2022 (10) TMI 1145 - SCH - Income Tax

Validity of order u/s 201 - HELD THAT - As submitted notice under Section 201 was issued much prior to the ITAT decided against the Department which was for the AY 2014-2015 2018 (6) TMI 1107 - ITAT MUMBAI . It is submitted that the appeal against the final decision of the ITAT for AY 2014-2015 is pending before the High Court. It is submitted that even the judgment for AY 2010-2011 which is followed subsequently while deciding the dispute for AY 2014-2015 is also pending before this Court. It is submitted that even in a case the Department succeeds before the High Court in an appeal for AY 2014-2015 in that case also subsequently there may be dispute with respect to limitation. It is submitted that therefore the proper course for the High Court would have been to club the writ petition(s) to be heard with the pending appeal against the final decision of the ITAT for AY 2014-2015 so that the dispute with respect to limitation may not arise subsequently. Issue notice for the aforesaid purpose making it returnable on 25.11.2022. Dasti in addition is also permitted. The respondent be served within a period of one week from today.

Summary

Issues: Delay in issuing notice under Section 201 of the Income Tax Act, 1961; Pending appeal before High Court for AY 2014-2015; Clubbing writ petitions with pending appeal.

In the present case, the main issue addressed by the Supreme Court was the delay in issuing a notice under Section 201 of the Income Tax Act, 1961. The petitioner argued that the notice was issued much before the ITAT decided against the Department for the Assessment Year (AY) 2014-2015. The petitioner further contended that the appeal against the ITAT's decision for AY 2014-2015 is pending before the High Court. Additionally, the judgment for AY 2010-2011, which was relied upon in deciding the dispute for AY 2014-2015, is also pending before the Supreme Court. The petitioner raised concerns that even if the Department succeeds in the appeal for AY 2014-2015, there might be a subsequent dispute regarding limitation. Therefore, the petitioner suggested that the High Court should have clubbed the writ petition(s) with the pending appeal to avoid potential issues related to limitation in the future.

Regarding the procedural aspect, the Supreme Court ordered the issuance of notice for the purpose of clubbing the writ petitions with the pending appeal against the final decision of the ITAT for AY 2014-2015. The notice was made returnable on a specified date, and Dasti, in addition, was also permitted. The Court further directed that the respondent should be served within a week from the date of the order. This procedural step was taken to ensure that the matters related to the pending appeal and the writ petitions are effectively consolidated and heard together to prevent any future disputes arising from potential issues with respect to limitation.