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2019 (5) TMI 740 - AT - Income TaxPower of CIT(A) to entertain appeal - violation of provisions of section 249(4) - assessee had not paid admitted tax on the returned income - difference of opinion between Members on the Bench - CIT(A) entertaining the assessee’s appeal without fulfilling conditions of section 249(4)(a) - HELD THAT:- While construing section 129E of the Customs Act, which is analogous to section 249(4) of the Income Tax Act , Hon’ble Supreme Court in VIJAY PRAKASH D. MEHTA VERSUS COLLECTOR OF CUSTOMS (PREVENTIVE) , BOMBAY [1988 (8) TMI 109 - SUPREME COURT] has observed that purpose of conditions incorporated in section 129E is to make people to comply with the provisions. Similar object is being achieved with the help of section 249(4)(a). With regard to other cases, and to take care of hardship of tax payers, remedy is being provided in sub-clause (b) of section 249(4). It is pertinent to observe that at the time of hearing, the ld.counsel for the assessee also not disputed this construction of section 249(4)(a). He raised alternative submissions, which we are going to deal with in the later part of this order. Thus, we are of the firm view that if an assessee filed return of income, admitted taxes under self-assessment, then unless these taxes are paid, his appeal will be hit by section 249(4)(a) and it cannot be entertained by the CIT(A). First proposition raised by the ld.counsel for the assessee was that the assessee has not paid tax on the returned income, therefore, return deserves to be treated as defective within meaning of section 139(9) Explanation (c) and if return is defective, then no cognizance of such return for passing assessment order can be taken. If it is construed that no return was filed (being non-est on account of defective return), then case of the assessee will fall within the section 249(4)(b) and CIT(A) could exempt the assessee from payment of alleged advance taxes required to be paid. We do not find any merit in this proposition of the ld.counsel for the assessee. Next proposition raised by the ld.counsel for the assessee before us was that real income ought to have been taxed, and for that purpose, he made reference to the decision of Hon’ble Supreme Court in the case of Godhra Electricity Co. Ltd. [1997 (4) TMI 4 - SUPREME COURT] and Excel Industries Ltd. [2013 (10) TMI 324 - SUPREME COURT] . On due consideration of the above proposition, we are of the view that all these arguments on merit can possibly be raised if there is a valid appeal before the ld.CIT(A). Upto and until, the assessee pays tax on self-assessment/returned income, no other plea could be entertained. By entertaining such plea, we will be committing same mistake as has been committed by the ld.CIT(A). The ld.counsel for the assessee on the strength of Hon’ble Karnataka High Court’s decision in the case of D. Komlakshi [2006 (11) TMI 155 - KARNATAKA HIGH COURT] contended that the assessee be given an opportunity to pay tax on the returned income now, and direct the ld.CIT(A) to decide the appeal on merit. As far as the above contention is concerned, no such plea was raised before the Division Bench who heard the appeal on 21.3.2013. Issue before us is to resolve difference of opinion amongst the members, whether having regard to the provisions of section 249(4)(a) of the Act the ld.CIT(A) has erred in law and on facts in entertaining assessee’s appeal. By entertaining the additional plea, we will be enhancing the scope of reference which is not within the power of this Bench. Hence, this plea cannot be examined in the present proceedings. Therefore, in view of the above discussion, we agree with the ld.Judicial Member and hold that the ld.CIT(A) has erred in entertaining the assessee’s appeal without fulfilling conditions of section 249(4)(a).
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