TMI Blog2012 (10) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... authority that the money seized in the hands of Sri. B.B.Swamy belongs to the Assessee and under such circumstances the direction issued by the CIT(Appeals) to give credit to the assessee to the extent of Rs. 10,00,000/- which was seized from late Sri.B.B.Swamy is not sustainable in law - in favour of the Revenue. - IT APPEAL NO. 5049 OF 2010 - - - Dated:- 3-10-2012 - Dr. K. BHAKTHAVATSALA AND B. SREENIVASE GOWDA, JJ. ORDER Dr. K. Bhakthavatsala, J. - This is an Appeal filed under Section 260A of the Income Tax Act, 1961, by the Revenue, questioning the legality of the order dated 1.10.2004 made in ITA No.77/PNJ/2002 on the file of Income Tax Appellate Tribunal (ITAT), Panaji Bench at Panaji, confirming the order of the Commissioner of Income Tax (Appeals), at Belgaum. 2. Brief facts of the case leading to the filing of the Appeal may be stated as under: During the course of Income Tax Department Search in the case of B.B. Swamy on 10.12.1991, the Income Tax Department seized certain amount and as per the provisions of the Income Tax Act, 1961 (in short 'the act'), the same was adjusted as against the income tax demand raised against him. Further, simultaneous sear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act to implement the directions given by the Commissioner of Income Tax in his order. 4. On service of notice in this appeal, the respondent/assessee entered appearance through his counsel. 5. The Revenue had filed an application for condonation of delay of 1942 day in filing the appeal (vide Misc.Cvl.109896/2010 filed under Section 5 of Limitation Act read with Section 206(A) of the Act). In view of huge tax liability as well as public interest and in the light of the ratio laid down by the Hon'ble Apex Court in the case of Commissioner of Income Tax v. West Bengal Infrastructure Development Finance Corporation Limited, (vide order dated 10.112.2010 made in Civil Appeal No.10462 of 2010), the delay in filing the appeal was condoned and the appeal was admitted. 6. We have heard the learned counsels for the parties in this appeal. 7. Learned counsel for the Revenue reiterated the grounds as urged in the memorandum of appeal. He also submits that the Commissioner of Income Tax (Appeals) though held that the assessee is liable to pay tax on the capital gains and without there being any proof that the money seized in the hands of B.B. Swamy belongs to the appellant, erred i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n important source of revenue for the Government. The Government needs money to maintain law and order in the country; safeguard the security of the country from foreign powers and promote the welfare of the people. It is the duty of the Government to bring out such welfare and development programmes which will bridge the gap between the rich and the poor. All this requires mobilization of funds from various sources. The sources may be direct or indirect. The administration and collection of Income- Tax is vested in the Central Govt., but the net proceeds of the tax are apportioned between the Centre and the States. However, Income Tax of companies; the proceeds of the tax attributable to Union territories; tax payable in respect of the union emoluments paid out of the consolidated fund of India and surcharge on income tax levied for purposes of the Union are excluded from the divisible pool. The amount excluded from the divisible pool goes to the Central Government. The principles regarding the distribution of the remaining amount are determined by the Finance Commission, which is appointed every five years. The Board is constituted under the Central Board of Revenue Act, 1963. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he tax effect was below 10 lakhs. The question that arose for before the Apex Court, in the above said was, (a) Whether the single panel circuit breakers are classifiable under Chapter Subheading 8535 (rate of duty 5%) as claimed by the addressee or under chapter sub-heading 8537 (rate of duty 20%) as per the revenue? And (b) Whether the Board circular Dt. 14.7.1994, which has classified that the single panel circuit breakers are classifiable under chapter 8537 has retrospective effect? Under the Central Excise Tariff Act, 1985 and the Rules, 1944, the Board had issued a Circular dated 14.7.1994 with regard to classification of goods. Hence the apex court in the above said case has held that such a circular with regard to the classification of goods is applicable to the pending disputes. The above ratio is not applicable to the facts and circumstances on hand. 14. It appears that in view of the national litigation policy, the Board has issued the instruction with regard to filing of appeals before the Tribunal/Courts fixing monetary limit/tax effect. The Central Govt. has formulated the national litigation policy in October 2009 with the object of reducing cases pending i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e following suggestions:- (i) That all Government servants, under the State/Centre (who are not assessees under the Income Tax), shall be made liable to pay Income Tax of atleast Rs. 1,000/- per annum; (ii) That all male graduates, who are mentally and physically sound, aged between 31 years to 60 years (who are not assessees under the Income Tax), shall be made liable to pay Income Tax at least Rs. 1000/- per annum and protect their interest on attaining age of 61 years by providing pension; (iii) That Election law may be amended prescribing a condition that every male person contesting election to the State assembly/Parliament shall be an income tax assessee. 18. For the foregoing reasons stated supra, we pass the following order; - Appeal is allowed. The Impugned order of the first appellate authority and the Tribunal, in so far as the direction given to the Revenue, to adjust the amount seized in the hands of Sri. B.B. Swamy towards tax liability of the Assessee, are set aside. The Registry is directed to send copy of this order, immediately, to the Secretary to Union Finance Department and the Secretary to Law Commission for necessary action. - - TaxTMI - TMI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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