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Showing 421 to 440 of 1328 Records

• 2014 (4) TMI 909
  

  Validity of Tribunal Order – Reduction in Pre-deposit for hearing appeal – Improper Classification of goods - Whether the majority opinion of CESTAT requiring pre-deposit of 50% duty is justified – Held That:- There appears to be a conflict within the department itself as to the proper classification of goods i.e. whether they are to be cleared under tariff heading 8443 32 70 or 8443 32 60 - One Member of the CESTAT was of the opinion that the extended period of limitation was not properly invoked, is in the opinion of this Court sufficient for Tribunal to have made an order granting substantial relief - This Court is of the opinion that the impugned order to the extent it requires deposit of 50% of the amount should be modified - Instead assessee should be permitted to deposit 20% of the amount as a pre-condition subject to which its appeal may be heard – Decided partly in favour of Asseessee.

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• 2014 (4) TMI 908
  

  Jurisdiction & Power of DGFT – Price Fixation Notification – Fixation of Tariff Value of Betel nut - Non-fulfillment of the policy condition of notification - Policy to import betel nut – Issuance of Show cause notice - Section 111(d) of the Customs Act, 1962 - Article 166 of the Constitution – Purpose of the Act - Imposition of penalty - Section 112 - Held That:- Judgment in Dattatreya Moreshwar v State of Bombay[1952 (3) TMI 32 - SUPREME COURT]followed - Clauses (1) and (2) of Article 166 are directory only and non-compliance with them does not result in the order being invalid and that in order to determine whether there is compliance with these provisions all that is necessary to be seen is whether there has been substantial compliance with those requirements - Relying upon S. MIRA COMMODITIES PVT. LTD. Versus UNION OF INDIA [2008 (9) TMI 213 - MADRAS HIGH COURT] - The DGFT functions as a limb of the Central Government and not as a delegatee and mere non-mentioning of the specific source of power does not invalidate the entire executive action.

  Merely by revising the rate in the garb of the amendment to a circular which has been quashed and set aside by the High Court cannot be done by way of an amendment of the policy u/s 5 of the FTDR Act - Paragraph 2.1 of the Foreign Trade Policy, 2009-2014 clearly provides the import and export, to be free except, where regulated by Foreign Trade Policy or any other law in force - It further provides that the Item wise export and import policy shall be notified by the DGFT as amended from time to time - According to the respondent, Paragraph 2.6 of the policy empowers the DGFT to adopt and enforce any measure under the principles of restrictions through a notification – The aforesaid parameters set forth therein does not satisfy the imposition of conditions by way of revision of rate from ₹ 75/- to 110/- per kg and above - Therefore, the DGFT even as a delegatee is not empowered to put a condition by revising the rate as a condition to import.

  Impugned notification dated 13-5-2013 issued by DGFT for fixation of tariff value cannot be sustained therefore set aside. - Decided in favor of assessee.

  Fixation of tariff value by the Customs Department - Notification dated 25-6-2013 - Held that:- The contention of the petitioners that the Board cannot fix the tariff value is unacceptable and runs contrary to the intendment of the legislation. - Except that the impugned notification does not stand on the anvil of wednespury principle and the principle of proportionality, it is not averred in the writ petition, the said notification lacks subjectivity - The power to frame the tariff value is entirely depend upon the satisfaction of the Board and the question of sufficiency of the ground which forms such satisfaction cannot be gone into unless it is demonstrated that it is extraneous to the scope and purpose of the statute - Relied upon Barium Chemicals Ltd. -vs- Company Law Board [1966 (5) TMI 36 - SUPREME COURT OF INDIA]

  It would be deciphered from the impugned notification that the authorities took note of the trend of the value of such or like goods and, therefore, the presumption lies in favour of upholding the notification - This Court, therefore, does not find that the impugned notification, which is issued in exercise of the power u/s 14(2) can be invalidated on the grounds taken by Assessee - Decided against the assessee.

