Milind Kamalakar Haval, Kolhapur v. ITO (Central), Kolhapur

ITA 1234/PUN/2010 | 2007-2008
Pronouncement Date: 31-01-2011 | Result: Allowed

Appeal Details

RSA Number 123424514 RSA 2010
Assessee PAN AACPH3362C
Bench Pune
Appeal Number ITA 1234/PUN/2010
Duration Of Justice 4 month(s) 8 day(s)
Appellant Milind Kamalakar Haval, Kolhapur
Respondent ITO (Central), Kolhapur
Appeal Type Income Tax Appeal
Pronouncement Date 31-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 31-01-2011
Date Of Final Hearing 31-01-2011
Next Hearing Date 31-01-2011
Assessment Year 2007-2008
Appeal Filed On 22-09-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV JUDICIAL MEMBER AND SHRI G.S. PANNU ACCOUNTANT MEMBER ITA NO. 1234 1235 & 1238/PN/2010 (ASSTT YEAR: 2007-08 2006-07 2001-02) MILIND KARMALKAR HAVEL 249 E-WARD NAGALA PARK APPELLANT KOLHAPUR PAN AACPH 3362C VS. INCOME-TAX OFFICER RESPONDENT (CEN) KOLHAPUR APPELLANT BY : SHRI C H NANIWADEKAR DEPARTMENT BY : SHRI HEMANT KUMAR C LEUVA ORDER PER BENCH: THE CAPTIONED THREE APPEALS BY THE ASSESSEE ARE DI RECTED AGAINST THE RESPECTIVE ORDERS OF THE COMMISSIONER O F INCOME-TAX (APPEALS) DATED 30.6.2010 PASSED UNDER SECTION 154 OF THE INCOME-TAX ACT 1961 (IN SHORT THE ACT) AMENDING THE EARLIER ORDERS DATED 12.3.2010 AND TREATING THE APPEALS FILED BY THE ASS ESSEE FOR ASSESSMENT YEARS 2001-02 2006-07 AND 2007-08 AS NO N-MAINTAINABLE. THE COMMISSIONER OF INCOME-TAX (APPEALS) HELD THE T HREE APPEALS AS NON-MAINTAINABLE FOR VIOLATION OF THE PROVISIONS OF SECTION 249(4) OF THE ACT. AS PER THE COMMISSIONER OF INCOME-TAX (APPEALS ) AS ON THE DATE OF FILING OF THE APPEALS NO TAXES WERE PAID ON THE TOTAL INCOMES RETURNED FOR THE THREE CAPTIONED ASSESSMENT YEARS A ND THEREFORE THE APPEALS WERE NON-MAINTAINABLE IN TERMS OF SECTION 2 49(4) OF THE ACT. 2. BEFORE US THE LEARNED COUNSEL FOR THE ASSESSEE VEHEMENTLY ARGUED THAT THE COMMISSIONER OF INCOME-TAX (APPEALS ) HAS ERRED ON FACTS AND IN LAW IN DISMISSING THE APPEALS FILED BY THE ASSESSEE AS NOT ITA NOS 1234 1235 1238/PN/10 MILIND K HAVEL KOLHAPR 2 MAINTAINABLE UNDER SECTION 249(4) OF THE ACT WITHOU T APPRECIATING THAT ALL THE TAXES DUE WERE ACTUALLY PAID BY THE ASSESSE E BEFORE THE HEARING OF APPEALS BY THE COMMISSIONER OF INCOME-TAX (APPEA LS). THE LEARNED COUNSEL POINTED OUT THAT IN THIS CASE A SEARCH UNDE R SECTION 132(1) OF THE ACT WAS CARRIED OUT IN THE COURSE OF WHICH CERT AIN AMOUNT OF CASH AND GOLD JEWELLERY BEING STOCK-IN-TRADE OF THE ASS ESSEE WAS SEIZED AND THE SAME WAS LYING WITH THE DEPARTMENT AS ON TH E DATE OF FILING OF THE RETURNS. THE ASSESSEE COULD NOT DEPOSIT THE TAX ES DUE ON THE RETURNED INCOME AND HAD REQUESTED TIME AND AGAIN FO R EITHER RELEASE OR AUCTION OF THE JEWELLERY. HOWEVER SUBSEQUENT TO THE FILING OF THE APPEALS BEFORE THE COMMISSIONER OF INCOME-TAX (APPE ALS) THE GOLD JEWELLERY WAS RELEASED ON 28.3.2010 AND THEREAFTER THE ASSESSEE PAID ALL THE ADMITTED AS WELL AS ASSESSMENT DUES BEFORE THE DATE OF HEARING OF THE APPEALS BY THE COMMISSIONER OF INCOME-TAX (A PPEALS). INITIALLY THE APPEALS WERE DISPOSED OF ON MERITS BY THE COMMI SSIONER OF