Pr. Commissioner of Income Tax 6 v. Nokia India Pvt. Ltd.
ABHAY MANOHAR SAPRE, J.
1. Leave granted.
2. This appeal is filed against the final judgment and order dated
21.04.2017 passed by the High Court of Delhi at New Delhi in IT A
No.854 of 2016 whereby the Division Bench of the High Court dismissed
the appeal filed by the appellant herein.
3. A few facts need mention hereinbelow for the disposal of this
appeal, which involves a short point.
4. By impugned order, the Division Bench of the High Court
dismissed the Revenue’s (appellant herein) appeal filed under Section
260-A of the Income Tax Act, 1961 (hereinafter referred to as “the
Act”) on the ground that it did not involve any substantial question of
law within the meaning of Section 260-A of the Act.
5. In other words, the High Court was of the view that since the
appeal did not involve any substantial question of law, it deserves dismissal
in limine .
6. The appellant is the Revenue (Commissioner of Income Tax)
and the respondent is an assessee. The issue arises out of an assessment
year (1999-2000).
7. The issue essentially relates to legality and correctness of the
notice issued by the Assessing Officer (AO) to the respon dent under
Section 148 of the Act and to the consequential determination made by
the AO in the assessment order for which the impugned notice was
issued to the respondent.
PR. COMMISSIONER OF INCOME TAX 6 v. NOKIA INDIA
PVT. LTD.
8. The objections raised by the respondent (assessee) to the notice
contending inter alia that since the impugned notice was based on
“change of the opinion” and hence bad in law was upheld by the ITAT
resulting in allowing the respondent’s appeal and further by dismissing
the Revenue’s appeal by the High Court. The Revenue has felt aggrieved
by the order of the High Court dismissing their appeal in limine and has
filed the present appeal by way of special leave in this Court.
9. The short question, which arises for consideration in this appeal,
is whether the High Court was right in dismissing the Revenue’s appeal
in limine holding that it did not involve any substantial question of law.
10. Having heard the learned counsel for the parties and on perusal
of the record of the case, we are of the view that the High Court was
not justified in dismissing the appeal on the ground that the appeal did not
involve any substantial question of law. We are, therefore, constrained
to allow this appeal, set aside the impugned order and remand the case
to the High Court for deciding the appellant’s appeal afresh on merits in
accordance with law.
11. In our considered view, the following substantial questions of
law do arise in this appeal filed by the Revenue (appellant herein) under
Section 260-A of the Act in the High Court against the order d ated
03.06.2016 passed by the ITAT in Appeal No. 1870/DEL/2010 and the
same should have been framed by the High Court for deciding the appeal
on merits in accordance with law:
1. Whether the ITAT was justified in holding that the notice
issued by the AO under Section 148 was bad in law when
admittedly the impugned notice was issued in the case where
the assessment was made under Section 143(1) of the Act
but not under Section 143(3) of the Act.
2. Whether the ITAT was justified in holding that the notice
issued under Section 148 of the Act was bad because it w as
based on mere change of opinion by overlooking the fact
that there was no foundation to form any such opinion.
3 When admittedly the notice in question satisfied the
requirements of Section 148 of the Act as it stood, namely ,
that first, it contained the facts constituting the “reasons
to believe” and second, it furnished the necessary de tails
481
for assessing the escaped income of the assessee, wheth er
the ITAT was still justified in declaring the notice as being
bad in law without taking into consideration any of the se
admitted facts.
4. In case, if the notice is held proper and legal, whe ther
the finding recorded by the ITAT on the merits of the c ase
on each item, which is subject matter of the notice, is legally
sustainable.
12. In our considered view, the aforementioned four questions
framed need to be answered by the High Court on their respective merits
while deciding the appeal filed by the Revenue (appellant herein) under
Section 260-A of the Act.
13. We are, therefore, of the view that such order is not lega lly
sustainable in law and hence deserves to be set aside.
14. In view of the foregoing discussion, the appeal succeeds and
is accordingly allowed. The impugned order is set aside. The c ase is
remanded to the High Court for answering the aforementioned questions
on merits in accordance with law.
15. Since we have formed an opinion to remand the case to the
High Court for its fresh disposal on merits, we have not expressed any
opinion on the merits of the case while deciding this appeal. The High
Court will, therefore, decide the appeal uninfluenced by any observation
made by this Court in this order.
Ankit Gyan Appeal allowed.
PR. COMMISSIONER OF INCOME TAX 6 v. NOKIA INDIA
PVT. LTD. [ABHAY MANOHAR SAPRE, J.]