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2017 (4) TMI 1616 - AT - Income TaxAppeals to the Joint Commissioner (Appeals) and Commissioner (Appeals) - appeal as unadmitted by wrongly invoking the provisions of Sec.249(4) - as per DR assessee has not paid the tax due on the income returned at the time of filing of appeal before the CIT(A) and, therefore, the provisions of Sec.249(4)(a) of the Act have been validly invoked in dismissing the appeal - What is the connotation of the expression return contained in clause (a) of Sec. 249(4) of the Act? - HELD THAT - The requirements of Sec. 249(4) of the Act have to be examined with reference to the tax payable on the income declared in the return filed on 19.11.2009. The rigors of Sec. 249(4)(a) of the Act clearly come into operation and the appeal before the CIT(A) deserved to be treated as unadmitted. It is also axiomatic that so far as the situation contemplated in clause (a) of Sec. 249(4) of the Act is concerned, the CIT(A) is not vested with any power to waive payment of the admitted tax and entertain the appeal in contrast to the situation contemplated in clause (b) to Sec. 249(4). As the defense put up by the appellant is that the non-payment of admitted tax on returned income is a curable defect and once such a defect has been cured, there is enough justification for the appeal being admitted by the CIT(A). Since the assessee has claimed that it has paid tax on the returned income before passing of order by the CIT(A), in our view, it will be in the fitness of things that the matter is remitted back to the file of CIT(A) to be considered afresh. Assessee has made a tabulation showing payment of tax on various dates and also challans evidencing the payment of admitted tax. We deem it fit and proper to remit the matter back to the file of CIT(A) who shall verify whether the entire admitted tax has been paid and if it is so found, he shall proceed to decide the various Grounds raised by the assessee on merits.
Issues Involved:
1. Justification of considering ?11,34,710 as explained by the assessee. 2. Deletion of addition on account of deemed rent from Janjira Bungalow and flat in White Tower. 3. Restriction of addition on account of unexplained investment in Janjira Bungalow. 4. Deletion of addition on account of unexplained investment in flat no. 202 Shabnam Apartment. 5. Compliance with CBDT Circular No. 21/2015 regarding monetary limits for filing appeals. 6. Dismissal of appeal due to non-payment of tax as per income returned. 7. Classification of rent on hire of Madh bungalow. 8. Addition on account of low withdrawals. 9. Addition on account of unsecured loan. 10. Addition on account of deemed rent of residential flats. Detailed Analysis: 1. Justification of considering ?11,34,710 as explained by the assessee: The Revenue questioned whether the CIT(A) was justified in directing the AO to consider ?11,34,710 as explained by the assessee's disclosure when this amount was not reflected in the assessee's books against the Bunch Berry flat and was not explained in the capital account and balance sheet filed along with the return of income for the year. 2. Deletion of addition on account of deemed rent from Janjira Bungalow and flat in White Tower: The Revenue contended that the CIT(A) erred in deleting the addition made on account of deemed rent from Janjira Bungalow and flat in White Tower without appreciating that section 23(2)(b) would not be applicable as the assessee owns more than one house property. 3. Restriction of addition on account of unexplained investment in Janjira Bungalow: The CIT(A) restricted the addition made on account of unexplained investment in Janjira Bungalow from ?20 lacs to ?17 lacs, ignoring the statement made by the assessee during the search. The Revenue argued that the CIT(A) should have remanded the matter to the AO for getting the investment valued by a Government valuer. 4. Deletion of addition on account of unexplained investment in flat no. 202 Shabnam Apartment: The CIT(A) held that the investment in flat 202 Shabnam Apartment was made by the firm M/s Sarang Associates and not by the assessee, thus deleting the addition of ?20,50,000. The Revenue contended that the investment was made in the name of the individual and not the firm. 5. Compliance with CBDT Circular No. 21/2015 regarding monetary limits for filing appeals: The CBDT Circular No. 21/2015 revised the monetary limits for filing appeals by the Department before the Tribunal retrospectively. The tax effect in dispute in the three appeals was below the monetary limit of ?10 lacs specified in the Circular. The Departmental Representative did not bring any material to suggest that the appeals were protected by any circumstances prescribed in Para-8 of the Circular. 6. Dismissal of appeal due to non-payment of tax as per income returned: The CIT(A) dismissed the appeal as unadmitted by invoking the provisions of Sec. 249(4) of the Act because the assessee had not paid the tax on the income of ?6,32,11,810 declared in the revised return filed on 12.11.2010. The assessee argued that the revised return was non-est in the eyes of law as it was not a valid return within the meaning of Sec. 139(5) of the Act. The Tribunal found justification in the assessee's plea and remitted the matter back to the CIT(A) to verify whether the entire admitted tax had been paid. 7. Classification of rent on hire of Madh bungalow: The assessee argued that the CIT(A) erred in not considering the rent on hire of Madh bungalow of ?800000 as 'Income from house property'. This issue was remitted back to the CIT(A) for fresh adjudication. 8. Addition on account of low withdrawals: The CIT(A) confirmed an addition of ?480000 on account of low withdrawals. This issue was also remitted back to the CIT(A) for fresh adjudication. 9. Addition on account of unsecured loan: The CIT(A) confirmed an addition of ?7993024 u/s 68 of the Income Tax Act on account of an unsecured loan. This issue was remitted back to the CIT(A) for fresh adjudication. 10. Addition on account of deemed rent of residential flats: The CIT(A) confirmed an addition of ?664000 as deemed rent of residential flats. This issue was remitted back to the CIT(A) for fresh adjudication. Conclusion: The Tribunal dismissed the three appeals filed by the Revenue as withdrawn/not pressed due to non-compliance with the CBDT Circular No. 21/2015. The appeals filed by the assessee for Assessment Years 2008-09 and 2009-10 were partly allowed for statistical purposes, with the matters remitted back to the CIT(A) for fresh adjudication on merits. The Tribunal emphasized that the CIT(A) should verify the payment of the entire admitted tax and proceed to decide the various grounds raised by the assessee on merits, allowing a reasonable opportunity of being heard.
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