Niko Resources Ltd., Baroda V. The Dy.CIT, (Intl.Taxn.)-II, Ahmedabad

CO 280/AHD/2014

• Counselvise Citation: [2017] 119 COUNSELVISE.COM (IT) 3410 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 16-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VASUNDHARA UPMANYA
• Assessee Lawyers: VIPSI T PATEL; YASH RAJPUROHIT ARS
• Keywords: Reason to believe
• Section: 148

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER ./ ITA NOS. 2399 & 2400/AHD/2014 & CO NOS. 279 & 280/AHD/2014 / ASSESSMENT YEAR: 2005-06 & 2006-07 DY. DIRECTOR OF INCOME-TAX (INTERNATIONAL TAXATION)-II, AHMEDABAD VS. M/S. NIKO RESOURCES LTD., 6 TH FLOOR, LANDMARK, RACE COURSE CIRCLE, VADODARA-7 PAN : AAACN 7060 L / (APPELLANT) / (RESPONDENT) & CROSS-OBJECTOR REVENUE BY : VASUNDHARA UPMANYA, CIT-DR ASSESSEE BY : VIPSI T PATEL & YASH RAJPUROHIT, ARS / DATE OF HEARING : 14/08/2017 / DATE OF PRONOUNCEMENT: 16/08/2017 / O R D E R PER N.K. BILLAIYA, ACCOUNTANT MEMBER : ITA NO. 2399/AHD/2014 AND CO NO.279/AHD/2014 ARE AP PEAL BY THE REVENUE AND CROSS-OBJECTION OF THE ASSESSEE, PREFER RED AGAINST THE VERY SAME ORDER OF THE CIT(A), GANDHINAGAR, AHMEDABAD DA TED 12.06.2014 PERTAINING TO ASSESSMENT YEAR 2005-06 AND ITA NO. 2 400/AHD/2014 AND CO NO.280/AHD/2014 ARE APPEAL BY THE REVENUE AND CROSS -OBJECTION OF THE ASSESSEE, DIRECTED AGAINST THE ORDER OF THE CIT(A), GANDHINAGAR, AHMEDABAD DATED 23.06.2014 PERTAINING TO ASSESSMENT YEAR 2006 -07. 2. THE GRIEVANCES IN THE IMPUGNED APPEALS ARE COMMO N; THEREFORE, THEY WERE HEARD TOGETHER AND ARE DISPOSED OF BY THIS COM MON ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. ITA NOS. 2399 & 2400 & CO 279 & 280/AHD/2014 DCIT VS. NIKO RESOURCES LTD AYS: 2005-06 & 2006-07 - 2 3. IT WOULD BE APPROPRIATE TO CONSIDER THE CROSS-OB JECTIONS OF THE ASSESSEE FIRST, BECAUSE THE SAME GO TO THE ROOTS OF THE MATTER. IN BOTH THE YEARS UNDER CONSIDERATION, BY ITS CROSS-OBJECTIONS, THE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE REOPENING OF THE ASS ESSMENT. 4. AT THE VERY OUTSET, THE LD. COUNSEL FOR THE ASSE SSEE BROUGHT TO OUR NOTICE THE JUDGMENT OF THE HONBLE JURISDICTIONAL H IGH COURT IN ASSESSEES OWN CASE IN SPECIAL CIVIL APPLICATION NO. 7307 OF 2 013, AND STATED THAT THE HONBLE HIGH COURT HAS QUASHED THE REASSESSMENT PRO CEEDINGS AND THEREBY MAKING THE ASSESSMENT ORDER NON-EST. THE DEPARTMENTAL REPRESENTATIVE FAIRLY CONCEDED TO THIS. THE RELEVANT FINDINGS OF THE HONBLE HIGH COURT READ AS UNDER:- 27. FROM THE RATIO THAT CAN BE CULLED OUT FROM ALL THESE DECISIONS, IT IS AMPLY CLEAR THAT THE ASSESSING OFFICER, WHO IS AUTHORIZED TO ISSUE NOTICE UNDER SECTION 148 OF THE ACT FOR REASSESSMENT, ON HIS HAV ING A REASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT FOR ANY ASSESSMENT YEAR, CAN ASSESS OR REASSESS SUCH INCOME AND ALSO ANY SUCH OT HER INCOME CHARGEABLE TO TAX, WHICH HAS ESCAPED THE ASSESSMENT. HOWEVER, NO SUCH