Pr. Commissioner Of Income Tax-1, Jaipur v. Shri Om Prakash Badaya, Huf

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 65/2021 Pr. Commissioner Of Income Tax-1, Jaipur ----Appellant Versus Shri Om Prakash Badaya, Huf, 42, Agrasen Nagar, Jaipur. ----Respondent For Appellant(s) : Ms. Parinitoo Jain, Adv., though V.C.For Respondent(s): HON'BLE MR. JUSTICE PRAKASH GUPTA HON'BLE MR. JUSTICE SAMEER JAIN 18/05/2022 Judgment / Order 1.Present appeal is filed by Revenue under Section 260Aof the Income Tax Act, 1961 against the order dated 19.11.2020passed by learned Income Tax Appellate Tribunal, Jaipur Bench,Jaipur in ITA No.217/JP/2020 for the assessment year 2015-16whereby the appeal was allowed. 2.The learned counsel for the revenue has submitted thatthe appeal is filed on following Substantial Questions of Law whichreads as under: “1. Whether on the facts and in thecircumstances of the case the Tribunal has erredin law in holding that the Pr. CIT himself oughtto have made some enquiry regarding impugnedtransactions before setting aside the case to thefile of the Assessing Officer by completelyignoring the Statutory Provision of section 263of the Income Tax Act as amended by theFinance Act, 2015? 2. Whether on the facts and in thecircumstances of the case the Tribunal has erredin law in holding that it is not a case where theAssessing Officer has not made any enquiryregarding the impugned transactions specificallywhen the Assessing Officer failed to examine thetransaction in the light of information from theInvestigation Wing, Kolkata?” 3.Learned counsel for the revenue has not rebutted thatthe controversy involved in the matter has been recently decidedby the Hon’ble Court in D.B. I.T. Appeal No.1/2021titled asPr.Commissioner of Income Tax-I Vs. Prakash Chand SharmaandD.B. I.T. Appeal No.54/2021 titled as Pr. Commissionerof Income Tax-I, Jaipur Vs. Ritu Agarwalwherein similarcontroversy pertaining to penny stock and other case involved inorganized tax evasion activity were involved and were put to rest. 4.Though the learned counsel for the revenue submittedthat the Tribunal has not considered the appeal on merits and hasdismissed the case on the ground of monetary limit yet thelearned Commissioner Appeals has given enough reasoning tojustify the claim of the department/revenue. The matterspertaining to alleged tax revenue activity qua issue of pennystocks which was duly considered in D.B. I.T. AppealNo.1/2021 titled as Pr. Commissioner of Income Tax-I Vs.Prakash Chand Sharma, D.B. I.T. Appeal No.22/2021titledas Pr. Commissioner of Income Tax, Jaipur-2, Jaipur Vs.Shri Sanjay Chhabraand inD.B. I.T. Appeal No.54/2021titled asPr. Commissioner of Income tax-I, Jaipur Vs. RituAgarwal, the relevant portion of the order in Prakash ChandSharma (supra) reproduced below: “2 By the Present IT appeal, the followingSubstantial Question of Law are proposed:-Substantial Question of Law are proposed:- (I)Whether in view of the Circular No.23/2019 dated 06/09/2019 which provides forfiling of appeal on merits in cases of pennystocks and other cases involved in organized taxevasion activity, irrespective of the tax effectinvolved, the orders passed by the Tribunal, videwhich the appeal and the misc. application of theappellant has been dismissed solely on accountof low tax effect, are sustainable? (II)Whether, the orders passed by the Tribunal arecontrary to Circular No. 23/2019 dated 06/09/2019 andSpecial Order dated 16/09/2019 issued by CBDT?” 3. At the outset, learned counsel for the appellantsubmits that the matter is covered by D.B. IT AppealNo.22/2021 titled as Pr. Commissioner of IncomeTax, Jaipur-2, Jaipur Vs. Shri Sanjay Chhabra. 4.We have considered the submissions. (II)Whether, the orders passed by the Tribunal arecontrary to Circular No. 23/2019 dated 06/09/2019 andSpecial Order dated 16/09/2019 issued by CBDT?” 3. At the outset, learned counsel for the appellantsubmits that the matter is covered by D.B. IT AppealNo.22/2021 titled as Pr. Commissioner of IncomeTax, Jaipur-2, Jaipur Vs. Shri Sanjay Chhabra. 4.We have considered the submissions. 