Case Law Details
Bhavesh Ghanshyam Advani Vs CIT (ITAT Mumbai)
ITAT Mumbai held that order of Commissioner passed under section 119(2)(b) of the Income Tax Act is not appelable before the ITAT. Such order can either be appealed directly to the Sectary, CBDT or can be challenged before High Court.
Facts- The assessee filed an application before Commissioner of Income Tax (International Taxation)-1, seeking condonation of delay in filing tax returns for Assessment Years (AY) 2011-12 and 2012-13. After receipt of the application by assessee, a report was called from ITO. In his application assessee has mentioned that the taxes were already deducted and paid by way of TDS from the concerned parties, but he did not receive the TDS certificates even after chasing them multiple times over a period of two years or more.
To this effect, copies of correspondence through email have been filed and it is claimed that the delay in filing of return has been attributed to the same. In this background, the applicant has requested for condonation of delay in filing the tax return and consequential claim of refunds against TDS for AYs. 2011-12 and 2012-13.
AO noticed that from the perusal of ITS data it was noted that the claim of assessee for refund and the amount of returned income is correct. He has further mentioned that the deductor has paid the TDS into the government account and the same was duly reflected in assessee’s 26AS form. In such view of the matter, the Assessing Officer has not recommended for condonation of delay.
Commissioner of Income Tax (International Taxation)-1, Mumbai, based on the report of the AO, held that it is not considered desirable or expedient to admit the claim of applicant within the meaning of section 119(2)(b) of the Income Tax Act, 1961. Accordingly, the applicant’s request for condonation of delay was rejected.
Conclusion- In our considered view, we found the contentions of the Revenue tenable that no appeal against the order passed under section 119(2)(b) can be heard by ITAT , if any assessee files such appeal before the ITAT against the order of Commissioner passed under section 119(2)(b) is not admissible and even if admitted, ITAT is not empowered by virtue of section 253 of the Act to decide the matter.
We further observed against such type of orders i.e. order passed under section 119(2)(b) can be appealed directly to the Secretary, CBDT or can be challenged through Writ before the Hon’ble Jurisdictional High Court. In view of above earlier order passed by ITAT is beyond its Jurisdiction.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
These appeals by the assessee are directed against the order of Commissioner of Income Tax (International Taxation)-1, Mumbai [hereinafter referred to as (‘CIT)] vide common order dated 14.06.2017 for the Assessment Years (AY) 2011-12 & 2012-13 respectively. The assessee has raised similar grounds of appeal in both the AYs. Firstly, we are taking ITA No. 5808/Mum/2017 for A.Y. 2011-12 as lead case. The assessee has raised the following grounds of appeal:
“1. The assessee prays before Your Honour to allow the Condonation of delay application dated 22.09.2016 as filed by the assessee before the Learned Commissioner of income Tax (Intl. Taxation)-1, which has been rejected by the Learned Commissioner of income Tax (Intl. Taxation)-1, there-by providing relief to the aggrieved assessee.”
2. Brief facts of the case are that the assessee filed an application before Commissioner of Income Tax (International Taxation)-1, Mumbai dated 22.09.2016 seeking condonation of delay in filing tax returns for A.Ys. 2011-12 and 2012-13. After receipt of the application by assessee, a report was called from ITO (IT)-1(1)(1)/Mumbai. In his application assessee has mentioned that the taxes were already deducted and paid by way of TDS from the concerned parties, but he did not receive the TDS certificates even after chasing them multiple times over a period of two years or more. To this effect, copies of correspondence through email have been filed and it is claimed that the delay in filing of return has been attributed to the same. In this background, the applicant has requested for condonation of delay in filing the tax return and consequential claim of refunds against TDS for A.Ys. 2011-12 and 2012-13.
3. The Assessing Officer, in his report, has mentioned that the assessee has e-filed return of income for A.Y. 2011-12 and 2012-13 on 29.01.2015 and as per the CBDT Circular No. 9 of 2015 dated 09.06.2015, the instant application for condonation of delay is within the prescribed time limit, and that from the perusal of ITS data it was noted that the claim of assessee for refund and the amount of returned income is correct. He has further mentioned that the deductor has paid the TDS into the government account on 13.09.2011 and the same was duly reflected in assessee’s 26AS form. Accordingly, the applicant could have filed the return of income before 31.03 2013 for A. Yr. 2011-12 and before 31.03.2014 for A Yr. 2012-13 as per law, but has failed to do so. The Assessing Officer has also mentioned that the facility of e-filing the return of income was in existence since F. Yr. 2006-07, which could have been used for filing the return of income even if the applicant resides outside India, and accordingly, it can be concluded that there is no case made out of genuine hardship on merits in this case. In such view of the matter, the Assessing Officer has not recommended for condonation of delay. In the forwarding note the Jt.CIT concerned has concurred with the opinion of the Assessing Officer.