  Maintainability of writ petition filing after submitting reply to the Show Cause Notice - Held that:- The petitioners have not only challenged the show cause notice after giving reply but have also challenged the impugned notification dated 13th May, 2013 and 25th June, 2013 which forms the basis of the issuance of the said show cause notice. There is no impediment in maintaining the writ petitions even after filing of the reply. - Following decision in the case of Suttons & Sons Pvt. Ltd; vs Union of India & Ors [1994 (2) TMI 298 - HIGH COURT OF CALCUTTA]; writ petition is maintainable - Decided in favor of assessee.

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• 2014 (4) TMI 907
  

  Jurisdiction of Settlement Commission - Customs duty – Mis-declaration - Smuggling and Confiscation of Gold & Coins in India - Scope of Section 127B of the Customs Act, 1962 u/s 124 - Penalty u/s 112 and 114AA of Act – Whether Section 127B bars the jurisdiction of the Settlement Commission for cases of mis-declaration - Held That:- Relying upon Union of India vs. Hoganas India Ltd & Ors [2005 (7) TMI 14 - HIGH COURT OF JUDICATURE (BOMBAY)] – A restrictive interpretation cannot be given to Section 127B - The words "or otherwise" which appear u/s 127B after the words "short levy on account of misclassification" would mean similar acts like misclassification - Principle of ejusdem generis would apply - There was no mandate to limit the jurisdiction of the Settlement Commission in such a manner - Providing an unduly narrow interpretation to Section 127B to nip its jurisdiction at the bud does not cohere with the text or context of the provision - Applications concerning mis-declaration are admissible u/s 127B.

  Pre-deposit - For approaching the Settlement Commission – Show cause notice - Whether application can be entertained without having to pay duty - Principle of ejusdem generis – Interpretation of Statutes - Clause (c) of the first proviso to Section 127B – Held that:- Clause (c) to the first proviso mandates a pre-condition to approaching the Settlement Commission - The duty "accepted by" the applicant must be paid, before the matter can even be considered by the Settlement Commission - A levy u/s 28-which authorizes a show-cause for duties not levied earlier-includes interest u/s 28AB - Thus, clause (c) requires that the applicant must deposit the duty he accepts to be the liability, along with interest - This means that it is not necessary for the show cause notice to propose a liability amount for it to be 'due' under clause (c) - The Court notices that the self-assessment standard is also prescribed in Section 28(b), as an alternative to the duty ascertained by the Revenue.

  Relying upon Jagdish Cancer and Research [2001 (8) TMI 113 - SUPREME COURT OF INDIA] - Once served with a show-cause notice u/s 124, the proper officer u/s 28 cannot simultaneously issue a notice – This does not mean that minimum duty is not payable on approaching the Settlement Commission u/s 127B - The customs duty, either the amount required by a Section 28(b), or the amount self-assessed u/s 124 notice, must be paid under clause (c) - The minimum condition of pre-depositing before the Settlement Commission remains intact - Even in cases where there is a notice u/s 124, which does not propose a customs duty, the applicant must self-assess the liability and pay such amount as a pre-condition.

  Opportunity to approach the Settlement Commission is a sort of concession given by the government to errant assessees to enable them to come clean - This opportunity is hedged in by certain conditions, one of which is that the assessee shall pay the additional amount of customs duty accepted by him along with interest due u/s 28AB - An assessee is permitted to approach the Settlement Commission subject to inviolable conditions, the proper and complete compliance with which cannot be compromised or condoned in any manner - Even on this score the petitioner has to fail - This Court clarifies this judgment leaves open the parties contentions on other grounds, including the applicability of Section 123 by way of the third proviso to Section 127B, which may be considered by the Settlement Commission, if advanced by the parties – Decided against assessee.

