This legal case delves into the intricacies of the Revenue’s appeal in a tax penalty matter, addressing the interpretation of CBDT Circular No.21 of 2015. The High Court’s detailed legal analysis provides insights into the maintainability of the appeal, focusing on the nuances of the tax law and judicial interpretation. The court’s examination of the appeal sheds light on the complexities surrounding tax penalties and the application of pertinent circulars. This summary highlights the key legal aspects of the case, emphasizing the court’s thorough analysis of the revenue’s appeal and the impact of the CBDT Circular.
Facts
- The appellant is aggrieved by the judgment and order passed by the High Court of Judicature for Rajasthan.
- The High Court allowed the appeal by the Revenue and set aside the order passed by the Income Tax Appellate Tribunal (ITAT) which had deleted the penalty under Section 271(1)(c) of the Income Tax Act.
- The appellant contends that the appeal by the Revenue was not maintainable in view of CBDT Circular No.21 of 2015 dated 10.12.2015.
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Analysis
- The Revenue challenged a penalty amount of Rs. 29,02,743 before the Tribunal and High Court.
- The penalty was later reduced to approximately Rs. 6 lakhs by the CIT(A), leading to a subsequent demand notice.
- The appellant argued that the appeal by the Revenue before the High Court was not maintainable due to the reduced penalty amount and the CBDT Circular limiting appeals based on tax effect.
- The High Court addressed this argument in paragraph 17 of the judgment, emphasizing that the original penalty amount was the subject of challenge and not the reduced penalty.
- Both the Revenue and the appellant contested the penalty amount before the Tribunal and High Court, amounting to Rs. 29,02,743.
- The Additional Commissioner of Income Tax’s approval for the penalty under Section 271(1)(c) was deemed valid based on the definitions in the Income Tax Act.
- The High Court’s view is in complete agreement with
- The appeal by the Revenue challenging the ITAT’s order was found to be maintainable
- The CBDT circular dated 10.12.2015 does not make the appeal invalid
- There is no substance in the present appeal and it is dismissed accordingly
- No costs are awarded
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Case Title: LATE GYAN CHAND JAIN THR LR. MANISH KUMAR JAIN Vs. COMMISSIONER OF INCOME TAX I (2022 INSC 435)
Case Number: C.A. No.-002704-002704 / 2022
