TaxTMI 
TaxTMI 
2006 (5) TMI 56
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....er the Income-tax Appellate Tribunal was justified in setting aside of a finding recorded by the Commissioner of Income-tax in section 263 proceedings by deleting a sum of Rs. 6,83,304 in relation to penalty imposed upon the assessee under the sales tax law ? 2. Whether benefit of deletion amounting to Rs. 6,83,304 granted to the assessee by the Tribunal can be said to be justified and is an allowable deduction and if so under what head ?" 2. The dispute pertains to the assessment year 1989-90. It is in relation to a deduction claimed by the assessee (respondent herein) amounting to Rs. 6,83,304 paid towards penalty under the sales tax law. In the assessment year in question, the question arose as to whether the assessee can be grante....
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....it was held that the amount of Rs. 6,83,304 is a part of Rs. 55 lakhs which was voluntarily surrendered by the assessee and hence, the same cannot be now again brought to tax for the year in question. 4. The Commissioner of Income-tax was not satisfied with this deletion made by the Assessing Officer in favour of the assessee and hence, (Commissioner of Income-tax) invoked his powers under section 263 of the Act and called upon the assessee to show as to why a sum of Rs. 6,83,304 be not included in the total income of the assessee. According to the Commissioner, the order of the Assessing Officer granting the benefit of Rs. 6,83,304 to the assessee was not only erroneous but was equally prejudicial to the interests of the Revenue and hen....
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....gs makes it abundantly clear that the assessee had made false claim of deduction in the return, as the amount(s) of sales tax penalty had been claimed and allowed in earlier years. It was in this back-drop that the assessee had requested the Assessing Officer to increase the returned income by the amount of sales tax penalty of Rs. 6,83,304. If that be so, the question of including this sum in the surrendered amount of Rs. 55 lakhs does not arise, as the fact of inclusion of the said sum being sales tax penalty in conspicuous by its absence in the assessee's letter of surrender dated March 3, 1992, relating to the assessment year 1989-90. Paragraphs 3 and 4 thereof do not refer to sales tax penalty. In sharp contrast, letter of surrender of....
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....essee. The assessee felt aggrieved of this assessment filed an appeal to the Commissioner of Income-tax (Appeals). By order, dated November 29, 1996, the Commissioner of Income-tax (Appeals) dismissed the appeal and upheld the assessment order including addition of Rs. 6,83,304. Aggrieved, the assessee filed further appeal to the Tribunal. By the impugned order, the Tribunal allowed the appeal filed by the assessee and deleted the addition of Rs. 6,83,304 made by the Assessing Officer pursuant to the order of Commissioner. It is against this order of the Tribunal, the Commissioner of Income-tax (Revenue) has felt aggrieved and filed this appeal. As stated supra, the appeal was admitted for final hearing on the aforementioned substantial que....
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....n, AIR 1985 Ker 66; V. E. Vasudevan v. State of Kerala, AIR 1985 Ker 69 [FB] ; Damodhar Rao v. Bhima Rao, AIR 1965 Mysore 290 ; Rajani Kumar Mitra v. Ajmaddin Bhuiya, AIR 1929 Cal 163, Addl. CIT V. Mukur Corporation [1978] 111 ITR 312 (Guj) CIT v. Seshasayee Paper and Boards Ltd. [2000] 242 ITR 490 (Mad) ; P. V. Doshi v. CIT [1978] 113 ITR 22 (Guj), Sri Sri Kubereswar Mahadeva Thakur v. CIT [1992] 196 ITR 649 (Cal) and CIT v. South India Shipping Corporation Ltd. [1998] 233 ITR 546 (Mad) learned counsel contended that the finding recorded by the Commissioner and later upheld by the Tribunal against the assessee would not be a bar in subsequent proceedings arising out of the appellate orders to again decide the issue on the merits. It was hi....
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....he Assessing Officer on the ground of its being erroneous and prejudicial to the interests of the Revenue. It is also not in dispute that the Commissioner did find that these two grounds did exist in the order of the Assessing Officer and accordingly, recalled the same. It is also not in dispute that the Tribunal too concurred with the finding of the Commissioner when it proceeded to dismiss the appeal filed by the assessee. It is also not in dispute that the assessee though had the opportunity to challenge the appellate order of the Tribunal in further appeal under section 260A ibid but for the reasons best known to them, they did not prefer to challenge and accepted the appellate order of the Tribunal. 14. In a situation emerging from ....