TaxTMI 
TaxTMI 
2010 (10) TMI 508
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....to the parties to maintain status quo with regard to the matter till the final decision in the matter is taken by the Committee concerned. However, it is made clear that the Committee shall expedite the matter and dispose of the same, thus taking a decision in the matter as early as possible, preferably within 3 (three) months from the date of receipt of this order. ......... The parties are given liberty to approach this Court if they are aggrieved by the decisions of the Committee, if so advised. ..........." 4. Concededly the issue, then, was: whether the income of the non-Sikkimese residing in Sikkim is taxable? As the said question was referred to a Committee and the decision of the Committee was pending, this Court passed an Order dated 21-7-2005, as referred to above. 5. However, as being mentioned, the said writ petitions No. 31 and 38 of 2001 were taken for further hearing on 27-4-2006 and this Court passed an Order dated 27-4-2006 in W.P.(C) Nos. 31 and 38 of 2001, which reads as hereunder: "(1) .................................... (2) This Writ Petition was allowed to be withdrawn with a direction to the parties to mainta....
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....-7-2009. However, the result was the same, as this Court by an Order dated 15-7-2009, once again, reiterated the earlier Order dated 21-7-2005, as hereunder:- "8. In consideration of the above facts and circumstances and also upon hearing of the learned Counsel for the parties, we reiterate the order dated 21-7-2005 and with a liberty to the parties to approach this Court or any other appropriate/competent authority or forum for redressal of any grievances in this regard." 8. In the meanwhile, the Central Board of Direct Taxes (for short, 'CBDT'), namely 5th respondent herein, by exercising the power conferred on them under section 119 (2) (a) of the Income-tax Act, 1961 passed Instruction No. 8 of 2008 dated 29-7-2008, which reads as hereunder: "INSTRUCTION NO 8/2008, Dated: July 29, 2008 ORDER UNDER SECTION 119(2)(a) OF THE INCOME-TAX ACT, 1961 Vide Finance Act,2008, a new clause (26AAA) has been inserted in section 10 of the Income Tax Act, 1961 ('Act') with retrospective effect from assessment year 1990-91. Under the said clause, the following income accruing or arising to a Sikkimese individual is exempt from tax- (a) income fr....
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....IKKIM No. ACIT/Cir-Gangtok/2009-10/920 Dated: 11/12/2009 To Sri Chhabil Das Agarwal, Singtam Bazar, East Sikkim. Subject: Writ Petitions I Nos. 38 & 31 of 2001 In the case of - Shri Chhabil Dass Agarwal v. UOI Ref: Your reminder letter No. Nil dated 7/11/2009 Received on 09/11/2009. *** Kindly refer to the above The above Writ Petitions have been disposed of by the Hon'ble High Court of Sikkim, Gangtok vide Hon'ble Court's order dated 15/07/2009 with the observation that the new clause (26AAA) inserted in Section 10 of the IT. Act, 1961 has apparently taken care of the grievance of the assessee as projected in the above Writ Petitions thereby giving liberty to the assessee to approach the competent authority or forum, including the Hon'ble High Court if the assessee is aggrieved in any manner. Relying on the order of the Hon'ble High Court dated 15-7-2009, you had, vide a petition dated 7th August, 2009 addressed to the DCIT, Cir-Gangtok, Sikkim sought cancellation of order under section 144/147, tax demand and withdrawal of penalty proceedings in view of Instruction No. 8/2008 dated 29-7-2008 and the Order ....
