Late Shri Gyan Chand Jain through LR vs Commissioner of Income Tax­I

Late Shri Gyan Chand Jain through LR vs Commissioner of Income Tax­I

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

[NON­REPORTABLE]

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2704 OF 2022

Late Shri Gyan Chand Jain through LR …Appellant

Versus

Commissioner of Income Tax­I       …Respondent

J U D G M E N T

M.R. SHAH, J.

1. Feeling aggrieved and dissatisfied with the impugned

judgment and order dated 29.03.2016 passed by the High

Court of Judicature for Rajasthan, Jaipur in D.B. Income

Tax Appeal No.33 of 2014 by which the High Court has

allowed the said appeal preferred by the Revenue and has

1

set  aside  the  order   passed  by  the   Income  Tax   Appellate

Tribunal (hereinafter referred to as the ‘ITAT’) deleting the

penalty under Section 271(1)(c) of the Income Tax Act (for

short   ‘the   Act’),   the   assessee   has   preferred   the   present

appeal.

2. It is mainly submitted on behalf of the appellant that in

view of the CBDT (Central Board of Direct Taxes) Circular

No.21 of 2015 dated 10.12.2015 the appeal preferred by the

Revenue was not maintainable.  It is the case on behalf of

the appellant that in view of the aforesaid circular no appeal

can be filed by the Department in any High Court, for nonpayment   of   taxes,   where   the   tax   effect   is   less   than

Rs.20,00,000/­.   It is the case on behalf of the appellant

that in view of the order passed by the CIT(A) and in view of

the subsequent demand, the penalty amount was reduced to

Rs.6,00,000/­ (approximately) and therefore when the tax

effect would be less than Rs.20,00,000/­, in view of the

2

CBDT Circular dated 10.12.2015 the appeal preferred by the

Revenue before the High Court was not maintainable.

2.1 Learned counsel appearing on behalf of the appellant

has   also   made   some   submissions   on   merits   on   the

jurisdiction of the Additional Commissioner of Income Tax.

However   considering   the   definitions   contained   in   Section

2(28C) read with Section 274(2) of the Income Tax Act, ‘Joint

Commissioner’   means   a  person  appointed  to   the   post   of

Joint Commissioner of Income Tax and includes Additional

Commissioner of Income Tax and in the present case the

approval of the Additional Commissioner of Income Tax was

obtained, we see no reason to interfere with the findings

recorded by the High Court on merits on the powers of the

Additional Commissioner to grant the approval sought by

the AO for imposing penalty under Section 271(1)(c) of the

Income Tax Act.

3

2.2 Now so far as the primary submission on behalf of the

appellant   assessee   that   as   the   penalty   amount   was

substantially   reduced   to   Rs.6   lakhs   and   even   the

subsequent demand notice was for an amount of Rs.6 lakhs

(approximately)   only   and   therefore   in   view   of   the   CBDT

Circular dated 10.12.2015 the tax effect being lower than

the permissible limit to prefer the appeal before the High

Court and therefore the appeal before the High Court was

not maintainable is concerned, at the outset it is required to

be noted that what was assailed by the Revenue was the

penalty amounting to Rs.29,02,743/­ and not the penalty

reduced   by   the   CIT(A).     Before   the   Tribunal,   both   the

Revenue, as well as the assessee, preferred the appeals and

the   entire   penalty   amounting   to   Rs.29,02,743/­   was   an

issue before the Tribunal as well as before the High Court.

The   subsequent   reduction   in   penalty   in   view   of   the

subsequent  order  cannot   oust   the  jurisdiction.     What   is

required   to   be   considered   is   what   was   under   challenge

before the Tribunal as well as the High Court.  At the cost of

4

repetition, it is observed that what was challenged by the

Revenue was the penalty amounting to Rs.29,02,743/­ and

not the subsequent reduction of penalty by the CIT(A).  The

aforesaid aspect has been dealt with by the High Court in

paragraph 17 of the impugned judgment and order.  We are

in   complete  agreement   with   the   view  taken   by   the  High

Court.  Therefore, it cannot be said that the appeal before

the High Court at the instance of the Revenue challenging

the order passed by the ITAT was not maintainable in view

of CBDT circular dated 10.12.2015.

4. In view of the above and for the reasons stated above

there is no substance in the present appeal and the same

deserves to be dismissed and is accordingly dismissed.  No

costs.

...…………………………….J.

       [M.R. SHAH]

5

………………………………J.

[B.V. NAGARATHNA]

NEW DELHI;

APRIL 19, 2022

   

6