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• 2014 (4) TMI 906
  

  Protection u/s 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 - whether the appellants who are Directors and Guarantors of a sick company and are entitled to get the protection of Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 - Held that:- Appellants, who are the guarantors, can obtain the protection of Section 22(1) of SICA only if the action filed by the bank comes within the ambit of the term ‘suit’. If the action filed by the respondent bank in the nature of ‘proceedings’ and not a ‘suit’, protection under Section 22(1) would not be available, especially, when the appellants are guarantors - term ‘suit’ have to be confined in the context of sub-section (1) of Section 22 of SICA to those actions which are dealt with under the Code and not in the comprehensive over-arching proceedings so as to apply to any original proceedings before any legal forum. The term ‘suit’ would apply only to proceedings in civil court and not actions or recovery proceedings filed by banks and financial institutions before a Tribunal such as DRT - Decided against appellant.

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• 2014 (4) TMI 905
  

  Winding up - Overriding preferential payment - enforceable charge on the assets of the company in liquidation - Held that:- appellant cannot claim that the order dated 15th April, 1987 created an enforceable charge on the assets of the company in liquidation. We are of the opinion that the learned counsel for the respondents are quite right in their submissions that an injunction was issued only to ensure that the company in liquidation does not further encumber or create charges in favour of third parties over the assets of the company in liquidation. In our opinion, neither the interim order dated 15th April, 1987 nor the undertaking given pursuant thereto can be said to be a charge on the assets of the company in liquidation.

  In the face of the directions given by this Court in the case of Oil and Natural Gas (supra) wherein this Court had directed that the ONGC is at liberty to take immediate steps to recover the charges due from the respondents in the light of the judgment. This Court did not direct that in view of the undertaking dated 27th May, 1987 the respondents have created enforceable charge in favour of ONGC. Furthermore, it is a matter of record that even the ONGC did not consider itself to be a secured creditor. At the time when the Ambica Mills Co. Ltd. came under the jurisdiction of the Official Liquidator, none of the two options adverted to earlier was exercised by ONGC. The plea of being a secured creditor is clearly an afterthought. Therefore, in our opinion, the judgments rendered by the learned Single Judge and the Division Bench of the Gujarat High Court do not call for any interference - Decided against appellant.

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• 2014 (4) TMI 904
  

  Disallowance of hire charges u/s 40(a)(ia) of the Act – Whether it is interest or not on hire purchase contract – The decision in CIT Vs. M/s M.G. Brothers Finance Ltd. [2014 (1) TMI 1590 - ANDHRA PRADESH HIGH COURT] followed - the payment made by the assessee on account of hire purchase transaction and payment of finance charges/hire charges cannot be construed as interest so as to deduct TDS u/s 194A of the IT Act - to that extent, the CIT(A) justified in observing that section 40(a)(ia) is not applicable - but, the insertion of Explanation 1 to section after amendment of section 194A by Taxation Laws (Amendment) Act, 2006, with effect from 13/07/2006, payment by the assessee towards hire charges on hire purchase agreement to be liable for TDS u/s 194I of the Act – thus, the AO is directed to recomputed the disallowance u/s 40(a)(ia) in the light of the amended provisions, which came into effect from 13/07/2006 – Decided partly in favour of Revenue.

  Disallowance of mobilization advance paid to JV – Held that:- The payment of interest is the income of the JV and if this included as income in the JV as income, assessee has not deducted the tax in view of the amended provisions of section 40(a)(ia) of the Act, wherein it was held that second proviso to section 40(a)(ia) inserted by the Finance Act, 2012 with effect from 01/04/2013, which is clarificatory in nature and the benefit of the same should be applied restrospectively – Relying upon as held by the Cochin Bench in the case of Antony D. Mundackal Vs. ACIT [2013 (12) TMI 67 - ITAT COCHIN] – thus, the AO is directed to see whether JV has paid tax on the income or not on this income and decide the issue in accordance with law – Decided in favour of Revenue.

