C.G. BUILDCON PRIVATE LIMITED,RAIPUR V. .ITO-3(1), RAIPUR, RAIPUR

MA 17/RPR/2024

AI Insights

C.G Buildcon Pvt. Ltd. filed a miscellaneous application against the order of the Income Tax Appellate Tribunal, which had earlier disposed of their appeal for the assessment year 2009-10. The application sought rectification of the Tribunal's order on several grounds, including the non-adjudication of certain appeal grounds and factual inaccuracies regarding the date of project approval and the necessity of a completion certificate. The Tribunal acknowledged the oversight regarding 'Ground of appeal no. 6' and recalled the order to address this specific issue. However, for the other grounds, the Tribunal found the application to be an attempt to seek a review of the merits, which is beyond the scope of Section 254(2).

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 35672 (ITAT-RAIPUR)
• Duration Of Justice: 6 month(s) 5 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 10-12-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 04-06-2024
• Other Referred Cases: T.S. Balaram, ITO v. Volkart Bros., Commissioner of Income Tax (IT-4) Vs. Reliance Telecom Ltd.
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: S.N AGRAWAL; VIRTUAL; MAHENDRA KUMAR AGRAWAL
• Keywords: Competent authority
• Section: 147; 143(3); 254(2)

Judgement Text

"आयकर अपीलȣय अͬधकरण Ûयायपीठ रायपुर मɅ। IN THE INCOME TAX APPELLATE TRIBUNAL, RAIPUR BENCH, RAIPUR BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER M.A. No.17/RPR/2024 (Arising out of ITA No. 300/RPR/2023) Ǔनधा[रण वष[ / Assessment Year : 2009-10 C.G Buildcon Pvt. Limited B-1, 3rd Floor, C.G Elite, Opp. Mandi Gate, Vidhan Sabha Road, Pandri (C.G)- 492 004 PAN : AACCC5355P ……….. आवेदक/Applicant बनाम / V/s. The Income-Tax Officer, Ward 3(1), Raipur ….…Ĥ×यथȸ / Respondent Assessee by : Shri S.N Agrawal, CA (Virtual) & Shri Mahendra Kumar Agrawal, CA Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख / Date of Hearing : 18.10.2024 घोषणा कȧ तारȣख / Date of Pronouncement : 10.12.2024 2 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 आदेश / ORDER PER RAVISH SOOD, JM The present miscellaneous application filed by the assessee company arises from the order passed by the Tribunal while disposing off the appeal filed by the assessee, vide its order passed in ITA No.300/RPR/2023 for A.Y. 2009-10 dated 11.12.2023. 2. As is discernible from the miscellaneous application (revised), the assessee company has assailed the order passed by the Tribunal in ITA No. 300/RPR/2023, dated 11.12. 2023 on four issues, viz, (i). the ground of appeal no. 6 raised before the tribunal had remained to be adjudicated; (ii). the ground of appeal no. 1 taken before the tribunal remained to be properly adjudicated; (iii). the date of approval of the project was inadvertently considered as 18.03.2005 even though the correct date of approval of the project was 16.08.2005; and (iv). if the date of approval of the project is considered as 18.03.2005, in that case it should be understood that there was no requirement for obtaining completion certificate at that point of time i.e prior to 01.04.2005. 3. We have heard the Ld. Authorized Representatives (AR’s) for both the parties, and also perused the record before us. As the asessee company/applicant has pointed out multiple issues based on which the 3 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 order passed by the tribunal while disposing off its appeal is stated to be suffering from mistakes rendering it amenable for rectification under sub- section (2) of Sec. 254 of the Act, therefore, we shall deal with the same in a chronological manner, as under; (A).“Ground of appeal No 6” raised before the tribunal not adjudicated: (i). The assessee company had, inter alia, assailed the order passed by the CIT(Appeals), before the tribunal, claiming as under : “6. That on the facts and in the circumstances and in law the Ld. CIT(A) erred in confirming the disallowance u/s 80IB(10) of the Act by the AO as the conditions to the allowability of such deduction was examined by the AO in the first year of claim during AY 2008-09 in the proceedings u/s 143(3)” (ii). After careful perusal of the order that was passed by the Tribunal while disposing off the appeal of the assessee company, i.e vide its order passed in ITA No, 300/RPR/2023, dated 11.12.2023. we concur with the assessee company/ applicant that the Tribunal had inadvertently omitted to deal with and, thus, adjudicate the aforesaid “Ground of appeal no. 6” that was