High Court allows Assessee's appeal, emphasizing statutory provisions. Remands to Tribunal for fresh decision.

The High Court allowed the Assessee's appeals, setting aside the Tribunal's Order that dismissed the appeal against the Order under Section 195(2) of the Income Tax Act. The Court emphasized the need to consider all relevant provisions, including Section 248 of the Act, and remanded the matter back to the Tribunal for a fresh decision, highlighting the error in overlooking crucial statutory provisions.

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Issues:
1. Appeal against the order passed under Section 195(2) of the Income Tax Act, 1961.
2. Maintainability of appeal before the Commissioner of Income Tax [Appeals].
3. Provisions of Section 248 of the Act and its impact on the appeal process.

Analysis:
1. The Assessee filed appeals against the Order passed by the Income Tax Appellate Tribunal, which held that the Order passed under Section 195(2) of the Income Tax Act is not appealable under Sections 246 & 246A of the Act before the Commissioner of Income Tax [Appeals]. The Tribunal quashed the Order passed by the Commissioner of Income Tax [Appeals] and dismissed the Assessee's appeal. The Tribunal emphasized that the Order under Section 195(2) is not appealable, and the lack of jurisdiction of the Commissioner of Income Tax [Appeals] renders the Order unsustainable. The Tribunal clarified that the enforceability of the Order passed under Section 195(2) by the Assessing Officer remains unaffected.

2. The Assessee's Authorized Representative relied on a Special Bench decision concerning the time limit for passing orders under Section 201 & 201A of the Act. However, the Tribunal found this decision irrelevant to the present case, emphasizing that the appeal against the Order under Section 195(2) is not maintainable due to jurisdictional issues and the absence of a remedy in appeal. Consequently, the Tribunal dismissed the Assessee's appeals, indicating that pursuing the wrong remedy led to the dismissal. The Tribunal highlighted the need for the Assessee to pursue the appropriate legal remedy against the impugned Order under Section 195(2) of the Act.

3. The Counsel for the Revenue acknowledged that the Tribunal overlooked the provisions of Section 248 of the Act, which allow an appeal by a person denying liability to deduct tax in specific cases. The Tribunal's failure to consider Section 248 led to an error in holding that the appeal before the Commissioner of Income Tax [Appeals] was not maintainable under Sections 246 & 246A of the Act. Consequently, the High Court found the Tribunal's Order flawed and per incurium due to the omission of crucial provisions. The Court allowed the Assessee's appeals, remanding the matter back to the Tribunal for a fresh decision considering Section 248 of the Act.

In conclusion, the High Court allowed the Assessee's appeals, emphasizing the importance of considering all relevant provisions, including Section 248 of the Act, in appeal processes. The Court set aside the Tribunal's Order and directed a reconsideration of the case in light of the overlooked statutory provisions.

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