I offered a receipt to tax in my return by mistake and it was never chargeable. Can I still appeal, or am I stuck with what I declared?
You can still appeal. The Bombay High Court held that the appeal against the intimation was maintainable and restored it to the Commissioner (Appeals) to decide on merits. There is no estoppel against the statute: Article 265 permits tax only by authority of law, and acquiescence cannot deprive a party of relief where tax has been collected without authority. The Assessing Officer was obliged to apply his mind to the facts disclosed in the return and to assess in accordance with the law holding the field, not simply to accept an erroneous offer. For the year in question an intimation under section 143(1) was itself a deemed appealable order.
Decided by the High Court (High Court of Judicature at Bombay, Ordinary Original Civil Jurisdiction - Dr S. Radhakrishnan and V.C. Daga, JJ; judgment by V.C. Daga, J) on 2008-12-19, reported as Income Tax Appeal No. 217 of 2001 (Bombay High Court). It bears on section 246(1)(a), section 143(1), section 45 of the Income Tax Act 1961, in Appeals and Assessment & Scrutiny matters.
This is the case to cite when the department says the assessee is bound by his own return. It contains two distinct points. The first is procedural and time-bound: while the Explanation to section 143(1) stood on the statute book, until its omission with effect from 1 June 1999, an intimation was deemed an order for sections 246 and 264, so an appeal lay against it. The second is general and is why the judgment is still used - the authorities are under an obligation to act in accordance with law, tax can be collected only as the Act provides, and where an assessee is over-assessed through mistake, misconception or bad advice, the authorities must assist him so that only legitimate taxes are collected. The Court also held that an appellate authority cannot treat an appeal as maintainable for one ground and not for another.
Binding within that High Court's jurisdiction. Persuasive elsewhere.
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The assessee, an individual, sold a godown at Chaya Building, Dadar. In his return he declared total income of Rs 1,04,86,080, which included long term capital gains of Rs 1,07,00,000 on that sale. In the computation filed with the return he stated that the cost of acquisition of the property was nil, and he nevertheless offered the whole consideration as capital gains and paid the tax. The Deputy Commissioner passed an order under section 143(1)(a) on 26 December 1997 and sent an intimation with a notice of demand including interest of Rs 1,87,352 under section 234. In appeal the assessee argued that on B.C. Srinivasa Shetty no capital gain was computable because the asset had cost him nothing, and separately that interest under section 234C was wrongly charged. The Commissioner (Appeals) rejected the first ground, holding that no appeal lay under section 246(1)(a) against an intimation where no adjustment had been made and the assessee had himself declared the amount, but entertained the second ground and directed the interest to be recomputed. The Tribunal dismissed the assessee's further appeal on 13 March 2001, and he appealed under section 260A.
The question of law was answered in favour of the assessee and against the Revenue. The impugned order was quashed and the appeal restored to the file of the Commissioner (Appeals) to be decided in accordance with law. The appeal against the intimation was maintainable so long as the Explanation to section 143(1) stood on the statute book, that Explanation deeming an intimation under sub-section (1) or (1B) to be an order for the purposes of sections 246 and 264. Since the language was plain there was no need to enter on the Revenue's argument that the word or in section 246(1)(a) should be read as and. The Court also held that the Commissioner (Appeals) could not entertain the appeal in part and reject it in part; if the appeal was not maintainable it was not maintainable at all, and the Revenue, having accepted the part allowed, could not now blow hot and cold. The Court expressly left open the effect of the omission of the Explanation with effect from 1 June 1999.
The Court accepted that there is no inherent right of appeal and that it must be found in the statute, but held that where a provision confers a right of appeal it should be read in a reasonable, practical and liberal manner. Reading the Explanation to section 143(1) together with clause 37 of the amending Bill and the memorandum explaining the Finance Bill 1994, which said in terms that an intimation shall be deemed to be an appealable order for the purposes of section 246, the Court found the position unambiguous, following its own Panaji Bench decision in Anderson Marine and Sons. Where language is plain and admits of one interpretation there is no occasion to construe it, and the Court cited Bhavnagar University, Mithilesh Singh and Dayal Singh on that. It then set out the substantive principle drawn from S.R. Kosti, C.P.A. Yoosuf, Bharat General Reinsurance and Archana R. Dhanwate: the authorities are obliged to act in accordance with law, tax can be collected only as the Act provides, and where an assessee is over-assessed under a mistake or misconception or through not being properly instructed, the authorities must assist him so that only legitimate taxes due are collected. Applying Nirmala L. Mehta and Sreeni Printers, the Court held there can be no estoppel against the statute, that Article 265 forbids any levy except by authority of law, and that acquiescence cannot take away the relief a party is entitled to where tax is levied without authority. It followed that the Assessing Officer was bound to apply his mind to the facts disclosed in the return rather than simply accept the assessee's own figure.
it was obligatory on the part of the Assessing Officer to apply his mind to the facts disclosed in the return and assess the assessee keeping in mind the law holding the field.