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....non-Sikkimese individual and hence your income is not exempt within the meaning of section 10 (26AAA) of the IT. Act, 1961. Order under section 144/147 of the IT. Act, 1961 for A. ys. 1995-96 and 1996-97 was passed on 9-7-2001 and 28-3-2001 respectively. Since the assessment under section 144/147 of the IT. Act, 1961 were completed long before the amendment inserting clause (26AAA) in section 10 of the I.T. Act, 1961 was made vide Finance Act, 2008, your plea for cancellation of orders under section 144/147, withdrawal of tax demand and dropping of penalty proceedings do not stand the test of Board's Instruction No. 8/2008 dated 29-7-2008. Your case does not fall under the parameter of Para 2(a), 2(b), 2(c) or 2(d) of the Instruction 8 /2008 dated 29-7-2009 as proceedings under section 144/147 of the I.T. Act, 1961 was completed long before the insertion of clause (26AAA) in section 10 of the I.T. Act, 1961. In view of the above, you are liable to pay the demand as indicated below- 3. Assessment Year 1995-96: Rs. 2,45,87,625 4. Assessment Year 1996-97: Rs. 6,05,474 Total : Rs. 2,51,93,099 Interest under section 220(2) of the I.T. Act, 1....
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....refusal of the benefit under Instruction No. 8 of 2008 dated 29-7-2008 to the writ petitioner-assessee alone is also discriminatory, because the assessment proceedings initiated against similarly placed persons are dropped; and (vii) that, in any event, the Assessing Officer failed to appreciate that the writ petitioner-assessee is also entitled for the benefit of the Instruction No. 8 of 2008 dated 29-7-2008 of the CBDT. 11. Per contra Mr. A. Moulik, learned Senior Counsel appearing for the respondent-revenue contends: (i) that Section 10(26AAA) of the Income-tax Act, 1961 does not provide any benefits to the non-Sikkimese individual; (ii) that even though, Instruction No. 8 of 2008 dated 29-7-2008 provides certain benefits to the non-Sikkimese residing in the State of Sikkim namely, viz.:- (a) For assessment year 2007-08 or any preceding assessment year, no assessment or reassessment shall be made with regard to the income- (i) income from any source in the State of Sikkim; or (ii) income by way of dividend or interest on securities. (b) In case any proceedings have been initiated for assessment year ....
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....ads hereunder:- "5. According to Mr. Moulik, since the relevant provision is amended as noted above, the grievance of the petitioner so projected in the writ petition appears to have been well taken care of and if the petitioner is aggrieved in any manner, he may have the liberty to approach the competent authority or forum including this Court as was already observed in the order dated 21-7-2005 whereby parties were given liberty to approach this Court." (emphasis supplied) 16. Accordingly, the writ petitioner-assessee filed a petition dated 7-8-2009 for cancellation of the demand of tax and for withdrawal of penalty proceedings in view of the Instruction No. 8 of 2008 dated 29-7-2008. The Assessing Officer, however, by the impugned proceedings dated 11-12-2009 held that:- (i) Section 10(26AAA) of the Income-tax Act, 1961 is not at all attracted to the case of the petitioner-assessee, a non-Sikkimese, and, therefore, the petitioner-assessee cannot seek any benefit under Instruction No. 8 of 2008 dated 29-7-2008 nor seek the withdrawal of penalty proceedings; and (ii) the case of the petitioner is also not governed by the Instructio....
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.... judgment assessment' under four deliberate defaults committed by the assessee. viz. (i) Where the assessee has failed to make the return required under section 139(1) and has not made a return under section 139(4) or a revised return under section 139(5); (ii) where there has been a failure to comply with the terms of a notice issued under section 142(1) requiring the assessee to produce accounts or other documents or information specified therein; (iii) where the assessee has failed to comply with the Assessing Officer's direction under section 142(2A) for getting the accounts audited and furnishing the audit report; or (iv) where the return has been made, and the Assessing Officer serves a notice under section 143(2) upon the assessee requiring his appearance or the production by him of evidence in support of his return, but the assessee does not comply with the terms of the notice. But, in the instant case the petitioner-assessee has not committed any of the above defaults but claims certain privileges and rights conferred on the non-Sikkimese residing in the State of Sikkim based on Instruction No. 8 of 2008 dated 29-7-2008 iss....