4. Commissioner of Income Tax (International Taxation)-1, Mumbai, based on the report of the AO and concurrent opinion of the concerned JCIT held as under:
“It is seen from the facts of the case that though the applicant has entered into few email exchanges with the deductor to obtain TDS Certificate, but obtaining of such certificates and possession of the same by the applicant was neither required as per procedure nor as per law to file the return of income within time. It is further seen from the facts of the case that a letter bearing No. NMS2/ASHPA4344A/6311816 dated 18.12.2014 was issued to the applicant by the Compliance Management Cell of the Income Tax Department, New Delhi. In this letter it was informed to the applicant that as per the information received by the department, certain financial transactions / activities were undertaken by him, details of which were provided in the said letter and that as per the department, the applicant did not appear to have filed income tax returns for 2011-12 as well as for A. Yr. 2012-13. It was only after this letter that his return for A.Ys. 2011-12 and 2012-13 on 29.01.2015. During n of delay was also explained as being not aware of the received letter from the department. The applicant actions/activities and has been generating income in India against which the tax was being deducted on the income generated u/s 195 of the Act. Further, such tax deducted were duly deposited in the government account by the deductor and were reflected in applicant’s annual tax statement u/s. 203AA of the IT Act, 1961 in the shape of Form 26AS. Despite such facts, the applicant, in disregard to his legal obligation, has not filed the return of income within the due time and till such time when such default was intimated to him by the department. Further, the applicant has not demonstrated any hardship having been caused to him or any other bonafide reason which may have resulted in delay in filing the return. Under such facts and circumstances of the case, it is not considered desirable or expedient to admit the claim of applicant within the meaning of section 119(2)(b) of the I.T. Act, 1961, and accordingly, the applicant’s request for condonation of delay is rejected”
5. Against this rejection of application, assessee moved an appeal before the ITAT, B, Bench for both the years vide Appeal No. 5808 & 5809/Mum/2017. ITAT in its order dated 10.09.2018 allowed the appeal of the assessee for statistical purposes and condoned the delay with a direction to the concerned Commissioner for fresh adjudication in accordance with law.
6. Against this order of ITAT, Revenue filed Miscellaneous Application (M.A.) vide M.A. No. 126/Mum/2019 under section 254(2) of the Act. In its M.A., Department raised the ground that order passed under section 119(2)(b) of the Act is not appealable before ITAT. They further objected the jurisdiction of the ITAT in terms of remedy against order passed under section 119(2)(b). Section 253 deals with the types of order passed, which can be appealed before ITAT, order under section 119(2)(b) does not fall in that category.
7. M.A. filed was allowed in favour of Revenue and matters recalled vide M.A. No. 125-126/Mum/2019 dated 21.02.2022.
8. We have gone through the order of ITAT in ITA No. 5808 & 5809/Mum/2017 for A.Ys. 2011-12 and 2012-13 dated 10.09.2018. We further referred M.A. No. 125 & 126/Mum/2019 dated 21.02.2022 for A.Ys. 2011-12 & 2012-13. For sake of clarity, we are reproducing here-in-below the relevant extracts of section 253 of the Act:
253. (1) Any assessee aggrieved by any of the following orders may appeal to the Appellate Tribunal against such order—
(a) an order passed by a [Deputy Commissioner (Appeals)][before the 1st day of October, 1998] [or, as the case may be, a Commissioner (Appeals)] under [***] [section 154], [***] section 250,[section 270A,][section 271, section 271A [,section 271J] or section 272A]; or
[(b) an order passed by an Assessing Officer under clause (c) of section 158BC, in respect of search initiated under section 132 or books of account, other documents or any assets requisitioned under section 132A, after the 30th day of June, 1995, but before the 1st day of January, 1997; or]
[(ba) an order passed by an Assessing Officer under sub-section (1) of section 115VZC; or]
(c) an order passed by a [Principal Commissioner or] Commissioner [under section 12AA or section 12AB] [or under clause (vi) of sub-section (5) of section 80G] or under section 263 [or under section 270A] [or under section 271] [or under section 272A] [***] or an order passed by him under section 154 amending his order under section 263] [or an order passed by a [Principal Chief Commissioner or] Chief Commissioner or a [Principal Director General or] Director General or a [Principal Director or] Director under section 272A; [or]]
[(d) an order passed by an Assessing Officer under sub-section (3), of section 143 or section 147 [or section 153A or section 153C] in pursuance of the directions of the Dispute Resolution Panel or an order passed under section 154 in respect of such order;]
(e) an order passed by an Assessing Officer under sub-section (3) of section 143 or section 147 or section 153A or section 153C with the approval of the [Principal Commissioner or] Commissioner as referred to in sub-section (12) of section 144BA or an order passed under section 154 or section 155 in respect of such order;]
(f) an order passed by the prescribed authority under [sub-clause (iv) or sub-clause (v) or] sub-clause (vi) or sub-clause (via) of clause (23C) of section 10.]