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Handle my notice → Ask a CA on WhatsAppYou can still appeal. The Bombay High Court held that the appeal against the intimation was maintainable and restored it to the Commissioner (Appeals) to decide on merits. There is no estoppel against the statute: Article 265 permits tax only by authority of law, and acquiescence cannot deprive a party of relief where tax has been collected without authority. The Assessing Officer was obliged to apply his mind to the facts disclosed in the return and to assess in accordance with the law holding the field, not simply to accept an erroneous offer. For the year in question an intimation under section 143(1) was itself a deemed appealable order. This was decided by the High Court (High Court of Judicature at Bombay, Ordinary Original Civil Jurisdiction - Dr S. Radhakrishnan and V.C. Daga, JJ; judgment by V.C. Daga, J) and bears on section 246(1)(a), section 143(1), section 45 of the Income Tax Act 1961. It is reported as Income Tax Appeal No. 217 of 2001 (Bombay High Court). This is the case to cite when the department says the assessee is bound by his own return. It contains two distinct points. The first is procedural and time-bound: while the Explanation to section 143(1) stood on the statute book, until its omission with effect from 1 June 1999, an intimation was deemed an order for sections 246 and 264, so an appeal lay against it. The second is general and is why the judgment is still used - the authorities are under an obligation to act in accordance with law, tax can be collected only as the Act provides, and where an assessee is over-assessed through mistake, misconception or bad advice, the authorities must assist him so that only legitimate taxes are collected. The Court also held that an appellate authority cannot treat an appeal as maintainable for one ground and not for another. If it applies to you, the first step is this: Where a receipt was offered in the return but is not chargeable in law, raise it in appeal and rely on the absence of estoppel against the statute rather than seeking to revise the return.
The assessee, an individual, sold a godown at Chaya Building, Dadar. In his return he declared total income of Rs 1,04,86,080, which included long term capital gains of Rs 1,07,00,000 on that sale. In the computation filed with the return he stated that the cost of acquisition of the property was nil, and he nevertheless offered the whole consideration as capital gains and paid the tax. The Deputy Commissioner passed an order under section 143(1)(a) on 26 December 1997 and sent an intimation with a notice of demand including interest of Rs 1,87,352 under section 234. In appeal the assessee argued that on B.C. Srinivasa Shetty no capital gain was computable because the asset had cost him nothing, and separately that interest under section 234C was wrongly charged. The Commissioner (Appeals) rejected the first ground, holding that no appeal lay under section 246(1)(a) against an intimation where no adjustment had been made and the assessee had himself declared the amount, but entertained the second ground and directed the interest to be recomputed. The Tribunal dismissed the assessee's further appeal on 13 March 2001, and he appealed under section 260A. The matter was decided on 2008-12-19 by the High Court (High Court of Judicature at Bombay, Ordinary Original Civil Jurisdiction - Dr S. Radhakrishnan and V.C. Daga, JJ; judgment by V.C. Daga, J). On those facts the High Court held as follows. The question of law was answered in favour of the assessee and against the Revenue. The impugned order was quashed and the appeal restored to the file of the Commissioner (Appeals) to be decided in accordance with law. The appeal against the intimation was maintainable so long as the Explanation to section 143(1) stood on the statute book, that Explanation deeming an intimation under sub-section (1) or (1B) to be an order for the purposes of sections 246 and 264. Since the language was plain there was no need to enter on the Revenue's argument that the word or in section 246(1)(a) should be read as and. The Court also held that the Commissioner (Appeals) could not entertain the appeal in part and reject it in part; if the appeal was not maintainable it was not maintainable at all, and the Revenue, having accepted the part allowed, could not now blow hot and cold. The Court expressly left open the effect of the omission of the Explanation with effect from 1 June 1999.