raised before it. As the omission to dispose off the “Ground of appeal no. 6” (supra) has rendered the order passed by the Tribunal, while disposing off the assessee’s appeal in ITA No. 300/RPR/2023, as suffering from a mistake which is glaring, patent, obvious and apparent 4 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 from record making it amenable for rectification under sub-section (2) of Sec. 254 of the Act; therefore, the said order for the limited extent for adjudicating the aforesaid “Ground of appeal no. 6” is recalled. (B).The “Ground of appeal no. 1” taken before the tribunal remained to be properly adjudicated : (i). The assessee company had, inter alia, assailed the order passed by the CIT(Appeals) based on its “Ground of appeal no. 1”, before the tribunal, claiming as under: “1. That on the facts and in the circumstances and in law the Ld. CIT(A) erred in upholding the reopening of the case u/s 147 for the reasons \"that the appellant was not in the possession of completion certificate of the project at the time of original assessment u/s 143(3), even though such information and documents were on record before the AO, whose office had allowed the deduction u/s 80IB(10) in scrutiny assessment order u/s.143(3) consecutively for the AY 2008-09 dated 04/11/2010, AY 2009-10 dated 09/12/2011 and AY 2010-11 dated 19/03/2013, after due verification, consideration and application of mind. (ii). The assessee company/applicant claims that the Tribunal while disposing off the assessee’s appeal, vide its order passed in ITA No.300/RPR/2023, dated 11.12.202, had failed to adjudicate the aforesaid ground of appeal properly. We may herein, observe, that the Tribunal after addressing the assessee’s contention, that as per the “1st proviso” to Sec. 147 of the Act, its concluded assessment could not have been reopened in absence of any failure on its part to fully and truly disclose all the material facts necessary for its assessment, had based 5 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 on its exhaustive deliberations disposed off the same, vide its observations recorded at Para 15 – 19 of its order, as under: 15. We shall now deal with the contention of the Ld. AR that as the A.O. had framed the original assessment in the case of the assessee company vide his order passed u/s. 143(3) dated 09.12.2011; therefore, in the absence of any failure on the part of the assessee company to disclose fully and truly all material facts necessary for its assessment for the said year, i.e., A.Y.2009-10, the same could not have been reopened after four years from the end of the relevant assessment year. 16. Observing that the assessee company had not specifically assailed the impugned order by raising a specific ground of appeal as regards the validity of jurisdiction assumed by the A.O in the backdrop of the mandate of the “1st proviso” to Section 147 of the Act, we had called upon the Ld. AR to explain on what basis the said claim was being raised before us. In reply, the Ld. AR had stated that the assessee company duly raised the said contention by way of an objection dated 06.06.2016 that was filed with the A.O, on the basis of which the very assumption of jurisdiction for the reopening of its concluded assessment was assailed before him. The Ld. AR had drawn our attention to the letter/objection dated 06.06.2016 that was filed before the A.O, Page 32-34 of APB. The Ld. AR referring to the aforesaid letter/objection dated 06.06.2016 (supra) submitted that the assessee company had, in the course of the assessment proceedings, while challenging the validity of the jurisdiction assumed by the A.O for reopening of its case had, inter alia, assailed the same in the backdrop of the mandate of the “1st proviso” to Sec. 147 by relying on the judgment of the Hon’ble High Court of Bombay in the case of Titanor Components Ltd. Vs. Assistant Commissioner of Income Tax (supra). 