INCOME-TAX (APPEALS) VIDE ORDER DATED 12.3.2010 BU T SUBSEQUENTLY BY WAY OF IMPUGNED ORDER THE APPEALS OF ASSESSEE HAVE BEEN HELD TO BE NON-MAINTAINABLE SINCE TAXES ON THE RETURNED INCOME WERE NOT PAID AT THE TIME OF FILING OF THE APPEAL IN TERMS OF SECTI ON 249(4) OF THE ACT. THE LEARNED COUNSEL CONTENDED THAT IN TERMS OF THE RATIO OF THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF BHUMIRAJ CONSTRUCTIONS V ADDL. CIT 49 DTR 195 (MUM) THE APP EALS OF THE ASSESSEE COULD NOT HAVE BEEN REJECTED BY THE COMMIS SIONER OF INCOME-TAX (APPEALS) AS NON-MAINTAINABLE SINCE THE DEFECT GOT REMOVED BEFORE THE HEARING OF APPEALS BY THE COMMIS SIONER OF INCOME-TAX (APPEALS). 3. ON THE OTHER HAND THE LEARNED DEPARTMENTAL REPR ESENTATIVE HAS DEFENDED THE ACTION OF THE COMMISSIONER OF INCOME-T AX (APPEALS) BY POINTING OUT THAT THE PAYMENT OF TAXES DUE ON THE I NCOME RETURNED BY ITA NOS 1234 1235 1238/PN/10 MILIND K HAVEL KOLHAPR 3 THE ASSESSEE BEFORE FILING OF AN APPEAL AGAINST THE ASSESSMENT ORDER IS A CONDITION PRECEDENT AND NON-COMPLIANCE OF THE SAME WOULD RENDER THE APPEAL AS NON-MAINTAINABLE. IN THIS REGARD REF ERENCE WAS MADE TO THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT IN TH E CASE OF S. ALAGARSWAMY V ITO296 ITR 43 (MAD). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. SECTION 249(4) OF THE ACT PRESCRIBES THAT NO APPEAL SHALL B E ADMITTED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) UNLESS AT THE TIME OF FILING OF THE APPEAL THE ASSESSEE HAS PAID THE TAXES DUE ON T HE INCOME RETURNED BY HIM OR WHERE NO RETURN HAD BEEN FILED B Y THE ASSESSEE THE ASSESSEE HAS PAID AN AMOUNT EQUAL TO THE AMOUNT OF ADVANCE TAX WHICH WAS PAYABLE BY HIM. IN THIS CASE ADMITTEDLY AT THE TIME OF FILING OF THE APPEALS BEFORE THE COMMISSIONER OF INCOME-TA X (APPEALS) THE TAX DUE ON THE INCOME RETURNED WAS NOT PAID. HOWEVE R THE CLAIM OF THE ASSESSEE IS THAT REQUISITE TAXES ALONGWITH THE TAX DEMAND RAISED CONSEQUENT TO THE ASSESSMENT HAS BEEN PAID BEFORE THE FINAL HEARING OF THE APPEAL BY THE COMMISSIONER OF INCOME-TAX (AP PEALS) AND THEREFORE IT CONSTITUTES A SUFFICIENT COMPLIANCE W ITH THE PROVISIONS OF SECTION 249(4) OF THE ACT. IN THIS CONTEXT CO-ORDI NATE BENCH OF THE TRIBUNAL IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUP RA) HAS OBSERVED THAT THE OBJECTIVE BEHIND SECTION 249(4) IS TO ENSU RE PAYMENT OF TAX ON INCOME RETURNED BEFORE THE ADMISSION OF AN APPEAL. AS PER OUR CO- ORDINATE BENCH IF THE APPEAL IS FILED WITHOUT PAYM ENT OF TAX ON RETURNED INCOME BUT SUBSEQUENTLY THE REQUIRED AMOU NT OF TAX IS PAID THE APPEAL SHALL BE ADMITTED ON PAYMENT OF TAX AND TAKEN UP FOR HEARING BY THE COMMISSIONER OF INCOME-TAX (APPEALS) . IT HAS BEEN OBSERVED THAT WHERE THE TAX IS PAID AFTER THE FILIN G OF APPEAL BUT BEFORE IT IS TAKEN UP FOR DISPOSAL IT WOULD BE SUFFICIENT TO VALIDATE THE DEFECTIVE APPEAL. THE REASONING MADE OUT BY THE CO- ORDINATE BENCH IS ITA NOS 1234 1235 1238/PN/10 MILIND K HAVEL KOLHAPR 4 THAT THE STIPULATION AS TO THE PAYMENT OF PRESCRIBE D TAX ANTE FILING OF FIRST APPEAL IS ONLY DIRECTORY AND NOT MANDATORY. I N OTHER WORDS