Delhi High Court - Orders
Pr Commissioner Of Income Tax, ... vs Sh. Shyam Sunder Jindal on 26 March, 2021
Author: Rajiv Shakdher
Bench: Rajiv Shakdher, Talwant Singh
$~10,13,14,15
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 104/2021 & CM No.12299/2021
PR COMMISSIONER OF INCOME TAX, CENTRAL-3
....Appellant
Through : Ms. Vibhooti Malhotra, Advocate.
versus
SH. SHYAM SUNDER JINDAL ..... Respondent
Through : Mr. Rohit Jain and Mr. Aniket D.
Agrawal, Advs.
ITA 107/2021 & CM APPL. 12301/2021
PR COMMISSIONER OF INCOME TAX, CENTRAL-3
....Appellant
Through : Ms. Vibhooti Malhotra, Advocate.
versus
SH. SHYAM SUNDER JINDAL ..... Respondent
Through : Mr. Rohit Jain and Mr. Aniket D.
Agrawal, Advs.
ITA 108/2021 & CM APPL. 12388/2021
PRINCIPAL COMMISSIONER OF INCOME TAX - CIRCLE-3
..... Appellant
Through : Ms. Vibhooti Malhotra, Advocate.
versus
SH. SHYAM SUNDER JINDAL ..... Respondent
Through : Mr. Rohit Jain and Mr. Aniket D.
Agrawal, Advs.
ITA 104/2021 & connected matters page 1 of 5
Signature Not Verified
Digitally Signed
By:VIPIN KUMAR RAI
Signing Date:04.04.2021
00:53:10
ITA 109/2021 & CM APPL. 12394/2021
PR COMMISSIONER OF INCOME TAX, CENTRAL-3
....Appellant
Through : Ms. Vibhooti Malhotra, Advocate.
versus
SH. SHYAM SUNDER JINDAL ..... Respondent
Through : Mr. Rohit Jain and Mr. Aniket D.
Agrawal, Advs.
CORAM:
HON'BLE MR. JUSTICE RAJIV SHAKDHER
HON'BLE MR. JUSTICE TALWANT SINGH
ORDER
% 26.03.2021 CM No.12299/2021 in ITA 104/2021 CM No.12301/2021 in ITA 107/2021 CM No.12388/2021 in ITA 108/2021 CM No.12394/2021 in ITA 109/2021
1. Allowed, subject to just exceptions.
ITA Nos.104/2021, 107/2021, 108/2021 & 109/2021
2. Issue notice to the respondent-assessee.
3. Mr. Rohit Jain accepts service on behalf of the respondent-assessee.
4. The captioned appeals have been filed by the revenue. Via these appeals, challenge is laid to the common order dated 20.12.2019 passed by the Income Tax Appellate Tribunal (in short „Tribunal‟) in exercise of its powers under Section 254(2) of the Income Tax Act, 1961. The order concerns the assessment years (in short AYs) 2008-2009 to 2011-2012.
5. The record shows that the Tribunal, in an earlier round, had dealt with ITA 104/2021 & connected matters page 2 of 5 Signature Not Verified Digitally Signed By:VIPIN KUMAR RAI Signing Date:04.04.2021 00:53:10 the AYs 2007-2008 to 2011-2012. These were the appeals which had been filed by the assessee.
5.1. The Tribunal while passing an order dated 03.09.2019, in the said appeals, dealt with the issue as to whether or not the assessee had maintained a foreign bank account with the Hongkong and Shanghai Banking Corporation Limited, Geneva, Switzerland (in short „HSBC‟). The Tribunal, after perusing the record and granting hearing to learned counsels for the parties, remanded the issue for fresh consideration by the assessing officer. To be noted, this issue arose only in AYs 2006-2007 and 2007-2008. 5.2. The other issue which the assessee had raised, and concerned addition of 4% notional interest vis-à-vis the credits found in the said account said to be maintained by the assessee, was not adjudicated upon by the Tribunal.
6. It is in this background that a rectification application was filed by the assessee which was disposed of by the Tribunal via the impugned order dated 20.12.2019.
7. Ms. Vibhooti Malhotra, who appears on behalf of the revenue, says that the Tribunal ought not to have reversed, albeit partially, its order dated 03.09.2019 concerning notional interest in exercise of powers under Section 254(2) of the Act as this was not an error apparent on the face of the record. 7.1. Mr. Rohit Jain, who appears on behalf of the assessee, contends to the contrary.
8. We have perused the order of the Tribunal which is indicative of the fact that the issue regarding notional interest was not the subject matter of assessment year 2007-2008. This issue arose only in AYs 2008-2009 to 2011-2012.
ITA 104/2021 & connected matters page 3 of 5 Signature Not Verified Digitally Signed By:VIPIN KUMAR RAI Signing Date:04.04.2021 00:53:10
9. The Tribunal, therefore, took a view that since it had not ruled on this aspect of the matter, the direction concerning remand could not apply to the said issue. It is on this basis that the rectification application was allowed and the matter was decided on merits. On merits, the Tribunal ruled in favour of the assessee by applying its own decision in the case of Krishna Kumar Modi dated 05.07.2019 passed in ITA No.2892/Del/2017. The Tribunal was of the view that since no material was available on record as to the interest received by the assessee, the same could not be added to his taxable income, albeit, on a notional basis. Based on this rationale, the issue with regard to the notional interest was decided in favour of the assessee. 9.1. It is in this backdrop that the revenue has suggested the following substantial questions of law for our consideration:
"A. Whether on facts and in the circumstances of the case and also on the prevailing law, Hon'ble ITAT has exceeded its power of rectification under Section 254(2) of the Act by means of the impugned order, when the issue had been remanded to the file of the AO by the Hon'ble ITAT vide its order dated 03.09.2019.
B. Whether on facts and in the circumstances of the case and also on the prevailing law, Hon'ble ITAT was legally justified in holding the interest income added by the AO as notional whereas the outstanding balance in HSBC account was interest bearing and there was no materials before Ld. ITAT to hold such interest as notional."
10. Having regard to our discussion above, in our opinion, the Tribunal exercised its powers, correctly, under Section 254(2) of the Act. Since the issue regarding notional interest is not adverted to in the order dated 03.09.2019, they were entitled to recall the order qua the said issue.
ITA 104/2021 & connected matters page 4 of 5 Signature Not Verified Digitally Signed By:VIPIN KUMAR RAI Signing Date:04.04.2021 00:53:10
11. Therefore, in our view, the first question of law does not arise for our consideration. The prayer made, in that behalf, is declined.
12. Insofar as the second question of law is concerned, we will consider the same along with assessee‟s appeal i.e. ITA No.612/2017 whereby the direction of remand qua the existence of the bank deposits has been assailed. This appeal, i.e. ITA No.612/2017, we are told, was admitted by this Court vide order dated 13.11.2017 which was corrected on 01.08.2019. 12.1. We are told by Mr. Rohit Jain that the said appeal is listed in the category of „Regulars‟.
13. Accordingly, list the captioned appeal on 05.08.2021 along with ITA No.612/2017.
RAJIV SHAKDHER, J TALWANT SINGH, J MARCH 26, 2021 aj Click here to check corrigendum, if any ITA 104/2021 & connected matters page 5 of 5 Signature Not Verified Digitally Signed By:VIPIN KUMAR RAI Signing Date:04.04.2021 00:53:10