2016 (10) TMI 1049 - HC - Income Tax

Ignoring the second provision to Section 158BFA - Tribunal allowed the respondent assessee s appeal by following its order in the case of Super Metal Industries Vs. Deputy Commissioner of Income Tax (2008 (8) TMI 385 - ITAT BOMBAY-E) - Held that - The appellant has filed an affidavit dated 22nd October, 2016 of one Mr. M.P. Ramteke, Assistant Commissioner of Income Tax. The affidavit states that the amount of ₹ 10,000/as directed has been paid to the Maharashtra State Legal Services Authority. It further states that they are unable to locate the papers and proceedings with regard to the decision of the Tribunal in the case of Super Metal Industries Therefore, Revenue is not able to put any facts on record in respect of the order of the Tribunal in Super Metal Industries (supra) particularly whether it was accepted or not. In the above view, it must be inferred that the same has been accepted as no evidence of it being challenged in Court or even any distinguishing features on facts are pointed out to us. No substantial question of law

Summary

Issues:
- Challenge to the order of the Income Tax Appellate Tribunal regarding Assessment for block period 1991-92 to 2000-01 and 2001-02(part).
- Alleged error by the Tribunal in ignoring the second provision to Section 158BFA of the Income Tax Act, 1961.

Analysis:
The High Court of Bombay heard an appeal challenging the order of the Income Tax Appellate Tribunal related to the assessment for the block period 1991-92 to 2000-01 and 2001-02(part). The main issue raised by the Revenue was whether the Tribunal erred in law by disregarding the second provision to Section 158BFA of the Income Tax Act, 1961. The Tribunal's impugned order favored the respondent assessee, citing a previous decision in the case of Super Metal Industries Vs. Deputy Commissioner of Income Tax, 119 ITD 153.

During the hearing, the Court noted that the impugned order simply followed the decision in the Super Metal Industries case without any attempt by the Revenue to challenge or provide reasons for the appeal. The Court emphasized the importance of certainty in tax matters and the need for the Revenue to justify appeals with cogent reasons, especially when previous decisions have been accepted. The Court adjourned the appeal, directing the Revenue's counsel to file an affidavit and pay costs for further consideration.

Subsequently, the Revenue filed an affidavit confirming the payment of costs but expressed inability to locate relevant documents regarding the Tribunal's decision in the Super Metal Industries case. As a result, the Revenue could not provide any information on whether the previous decision was accepted or challenged. The Court inferred that since no evidence of challenge or distinguishing features were presented, it can be assumed that the decision was accepted. Consequently, the question raised by the Revenue did not present a substantial question of law and was not entertained, with no order as to costs being issued.