ACCORDING TO THE CO-ORDINATE BENCH WHEREAS THE PAY MENT OF PRESCRIBED TAX IS MANDATORY BUT THE REQUIREMENT OF SECTION 249 (4) OF PAYING OF SUCH TAX BEFORE FILING OF APPEAL IS ONLY DIRECTORY. IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA) THE ASSESSEE PAID T HE TAXES ON RETURNED INCOME AFTER THE DISPOSAL OF APPEAL BY THE COMMISSIONER OF INCOME-TAX (APPEALS). UNDER THESE CIRCUMSTANCES ALS O THE TRIBUNAL HELD THAT THE DEFECT IN APPEAL DUE TO NON-COMPLIANC E OF A DIRECTORY REQUIREMENT OF PAYING SUCH TAX BEFORE FILING OF THE APPEAL STOOD REMOVED AND THEREFORE THE FIRST APPELLATE AUTHORI TY OUGHT TO HAVE REVIVED SUCH AN APPEAL. UNDER THESE CIRCUMSTANCES THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DISMISSING THE APPEAL OF THE ASSESSEE WAS SET ASIDE AND THE MATTER RESTORED BACK FOR DISPOSAL ON MERITS. 5. IN THE PRESENT CASE THE CLAIM OF THE ASSESSEE IS THAT IT HAS PAID REQUISITE TAXES BEFORE HEARING OF APPEAL BY THE COM MISSIONER OF INCOME-TAX (APPEALS) AND THEREFORE FOLLOWING THE PARITY OF REASONING IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA) THE APPEALS OF THE ASSESSEE COULD NOT BE DISMISSED AS NON-MAINTAINABLE UNDER SECTION 249(4) OF THE ACT. AS A RESULT THEREOF THE IMPUGNE D ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) IS SET ASIDE A ND THE APPEALS OF THE ASSESSEE ARE ALLOWED. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAD REF ERRED TO THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT IN THE CA SE OF S. ALAGARSWAMY (SUPRA) IN SUPPORT OF THE IMPUGNED ORDE R. NO DOUBT THE PAYMENT OF TAX DUE ON THE INCOME RETURNED BY THE AS SESSEE BEFORE FILING OF AN APPEAL AGAINST THE ASSESSMENT ORDER I S A CONDITION PRECEDENT AND AS PER THE HONBLE HIGH COURT SUCH A NON-COMPLIANCE ITA NOS 1234 1235 1238/PN/10 MILIND K HAVEL KOLHAPR 5 RENDERS THE APPEAL NON-MAINTAINABLE IN TERMS OF SEC TION 249(4A) OF THE ACT. THE SAID PROPOSITION IS NOT IN DISPUTE SO HO WEVER IN THE PRESENT CASE THE CASE MADE OUT BY THE ASSESSEE IS THAT THE REQUIRED TAXES HAVE BEEN PAID BEFORE HEARING OF THE APPEAL BY THE COMMISSIONER OF INCOME-TAX (APPEALS) AND IN TERMS OF RATIO OF THE T RIBUNAL IN THE CASE OF BHUMIRAJ CONSTRUCTIONS (SUPRA) THE SAME CONSTIT UTED A SUFFICIENT COMPLIANCE WITH THE CONDITION PRESCRIBED UNDER SECT ION 249(4)(A) OF THE ACT. THUS THE DECISION OF THE HONBLE HIGH COURT I N THE CASE OF S. ALAGARSWAMY (SUPRA) DOES NOT MILITATE AGAINST THE P LEAS OF THE ASSESSEE. AS A RESULT THE ORDER OF THE COMMISSIONE R OF INCOME-TAX (APPEALS) DATED 30.6.2010 IS SET ASIDE AND CONSEQUE NTLY THE ORDERS OF THE COMMISSIONER OF INCOME-TAX (APPEALS) DATED 12.3 .2010 FOR THE CAPTIONED ASSESSMENT YEARS ARE RESTORED. 7. IN THE RESULT THE APPEALS OF THE ASSESSEE ARE A LLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 31ST DAY OF J ANUARY 2011. SD/- SD/- (SHAILENDRA KUMAR YADAV) (G.S. PANNU ) JUDICIAL MEMBER ACC OUNTANT MEMBER PUNE DATED: 31ST JANUARY 2011 COPY TO:- 1) MILIND K HAVEL KOLHAPR 2) THE ITO CEN. KOLHAPUR 3) THE CIT (A) KOLAHPUR 4) THE CIT-I KOLHAPUR 5) THE D R B BENCH ITAT PUNE. BY ORDER TRUE COPY ASSTT.REGISTRAR I.T.A.T. PUNE B