(2) The [Principal Commissioner or] Commissioner may, if he objects to any order passed by a [Deputy Commissioner (Appeals)] before the 1st day of October, 1998] [or, as the case may be, a Commissioner (Appeals)] under [section 154 or] section 250, direct the [Assessing] Officer to appeal to the Appellate Tribunal against the order.
(2A) [***]
Every appeal under sub-section (1) or sub-section (2) shall be filed within sixty days of the date on which the order sought to be appealed against is communicated to the assessee or to the [Principal Commissioner or] Commissioner, as the case may be :
[Provided that in respect of any appeal under clause (b) of sub-section (1), this sub-section shall have effect as if for the words “sixty days”, the words “thirty days” had been substituted.]
(3A) [***]
[(4) The Assessing Officer or the assessee, as the case may be, on receipt of notice that an appeal against the order of the Commissioner (Appeals), has been preferred under subsection (1) or sub-section (2) by the other party, may, notwithstanding that he may not have appealed against such order or any part thereof, within thirty days of the receipt of the notice, file a memorandum of cross-objections, verified in the prescribed manner, against any part of the order of the Commissioner (Appeals), and such memorandum shall be disposed of by the Appellate Tribunal as if it were an appeal presented within the time specified in subsection (3).]
(5) The Appellate Tribunal may admit an appeal or permit the filing of a memorandum of cross-objections after the expiry of the relevant period referred to in sub-section (3) or subsection (4), if it is satisfied that there was sufficient cause for not presenting it within that period.
[(6) An appeal to the Appellate Tribunal shall be in the prescribed form and shall be verified in the prescribed manner and shall, in the case of an appeal made, on or after the 1st day of October, 1998, irrespective of the date of initiation of the assessment proceedings relating thereto, be accompanied by a fee of,—
(a) where the total income of the assessee as computed by the Assessing Officer, in the case to which the appeal relates, is one hundred thousand rupees or less, five hundred rupees,
(b) where the total income of the assessee, computed as aforesaid, in the case to which the appeal relates is more than one hundred thousand rupees but not more than two hundred thousand rupees, one thousand five hundred rupees,
(c) where the total income of the assessee, computed as aforesaid, in the case to which the appeal relates is more than two hundred thousand rupees, one per cent of the assessed income, subject to a maximum of ten thousand rupees,
[(d) where the subject matter of an appeal relates to any matter, other than those specified in clauses (a), (b) and (c), five hundred rupees:]
[Provided that no fee shall be payable in the case of an appeal referred to in sub-section (2), or, sub-section (2A) as it stood before its amendment by the Finance Act, 2016, or, a memorandum of cross objections referred to in sub-section (4).]
(7) An application for stay of demand shall be accompanied by a fee of five hundred rupees.]
[(8) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of appeal to the Appellate Tribunal under sub-section (2), so as to impart greater efficiency, transparency and accountability by—
(a) optimising utilisation of the resources through economies of scale and functional specialisation;
(b) introducing a team-based mechanism for appeal to the Appellate Tribunal, with dynamic jurisdiction.
(9) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (8), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification:
Provided that no direction shall be issued after the 31st day of March, [2024].
(10) Every notification issued under sub-section (8) and sub-section (9) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.]”
9. We have gone through the earlier order passed by the ITAT, Mumbai, order against M.A. and scope of section 253. In our considered view, we found the contentions of the Revenue tenable that no appeal against the order passed under section 119(2)(b) can be heard by ITAT , if any assessee files such appeal before the ITAT against the order of Commissioner passed under section 119(2)(b) is not admissible and even if admitted, ITAT is not empowered by virtue of section 253 of the Act to decide the matter.
10. We further observed against such type of orders i.e. order passed under section 119(2)(b) can be appealed directly to the Secretary, CBDT or can be challenged through Writ before the Hon’ble Jurisdictional High Court. In view of above earlier order passed by ITAT is beyond its Jurisdiction, hence, appeal of the assessee in ITA No. 5808 & 5809/Mum/2017 is rejected treating the same as infructuous.
11. In the result, appeals filed by the assessee are dismissed.
Order pronounced in the open court on 11th day of October, 2022.
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