciating that conduct of assesse that assesse challenged assessment order passed in case of Individual also and now has taken up stand that HUF was not existing when assessment order is passed in case of HUF by contending that HUF was disrupted"? - 5 - 6. 'Whether on the facts and in the circumstances of the case, the Tribunal's order can be said as perverse in nature in deleting addition made on account of AMP expenses ignoring that same has created intangible asset"? 3. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue. 4. On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024. 5. In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned - 6 - counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding. Sd/- (S.G.PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE SMJ List No.: 2 Sl No.: 4