2014 (1) TMI 1296 - AT - Income Tax

Maintainability of Appeal to the Tribunal u/s 254 of the Act Penalty levied u/s 271FA of the Act Held that - The decision in The Sub Registrar Sub Registrar Office Versus The DIT (Intelligence) 2014 (1) TMI 1055 - ITAT COCHIN followed - Nowhere in section 253 mentions the order passed by Director of Income Tax (Intelligence) or any other officer of the Income Tax department levying penalty u/s 271FA is appealable before the Tribunal - The Tribunal being a quasi-judicial authority established under the provisions of the Income Tax Act cannot travel beyond the provisions of the Act - Therefore, unless and until an appeal is specifically provided section 253 of the Act against the order levying penalty u/s 271FA, the Tribunal is of the considered opinion that the present appeal is not maintainable before this Tribunal. Consent of a litigant party will not confer any jurisdiction of a judicial or quasi-judicial authority unless and until it is otherwise conferred by the legislature - Therefore, the consent/direction of the Director of Income Tax (Intelligence) will not confer any jurisdiction on the Tribunal unless sit is provided for in the income tax Act by the Parliament. The legislature treated sections 271 and 271A as separate and independent sections - section the reference of section 271 in section 253(1)(a) or 253(1)( c) may not be included section 271FA - the omission to include section 271FA in section 253 may be unintended thus, it is open to the department to bring to the notice of the concerned authority about the omission to provide appeal before the Tribunal for making consequential amendment to section 253 of the Act in case the department found that the omission is unintended thus, appeals are not maintainable before the Tribunal against the order of the Director of Income Tax (Intelligence) levying penalty u/s 271FA of the Act though, the assessee is at the liberty to challenge the impugned order of the Director of Income Tax (Intelligence) before the appropriate forum in a manner known to law Decided against Assessee.

Summary

Issues:
Appeals against orders of penalty u/s 271FA of the Income Tax Act before the ITAT Cochin.

Analysis:
The judgment addresses the issue of the maintainability of appeals against orders of penalty u/s 271FA of the Income Tax Act before the ITAT Cochin. The Tribunal observed that the provisions of section 253 of the Act do not specifically mention the order passed by the Director of Income Tax (Intelligence) levying penalty u/s 271FA as appealable before the Tribunal. The Tribunal emphasized that it cannot go beyond the provisions of the Act and entertain appeals unless specifically provided for by the legislature. The Tribunal highlighted that consent or direction from the authority does not confer jurisdiction unless provided for by law. It noted that while section 246A(q) allows appeals against orders imposing penalties under Chapter XXI, including section 271FA, the appeal before the CIT(A) may not be an effective remedy. However, the Tribunal reiterated that it cannot entertain appeals solely based on the ineffectiveness of other remedies. The Tribunal also pointed out a potential legislative oversight in not amending section 253 to include appeals against penalties u/s 271FA, suggesting that the department could address this omission for future clarity.

The Tribunal further analyzed the relationship between section 271 and section 271FA, emphasizing that section 271FA is a separate and independent section, not a part or branch of section 271. It clarified that sections 271A to 271G are independent sections by themselves and not sub-sections under section 271. The Tribunal concluded that the omission to include section 271FA in section 253 may have been unintended, leaving room for the department to rectify the issue by proposing consequential amendments. Ultimately, the Tribunal dismissed the appeals by the assessee against the orders of penalty u/s 271FA, stating that they were not maintainable before the ITAT Cochin. However, the assessee was granted the liberty to challenge the impugned orders before the appropriate forum following legal procedures. The appeals were officially dismissed, and the order was pronounced in open court on the 29th of July 2013.