2020 (12) TMI 992 - HC - Income Tax

Review Application - Penalty u/s 271(1)(c) imposed - non-disclosure of the capital gains - other sufficient reason which would entitle the petitioner/assessee to apply for review of the judgment passed by this Court - HELD THAT - Unless any other sufficient reason is analogous to other two conditions, review cannot be granted. Therefore, the argument of Ms.S.Yogalakshmi, that she seeks to invoke the third limb of order 47 Rule 1(1) CPC is not acceptable, because the third limb has been explained to mean that unless any other sufficient reason is analogous to the other two conditions, viz., excusable failure to bring to the notice of the Court new and important matters or error apparent on the face of the record, a review cannot be entertained. The grounds canvassed in this review application were in fact argued in the appeal and the Court has taken into consideration the arguments and held against the assessee. As rightly pointed out by Ms.K.G.Usha Rani, learned Standing Counsel, the finding of this Court, more particularly, in paragraphs 6 and 12 is a clear answer to the grounds canvassed before this Court in this review application. Thus, in the absence of any grounds made out to exercise review jurisdiction of this Court, this review application has to necessarily fail.

Summary

Issues:
Review application filed under Order 47 Rule 1 read with Section 114 of CPC to review judgment in T.C.A.No.266 of 2018 regarding penalty under Section 271(1)(c) of the Income Tax Act, 1961 for the assessment year 2012-13.

Detailed Analysis:

1. Substantial Questions of Law:
The petitioner/assessee filed a tax case appeal challenging the penalty imposed under Section 271(1)(c) of the Income Tax Act for the assessment year 2012-13. The substantial questions of law included the validity of penalty despite the initiation of proceedings on an invalid show cause notice, sustainability of penalty despite disclosure of transactions in financial statements, and the sustainability of penalty on debatable issues regarding reporting of capital gains.

2. Judgment and Review Application:
The High Court dismissed the tax case appeal on 25.08.2020, upholding the penalty imposed on the petitioner/assessee. The review application was filed seeking the deletion of the penalty based on inadvertence in disclosure and inconsistencies in the orders of the Assessing Officer, CIT(A), and Tribunal.

3. Contentions of the Parties:
The petitioner's counsel argued for the review application, emphasizing inadvertence in disclosure and inconsistencies in penalty orders. The respondent's counsel contended that there were no grounds for reviewing the judgment, citing the Court's previous considerations and findings regarding bonafide actions and concealment of income by the assessee.

4. Grounds for Review Application:
The petitioner's counsel invoked the third limb of Order 47 Rule 1(1) CPC, seeking review based on "any other sufficient reasons." However, the respondent's counsel argued against the acceptance of this ground, citing precedents restricting review to reasons analogous to excusable failure or error apparent on record.

5. Court's Decision and Dismissal:
The Court found that the grounds raised in the review application were previously considered and addressed in the judgment, leading to the dismissal of the review application. The Court emphasized that without new grounds warranting review, the application could not succeed, and no costs were awarded.

In conclusion, the High Court rejected the review application, maintaining the penalty imposed under Section 271(1)(c) of the Income Tax Act for the assessment year 2012-13, based on the findings and considerations made in the initial judgment.