17. We have thoughtfully considered the aforesaid issue and find substance in the claim of the Ld. AR that the validity of jurisdiction assumed by the A.O. for reopening of the concluded assessment of the assessee company was, inter alia, challenged in the backdrop of the mandate of the “1st proviso” to Section 147 of the Act. It transpires from the record that the assessee company had not only assailed the assumption of jurisdiction by the A.O before us in the backdrop of the “1st proviso” to Sec. 147 vide “Ground of appeal No.1” but had also raised the same at the stage of filing of objection dated 06.06.2016 (supra) before the A.O. 6 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 18. Apropos the claim of the Ld. AR that the reopening of the concluded assessment of the assessee company is hit by the “1st proviso” to Sec. 147 of the Act, we are unable to persuade ourselves to subscribe to the same. As is discernible from the copy of the “reasons to believe” it transpires that as the A.O had categorically observed that in the course of the assessment proceedings in the case of the assessee company for A.Y.2012-13 it stood revealed that the latter had failed to obtain the “completion certificate” from the competent authority, thus, its claim for deduction u/s. 80IB(10) of the Act was disallowed while framing the assessment in its case for the said year u/s. 143(3) of the Act. Thereafter, the A.O., in the backdrop of the aforesaid fact, observed that as per the facts and documents on record the assessee company was not entitled to claim deduction u/s. 80IB(10) for the year under consideration, i.e., A.Y.2009-10; therefore, its income to the said extent had escaped assessment within the meaning of Section 147 of the Act. As the very basis for reopening the concluded assessment of the assessee company for the year under consideration, i.e., A.Y.2009- 10, was based on the fact that the competent authority had not issued the certificate for completion of the housing project of the assessee company within the prescribed period, a fact that was not disclosed by the assessee company in its return of income/audit report for A.Y.2009- 10; therefore, we are of a strong conviction that the same would suffice the satisfaction of the requisite condition contemplated in the “1st proviso” to Section 147 of the Act, i.e., there was failure on its part to disclose fully and truly all material facts necessary for framing of its assessment for the year under consideration, i.e., A.Y.2009-10. 19. In sum and substance, as can be gathered from the “reasons to believe”, which had formed the very basis for reopening the concluded assessment of the assessee company for the year under consideration, the fact that the assessee company in its return of income for A.Y.2009- 10 had failed to come forth with full and true disclosure as regards the material fact that the “completion certificate” of its housing project was not obtained within the prescribed period contemplated u/s. 80IB(10) of the Act; thus, the same duly brings its case within the sweep of the “1st proviso” to Section 147 of the Act. Our aforesaid conviction is supported by the fact that a perusal of the audit report filed by the assessee company in Form 10CCB dated 03.09.2009 reveals that at Sr. No.23, it had, inter alia, wrongly claimed that the housing project was completed on 29.10.2007. For the sake of clarity, the relevant extract of the aforesaid audit report in Form 10CCB is culled out as under: 7 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 On a perusal of letter No.664 dated 29.10.2007, Page 42 of APB issued by the Municipal Corporation, Raipur, we find that as observed by the CIT(Appeals), and rightly so, the aforesaid letter was issued for releasing the mortgage flats after completion of various development and internal works and was not a “completion certificate” as had been claimed by the assessee company in its audit report in “Form 10CCB” (supra) as well as in the course of the proceedings before us. Based on the aforesaid material fact that the letter dated 29.10.2007 (supra) issued by the Municipal Corporation, Raipur is not a “completion certificate”; thus, the same falsifies the claim raised by the assessee company in its audit report in “Form 10CCB” (supra), which, in turn, suffices the satisfaction of the precondition contemplated in the “1st proviso” to Section 147 of the Act for reopening the concluded assessment of the assessee company. Thus, in terms of our aforesaid observations, we are unable to concur with the Ld. AR that reopening of the concluded assessment of the assessee’s case is hit by the non- satisfaction of the pre-conditions contemplated in the “1st proviso” to Section 147 of the Act.” (iii). We are of the view that as the Tribunal vide its order passed in ITA No.300/RPR/2023 dated 11.12.2023, had taken a conscious view on the aforesaid claim of the assessee, therefore, the assessee company/applicant cannot seek revisiting of the said view by filing the present miscellaneous application. Our aforesaid conviction is supported by the judgment of the 8 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 