2018 (9) TMI 1318 - HC - Income Tax

Revision under Section 264 - Held that - Though an exception is taken by the petitioner against the affidavit filed by the Revisional Authority justifying the order, which as per the petitioner is impermissible, as the order under challenge has been passed by the Authority concerned in her capacity of quasi-judicial Authority. Respondents fairly submits that the petitioner/assessee had raised a ground regarding non-service of notice under Sections 148, 142(1) and 144 of 1961 Act, which is not being considered, the Revision has been dismissed on merit. In view of the submissions made on behalf of the respondents, we are of the considered opinion that the matter deserves to be remitted to the Revisional Authority for fresh consideration of the Revision filed by the petitioner dwelling on all the issues raised therein. The impugned order is set aside. The matter is relegated to Principal Commissioner of Income Tax, Gwalior, for reconsideration of Revision preferred by the petitioner. Principal Commissioner of Income Tax, Gwalior, shall, after affording opportunity of hearing, decide the Revision in accordance with law meeting out the contentions raised in the Revision.

Summary

Issues:
Challenge to order dismissing Revision under Section 264 of Income Tax Act, 1961 based on non-service of notices and jurisdictional concerns.

Analysis:
The petitioner challenged an order passed by the Principal Commissioner of Income Tax dismissing the Revision under Section 264 of the Income Tax Act, 1961. The Revision was against the assessment order for the accounting year 2009-10 and a demand order directing a substantial amount to be deposited by the petitioner. The petitioner contended that notices under various sections were not served and that the jurisdiction of the Assistant Commissioner to initiate assessment was questioned. The Revisional Authority dismissed the Revision, stating the petitioner was not entitled to exemption under Section 10(23C)(iiiad) of the Act.

The impugned order highlighted discrepancies in cash deposits, jurisdiction, and commercial nature of fee receipts. The Revisional Authority found the petitioner ineligible for the claimed exemption due to commercial activities and insufficient expenditure. The respondents filed a reply, and the Revisional Authority's affidavit was contested by the petitioner. The court noted that the non-consideration of the non-service of notices issue required the matter to be remitted for fresh consideration by the Revisional Authority, addressing all raised issues.

Consequently, the court set aside the impugned order and remitted the matter to the Principal Commissioner of Income Tax for a reconsideration of the Revision, ensuring all contentions are addressed. The Principal Commissioner was directed to decide the Revision promptly, not exceeding 30 days from the order's communication. The petition was disposed of with no costs incurred.