ACTION IS PERMISSIBLE AFTER LAPSE OF 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR UNLESS INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT ON ACCOUNT OF FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY AL L MATERIAL FACTS NECESSARY FOR THE PURPOSE OF SUCH ASSESSMENT. THE ONUS IS ON THE ASSESSEE TO REVEAL THE PRIMARY FACTS AND TO DRAW THE INFERENTIAL FACTS WOU LD BE THE RESPONSIBILITY OF THE ASSESSING OFFICER. ONCE HAVING REVEALED FROM TH E RECORD THAT THE ASSESSEE DISCLOSED FULL AND COMPLETE FACTS AND ON SCRUTINY, AT THE TIME OF ORIGINAL ASSESSMENT ALL THESE DETAILS ARE EXAMINED, NO CHANG E OF OPINION IS PERMISSIBLE MERELY BECAUSE THERE WAS SOME ERROR EARLIER ON THE PART OF THE ASSESSING OFFICER HIMSELF OR BECAUSE HE CHOSE NOT TO OPINE ON THE ISSUE OR EVEN WHEN HE CHANGES HIS MIND AND INTERPRETS THE MATERIAL OR LAW OTHERWISE THAN WHAT WAS DONE BY HIM. 37. IN THE ASSESSMENT ORDER PASSED ON 30.12.2008, N OWHERE THERE IS ANY REFERENCE OF NON-COMPLIANCE OF THE DIRECTION OF THE ASSESSING OFFICER. IT ALSO DOES NOT MENTION ANYWHERE THE ABSENCE OF PRODUCTION OF RECORD ENSURED TO BE DONE AT THE TIME OF ASSESSMENT PROCEEDINGS. THOSE D OCUMENTS EITHER WERE ITA NOS. 2399 & 2400 & CO 279 & 280/AHD/2014 DCIT VS. NIKO RESOURCES LTD AYS: 2005-06 & 2006-07 - 3 PRODUCED FOR PERUSAL AND SCRUTINY OR THE ASSESSING OFFICER, WHO DEEMED IT FIT NOT TO CALL FOR THEM, AT THE TIME OF ASSESSMENT, TH OUGH SPECIFICALLY OFFERED BY THE ASSESSEE. IT DEALT WITH THE ISSUE OF DEPRECIATI ON AT LENGTH. DISALLOWED THE AMOUNT OF RS.90,32,567/- AND ALSO ALLOWED THE DEPRE CIATION TO THE TUNE OF RS.9,15,41,627/- AT THE TIME OF FINAL ASSESSMENT. I N SUCH CIRCUMSTANCES, IN ABSENCE OF ANY SPECIFIC AVERMENT IN THE REASONS REC ORDED FOR REOPENING OF THE ASSESSMENT, THAT THERE WAS ANY FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS, IT WOULD NOT BE POSSIBLE FOR THE COURT TO ALLOW THE NOTICE UNDER SECTION 148 TO BE SUSTAINED, WHICH IS WHOLLY WITHOUT ANY BACKING OF LAW. CONTENTIONS OF THE RESPONDENT T HAT NO OPINION WAS FORMED DURING THE ASSESSMENT PROCEEDINGS IS NOT FINDING FA VOUR OF THE COURT. 5. AS THE REOPENING OF THE ASSESSMENT HAS BEEN QUAS HED BY THE HONBLE GUJARAT HIGH COURT (SUPRA), THE ASSESSMENT ORDERS B ECOME NON-EST. WE ACCORDINGLY ALLOW THE CROSS-OBJECTIONS OF THE ASSES SEE AND THE APPEALS FILED BY THE REVENUE THUS BECOME INFRUCTUOUS. 6. IN THE RESULT, THE APPEALS FILED BY THE REVENUE ARE AS INFRUCTUOUS AND THE CROSS-OBJECTIONS FILED BY THE ASSESSEE ARE ALLO WED. ORDER PRONOUNCED IN THE COURT ON 16 TH AUGUST, 2017 AT AHMEDABAD. SD/- SD/- (S.S. GODARA) JUDICIAL MEMBER (N.K. BILLAIYA) ACCOUNTANT MEMBER AHMEDABAD; DATED 16/08/2017 BIJU T., SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. $ & / CONCERNED CIT 4. & ) ( / THE CIT(A)- 5. $ , $ , /DR,ITAT, AHMEDABAD, 6. 0 / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) $ ITAT, AHMEDABAD