Wp/276/2022 Of Pr. Commissioner Of Income Tax-8 v. Turnkey Electricals P. Ltd

Digitallysigned byMEERAMEERAMAHESHMAHESHJADHAVJADHAVDate:2022.03.3116:51:42+0530 IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTIONWRIT PETITION NO. 276 OF 2022 Pr. Commissioner of Income Tax-8 V/s.Turnkey Electricals P Ltd. ….Petitioner …Respondent ---- Mr. Suresh Kumar for PetitionerMr. Mandar M Vaidya for Respondent ---- CORAM : K.R. SHRIRAM &N.R. BORKAR, JJ DATED : 28[th] MARCH 2022 P.C. : 1The Revenue has filed this petition impugning an order pronouncedon 14[th] October 2019 by Income Tax Appellate Tribunal (ITAT) rejecting thepetitioner’s miscellaneous application (MA). 2The MA was taken out by the Revenue for rectification of a mistake inorder dated 5[th] June 2019. In the order pronounced on 22[nd] January 2019ITAT dismissed an appeal filed by Revenue pertaining to A.Y.-2008-2009 onthe grounds that tax effect in dispute was Rs.17,94,852/- which was belowthe monetary limit of Rs.20 lakhs specified in CBDT circular No.3 of 2018 asamended. While dismissing the appeal, liberty was granted to Revenue toapproach the ITAT for recalling of the order of dismissal and re-institution ofthe appeal, if at a later date, Revenue found that filing of the appeal wasprotected by the exception provided in clause (e) of paragraph 10 of CBDTCircular No.3 of 2018 as amended. 3Subsequently, when revenue realised that its case falls under theprotection provided under exception, Revenue preferred the MA for restoration of the appeal stating that the penalty order emanates fromaddition based on information received from external sources, i.e., Sales TaxDepartment through DGIT (Inv). This MA was dismissed by order dated 14[th]October 2019 on the grounds that it is a debatable issue whether penaltylevied is directly covered by exceptions and since it is a debatable issue, theRevenue cannot invoke provisions of Section 254(2) of the Act. 4In our view, ITAT having given liberty to petitioner to file anapplication for restoration of the appeal, if at a later date the Revenue foundthat the filing of the appeal was protected by the exceptions provided inclause (e) of paragraph 10 of the CBDT circular No.3 of 2018 as amended,ITAT ought to have considered the MA and passed order on merits. ITATshould have decided whether the penalty levied by petitioner was coveredby the exceptions provided in clause (e) of paragraph 10 of CBDT CircularNo.3 of 2018, as amended. 5In the circumstances, we quash and set aside ITAT’s order dated 14[th]October 2019 with a direction to consider petitioner’s application forrestoration on merits and decide whether petitioner’s case will fall under theexception provided in clause (e) of paragraph 10 of CBDT circular No.3 of2018 as amended. ITAT is requested to consider and dispose of the MA asearly as possible and preferably by 31[st] July 2022. 6Petition disposed. (N. R. BORKAR, J.) (K.R. SHRIRAM, J.)