Hon'ble Supreme Court in the case of T.S. Balaram, ITO v. Volkart Bros., (1971) 82 ITR 50 (SC), wherein it was held as under: \" ....A mistake apparent on the record must be an obvious and patent mistake and not something which can be established by a long-drawn process of reasoning on points on which there may conceivably be two opinions. As seen earlier, the High Court of Bombay opined that the original assessments were in accordance with law though in our opinion the High Court was not justified in going into that question.......an error which has to be established by a long-drawn process of reasoning on points where there may conceivably be two opinions cannot be said to be an error apparent on the face of the record. A decision on debatable point of law is not a mistake apparent from the record........\" Also, a similar view had been taken by the Hon'ble Supreme Court in the case of Commissioner of Income Tax (IT-4) Vs. Reliance Telecom Ltd., (2021) 133 taxmann.com 41 (SC), wherein it was held as under: \"From the impugned judgment and order passed by the High Court, it appears that the High Court has dismissed the writ petitions by observing that (i) the Revenue itself had in detail gone into merits of the case before the ITAT and the parties filed detailed submissions based on which the ITAT passed its order recalling its earlier order; (ii) the Revenue had not contended that the ITAT had become functus officio after delivering its original order and that if it had to relook/revisit the order, it must be for limited purpose as permitted by Section 254(2) of the Act; and (iii) that the merits might have been decided erroneously but ITAT had the jurisdiction and within its powers it may pass an erroneous order and that such objections had not been raised before ITAT. 6. None of the aforesaid grounds are tenable in law. Merely because the Revenue might have in detail gone into the merits of the case before the ITAT and merely because the parties might have filed detailed submissions, it does not confer jurisdiction upon the ITAT to pass the order de hors Section 254(2) of the Act. As observed hereinabove, the powers under Section 254(2) of the Act are only to correct and/or rectify the mistake apparent from the record and not beyond that. 9 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 Even the observations that the merits might have been decided erroneously and the ITAT had jurisdiction and within its powers it may pass an order recalling its earlier order which is an erroneous order, cannot be accepted. As observed hereinabove, if the order passed by the ITAT was erroneous on merits, in that case, the remedy available to the Assessee was to prefer an appeal before the High Court, which in fact was filed by the Assessee before the High Court, but later on the Assessee withdrew the same in the instant case.\" (emphasis supplied by us) (iii). Accordingly, as the assessee company/applicant, to the extent it has assailed the correctness of the view taken by the Tribunal on the aforesaid issue, has in the garb of the present application filed under sub-section (2) of Sec. 254 of the Act sought for a review of the said view, which is not permissible under law, therefore, we decline to accept the same. C). The date of approval of the project was inadvertently considered as 18.03.2005, even though the correct date of approval of the project was 16.08.2005. (i). The aforesaid claim of the assessee is found to be in contradiction of the record, as was there before the Tribunal while disposing off the appeal, vide its order passed in ITA No.300/RPR/2023 dated 11.12.2023. The CIT(Appeals), vide his order dated 27/07/2023, had dealt with and 10 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 disapproved the aforesaid claim of the assessee company at Page 12 of his order, observing as under: “In this regard, the appellant contended that it got approval vide order no. 116 dated 16.08.2005 and therefore, the project was to be completed by 31.03.2011 as per the provisions of section 80IB(10(a)(iii) of the Act, which is factually incorrect because the order relates to permission for starting construction of the building and not the approval of the residential project namely “CG Heights”. Also, Section 80IB(10)(a)(iii) of the Act was inserted vide Finance Act, 2010 wef 01.04.2010.i.e much later than the date of approval of the project and the project of the appellant is not covered under this sub-clause. Further, it is a matter of fact that the Nagarnigam Palika, Raipur had issued