The Court accepted that there is no inherent right of appeal and that it must be found in the statute, but held that where a provision confers a right of appeal it should be read in a reasonable, practical and liberal manner. Reading the Explanation to section 143(1) together with clause 37 of the amending Bill and the memorandum explaining the Finance Bill 1994, which said in terms that an intimation shall be deemed to be an appealable order for the purposes of section 246, the Court found the position unambiguous, following its own Panaji Bench decision in Anderson Marine and Sons. Where language is plain and admits of one interpretation there is no occasion to construe it, and the Court cited Bhavnagar University, Mithilesh Singh and Dayal Singh on that. It then set out the substantive principle drawn from S.R. Kosti, C.P.A. Yoosuf, Bharat General Reinsurance and Archana R. Dhanwate: the authorities are obliged to act in accordance with law, tax can be collected only as the Act provides, and where an assessee is over-assessed under a mistake or misconception or through not being properly instructed, the authorities must assist him so that only legitimate taxes due are collected. Applying Nirmala L. Mehta and Sreeni Printers, the Court held there can be no estoppel against the statute, that Article 265 forbids any levy except by authority of law, and that acquiescence cannot take away the relief a party is entitled to where tax is levied without authority. It followed that the Assessing Officer was bound to apply his mind to the facts disclosed in the return rather than simply accept the assessee's own figure. In the words reproduced by the source cited on this page: "it was obligatory on the part of the Assessing Officer to apply his mind to the facts disclosed in the return and assess the assessee keeping in mind the law holding the field."
It was decided by the High Court on 2008-12-19 and is reported as Income Tax Appeal No. 217 of 2001 (Bombay High Court). Binding within that High Court's jurisdiction. Persuasive elsewhere. A High Court decision binds the assessing officer, the Commissioner (Appeals) and the Income Tax Appellate Tribunal within that state, and is persuasive elsewhere. If your assessment is in a different jurisdiction, check whether your own High Court has taken the same view before relying on it. On section 246(1)(a), section 143(1), section 45, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The question of law was answered in favour of the assessee and against the Revenue. The impugned order was quashed and the appeal restored to the file of the Commissioner (Appeals) to be decided in accordance with law. The appeal against the intimation was maintainable so long as the Explanation to section 143(1) stood on the statute book, that Explanation deeming an intimation under sub-section (1) or (1B) to be an order for the purposes of sections 246 and 264. Since the language was plain there was no need to enter on the Revenue's argument that the word or in section 246(1)(a) should be read as and. The Court also held that the Commissioner (Appeals) could not entertain the appeal in part and reject it in part; if the appeal was not maintainable it was not maintainable at all, and the Revenue, having accepted the part allowed, could not now blow hot and cold. The Court expressly left open the effect of the omission of the Explanation with effect from 1 June 1999. It arises in Appeals and Assessment & Scrutiny matters, on section 246(1)(a), section 143(1), section 45 of the Income Tax Act 1961, and was decided by High Court of Judicature at Bombay, Ordinary Original Civil Jurisdiction - Dr S. Radhakrishnan and V.C. Daga, JJ; judgment by V.C. Daga, J. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Put the correcting facts in the computation filed with the return, as this assessee did in stating that the asset had cost nothing; the Court treated the return itself as disclosing that the amount was not taxable. If the Commissioner (Appeals) entertains one ground and rejects another for want of maintainability, take the point that an appeal is either maintainable or it is not. Check which appellate route is open for your year: the deemed-order Explanation to section 143(1) was omitted with effect from 1 June 1999, and this judgment expressly leaves the position after that date open.
Validity check could not be completed. No later history was checked. The procedural holding depends on an Explanation omitted with effect from 1 June 1999 and the Court left the position after that date open; the substantive principle that there is no estoppel against the statute rests on earlier Supreme Court and High Court authority but has not been checked against anything later. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The batch line gives the year as 2009; the judgment was delivered on 19 December 2008 and that date is used. The batch line lists sections 139, 143(3) and 4; the judgment turns on section 246(1)(a), on section 143(1) and its Explanation, and on the computability of capital gain under section 45 following B.C. Srinivasa Shetty, and those are given instead. The judgment is internally inconsistent about the year: paragraph 3 says the year under consideration is financial year 1995-96 and that the return was for assessment year 1996-97, while paragraphs 24 and 27 proceed on the assessment year being 1995-96. The Court did not decide whether the capital gain was in fact taxable; that question goes back to the Commissioner (Appeals). The batch line carried no reporter citations, so the case number is used. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The question of law was answered in favour of the assessee and against the Revenue. The impugned order was quashed and the appeal restored to the file of the Commissioner (Appeals) to be decided in accordance with law. The appeal against the intimation was maintainable so long as the Explanation to section 143(1) stood on the statute book, that Explanation deeming an intimation under sub-section (1) or (1B) to be an order for the purposes of sections 246 and 264. Since the language was plain there was no need to enter on the Revenue's argument that the word or in section 246(1)(a) should be read as and. The Court also held that the Commissioner (Appeals) could not entertain the appeal in part and reject it in part; if the appeal was not maintainable it was not maintainable at all, and the Revenue, having accepted the part allowed, could not now blow hot and cold. The Court expressly left open the effect of the omission of the Explanation with effect from 1 June 1999.
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