2008 (4) TMI 213 - HC - Income Tax

Whether ITAT is right in deleting addition by quashing the assessment made under Section 143 (3) read with Section 147 - impugned order dated 19.1.2006, passed by the ITAT is set aside and the matter is remanded to the Tribunal to consider the matter afresh in the light of the amendment inserted in section 148 of the Income Tax Act by the Finance Act, 2006 with retrospective effect from 1.10.1991, as well as on merits, in accordance with law

Summary

Issues:
Appeal under Section 260-A of the Income Tax Act against the order dated 19.1.2006 by the Income Tax Appellate Tribunal for the assessment year 1994-95.

Analysis:

1. Issue: Addition of Rs. 8,05,000 by quashing the assessment under Section 143(3) read with Section 147 of the Income Tax Act.
The court considered whether the ITAT was correct in law in deleting the addition of Rs. 8,05,000 by quashing the assessment made under Section 143(3) read with Section 147 of the Income Tax Act. The court noted that the amendment inserted in section 148 of the Income Tax Act by the Finance Act, 2006 with retrospective effect from 1.10.1991 was not considered when the Tribunal passed the impugned order. Both counsels agreed that the impugned order be set aside and the matter be remitted to the Tribunal to consider the amendment as well as on merits. Consequently, the impugned order was set aside, and the matter was remanded to the Tribunal for fresh consideration in light of the amendment and on merits.

2. Conclusion:
The High Court disposed of the appeal accordingly, setting aside the impugned order and remanding the matter to the Tribunal for reconsideration in view of the amendment inserted in section 148 of the Income Tax Act by the Finance Act, 2006 with retrospective effect from 1.10.1991, as well as on merits.