/2022 INSC 0293/
[NON­REPORTABLE]
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.2704 OF 2022
Late Shri Gyan Chand Jain through LR …Appellant
Versus
Commissioner of Income Tax­I       …Respondent
J U D G M E N T
M.R. SHAH, J.
1. Feeling   aggrieved   and   dissatisfied   with   the   impugned
judgment   and   order   dated   29.03.2016   passed   by   the   High
Court   of   Judicature   for   Rajasthan,   Jaipur   in   D.B.   Income
Tax   Appeal   No.33   of   2014   by   which   the   High   Court   has
allowed   the   said   appeal   preferred   by   the   Revenue   and   has
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set   aside   the   order   passed   by   the   Income   Tax   Appellate
Tribunal   (hereinafter   referred   to   as   the   ‘ITAT’)   deleting   the
penalty   under   Section   271(1)(c)   of   the   Income   Tax   Act   (for
short   ‘the   Act’),   the   assessee   has   preferred   the   present
appeal.
2. It is mainly submitted on behalf of the appellant that in
view   of   the   CBDT   (Central   Board   of   Direct   Taxes)   Circular
No.21 of 2015 dated 10.12.2015 the appeal preferred by the
Revenue   was   not   maintainable.     It   is   the   case   on   behalf   of
the appellant that in view of the aforesaid circular no appeal
can be filed by the Department in any High Court, for non­
payment   of   taxes,   where   the   tax   effect   is   less   than
Rs.20,00,000/­.     It   is   the   case   on   behalf   of   the   appellant
that in view of the order passed by the CIT(A) and in view of
the subsequent demand, the penalty amount was reduced to
Rs.6,00,000/­   (approximately)   and   therefore   when   the   tax
effect   would   be   less   than   Rs.20,00,000/­,   in   view   of   the
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CBDT Circular dated 10.12.2015 the appeal preferred by the
Revenue before the High Court was not maintainable.
 
2.1 Learned   counsel   appearing   on   behalf   of   the   appellant
has   also   made   some   submissions   on   merits   on   the
jurisdiction   of   the   Additional   Commissioner   of   Income   Tax.
However   considering   the   definitions   contained   in   Section
2(28C) read with Section 274(2) of the Income Tax Act, ‘Joint
Commissioner’   means   a   person   appointed   to   the   post   of
Joint   Commissioner   of   Income   Tax   and   includes   Additional
Commissioner   of   Income   Tax   and   in   the   present   case   the
approval of the Additional Commissioner of Income Tax was
obtained,   we   see   no   reason   to   interfere   with   the   findings
recorded   by   the  High   Court   on   merits  on   the  powers   of   the
Additional   Commissioner   to   grant   the   approval   sought   by
the   AO   for   imposing   penalty   under   Section   271(1)(c)   of   the
Income Tax Act.
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2.2 Now so far as the primary submission on behalf of the
appellant   assessee   that   as   the   penalty   amount   was
substantially   reduced   to   Rs.6   lakhs   and   even   the
subsequent demand notice was for an amount of Rs.6 lakhs
(approximately)   only   and   therefore   in   view   of   the   CBDT
Circular   dated   10.12.2015   the   tax   effect   being   lower   than
the   permissible   limit   to   prefer   the   appeal   before   the   High
Court   and   therefore   the   appeal   before   the   High   Court   was
not maintainable is concerned, at the outset it is required to
be   noted   that   what   was   assailed   by   the   Revenue   was   the
penalty   amounting   to   Rs.29,02,743/­   and   not   the   penalty
reduced   by   the   CIT(A).     Before   the   Tribunal,   both   the
Revenue, as well as the assessee, preferred the appeals and
the   entire   penalty   amounting   to   Rs.29,02,743/­   was   an
issue   before   the   Tribunal   as   well   as   before   the   High   Court.
The   subsequent   reduction   in   penalty   in   view   of   the
subsequent   order   cannot   oust   the   jurisdiction.     What   is
required   to   be   considered   is   what   was   under   challenge
before the Tribunal as well as the High Court.  At the cost of
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repetition,   it   is   observed   that   what   was   challenged   by   the
Revenue  was  the  penalty  amounting   to  Rs.29,02,743/­  and
not the subsequent reduction of penalty by the CIT(A).   The
aforesaid   aspect   has   been   dealt   with   by   the   High   Court   in
paragraph 17 of the impugned judgment and order.   We are
in   complete   agreement   with   the   view   taken   by   the   High
Court.     Therefore,   it   cannot   be   said   that   the   appeal   before
the   High   Court   at   the   instance   of   the   Revenue   challenging
the   order   passed   by   the   ITAT   was   not  maintainable   in   view
of CBDT circular dated 10.12.2015.
4. In   view   of   the   above   and   for   the   reasons   stated   above
there   is   no   substance   in   the   present   appeal   and   the   same
deserves   to   be   dismissed   and   is   accordingly   dismissed.     No
costs.
...…………………………….J.
       [M.R. SHAH]
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………………………………J.
[B.V. NAGARATHNA]
NEW DELHI;
APRIL 19, 2022
   
 
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