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• 2014 (4) TMI 903
  

  Deletion of disallowance of interest – Debit balance maintained for short period – Validity of Direction made by the CIT(A) Held that:- The CIT(A) agreed that there is a commercial expediency to transfer the funds from assessee's CC A/c to SB accounts of assessee's family members with the same Bank – but, the CIT(A) accepted such diversion only for short period of 10 days and he directed to disallow interest for balance period – the direction of the CIT(A) is not proper - Once the CIT(A) observed that there is commercial expediency to divert the funds from assessee's account so as to oblige the request of the Bank to boost up their deposit position, the interest earned on such diversion to the accounts of family members should be the income of the assessee rather income of the family members – thus, the AO is directed to bring the interest earned, on diversion of fund from assessee's CC account to the SB accounts of family members, to tax in the hands of the assessee – Decided partly in favour of Assessee.

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• 2014 (4) TMI 902
  

  Validity of notice issued u/s 148 of the Act – Proceedings initiated after four years - Addition made as unexplained cash credits – Held that:- The AO have not applied his mind at all, which is evident from the several observations made by him in his order and in the notice issued u/s 148 of the Act – AO assumed that the assessee intended to convert the unexplained cash through the route of capital gains, even after several years the assessee did not sell the shares, as stated by the assessee - the shares were demated and available in the name of the assessee but no mention was made at any stage of the proceedings on this aspect though the shares were purchased at a particular price and service tax, commission, etc. have been paid based on the rate for which it was purchased.

  The assessee had declared the investments in the books of account and even if the AO is of the opinion that the assessee has invested more than what is recorded in the books the differential amount can at best be treated as unexplained investment u/s 69B of the Act - the AO could not have assumed jurisdiction to reopen the assessment proceedings, that too beyond a period of four years, unless it is with the sole intention of bringing the case under the purview of section 149(b) of the Act, it is not permissible in law - what cannot be done directly cannot be done indirectly - AO having initiated the reassessment proceedings after a lapse of four years from the end of the relevant assessment year – thus, the reassessment proceedings are bad in law – also, the addition and assessment made on the strength of proceedings set aside – Decided in favour of Assessee.

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• 2014 (4) TMI 901
  

  Validity of framing single assessment for entire period –Validity of order passed - Held that:- The Tribunal rightly held that the order u/s 154 has been set aside in appeal and the order has attained finality, resulting that the order passed granting permission to adopt the previous year ending on 30th June stood valid - there is no justification in taking a different view in the matter – the very basis of passing two assessment orders does not survive, thus, there is no error in the order of the Tribunal – the assessment made for the A.Y.1989-90 for the period is in consonance with the amended Section 3, which stood amended by the Taxation Laws (Amendment) Act, 1987 – the amendment was applicable to the assessment year 1989-90, there is no ambiguity in adopting the period of assessment from 1.1.1987 to 31.3.1989 – Decided against Revenue.

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• 2014 (4) TMI 900
  

  Direction to complete the Assessment – Order cancelled u/s 154 of the Act – Held that:- The decision in Commissioner of Income Tax, Bareilly and Others vs. M/S. Rampur Distillery & Chemical Co. Ltd. [2014 (4) TMI 901 - ALLAHABAD HIGH COURT] followed – The CIT(A) has directed the AA to pass the order for the period of 27 months -The Assessing Authority passed the assessment order in pursuance of the order of CIT(A) u/s 251 of the Act and in pursuance of the order arising from the assessment order, the appeal has been decided by CIT (A) and by the Tribunal – thus, it is not upon to the Revenue to raise the issue again – Decided against Revenue.

  Deletion of disallowance of interest – Held that:- Following the decision in Commissioner of Income-Tax And Another Versus Radico Khaitan Ltd. [2004 (9) TMI 37 - ALLAHABAD High Court] – the conditions u/s 36(1)(iii) of the Act have been complied with – thus, the assessee-company was entitled to full allowance of the amount of interest paid by it on borrowed capital - Decided against Revenue.

