TaxTMI 
TaxTMI 
2007 (10) TMI 634
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....uted and the penalty is based on the assessed income and as such it was decided that in respect of appeal against the penalty under section 271(1)(c), the filing fee would be considered as per clauses (a), (b) and (c ) of section 253(6) and not under section 253(6)(d) of the Act. It was also pointed out that the Hon'ble Karnataka High Court in the case of Rajakamal Polymers (P) Ltd. v. CIT [2007] 207 CTR (Kara) 160 : [2007] 291 ITR 314 (Kar) has considered the issue regarding the fees payable in respect of appeal relating to the order passed under section 271(1)(c ) and others of the IT Act. The Hon'ble Karnataka High Court has held that in all these cases since the subject-matter relates to the matter other than those specified in clauses (a ) to (c), the Court fees payable should be taken to be Rs. 500 and the matter will fall under clause (d). It was contended that from the decision of the Karnataka High Court the view expressed by the Kolkata "D" Special Bench in the case of Bidyut Kumar Sett v. ITO (supra) has been reversed. Thus, it was contended that the assessee has paid proper fees and the appeal be admitted for prosecution. 3. The learned Departmental Representat....
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....inion expressed in the above case. In our view also the words 'in the case to which the appeal relates' only refer to the proceedings relating to the assessee in whose case the penalty order has been passed. We are in full agreement with the view expressed in the dissenting opinion that these words should not be understood in a restrictive sense and must be broadly construed so as to cover all appeals which are filed in the case of the assessee where the appeal is filed against an order which is based on the quantum of income assessed. An order levying penalty for concealment is undeniably connected with the assessment order or more particularly to the total income computed by the AO. It may be that, as contended by one of the learned representatives appearing before us for the assessee, the penalty is levied only with reference to the tax sought to be evaded on the concealed income, but the concealed income, as rightly pointed out in the dissenting opinion in the case of Vinod Khatri (supra), does form part of the assessed income as computed by the AO and this is sufficient to establish the nexus between the amount of income assessed by the AO and also to establish the req....
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.... the filing fee in respect of appeals filed before the Tribunal. Nor can it follow that penalty proceedings have no relation to assessed income. Further as held in the dissenting opinion, the requirement that the AO should record the satisfaction that the assessee has concealed his income and such satisfaction should be reached in the course of the assessment proceedings, supports the view that there is a link or nexus or relationship between the assessment proceedings and the penalty proceedings. 18. For the above reasons, we are in full agreement with the view expressed in the dissenting opinion in the Special Bench decision in the case of Vinod Khatri (supra). We are, therefore, unable to accept the arguments advanced on behalf of the assessees and the interveners before us. We are, however, indebted to both sides for their lucid arguments. 19. We, therefore, answer the question referred to us in the following manner: The Tribunal fee on an appeal against the order of penalty levied under section 271(1)(c) of the IT Act is governed by clause (a) to (c) of section 253(6) of the IT Act'." 6. Subsequent to the decision of the Special Bench, the only decision in respect o....
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....involving more than two hundred thousand rupees, the Court fee payable is one per cent of the assessed income subject to a maximum of ten thousand rupees section 253(6)(d) would provide that in the event the subject-matter of the appeal relates to any matter other than those specified in clauses (a), (b) and (c ) the Court fee payable is five hundred rupees. In the case on hand, it is seen that the Appellate Commr. has chosen to reject the appeal on the ground of limitation. In our view, such an order would fall within clause (d) of section 253(6) of the Act. Hence, only a sum of Rs. 500 is payable in terms of section 253(6)(d) of the Act. Unfortunately, the Tribunal, without even looking into the basic requirement of Court fee, has chosen to blindly accept the objection of the Registrar. In the circumstances, we are satisfied that the appellant is justified in complaining that the order of the Tribunal runs counter to section 253(6)(d) of the Act. We accept the submission of the appellant assessee. On the facts and given circumstances, we deem it proper to hold that the appellant is liable to pay Court fee @ Rs. 500 for each one of the appeals for the purpose of maintaining appe....