5.On going through the contents of theorder of learned ITAT dated 06.07.2020, it isobserved that before rendering the judgment thelearned ITAT has considered entire facts of the case,and has given a categorical finding that, in the casein hand, the assessee produced all the documentaryevidence to establish the genuineness oftransaction. The learned Assessing Officer, as perthe learned ITAT, has failed to produce contrarymaterial evidences to rebut the claim of theassessee and documents produced by him. LearnedITAT has considered the bank statement, demataccount, books of account, contract notes whichwere external documents not in the control of theassessee and therefore the claim of the departmentof manipulation and for treating the transaction inquestion as sham and bogus were not proven andfound untenable. 6.On perusal of the order of learned ITATand reasonings given therein, this court is of theview that the substantial questions of lawformulated above does not arise as learned ITAThas logically dealt with questions of fact and lawinvolved by way of reasoned order. 7.Placing reliance upon the Apex Courtjudgment of Steel Authority of India Ltd. Vs.Designated Authority, Directorate General ofAnit Dumping & Allied Duties and Ors.:2017(349) E.L.T 193 (SC),wherein the question ofadmission of an appeal, on substantial question oflaw was considered and it was held as under:- “(i) The question raised must involve asubstantial question of law which has notbeen answered or, on which, there is aconflict of decisions necessitating aresolution. (ii) If the Tribunal, on consideration of thematerial and relevant facts, had arrived at a conclusion which is a possibleconclusion, the same must be allowed torest even if this Court is inclined to takeanother view of the matter. (iii) The Tribunal had acted in grossviolation of the procedure or principles ofnatural justice occasioning a failure ofjustice. 8.We are of the view that learned ITAT, onconsideration of material and relevant facts arrivedat a logical conclusion and the same must beallowed to rest. There is no gross violation ofprinciples of natural justice and no error has creptin the order of the learned ITAT. The CoordinateBench of this court in D. B. IT Appeal No.54/2021 titled as Pr. Commissioner ofIncome Tax-I, Jaipur Vs. Ritu Agarwal, in thesimilar facts and circumstances, has already takena view that in the appeal at hand, under Section260A of the Act, no substantial question of lawarises. 9.In the light of above discussions, thepresent appeal under Section 260A of the Act doesnot call for interference and is hereby dismissed, asno substantial question of law worth considerationarises.” 5.On consideration of the above findings of the judgmentof Division Bench of this court, we are of the view that the matteris similar to those appeals and no Substantial Question of Law 9.In the light of above discussions, thepresent appeal under Section 260A of the Act doesnot call for interference and is hereby dismissed, asno substantial question of law worth considerationarises.” 5.On consideration of the above findings of the judgmentof Division Bench of this court, we are of the view that the matteris similar to those appeals and no Substantial Question of Law arises for consideration before this court. Further, the order of theTribunal on account of monetary limit and on account of circulardated 06.09.2019 are set aside only to the extent of monetarylimits and not on merits. The findings, though not considered bylearned ITAT but by CIT(A) and assessing officers, is required tobe reversed as pertaining to similar issue of penny stocks insimilar facts and circumstances, with consent of learned counselfor the revenue, we are not remitting the matter to the ITAT butdisposing of the same in light of Prakash Chand Sharma(supra) that the similar Substantial Questions of Law in the samecircumstances were dismissed by this Hon’ble High Court. 6.On perusal of order of ITAT and impugned orders ofCIT(A) and assessment order, this court is of the opinion that noground for interference is called for in this appeal, as noSubstantial Question of Law exists.7.For the reasons stated above, the appeal is dismissed.All pending applications also stand disposed of. (SAMEER JAIN),J (PRAKASH GUPTA),J JKP/8