  Deletion of disallowance u/s 37(1) of the Act – Held that:- the club membership fees for employees incurred by the assessee is business expense u/s 37 of the Act – Decided against Revenue.

  Deletion of investment allowance on distillery unit – Held that:- Following the decision in Commissioner of Income-Tax And Another Versus Radico Khaitan Ltd. [2004 (9) TMI 37 - ALLAHABAD High Court] – In view of the specific provisions contained in sub-section (2A) of section 32A of the Act, investment allowance is not admissible in respect of the plant and machinery installed for the purpose of manufacturing any of the items mentioned in the Eleventh Schedule – Decided in favour of Revenue.

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• 2014 (4) TMI 899
  

  Refusal for best judgment assessment – whether AO can refuse to do a best judgment assessment, even though the assessee himself has admitted that his accounts are not full and complete? - Accounts audited u/s 44AB of the Act – Rejection of books of accounts – Held that:- There were over 1000 sundry creditors of which the assessee had got the confirmation letters from nearly 264 parties and in respect of 84 of parties, the assessee itself pleaded that the creditors were not traceable - when the assessee could produce the materials of confirmation in respect of the some of the creditors and could not produce any such evidence from 84 parties, - The assessee had shifted its stand to have the assessment done to its desire which cannot be approved - the assessee had stated that they had not maintained the books of accounts particularly with reference to the stock - accounts were audited by a qualified Chartered Accountant as required u/s 44AB of the Act - With the material particulars available as to the income of the assessee, it could be understood as to how the assessee could insist on a best of judgment assessment only for gaining certain tax benefits – thus, no substantial question of law arises for consideration – Decided against Assessee.

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• 2014 (4) TMI 898
  

  Validity of re-assessment u/s 147 /148 of the Act – ex-parte assessment order - Interim order for stay passed – Filing of return - Held that:- Without going in the question that whether the order has been received on 29.03.2006 or prior to the passing of the order, it has been decided that the petition is to be disposed of asking the assessee to file the return in compliance of the notice u/s 148 of the Act for the A.Y. 1998-99 – The assessing authority may provide the copy of the reasons recorded and it will be open to the petitioner to challenge the initiation of the proceedings and to participate in the proceedings. In case, if the petitioner files any objection on the initiation of the proceedings, the assessing authority may decide the objection before proceeding with the case. - ex-parte order set aside and the matter is remitted back to the AA – Decided in favour of Assessee.

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• 2014 (4) TMI 897
  

  Eligibility for exemption u/s 10B of the Act – Structures of industry to be included or not - Whether the Tribunal is right in holding that the structure of the industry constitutes building and is not eligible to be included in computing the plant and machinery for the purpose of determining the eligibility u/s 10B of the Act – Held that:- Following Commissioner of Income Tax V. Heartland KG Information Ltd. [2013 (9) TMI 375 - MADRAS HIGH COURT] to attract Section 10B favourably to an undertaking, such undertaking should not be formed by transfer to a new business any machinery or plant previously used for any purpose - even if there be transfer of machinery previously used for any purpose is transferred, the total value of the machinery at plant so transferred should not exceed 20% of the total value of the machinery used in the business.

  When a DTA unit is converted into 100% EOU unit, there is neither a transfer nor a creation of a new business to attract section 10B(2)(iii) of the Act - there is no specific prohibition to an industrial unit formed by transfer of entire business, there is no transfer at all to a new business and what was already in existence as a DTA unit, by reason of the recognition granted by the statutory authority, it became a 100% EOU unit - Thus the status granted to a DTA unit as a 100% EOU unit does not result in a transfer or splitting up or re-construction of a business already in existence so as to fall u/s 10(2)(iii) of the Act - going by the Circular No.1 of 2005 dated 06.01.2005.17 clarifying the stand that the DTA unit on conversion to 100% EOU unit eligible for exemption under Section 10B of the Income Tax Act also – thus, the order of the Tribunal is set aside – Decided in favour of Assessee.

