New Delhi: The Madras High Court on Tuesday dismissed an appeal filed by Income Tax department against actor Rajinikanth on the order of Income Tax Appellate Tribunal (ITAT) as the department itself submitted to the court that it is going to withdraw the appeal on the basis of a circular issued by Central Board of Direct Taxes (CBDT) dated August 8, 2019.
A division bench of justices Vineet Kothari and R Suresh Kumar passed the order after the department submitted it was withdrawing the appeal against July 26, 2013 order of the Income Tax Appellate Tribunal (ITAT) which had allowed the actor's plea against the assessment orders levying penalty on income totaling over Rs 66 lakh.
The matter related to an order passed by the Assessment Officer levying penalty under section 271(1)(C) of the Income Tax Act assessing an amount of Rs 6.20 lakh for the assessment year 2002-03, Rs.5.56 lakh for AY 2003-04 and Rs. 54.46 lakh for AY 2004-05.
Aggrieved by it, Rajinikanth had filed an appeal before Income Tax ( Appeal), which dismissed the appeal after which the actor approached the ITAT. The ITAT allowed the appeal and held that the penalty was imposed by the assessing officer only on the statement recorded by the assesse and his employee without any material evidence or investigation.
The Commissioner of Income Tax has filed the appeal before High Court against the order questioning whether the ITAT is right in law in deleting the penalty levied.
When the matter came up before the bench on Tuesday, counsel Swaminathan, who appeared on behalf of the Income Tax department, submitted that vide an earlier circular in 2018 the CBDT directed the department not to go on appeal where the amount of tax will not exceed Rs 50 lakh and by an amendment it was increased to Rs 1 crore.
The counsel for the Income Tax department submitted that they would like to withdraw the appeal as the amount is less than a crore in all the three assessment years, after which the high court bench dismissed the appeal as withdrawn.
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