FB 2018 – S.253 Appeal before Tribunal-proposed amendment should be w.e.f. 01.04.2017 the day when S.271J became effective empowering CIT(A) to impose penalty

[CA DEV KUMAR KOTHARI]

Relevant links and references:

Section 271J – Penalty for furnishing incorrect information in report or certificate

 Levy of penalty:

Penalty for furnishing incorrect information in report or certificate u.s. Section 271J can be levied  by the AO and also CIT(A).

This section falls under Chapter XXI, and as per S.246A (1) (q) any order imposing a penalty under Chapter XXI is appealable before CIT(A). Such orders of penalty are usually passed by AO.

However, in  some cases like  s.271J,  penalty can also be levied by CIT(A).

Appeal against order of CIT(A) is to be filed before a higher forum that is Tribunal. In provision so S. 253 appealable orders of CIT(A) are also mentioned.

S. 271 J was inserted w.e.f. 01.04.2017 by the FA 2017. At that time S. 253 was not amended though it should have been amended as a consequence of CIT(A) being empowered to levy penalty.

Therefore there was a drafting mistake of nature of omission.

This omission is being rectified by amendment. However, the amendment is proposed to be made effective from 01.04 2018

As this amendment is to remove omission, it is desirable that the amendment should also be specifically made applicable from 01.04.2017 to remove hardship and to avoid disputes on this issue.

Other provisions of similar nature should also be reviewed and amendment should be made, if required.

From THE FINANCE BILL, 2018

50. Amendment of section 253.

In section 253 of the Income-tax Act, in sub-section (1), in clause (a), after the word, figures and letter “section 271A”, the word, figures and letter “, section 271J” shall be inserted.

 From Notes on clauses:

Clause 50 of the Bill seeks to amend section 253 of the Income-tax Act relating to appeals to

the Appellate Tribunal.

Sub-section (1) of the said section provides that any assessee aggrieved by any of the orders mentioned therein may appeal to the Appellate Tribunal.

It is proposed to amend clause (a) of the said sub-section so as to make an order passed by a Commissioner (Appeals) under section 271J also appealable to the Appellate Tribunal.   This amendment will take effect from 1st April, 2018.

 

From explanatory memorandum:

Appeal against penalty imposed by Commissioner (Appeals) under section 271J.

Section 253 of the Act inter-alia provides that any assessee aggrieved by any of the orders mentioned in sub-section (1) of the said section may appeal to the Appellate Tribunal against such order.

It is proposed to amend clause (a) of the said sub-section so as to also make an order passed by a Commissioner (Appeals) under section 271J appealable before the Appellate Tribunal.

This amendment will take effect from 1st April, 2018.

[Clause 50]