Grounds can’t be raised for first time before High Court if same was never raised before Tribunal: HC

Case Details: PCIT v. Surya Textech - [2022] 134 taxmann.com 349 (Himachal Pradesh)

Judiciary and Counsel Details

• • Tarlok Singh Chauhan and Ms. Jyotsna Rewal Dua, JJ.
  • Vinay Kuthiala, Sr. Adv. and Diwan Singh Negi, Adv. for the Appellant.

Facts of the Case

Assessee filed return of income for the Assessment Year 2012-13. The assessee’s case was selected for scrutiny, and an assessment was completed wherein the Assessing Officer (AO) disallowed certain deductions.

On appeal, the CIT(A) granted relief to the assessee. Against the order of CIT(A), Later, the appeal of the AO against the order of CIT(A) was dismissed by the ITAT. AO approached the High Court by filing an appeal.

AO contended that the ITAT dismissed the appeal only on the ground that the tax effect in the appeal was much less than the limit prescribed by the CBDT in Circular No. 17/2019, dated 8-8-2019. AO had further raised the grievance that the ITAT had failed to consider the case’s merits as the noted circular was not applicable in view of clause 10(c) of the CBDT Circular no. 3/2018 dated 11-7-2018.

High Court Held

The High Court held that Circular No. 17/2019 was an extension of Circular No. 3/2018 issued by the CBDT, whereby certain modifications have been made in the original circular, especially in respect of enhancement of revision of monetary limits for appeals/SLPs in income tax matters.

It is evident from the impugned order that the AO was duly represented at the time of hearing of an appeal before the ITAT. However, no such ground had been raised on behalf of the AO before the ITAT requiring the said Tribunal to decide the matter on merits in view of clause 10(c) of Circular No. 3/2018.

Once the AO had not raised the plea of applicability of clause 10(c) of CBDT Circular No. 3/2018, it cannot raise such a plea in the appeal before the High Court.
The ITAT had correctly held the appeal before it to be not maintainable in view of the clear mandate of Circular No. 17/2019. The same principle applies to the filing of the present appeal. Hence, no substantial question of law arises for determination.

Case Review

• • Order dated 28-5-2020 passed by the Income-tax Appellate Tribunal, Chandigarh, in Dy. CIT v. Surya Textech [IT Appeal No. 1222 (Chd.) of 2019, dated 28-5-2020] (para 4) affirmed.