Unless and until the order of ITAT is reversed by High Court, the same has to be given due effect – ITAT
In a recent judgment, ITAT has held that judicial discipline demand that unless and until order of the Tribunal is reversed by the High Court, the same has to be given due effect.
ABCAUS Case Law Citation:
ABCAUS 3931 (2024) (04) ITAT
In the instant case, the Revenue had challenged the order passed by the CIT(A) in setting aside the assessment order passed in compliance to order u/s 263 on the ground that the very ITAT order setting aside the PCIT’s order u/s 263 was subjudice before jurisdictional High Court.
In the case under consideration, the Principal Commissioner of Income Tax (PCIT) had passed the order u/s 263 of the Income Tax Act, 1961 (the Act).
The assessee filed the appeal before Income Tax Appellate Tribunal against the order passed by the PCIT u/s 263 of the Act. The ITAT disposed of the said appeal by order in which the revision order passed by the PCIT u/s 263 of the Act had been quashed holding that the assessing officer had taken a reasonable and plausible view, which cannot be branded as erroneous and as the twin conditions as enumerated in section 263 were not fulfilled, the order passed by the PCIT was not sustainable.
The Department filed an appeal before the jurisdictional High Court against the order passed by the ITAT.
Meantime, the CIT(A) by the impugned order deleted addition regarding disallowance of capital gain deduction u/s 54B of the Act made by the assessment order passed in compliance of the said revisionary order u/s 263 of the Act passed by the PCIT.
Against the said order of the CIT(A), the Department filed the instant appeal before the Tribunal to keep the issue alive.
The Revenue argued that Department had filed an appeal before Hon’ble jurisdictional High Court against the order of Tribunal. Therefore, to keep the issue alive, the Department has filed present appeal before the Tribunal. The Revenue stated that interest of the Department should be protected since Department has filed further appeal against the order passed by the Tribunal and therefore till verdict of the Hon’ble jurisdictional High Court, this appeal of Department may be kept alive to protect the interest of Department and for that adjournment for a longer period may be granted to the Department and appeal of the Department should not be dismissed just because order of PCIT, under section 263 of the Act, was quashed by this Tribunal.
On the contrary, the respondent assessee pleaded that if the Department has filed the appeal against the order of Tribunal, before Hon’ble jurisdictional High Court that does not mean that Assessing Officer would not give appeal effect of the order of the Tribunal. The Assessing Officer will not wait till the decision of Hon’ble jurisdictional High Court. If the Hon’ble jurisdictional High Court decides the issue against the assessee, then the Assessing Officer can raise the demand again, by way of giving appeal effect of the decision of Hon’ble
jurisdictional High Court. Therefore, there was no point to entertain this appeal and hence the appeal of Department should be dismissed.
The Tribunal stated that the CIT(A) had rightly stated that since the order passed u/s 263 had been quashed by the Tribunal, therefore, Assessing Officer supposed to give the appeal effect of that order. Therefore, there was no foundation to keep alive the present appeal as order passed u/s 263 has been quashed by this Tribunal.
The Tribunal stated that the Assessing Officer has to follow the judicial disciple to give appeal effect of the order of Tribunal. If the Hon’ble jurisdictional High Court, decides the issue against assessee, then Assessing Office would give appeal effect of the order of the Hon’ble jurisdictional High Court and may again raise th demand on the assessee, if any, as per the finding of Hon’ble jurisdictional High Court.
The Tribunal stated that the mere fact, that further appeal has been filed by the Department, in no way, means that the Tribunal’s order under consideration is not operational and effective. Unless and until the order of the Tribunal is reversed by the Hon`ble High Court, the same has to be given due effect. Judicial discipline demands that once an order has been passed in the assessee’s own case, lower authorities are duty bound to act in accordance with the same.
Therefore, the Tribunal dismissed the appeal of Revenue.
Download Full Judgment ABCAUS 3931 (2024) (04) ITAT >>
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