Pr Commissioner Of Income Tax Central 2 v. Atul A Sanghvi

by PALLAVI MAHENDRA WARGAONKAR Date:

2025.09.29 18:39:00 +0530 PALLAVI MAHENDRA WARGAONKAR Pallavi

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL (IT) NO. 5 OF 2024 Pr Commissioner Of Income Tax Central 2 ...Appellant

Versus

Atul A Sanghvi

...Respondent

______________________________________________________ Mr. N.C. Ranganayakulu, for Appellant.

Mr. Gautam Thacker, a/w Sneha Agicha i/b. D.M. Harish & Co. for Respondents.

______________________________________________________ CORAM : M.S. Sonak & Advait M. Sethna, JJ.

DATED : 24 September 2025 P.C.:- 1.

Heard Mr. Ranganayakulu, the learned counsel for the Appellant and Mr. Gautam Thacker, learned counsel for the Respondent.

2.

Mr. Ranganayakulu proposes the following questions, which he styles as substantial questions of law: "i.

"Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT is correct in deleting the penalty of Rs. 81,89,05,132/- levied u/s 271(1)(c) of the I.T. act 1961 by holding that the Assessing Officer in the show cause notice has failed to specify the particular limb i.e. whether the initiation of penalty is for concealment of income or for furnishing of inaccurate particulars of income, even though the assessing officer

invoked both the limbs for levy of penalty u/s 271(1)(c) of the Act."

ii.

"Whether on the Hon'ble ITAT is correct in law, in not appreciating the judgment of the Hon'ble High Court of Madras in the case of Gangotri Textiles Ltd [2020], 121 taxmann.com 171, which was subsequently upheld by the Hon'ble Supreme Court vide Gangotri Textiles Ltd. Vs. Deputy Commissioner of Income Tax [2022] 137 taxmann.com 198 (SC) dated 18.02.2022, wherein it was held that once the assessee understood and responded to the notice u/s 271(1)(c), a contention cannot be raised for the first time before the court."

3.

In our judgment, neither of the two questions constitutes a substantial question of law. This is because virtually identical questions have been answered against the Revenue by the Full Bench of this Court in the case of Mohd Farhan A. Shaikh vs. Deputy Commissioner of Income Tax, Balgum1.

4.

The Division Bench followed the decision by the Full Bench in the case of Principal Commissioner of Income-Tax vs. Times Global Broadcasting Limited2, and an Appeal involving almost identical questions was not admitted. 5.

Mr. Ranganayakulu however submits that the Madras High Court in the case Gangotri Textiles Ltd. (supra) was affirmed by the Supreme Court. He therefore submits that the same should prevail over the decision of the Full Bench in the case of Mohd. Farhan A. Shaikh (supra).

.

[2021] 125 taxmann.com 123 (Bombay).

.

[2025] 172 taxmann.com 786 (Bombay)

6.

The Full Bench in paragraph 93 of its judgment has specifically considered the Gangotri Textiles Limited (supra) and held that this decision helps neither the Revenue nor the Assessee. No submission was made regarding the Full Bench decision of this Court being challenged by the Revenue. 7.

Accordingly, by following the decision of the Full Bench in Mohd. Farhan A. Shaikh (supra) and the decision of the Division Bench in Principal Commissioner of Income-Tax vs. Times Global Broadcasting Limited (supra), we reject this Appeal as involving no substantial questions of law. 8.

Accordingly, this appeal is dismissed without any costs.

(Advait M. Sethna, J) (M.S. Sonak, J.)