The Court criticized the Income-tax Department's approach in penalizing the State for non-filing of TDS returns.

S.K. Keshote, J.-The State of Rajasthan through Superintending Engineer, Irrigation Circle, Irrigation Department, Jaipur, filed this appeal under Section 260A of the Income-tax Act, 1961 (for short “the Act, 1961”), against the order dated January 18, 1999, of the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, passed in I. T. A. No. 2029/JP of 1992, for the assessment year 1990-9 1 and the order dated December 22, 1999, of the Tribunal in the Review Application No. 16/JP of 1999.

2. As per the narration in the memo of appeal the facts of the case are that the appellant, Irrigation Department, Government of Rajasthan, mainly performing the duties and functions providing irrigation facilities and other infrastructure in the field of irrigation all over the State. A notice was served by respondent No. 2 to the appellant for the assessment year 1990-9 1 in regard to non-filing of annual TDS returns under Section 206 of the Act, 1961, in Form No. 24 of I. T. A. on reference made to it by the Income-tax Officer (TDS). Under the reference made by the Income-tax Officer (TDS) a proposal for the imposition of penalty under Section 272A(2) of the Act, 1961, was proposed. The contents of the notice are that the appellant has failed to submit annual TDS return in the prescribed Form No. 24 under Section 206 of the Act, 1961, thereby a delay of 460 days has taken place for the assessment year 1990-91 for which the due date was April 30, 1990. In response to that notice the appellant appeared before respondent No. 2. It filed detailed submissions. Respondent No. 2 decided the matter under its order dated January 17, 1992. The appellant was held guilty for non-filing of the TDS returns in limitation in the prescribed Form No. 24 under Section 206 of the Act and thereby imposed a penalty of Rs. 46,000. The appellant preferred an appeal against this order of respondent No. 2 before the Commissioner of Income-tax (Appeals), Rajasthan, Jaipur. It was registered as Appeal No. 1133 of 199 1-92. The appeal came to be decided by the appellate authority and under its order dated October 26, 1992, the same was allowed and penalty imposed by respondent No. 2 was cancelled. Respondent No. 2 aggrieved by the order aforestated of the Commissioner of Income-tax (Appeals), Jaipur, filed appeal before respondent No. 1 which was registered as I. T. A. No. 2029/JP of 1992.

3. The learned Tribunal decided the appeal on January 18, 1999. The same was allowed quashing and setting aside the order of the Commissioner of Income-tax (Appeals) and the order of respondent No. 2 was restored. The appellant filed a petition for review of the order dated January 18, 1999. The Tribunal dismissed the review petition on December 22, 1999. Hence, the appellant is before the Court.

4. The appeal is barred by ten days. The appellant filed an application under Section 5 of the Limitation Act for condonation of this delay. The appeal was placed for preliminary hearing on board on May 16, 2002. On that day notices of the application under Section 5 of the Limitation Act were issued to the respondents returnable within four weeks. Reply to this application of the appellant filed under Section 5 of the Limitation Act is filed by respondent No. 2.

5. On September 9, 2002, it is noticed that by this appeal the appellant has challenged two different orders of the Tribunal, i.e., annexure 3 (dated January 18, 1999) and annexure 4 (dated December 22, 1999). Under the order dated January 18, 1999 (annexure 3), the Tribunal has decided the appeal. Vide its order dated December 22, 1999 (annexure 4), the Tribunal decided the review petition. The Court held that the two orders cannot be challenged in one appeal. The appellant was directed to file separate appeal if he desires to challenge the order dated January 18, 1999 (annexure 3). The Court has further directed the appellant to make necessary corrections in the appeal challenging the order dated December 22, 1999 (annexur