Zakkariya Raj Sabjan Vs Additional/ Joint/ Deputy/ ACIT (Kerala High Court)
The Kerala High Court dismissed an appeal challenging a judgment that declined to examine the merits of a penalty order passed under Section 271D of the Income Tax Act and instead directed the taxpayer to avail the statutory appellate remedy. The appellant contended that the penalty order was invalid as the essential ingredients of Section 271D were not satisfied, that the authority had failed to properly consider his statement, and that the proceedings were barred by limitation under Section 275 of the Act.
The Revenue submitted that the authority had recorded that the appellant failed to discharge the preliminary onus regarding Section 269SS, thereby justifying initiation of penalty proceedings under Section 271D. The High Court observed that the appellant’s contentions involved disputed questions of fact, including the evaluation of evidence and the applicability of Sections 271D and 275, which were required to be examined by the competent appellate authority under the statutory framework.
Holding that the Single Judge had correctly relegated the appellant to the alternative statutory remedy, the Court declined to interfere with the impugned judgment. However, considering that the appeal had remained pending before the High Court, it granted the appellant an additional three weeks to file the statutory appeal. The Court clarified that all contentions on merits were left open for consideration by the appellate authority.
