2013 (2) TMI 911 - HC - Income Tax

Summary

Issues involved: Dismissal of writ petitions challenging penalty under s. 271FA of the IT Act, 1961 and availability of alternative remedy through appeal before CIT(A).

The judgment by the Rajasthan High Court pertains to a batch of 3 writ petitions challenging the imposition of penalty under s. 271FA of the IT Act, 1961. The petitioner, a Sub-Registrar, filed the writ petition against the IT Department for imposing a penalty of &8377; 66,400 for delay in furnishing returns as required under s. 285BA(i) of the IT Act, 1961. The petitioner had also previously filed an appeal before the Tribunal, which was dismissed as not maintainable. The respondent, representing the IT Department, argued that as per a Co-ordinate Bench's decision, an appeal against the penalty order under s. 271FA lies before the CIT(A) and not the Tribunal. The Court noted that since an alternative remedy through appeal is available to the petitioner before the CIT(A), it refrained from delving into the merits of the penalty imposition and directed the petitioner to file appeals within one month from the judgment date. The Court emphasized that filing appeals within the specified time frame would not be limited by any objections of limitation, and the CIT(A) was directed to expedite the decision on the appeals.

In the judgment, it was highlighted that the question of appealability of an order passed under s. 271FA of the IT Act, 1961 by an officer holding the rank of CIT was discussed. The Court referred to relevant provisions under Chapter XXI of the Act and noted that appeals against orders of penalty under this chapter are maintainable before the CIT(A). The Court emphasized that the specific provision under s. 253(1)(c) of the Act excludes appeals against penalty orders under ss. 271 and 272A before the CIT(A). Therefore, the Court concluded that an order under s. 271FA is appealable under s. 246A(1)(q) of the Act, and the law as enacted cannot be displaced by interpretative exercises. Additionally, it was noted that the demand notice under s. 156 of the Act informed the assessee about the appealability of the penalty order before the jurisdictional CIT(A).

In conclusion, the Rajasthan High Court dismissed the writ petitions challenging the penalty under s. 271FA of the IT Act, 1961, directing the petitioner, a Sub-Registrar, to avail the alternative remedy of filing appeals before the CIT(A) within one month from the judgment date. The Court stressed that objections of limitation would not hinder the filing of appeals, and the CIT(A) was instructed to promptly decide on the appeals in accordance with the law.