completion certificate dated 24.08.2016 wherein it has categorically been mentioned that the project was permitted vide letter no. 21/83/2005 dated 18.03.2005 and a letter no. 664 dated 29.10.2007 was issued releasing the mortgaged flats due to completion of various internal development works. These facts clearly show that the project was approved on 18.03.2005 and the same was required to be completed by 31.03.2009 i.e four years from the end of the financial year in which the housing project is approved by the local authority as per the provisions of section 80IB(10)(a)(ii) of the Act for getting the benefit of deduction u/s 80IB(10) of the Act. Hence, the appellants argument on this count is rejected.” (emphasis supplied by us) Accordingly, the aforesaid claim of the assessee applicant, being contrary to the facts emanating from the record, thus, is found to be factually incorrect. As the Tribunal had acted upon the facts emanating from the impugned order, i.e the CIT(Appeals) order, therefore, its order 11 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 being based on the facts available on record cannot be held to be suffering from a mistake rendering it amenable for rectification under sub-section (2) of Sec. 254 of the Act. Apart from that, we find that the assessee company had neither challenged the aforesaid observation of the CIT(Appeals) in the appeal that was filed before us; nor has brought to our notice any application that was filed before the CIT(Appeals) seeking rectification of his said observation. Also, no contention pointing out the aforesaid infirmity in the observation of the CIT(appeals) (as alleged in the present application) was brought to the notice of the tribunal in the course of the hearing of the appeal. (ii). We, thus, are of a firm conviction that as the assessee company/applicant cannot in the garb of the present application filed under sub-section (2) of Sec. 254 of the Act, seek rectification of the Tribunal’s order on the basis of facts which do not emanate from the record, therefore, the application so filed before us on the said aspect cannot succeed. D). If the date of approval of the project is considered as 18.03.2005, in that case it should be understood that there was no requirement for obtaining completion certificate at that point of time i.e prior to 01.04.2005 : 12 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 (i). We find that the assessee company/applicant based on a new set of facts which do not emanate from the record, had sought for a review of the order passed by the Tribunal vide its order dated ITA No. 300/RPR/2023, dated 11.12.2023. As seeking of review of an order passed by the tribunal, falls beyond the scope and realm of sub-section (2) of Sec. 254 of the Act, therefore, the aforesaid claim of the assessee company/applicant being devoid and bereft of any substance is rejected. 4. Resultantly, the miscellaneous application i.e MA 17/RPR/2024 filed by the assessee company/applicant under sub-section (2) of Sec. 254 is partly allowed in terms of our aforesaid observations. Accordingly, as the omission to dispose off the “Ground of appeal no. 6” (supra) had rendered the order passed by the Tribunal while disposing off the assessee’s appeal in ITA No. 300/RPR/2023, as suffering from a mistake which is glaring, patent, obvious and apparent from record, making it amenable for rectification under sub-section (2) of Sec. 254 of the Act; therefore, the order to the said limited extent, i.e, for adjudicating the aforesaid “Ground of appeal no. 6” is recalled. The registry is directed to fix the appeal for the aforesaid limited purpose on 24/01/2025 after putting both the parties to notice. 13 C.G Buildcon Pvt. Ltd. Vs. ITO, Ward 3(1), Raipur MA No.17/RPR/2024 In the result, the miscellaneous application filed by the assessee company is partly allowed in terms of our aforesaid observations. Order pronounced in open court on 10th day of December, 2024. Sd/- Sd/- ARUN KHODPIA RAVISH SOOD (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) रायपुर/ RAIPUR ; Ǒदनांक / Dated : 10th December, 2024 आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of the Order forwarded to : 1. अपीलाथȸ / The Appellant. 2. Ĥ×यथȸ / The Respondent. 3. The CIT(Appeals)-1, Raipur (C.G.) 4. The Pr. CIT, Raipur-1 (C.G) 5. ͪवभागीय ĤǓतǓनͬध, आयकर अपीलȣय अͬधकरण, रायपुर बɅच, रायपुर / DR, ITAT, Raipur Bench, Raipur. 6. गाड[ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Ǔनजी सͬचव / Private Secretary आयकर अपीलȣय अͬधकरण, रायपुर / ITAT, Raipur. "