The Commissioner Of Income Tax ... vs Shri Kapil Dev
2008 Latest Caselaw 1414 Del

*              THE HIGH COURT OF DELHI AT NEW DELHI

%                                Judgment delivered on : 21.08.2008

+                           ITA No. 1563/2006


THE COMMISSIONER OF INCOME
TAX DELHI (CENTRAL)-II                                 ...... Appellant

                                  -versus-

SHRI KAPIL DEV                                        ..... Respondent

Advocates who appeared in this case:

For the Appellant : Mr R. D. Jolly For the Respondent : Mr. S. Krishnan

CORAM :-

HON'BLE MR JUSTICE BADAR DURREZ AHMED HON'BLE MR JUSTICE RAJIV SHAKDHER

1. Whether the Reporters of local papers may be allowed to see the judgment ?

2. To be referred to Reporters or not ?

3. Whether the judgment should be reported in the Digest ?

BADAR DURREZ AHMED, J (ORAL)

1. This is an appeal filed by the revenue in respect of the

assessment year 1991-92 and is directed against the order dated

15.02.2006 passed by the Income Tax Appellate Tribunal in ITA

No.4787/Del/2003. The impugned order is a composite order in

respect of the assessment years 1991-92, 1992-93, and 1993-94.

Separate appeals have been filed in respect of each of the assessment

years. In the present appeal we are only concerned with the

assessment year 1991-92.

2. The only issue that arises for consideration in this appeal

is with regard to the validity of the re-assessment proceedings under

Section 147 Income Tax Act, 1961 (hereinafter referred to as the

said Act). Since the re-assessment was done admittedly after a

period of four years of the completion of the assessment under

Section 143 (3), the proviso to Section 147 would be applicable.

3. It is clear that in view of the said proviso to Section 147,

the assessment could be re-opened only in case the assessee failed to

disclose fully and truly all material facts necessary for the purposes

of the assessment. The issue sought to be raised by the learned

counsel for the appellant is that the assessee was a professional

cricketer and he did not disclose this fact before the Assessing

Officer and consequently, the re-assessment proceedings would be

valid in as much as, the case would squarely fall within the proviso

to Section 147 of the said Act.

4. On the other hand, it is contended on behalf of the

learned counsel for the respondent that the assessee had fully and

truly disclosed all material facts which were necessary for

completing the assessment in his case. He further submitted that the

Assessing Officer had considered all the aspects of the matter and

had framed the assessment under Section 143 (3) of the said Act. In

particular, it was pointed out that the Assessing Officer had

considered the Central Board of Direct Taxes' Circular No.200151

/80/IT/(A) dated 26.11.1981 (Instruction No.1432) under which the

assessee was claiming exemption from income derived from cricket

matches (test matches and one-day matches). In the case of test

matches outside India, 50% of the earnings were claimed as exempt

and in case of test matches in India, 75% of the earning were

claimed as exempt in terms of the circular. As regards the one-day

matches, whole of the income was claimed as exempt. From the

assessment order dated 28.08.1992 it is apparent that the circular

was considered in detail. In fact, after construing the said circular,

the Assessing Officer added back an amount of Rs 3,600/- per match

in respect of test matches in India after construing the terms of the

circular. It cannot, therefore, be said that the assessment order was

completed without the Assessing Officer having considered the

circular in detail. It is an admitted position that the exemption

under the circular were available to a professional cricketer and not

to an ameteur. The learned counsel for the respondent submitted

that there is no guideline given in the circular as to when a cricketer

would be construed as a professional cricketer and when he would

be construed as an ameteur. It was therefore, submitted that all that

the assessee was required to do was to disclose that he is a cricketer

and claim exemption under the circular. It was for the Assessing

Officer to have considered the facts and circumstances of the case

and then classified the assessee as an ameteur or as a professional

cricketer. The very fact that the Assessing Officer granted the

assessee exemptions under the circular and added back the said sum

of Rs. 3,600/- per match for test matches in India, based upon the

circular, clearly implies that the Assessing Officer had considered

the assessee to be a ameteur cricketer. He submitted that it is only in

the assessment proceedings for the assessment year 1994-95 that the

Assessing Officer took a different view and held the assessee to be a

professional cricketer.

5. After having heard the learned counsel for the parties,

we are of the view that all these aspects have been considered by the

Tribunal and the Tribunal has concluded that all the material facts

have been fully and truly disclosed by the assessee at the time of

original assessment and that these facts were taken into

consideration while completing the assessment under Section 143

(3) of the said Act on 28.08.1992 for the assessment year 1991-92.

The Tribunal also noted that the findings of the CIT (Appeals) with

regard to the said circular to this effect had not been controverted by

the Department, and therefore, came to the conclusion that they

did not find any reason to interfere with the said findings.

6. The Tribunal has returned the finding that all the

material facts were fully and truly disclosed by the assessee and that,

therefore, invocation of the provisions of Section 147 of the said Act

was not in accordance with law. We see no reason to interfere with

these findings as there is nothing perverse about the said findings.

No substantial question of law arises for consideration of this Court.

This appeal is dismissed.

BADAR DURREZ AHMED, J

RAJIV SHAKDHER, J

August 21, 2008 mk