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....f the Revenue. The finding given in the order passed under section 263 is not based on the computation of total income by the AO. Therefore, we are of the view that the objection raised by the Registry is not sustainable and the assessee has paid the fees in accordance with clause (d) of section 253(6) of the Act which was rightly applicable in the case of the assessee. 8. Now coming to the merits of the case, the only issue involved in this appeal is that the order passed by the CIT by applying the provisions of section 263 is not valid order and must be annulled. The learned Authorised Representative contended that the assessment in the case of the assessee was completed under section 143(3) on 6th Feb., 2006 on a total income of Rs. 23,59,257. The CIT issued the notice under section 263 on two issues; first that the AO has accepted the GP rate shown by the assessee @ 25 per cent as against 30 per cent shown in the immediately preceding assessment year without making any verification and inquiries. The other reason was that the partners have introduced capital during the year and there were cash credits from the relatives of the partners and from others. The AO has not made any ....
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....ls & Ferro Alloys Ltd. v. CIT [1993] 112 CTR (Ori) 94 : [1993] 203 ITR 729 (Ori); -Duggal & Co. v. CIT [1994] 122 CTR (Del) 171 : [1996] 220 ITR 456 (Del); -Smt. Tara Devi Aggarwal v. CIT 1973 CTR (SC) 107 : [1973] 88 ITR 323 (SC); -Rampyari Devi Saraogi v . CIT [1968] 67 ITR 84 (SC). Thus it was contended that the order passed by the AO was erroneous as well as prejudicial to the interest of Revenue. Referring to the assessment order, it was pointed out that the AO has not considered any of he issues brought out by the CIT in the assessment order as nothing has been mentioned in this regard. The CIT has merely set aside the order and therefore, the assessee has full opportunity to plead his case before the AO. 10. We have carefully considered the rival submissions, perused the materials placed before us alongwith the case law relied on before us along with the order of CIT passed under section 263. We are of the view that in order to invoke the provision of section 263, both the conditions that the order passed by the AO is erroneous and also that it is prejudicial to the interest of Revenue must be satisfied. If one of them is absent, it will be held that the provisions of s....
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....e each and every issue in respect of which the AO made the enquiry with the assessee even if the AO got satisfied that no addition is required to be made in the assessment. We find that Hon'ble Bombay High Court in the case of CIT v. Gabrial India Ltd. (supra) has held in this regard as under: "Held, that the ITO in this case had made enquiries in regard to the nature of the expenditure incurred by the assessee. The assessee had given a detailed explanation in that regard by a letter in writing. All these were part of the record of the case. Evidently, the claim was allowed by the ITO on being satisfied with the explanation of the assessee. This decision of the ITO could not be held to be 'erroneous' simply because in his order he did not make an elaborate discussion in that regard. Moreover, in the instant case, the CIT himself, even after initiating proceedings for revision and hearing the assessee, could not say that the allowance of the claim of the assessee was erroneous and that the expenditure was not revenue expenditure but an expenditure of capital nature. He simply asked the ITO to re-examine the matter. That was not permissible. The Tribunal was justified i....
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.... to examine the meaning of the words "prejudicial to the interests of the Revenue". In this case the assessee has voluntarily filed the return and was assessed accordingly although some other person was liable to be taxed on such income. When the matter travelled to the Hon'ble Supreme Court regarding the jurisdiction of the CIT under section 33B to cancel the assessment, the Hon'ble Supreme Court observed that where an income has not been earned the same is not assessable merely because the assessee wants it to be assessed in his or her hands in order to assist someone else who would have been assessed to a larger amount, an assessment so made will be erroneous and prejudicial to the Revenue. The facts in this case are totally different from the facts in the case before us and therefore this case will also not assist the Revenue. In the case before us, we noted that the AO had made the enquiries in respect of both the issues. The explanations were asked for from the assessee from time to time. The AO has also made the specific query. The copies of the letters issued by the AO and the explanation given by the assessee are on record and form part of the paper book. A perusal....