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• 2014 (4) TMI 896
  

  Partial Deletion made u/s 69B of the Act – Unexplained investment in house property – Reliance placed upon DVO’s report – Held that:- Following Goodluck Automobiles Pvt. Ltd. v. Assistant Commissioner of Income tax [2012 (9) TMI 157 - Gujarat High Court] - There is nothing in the assessment order to suggest that the AO had any doubt regarding the cost of construction or that he was not satisfied regarding the correctness or completeness of the books of account - the only reason for making the addition u/s 69 of the Act is that there is a difference in the cost of construction as determined by the Valuation Officer and as shown by the assessee - At no stage of the assessment proceedings does the AO appear to have mentioned that the books of account are defective or that the cost of construction as shown in the books of account is not the true cost of construction - unless the books of accounts are rejected, the AO cannot make a reference to the Valuation Officer - The reference made to the Valuation Officer, not being in consonance with the provisions of law was invalid - the report made by the Valuation Officer pursuant to such an invalid reference could not have been made the basis for addition u/s 69 of the Act – no substantial question of law arises for consideration - Decided against Revenue.

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• 2014 (4) TMI 895
  

  Validity of re-assessment order u/s 143(3) r.w.s.147 of the Act – Allowability of claim of deduction u/s 80IB of the Act – Contracts for erection, commissioning and pressure die casting Held that:- The original assessment u/s 143(3) of the Act was completed on 22.09.2003, disallowing the claim for deduction u/s 80IB of the Act - if there is any mistake in granting relief to the assessee u/s 80IB of the Act in the order, the only order that could be the subject of Revision would be the order dated 18.05.2005 and not the order passed on 22.09.2003, which was the subject matter of appeal before the Tribunal at the instance of the Revenue on 22.06.2007 and the order of the Tribunal had also attained finality - if the Revenue is questioning the quantum of relief granted to the assessee, the order available for revision would be the order dated 18.05.2005 - this is not subjected to any revision u/s 147 of the Act, the Revenue would not be justified in sustaining its plea on its jurisdiction to revise the order u/s 147 of the Act – Decided against Revenue.

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• 2014 (4) TMI 894
  

  Assessment u/s 153C - Addition of income from business and jewellery business - Whether the Tribunal is right in confirming the estimated addition of income from business and jewellery business - Held that:- Tribunal held that there was sufficient evidence found at the time of search to show that assessee was having substantial gold and silver jewellery business apart from what was returned by the assessee in books of accounts and there was surplus stock of more than Rs.95 lakhs and odd and the assessee was unable to establish that admission made by him at the time of search was not correct - the AO was justified in estimating the income of the assessee from jewellery business for various years - the AO did not give any reduction for the income returned in the regular returns - Tribunal held that the additions made however took note of the materials gathered and hence were to be sustained - thus, the Tribunal directed the AO to exclude the income of Rs.1,05,528/- and Rs.89,702/- returned by the assessee in the returns filed for 2000-01 and 2001-02 while confirming the addition.

  CIT(A) was justified in taking the view that the excess stock found at the time of search could be considered for assessment only in the assessment years relevant to the previous year in which the search was conducted – the Tribunal directed the AO to ensure that the amount was included in the income of the assessee in the assessment – the issue is a pure question of fact - there was no factual error in the order passed or no perversity shown in the finding of the Tribunal – thus, the appeal cannot be admitted – Decided against Assessee.

