Principal Commissioner Of Income Tax – 1, Kolkata v. C.m. Rajgarhia (P) Limited …………_

OD - 2 ITAT/112/2023IA NO. GA/1/2023 IN THE HIGH COURT AT CALCUTTASPECIAL JURISDICTIONORIGINAL SIDE PRINCIPAL COMMISSIONER OF INCOME TAX – 1, KOLKATAVersusC.M. RAJGARHIA (P) LIMITED………… BEFORE: The Hon'ble T.S. SIVAGNANAM ACTING CHIEF JUSTICE AND The Hon’ble JUSTICE HIRANMAY BHATTACHARYYA Date : 10[th ]May, 2023. Appearance :Mr. Soumen Bhattacharjee, Adv.…for appellant The Court : This appeal filed by the revenue under Section 260A of the Income Tax Act, 1961 (the Act) is directed against the order dated 22[nd]November, 2023 passed by the Income Tax Appellate Tribunal, Kolkata “B”Bench in ITA 144/Kol/2021 for the assessment year 2015-16. The revenue hasraised following substantial questions of law for consideration :- A)Whether the Learned Tribunal has committed substantial error in law by quashing the Order passed PCIT-3, Kolkata by holding that therectification Order Under Section 154 of the Income Tax Act, 1961and assessment Order dated 28.12.2017 passed by the AssessingOfficer were not erroneous?rectification Order Under Section 154 of the Income Tax Act, 1961and assessment Order dated 28.12.2017 passed by the AssessingOfficer were not erroneous? B)Whether the Learned Tribunal has committed substantial error in lawby holding that the ‘Taxable Distributed Income’ of Rs.3,29,00,000/-by holding that the ‘Taxable Distributed Income’ of Rs.3,29,00,000/- not to be taxed under the per view of Section 115QA of the IncomeTax Act, 1961? We have heard Mr. Soumen Bhattacharjee, learned standing Counsel forthe appellant/revenue. The assessee had filed the appeal before the Tribunal challenging theorder passed by the Principal Commissioner of Income Tax-3, Kolkata (PCIT) inexercise of its powers under Section 263 of the Act. The learned Tribunal notedthat PCIT has exercised its revisional jurisdiction in respect of an order passedunder Section 154 of the Act, even when the subject matter of revision did notat all arise out of the said rectification order passed by the assessing officerunder Section 154 of the Act. The Tribunal perused the case records and foundthat the assessment was completed under Section 143(3) of the Act by orderdated 28.12.2017. The issue was pertaining to levy of tax under Section 115QA, which wasexamined by the assessing officer in the assessment proceedings. The Tribunalnoted that assessment order having been passed on 28.12.2017, PCIT couldhave exercised its jurisdiction under Section 263 not later than 31.03.2019.However, the PCIT exercised its jurisdiction on 10.06.2020, which is barred bylimitation in respect of the assessment order, which was passed on 28.12.2017.That apart, the Tribunal noted that the assessee in the original assessmentproceedings demonstrated that the provision of Section 115QA was notapplicable to their case as the explanation to Section 115QA (1) as applicableprior to 01.06.2016. Buy-back means, the purchase by the companies of itsown shares in accordance with the provisions of the Section 77 of theCompanies Act. Thus, Tribunal noted that as per the said provision in forceduring the relevant assessment year, the buy-back pursuant to order of Company Law Board will appear under Section 402 of the Companies Act wasnot included. Therefore, the Tribunal on fact held that the PCIT was notjustified in invoking the provisions of Section 263 of the Act. Thus, we find thatthe Tribunal having examined the jurisdictional issue as well as on factsallowed the appeal filed by the assessee. Thus, we find that there is no question of law, much less substantialquestions of law arising for consideration in this appeal. Accordingly, the appeal is dismissed. (T.S. SIVAGNANAM) ACTING CHIEF JUSTICE (HIRANMAY BHATTACHARYYA, J.) pkd/GH.