BARIK BISWAS,BASIRHAT V. ACIT, CIRCLE 49(1) & (2), KOLKATA

MA 41/KOL/2025

AI Insights

The case involves Barik Biswas, the assessee, who filed Miscellaneous Applications against the orders of the Income Tax Appellate Tribunal (ITAT) concerning several assessment years. The primary contention was that the ITAT had not addressed the merits of the case in their previous ruling, which only considered the legal issues raised. The Tribunal acknowledged the oversight and amended their earlier decision to include a detailed examination of the merits, particularly focusing on the procedural validity of the revisionary orders under section 263 of the Income Tax Act. The Tribunal concluded that the revisionary orders were invalid as they addressed issues not covered in the original assessment, leading to the quashing of subsequent assessments.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 776519 (ITAT-KOLKATA)
• Duration Of Justice: 5 month(s) 3 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 15-09-2025
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 11-04-2025
• Other Referred Cases: CIT vs. Alagendran Finance Ltd, CIT Vs Lark Chemicals Ltd, Keshab Narayan Banerjee Vs CIT & Another, PCIT Vs. Bulbul Agrawal
• Laws Referred To: Income Tax Act
• Court: TRIBUNAL
• Department Lawyers: S.B. CHAKRABORTHY
• Assessee Lawyers: S.M. SURANA
• Keywords: Reopening of assessment; Revision of order
• Section: 147; 263; 40A(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, AM AND SHRI PRADIP KUMAR CHOUBEY, JM MA Nos. 37 to 43/KOL/2025 (Arising in ITA No. 521 to 526 & 918/KOL/24 for A.Ys. 08-09 to A.Y. 13-14 & A.Y. 2020-21) Barik Biswas, Basirhat Sangrampur Basirhat, North 24 Parganas, West Bengal-743422 Vs. ACIT, Circle-49(1)&(2) West Bengal (Applicant) (Respondent) PAN No. AHYPB7479F Assessee by : Shri S.M. Surana, AR Revenue by : Shri S.B. Chakraborthy, DR Date of hearing: 29.08.2025 Date of pronouncement: 15.09.2025 O R D E R Per Rajesh Kumar, AM: MA No. 37/KOL/2025 for A.Y. 2008-09 By virtue of these miscellaneous application, the assessee prayed before the Bench that the order passed by the Bench in ITA No. 521/KOL/2024, for A.Y. 2008-09, contained prima facie mistake within the meaning of section 254(2) of the Act and therefore, the said order of the ITAT may kindly be rectified / modified. 02. The ld. AR vehemently submitted before us that at the time of hearing the grounds raised in the memorandum of appeal were argued at length on merit and all the evidences/ details qua the issues involved on merit of the case were placed before the Bench by way of filing a very comprehensive paper books. The ld. Counsel for the assessee Printed from counselvise.com Page | 2 MA Nos. 37 to 43/KOL/2025 Barik Biswas; A.Ys. 08-09 to 13-14, 20-21 submitted that the assessee submitted during the course of hearing by filing the necessary evidences that no payments exceeding limit as specified u/s 40A(3) of the Act were made and pointed out by the ld. Assessing Officer in the assessment order. The ld. Counsel for the assessee submitted that while passing the order, the Hon'ble Tribunal has decided only the legal issue raised in the additional ground by allowing the appeal and has not given its findings on the merit. Therefore, the order of the Tribunal may be rectified accordingly. The ld. DR on the other hand submitted that the Tribunal has already allowed the appeal of the assessee on legal issue, therefore merits are not required to be decided and the MA moved by the assessee may kindly be dismissed. 03. After hearing the rival contentions and perusing the materials available on record, we find that undisputedly the assessee’s counsel argued legal issue by raising additional ground on which the findings have been given by the Tribunal in Para no.13 of the order passed by the Tribunal. However, the arguments of the counsel on merits were not considered and adjudicated and thus to this extent we are agree with the contention raised by the counsel of the assessee in Miscealleneous Application. Accordingly, in place of para no.13, the following para no. 13 is substituted. “13. After hearing the rival contentions and perusing the materials available on record, we find that in this case, the assessment was