THE OLD SETTLERS OF SIKKIM

Wherein a benefit is sought to be given to an assessee that too with retrospective effect, a highly technical and pedantic approach is required to be eschewed-Mumbai HC

The Petitioner is an Indian National of Sikkimese origin. The Petitioner’s profession is acting in flims. The Petitioner’s original name is Tshering Pintso. The subject matter of the above Petitions are the Assessment Year 1997­98 to 2005­06. The Petitioner is seeking certain benefits which have been conferred on account of insertion of Section 10(26 AAA) by the Finance Act, 2008, which has been incorporated with retrospective effect from 1­4­1990. The Petitioner’s assessment was completed for the relevant years and an order under Section 143(1) of the said Act has already been passed accepting total income mentioned by the Petitioner for each of the said Assessment Years.  Since the Applications have been filed by the Petitioner under Section 264 of the said Act. In view of the introduction of Section 10 (26 AAA) in the said Act, it would be gainful to refer to the said provision: “(26AAA) in case of an individual, being a Sikkimese, any income which accrues or arises to him­­­­ (a) from any source in the State of Sikkim; or (b) by way of dividend or interest on securities; Provided that nothing contained in this clause shall apply to a Sikkimese woman who, on or after the 1st day of April 2008, marries an individual who is not a Sikkimese. Explanation ­­­ For the purposes of this clause, “Sikkimese” shall mean (i) an individual, whose name is recorded int he register maintained under the Sikkim Subject Rules, 1961 (hereinafter referred to as the “Register of Si[kkim Subjects”), immediately before the 26th day of April, 1975; or (ii) an individual, whose name is included in the Register of Sikkim Subjects by virtue of the Government of India Order No.26030/36/90­ I.C.I., dated the 7th August, 1990 and order of even number dated the 8th April, 1991; or (iii) any other individual, whose name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual’s father or husband or paternal grand­ father or brother from the same father has been recorded in that register;] The said provision has been inserted with retrospective effect from 1­4­1990 by the Finance Act 2008, which received the assent of the President received on 10­5­2008. The said fact is relevant in the context of the issue, which arise for consideration in present Petitions. In terms of the said provision, the Petitioner being of Sikkimese origin claimed that the amounts that he has received as and by way of dividend and interest in each of the Assessment Years, would be exempt from tax by virtue of newly inserted provision. In so far as the above Writ Petition No.1549 of 2010 is concerned, the dividend amount is Rs.26,73,023/­ and the interest is Rs.1250/­ for the Assessment Year 2002­2003. The said amounts vary in order of the above Petitions.   The Petitioner accordingly sought to claim benefit of the said provision and filed an Application under Section 264 of the said Act on 4­9­2008. To the said application, the Petitioner appended the certificate issued by the Land Revenue Department, Government of Sikkim stating that the Petitioner is a Sikkimese subject and registered under Sikkim Subject Register at Sr. No.741 as also certificate issued by the Sub Divisional Magistrate (Adm.), Gyalshing, West Sikkim, disclosing that the Petitioner owns landed property bearing holding No.5 plot no.91 admeasuring are 8860 hectare situated at Yuksam and that he is the Schedule Tribe belonging to Bhutia Community. The Court of the opinion that if the Assessee was prevented by sufficient cause from making the application within the period prescribed and the Commissioner is satisfied with the reasons given by the Assessee for not filing the said application within the period prescribed, he may admit the application made after expiry of a period. Indubitably in the instant case, the Application under Section 264 came to be filed by the into operation with retrospective effect from 1­4­1990. By the said provision the assessee, who is a Sikkimese by origin, was entitled to certain benefits, obviously there seem to be a rational in introducing the said provisions as may be the Government was of the view that the said benefit is required to be granted for the upliftment of the people of Sikkimese origin. There can be no dispute that the Finance Act by which the said provision was introduced, received the assent of the President on 10­5­2008. The Petitioner has made an application immediately after a period of four months of the said Finance Act, receiving assent of the President. The reasons as to why the Petitioner did file the applications at the said point of time, have been mentioned by the Petitioner in the applications for each of the Assessment Years. However, as can be seen from the impugned order, the Commissioner has not even adverted to the reasons mentioned by the Petitioner in the application of condonation of delay and has in a cryptic manner rejected the said Application by observing that he is unable to entertain the Petitioner beyond the time limit prescribed. Once the Commissioner is vested with the power of condonation of delay, then it is incumbent upon the Commissioner to take into consideration the reasons mentioned by the Assessee seeking condonation of delay.(2010-ITS-3991-HC- Danny Denzongpa vs.Commissioner of Income Tax­11 , Mumbai Dated .20th September ,2010)http://indiantaxsolutions.com/old_site/print.php?id=1275849006&tb=content source: