PCIT Vs Tetra Pak India Pvt Ltd (Bombay High Court)
The Bombay High Court considered the Revenue’s appeal against the ITAT order dated 24 May 2019 in ITA No. 1609/PUN/2013 concerning A.Y. 2005-06. The ITAT had allowed the assessee’s appeal because the underlying revisional order, pursuant to which a fresh assessment had been framed, had already been set aside by the Tribunal in the assessee’s own case in ITA No. 733/PN/2011. In that earlier proceeding, the Tribunal had held that the Commissioner was not justified in exercising revisionary jurisdiction under Section 263 of the Income Tax Act, 1961.
Consequently, the ITAT held that once the Section 263 revisional order itself had been set aside, the fresh assessment order passed pursuant to that revisional order became invalid and had no independent basis to survive. The Revenue challenged this conclusion before the Bombay High Court and proposed a substantial question of law as to whether the ITAT was justified in invalidating the fresh assessment under Section 143(3) read with Section 263 merely because the underlying revision order had been set aside.
The Revenue informed the High Court that the Tribunal’s earlier order in ITA No. 733/PN/2011, by which the Section 263 order had been set aside, was itself under challenge before the High Court in Income Tax Appeal No. 150 of 2018. That appeal had already been admitted on two substantial questions of law by an order dated 11 August 2022. Considering this position, the High Court found that the Revenue’s first proposed question in the present appeal did give rise to a substantial question of law. The Court accordingly admitted the appeal on that question and directed that it be heard along with Income Tax Appeal No. 150 of 2018 because the outcome of the earlier appeal would have a direct bearing on the present proceedings.
