Itxa/1182/2011 Of Commissioner Of Income Tax-Cen-Iv v. Shri Purshottam G. Budhwani

itxa1182-11 IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1182 OF 2011 The Commissioner of Income Tax, Cen-IV, Mumbai ..Appellant. V/s. Shri Purshottam G. Bhudhwani..Respondent. Mr. Arvind Pinto with Ms. Padma Divakar for the appellant. Mr.P.J.Pardiwala, senior Advocate with Rahul S.Arote for the respondent. CORAM : J.P. DEVADHAR AND M.S. SANKLECHA, JJ. DATED : 14TH JANUARY, 2013 P.C. :- 1. In this appeal under Section 260A of the Income Tax Act, 1961 ('the Act' for short) for the assessment year 2006-07, the following question of law has been proposed for our consideration:- “ Whether on the facts and in the circumstances of the case and in law, the ITAT was justified in directing the CIT(A) to admit the appeal and decide the same on merit, even though, at the time of filing the appeal before the CIT(A), the assessee had not itxa1182-11 complied with the mandatory requirement of payment of admitted taxes on returned income as per the provisions of Section 249(4)(a) of the I.T. Act, 1961 ? ” 2.Consequent to a survey, the respondent-assessee filed a revised return of income for the assessment year 2006-07 declaring the total income of Rs.4.89 crores on which tax payable was Rs.80.03 lakhs. However, the assessee had not paid the taxes due on the basis of voluntarily revised return. By an order dated 27[th] December, 2007 under Section 143(3) r/w. 153A of the Income Tax Act, 1961 (the Act), the assessing officer assessed the respondent-assessee to an income of Rs.7.27 crores. 3.Being aggrieved, the respondent-assessee filed an appeal before the CIT(A) against the order of the assessing officer dated 27[th ]December, 2007. However, as the returned tax had not been paid, the CIT(A) by order dated 7[th] November, 2008 dismissed the appeal on the ground that the mandatory requirement for entertaining the appeal viz. Returned tax should have been paid under Section 249 (4)(a) of the Act was not satisfied. 4.In second appeal, the Tribunal by its order dated 4[th ]November, 2010 allowed the appeal and restored the same to the file of the CIT(A) for disposal on merits. This was so as the returned tax and interest thereon had been paid on 15[th] October, 2010. In the impugned order, the Tribunal recorded that non payment of the returned tax by the respondent-assessee was due to circumstances beyond its control as all its assets had been attached the Demat accounts by SEBI and bank accounts by the CBI. In view of the aforesaid fact, the Tribunal held that there was sufficient cause for non payment of taxes and even though the taxes had been paid late, it was an admitted position that the taxes had been paid along with interest. 5.We note, as recorded by the Tribunal, that the respondent-assesses has already paid the taxes along with interest thereon on 15[th ]October, 2010. Further, the non payment of the returned tax at the time of filing the appeal was for reasons beyond the control of the respondent-assessee. The appeal of the respondent-assessee was dismissed by CIT(A) only on the ground that the returned taxes had not been paid as required under Section 249(4)(a) of the Act. 6.However, now that the returned tax along with the interest for delay has been paid, the respondent-assessee should not be deprived of its right to appeal. At the highest, as held by the Apex Court in the matter of CIT v/S. Filmstan reported in 42 ITR 163 as there is a delay in paying the taxes, the appeal be taken to have been filed late and the reason for the delay be considered for condonation of delay. The remand of the matter to CIT(A) will not cause any prejudice to the revenue as the amount of tax has already been paid along with interest and the respondent-assessee's appeal shall be decided on merits. 7.In view of the above, we see no reason to entertain the present appeal. Accordingly, the appeal is dismissed with no order as to costs. (M.S. SANKLECHA, J.) (J.P. DEVADHAR, J.)