framed u/s 143/ 147 of the Act vide order dated 25.03.2016 after the case was reopened u/s 147 of the Act. We note that the issue in the said reopening of assessment as recorded in the reasons to believe was with regard to cash deposited in the assessee’s bank account. Thereafter the ld. Pr. CIT revised the said assessment order vide its revisionary order u/s 263 of the Act dated 20.11.2017, directing the ld. AO to pass the assessment afresh after examining the issue of violation of section 40A(3) of the Act with regard to purchases. Printed from counselvise.com Page | 3 MA Nos. 37 to 43/KOL/2025 Barik Biswas; A.Ys. 08-09 to 13-14, 20-21 We note that the issue on which the reopening was made vis a vis the issue on which the revisionary order was passed were two different issues and therefore, the assessment framed u/s 143(3)/147 dated 25.03.2016 is not amenable to revision u/s 263 of the Act, as the issue on which the reopening was made was completely different. Therefore, we find merit in the contention of the assessee that the revisionary jurisdiction exercised by the ld. PCIT u/s 263 of the Act and the order passed consequently dated 20.11.2017 were bad in law. Consequently all the proceedings, thereafter are also invalid and bad in law. Thus, the case of the assessee find support from the decision of Hon'ble Apex court in the case of CIT vs. Alagendran Finance Ltd (supra), wherein the Hon'ble Apex court has held that the order u/s 263 of the Act on an issue which was not subject matter of reassessment order. Moreover, if the order which was to be revised was the order passed u/s 143(1) and not u/s 143(3)/147 of the Act but that has become barred by limitation as on 31st March 2017. We also note that the decision of the Hon'ble Apex Court was followed by Hon'ble Bombay High Court in the case of CIT Vs Lark Chemicals Ltd. (supra) and also by Hon'ble Calcutta High Court in case of Keshab Narayan Banerjee Vs CIT & Another (supra). Therefore, we are inclined to hold that the assessment framed u/s 144/263 of the Act dated 20.12.2018 is invalid and is hereby quashed on the ground that the same was framed in pursuance to invalid revisionary order passed u/s 263 of the Act. The Hon'ble Apex Court in the case of PCIT Vs. Bulbul Agrawal (supra), wherein the Hon'ble Court dismissed petition for Special Leave to appeal (C) No. 26629/2023 order dated 19.02.2025, wherein the Hon'ble Apex Court while dismissing the SLP referred to the decision of the co-ordinate Bench in Para 14 and 15, whereby the Tribunal held that the validity of order can be taken in the collateral proceeding and in Para 16 quashed the order u/s 263 of the Act. Similarly, considering the facts and circumstances of the case and in the light of aforesaid decisions, we quash the assessment u/s 144/263 of the Act. The appeal of the assessee is allowed on legal issue. Since, we have allowed the appeal of the assessee on legal issue raised by way of additional ground before us in favour of the assessee, the other grounds raised and argued on merits are not being adjudicated at this stage and are being left open to be decided at a later stage if the need arises for the same.” 04. Accordingly, the MA of the assessee is allowed in terms of above modification to our order passed in ITA No. 521/Kol/2024 for A.Y. 2008-09. MA Nos. 38 to 43/KOL/2025 for A.Ys. 09-10 to A.Y. 13-14 & A.Y. 2020-21 05. The issue raised in these Miscealleneous Applications is identical to one as decided by us in MA No.37/KOL/2025 for A.Y. 2008-09. Accordingly, our decision would, mutatis mutandis, apply to these Printed from counselvise.com Page | 4 MA Nos. 37 to 43/KOL/2025 Barik Biswas; A.Ys. 08-09 to 13-14, 20-21 Miscealleneous Applications by the assessee in MA Nos. 38 to 43/Kol/2025. Hence, the Miscealleneous Applications of the appeal of the assessee are allowed. 06. In the result, the Miscellaneous Applications of the assessee are allowed in terms of the above modifications to the order passed earlier. Order pronounced in the open court on 15.09.2025. Sd/- Sd/- (PRADIP KUMAR CHOUBEY) (RAJESH KUMAR) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Kolkata, Dated:15.09.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Kolkata Printed from counselvise.com "