2011 (1) TMI 1475 - AT - Income Tax

Summary

Issues involved: The judgment deals with the maintainability of appeals under section 249(4) of the Income-tax Act, 1961.

Details of the judgment:

1. The Commissioner of Income-tax (Appeals) held three appeals as non-maintainable u/s 249(4) of the Act due to non-payment of taxes on total incomes returned for assessment years 2001-02, 2006-07, and 2007-08 at the time of filing the appeals.

2. The assessee argued that all taxes were paid before the hearing of appeals, citing the release of seized assets and subsequent payment of dues. The Counsel referred to a Tribunal decision stating that non-payment of tax before filing an appeal is a directory requirement, not mandatory.

3. The Departmental representative contended that non-payment of taxes before filing an appeal renders it non-maintainable, referring to a judgment of the Madras High Court.

4. The Tribunal observed that the objective of section 249(4) is to ensure tax payment before appeal admission. Payment of taxes before the final hearing validates the appeal, as seen in a previous case. The Tribunal set aside the Commissioner's order and restored the appeals for disposal on merits.

5. The Tribunal found that the assessee had paid taxes before the appeal hearing, following the precedent set by the previous case, and allowed the appeals.

6. The Departmental representative's reliance on the Madras High Court judgment was noted, but the Tribunal found that the assessee's compliance with tax payment before the appeal hearing was sufficient, as per the Tribunal's precedent. The Commissioner's order was set aside, and the original orders for the assessment years were restored.

7. Consequently, the appeals of the assessee were allowed, and the orders were pronounced on January 31, 2011.