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• 2014 (4) TMI 893
  

  Deletion made u/s 28(iv) of the Act – Benefit to the assessee by the allotment of shares – Held that:- The Tribunal has found that the allotment is made much prior to the performance of M/s. Reliance - when the assessee was not having any direct business relations or not having carried out any business with M/s. Reliance Communications either in the past or during the year, then the assessee cannot be said to be having any business or professional relationship with M/s.Reliance Communication Ltd. - Reliance Communication and Reliance Group of Companies are independent entities and even for taxation purposes, they are separate and independent - the finding of fact that section 28(iv) has no application, is based on all the materials produced and which have been noted by the Tribunal - once the Tribunal has come to a conclusion that section 28(iv) has no application, then, any further aspect of the matter need not be probed or investigated – thus, no substantial question of law arises for consideration – Decided against Revenue.

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• 2014 (4) TMI 892
  

  Validity of direction to compute LTCG – Sale of 50% undivided right – Valuation adopted by the DVO – Held that:- The report of DVO was not available to the AO - it was taken into consideration while adjudicating the appeal by CIT(A) during the course of first appellate proceedings - The assessee had also relied upon certain sale instances, and this fact has been admitted by CIT(A) - CIT(A) has not given any reason to deviate from the sale instances relied upon by the assessee and has simply observed that the report of valuation carried out by DVO is fair and reasonable – thus, it would be proper if the additional evidence filed by assessee is admitted and the issue is remitted back to the AO for redetermination of the FMV of the flat and garage as on 1.4.1981 after giving assessee reasonable opportunity of hearing – Decided in favour of Assessee.

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• 2014 (4) TMI 891
  

  Deemed dividend u/s 2(22)(e) of the Act – Loans and advances made by the company to the firm – Held that:- No amount was advanced by the firm to the partners and there was credit balance in the accounts of the partner and at no point of time there was debit balance in the account of the partners from the bank book - there were transactions between the firm and company in the ordinary course of business and no amount received by the firm had been utilized in giving advance to any of the partners, including this assessee - CIT(A) has concluded that the firm in the present year as well as in the previous year has received trade advances from the company for supply of particular type of guwar gum powder – thus, the transactions between the company and firm are business transactions and amounts advanced by this company to the firm is only advance for business purpose and not as loan.

  Assessee rightly contended that the nature of the transactions has to be decided on the basis of true nature of transactions and not as per nomenclature given in the books – Relying upon Prakash Cotton Mills P. Ltd. Vs. CIT [1993 (4) TMI 3 - SUPREME Court] - the transactions were for the benefit of the shareholders who were also partners in the firm - it cannot be said that the amounts constitute a dividend even under the deeming provisions – the provisions of section 2(22)(e) of the Act are not attracted - the payments were normal business transactions –thus, there is no infirmity in the order of the CIT(A) – Decided against Revenue.

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• 2014 (4) TMI 890
  

  Validity of CIT(A)’s action – Dismissal of appeal against order u/s 200A of the Act – AO is directed to take corrective action - The CIT(A) on the one hand has dismissed the appeal of the deductor assessee by holding that the order passed by the Assessing officer u/s 200A of the Income-tax Act, 1961 is not appealable u/s 246A of the Income Tax Act, 1961 and on the other hand has given direction to the Assessing officer to take corrective action to rectify the mistakes in the order within two months either through the ITD System or manually – Held that: -As per the clear provisions of I.T. Act, if assessee chooses to proceed with the legal remedy provided by the Act, the AO has to decide the issue in accordance with law, even if there is no direction of the CIT(A) - The net effect of the direction of CIT(A) is to the effect that if the assessee files rectification application the AO will decide the same in accordance with law - The direction of the CIT(A) to assessing officer (TDS) to give appeal effect within 2 months of the receipt of order has no consequence inasmuch as the entire process will start only after application is filed by the assessee – the CIT(A)’s directions are ineffective and do not create any legal binding – the assessee has various remedies under Income-tax Act - To seek remedial action, there cannot be any estoppel over that remedial right in accordance with law - If the assessee chooses to take a remedial action as a rule of law AO has to decide the same in accordance with law - In view of assessee’s agreeing that appeals were not maintainable, the revenue’s appeals are allowed – Decided in favour of Revenue.

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