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Maharawal Khewaji Trust Versus Asst. CIT, Ferozepur

2017 (2) TMI 590 - ITAT AMRITSAR

Penalty u/s 271(1)(c) - exemption u/s 11&12 denied - CIT-A issued an alert to the Assessing Officer to take cognizance of the appellant entity losing its status of 'trust' and the income accruing thereof becoming the right of two individuals as a consequence of the decision of the Additional Civil Judge, Chandigarh and take necessary consequential actions/remedies, should it be considered appropriate - Held that:- We find that it is an undisputed fact that the above said orders passed by ld. CIT .....

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as been mentioned in the said section. The Hon'ble High Court of Allahabad in Commissioner Of Income-Tax, Uttar Pradesh Versus Rameshwardas Ram Narain [1974 (12) TMI 12 - ALLAHABAD High Court ] has considered the similar issue and has held that appellate Assistant Commissioner had no jurisdiction to make the direction of the kind that he made in the appellate order. - Decided in favour of assessee - I.T.A. Nos. 547 to 550 (Asr)/2015 - Dated:- 7-2-2017 - Sh. T. S. Kapoor, Accountant Member And Sh .....

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ether, therefore, for the sake of convenience a common and consolidated order is being passed. 4. The assessee has taken various grounds of appeals. For the sake of convenience the grounds of appeal in ITA No.547(Asr)/2015 for Asst. Year:2007-08 are reproduced herein below. (1) That on the facts and in the circumstances of the case and in law, the learned CIT(A) erred in issuing the alert to the AO to take cognizance of the assessee losing its status of "trust" and the income accruing .....

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rh has since been stayed by the District Judge, Chandigarh and is still in force. So, is beyond his power and is pre-mature. Even some appeals against this order are pending in the Hon'ble High Court. (3) That on the facts and in the circumstances of the case and in law, the learned C1T(A) erred in giving the above direction in Ground of Appeal No. 1 as the writ petition stand admitted against rejection of application for registration of charitable trust by the department and is still pendin .....

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Assessing Officer imposed penalties for concealment of income u/s 271(1)(c) of the Act. 6. Aggrieved with the penalty orders, the assessee filed appeals before ld. CIT(A) and ld. CIT(A) deleted the penalty imposed by Assessing Officer, however, while allowing relief to the assessee, the ld. CIT(A) vide para-14 has noted as under.. "14. It is considered appropriate, before parting, to issue an alert to the Assessing Officer to take cognizance of the appellant entity losing its status of  .....

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ld. CIT(A) in disposing of the appeals relating to imposition of penalty are contained in Sec.251(1)(b) of the Act and as per the provisions of this section, the ld. CIT(A) has powers to confirm or cancel the penalty or to enhance or reduce the penalty. He submitted that other than this power ld. CIT(A) has no power while disposing of the penalty appeal. Reliance in this respect was placed on the following case laws: (i) CIT Vs. Rameshwardas Ram Narain 107 ITR 710 (All). (ii) CIT Vs. Eminent En .....

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the penalties imposed by Assessing Officer u/s 271(1) (c) of the Act. It is also undisputed fact that the ld. CIT(A) has allowed relief and had deleted the penalties in these orders. The powers of CIT(A), while disposing of the appeals relating to penalties are contained in Sec.251(1)(b) of the Act. For the sake of convenience, the said powers as contained in Sec.251(1)(b) are reproduced herein below. 251.(1) In disposing of an appeal, the [***] [Commissioner (Appeals)] shall have the following .....

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ion. The Hon'ble High Court of Allahabad has considered the similar issue and has held that appellate Assistant Commissioner had no jurisdiction to make the direction of the kind that he made in the appellate order. The findings of the Hon'ble Court are reproduced below. "Whether, on the facts and in the circumstances of the case, the Tribunal was right in canceling the direction of the Appellate Assistant Commissioner in his order against the penalty imposed under section 28(l)(c) .....

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tion he cannot validly take such action. The direction in the appellate order that the Income-tax Officer should take such action according to law as he deems necessary in this case might have confused the situation. The Income-tax Officer was bound to take some action in accordance with the appellate direction. For this reason also the Tribunal was justified in setting aside the direction." Similarly, the Hon'ble Kerala High Court in the case of CIT vs. Eminent Enterprises 201 ITR 766, .....

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sment, he may confirm, reduce, enhance or annul the assessment ; or he may set aside the assessment and refer the case back to the AO for making a fresh assessment in accordance with the directions given by the Deputy Commissioner (Appeals) or, as the case may be, the Commissioner (Appeals) and after making such further enquiry as may be necessary, and the AO shall thereupon proceed to make such fresh assessment and determine, where necessary, the amount of tax payable on the basis of such fresh .....

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ent or reduction. " Section 251(l)(a) deals with the power of the first appellate authority in disposing of an appeal against an order of assessment. The appellate authority may confirm, reduce, enhance or annul an assessment. He may also set aside the assessment and refer the case altogether to the AO for making a fresh assessment and he can also issue directions in that behalf. Section 251(l)(b) deals with an appeal against an order imposing penalty. Therein, the only powers given to the .....

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set aside the order appealed against and order remit or make further directions or pass such other order which will meet the ends of justice. Section 251 deals with the powers of the first appellate authority in different situations. Whereas, in cases coming under section 251(l)(a)-appeal against an order of assessment and cases other than appeals against assessment and penalty the first appellate authority can pass any order as he thinks fit, in the appeals against orders imposing penalties, t .....

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