ITO, Ward-6(4), Hyderabad V. Mirza Rafiullah Baig, Hyderabad

CO 43/HYD/2013

• Counselvise Citation: [2014] 122 COUNSELVISE.COM (IT) 9268 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 21 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 10-01-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 19-09-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SOLGY JOSE KOTTARAM
• Assessee Lawyers: K C DEVADAS
• Section: 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO.909/HYD/13 : ASSTT. YEAR 2008 - 09 INCOME TAX OFFICER WARD 6(4), HYDERABAD V/S. SHRI MIRZA RAFIULLAH BAIG, HYDERABAD ( PAN - AIWPB 7351 F ) (APPELLANT) (RESPONDENT) C.O. NO.43/HYD/2013 (IN ITA NO.909/HYD/13) : ASSTT. YEAR 2008 - 09 SHRI MIRZA RAFIULLAH BAIG, HYDERABAD ( PAN - AIWPB 7351 F ) V/S. INCOME TAX OFFICER WARD 6(4), HYDERABAD (CROSS OBJECTOR) (APPELLANT - IN - APPEAL) ASSESSEE BY : SHRI K.C.DEVADAS DEPARTMENT BY : SHRI SOLGY JOSE KOTTARAM, DR DATE OF HEARING 8.1.2014 DATE OF PRONOUNCEMENT 8.1.2014 O R D E R PER SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER: THIS APPEAL BY THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME - TAX(APPEALS) IV HYDERABAD DATED 19.3.2013 FOR THE ASSESSMENT YEAR 2008 - 09. 2. FACTS OF THE CASE IN BRIEF LEADING TO THE FILING O F THE PRESENT APPEAL BY THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE ARE THAT THE ASSESSEE FIELD RETURN O F IN C OM E ON 24.7.2008 DECLARING AN INCOME OF RS.43,81,494 INCLU D IN G SHORT TERM CAPITAL GAINS OF RS.42,92,200. THE ASSESSING OFFICER COMPU TE D THE CAPITAL GAINS AT RS.4,47,87,200 AND ASSESSED THE TOTAL INCOME AT RS.4,49,22,535, VIDE O R DER OF ASSESSMENT DATED 30.12. 2011 PASSED UNDER S.143(3) RE A D WITH S.147 OF THE ACT. I TA NO. 909/ HYD/2013 & CO THEREIN SHRI MIRZA RAFIULLAH BAIG, HYDERABAD 2 3. ON APPEAL BEFORE THE CIT(A), THE ASSESSEE ORIGINALLY RAISED GROUNDS CONTESTING THE ADDITIONS MADE BY THE ASSESSING OFFICER TO THE SHORT T E RM CAPITAL GAINS DI S CLO S ED BY THE ASSESSEE. HO WE VER, S UBSEQUENTLY, T HE ASSESSEE RAISED ADDITIONAL GROUNDS WHICH ARE LEGAL IN NATURE, CONTENDING THAT INITIATION OF P R OCEEDIN G S UNDER S.147 IS BAD IN LAW IN AS MUCH AS THE PROCEEDINGS OUGHT TO HAVE BEEN INI T I A TED UN D ER S .153C AS THE BASIS FOR THE INITIATION O F P R OCEEDING UNDER S.147 REL A TES TO DISCOVERY OF A DOCUMENT BELONGING TO THE ASSESSEE, FOUND IN TH E COU R SE OF S EAR C H ON THE PRE M I S ES OF JANAPRIYA ENGINEERING SYNDICATE, WHICH WAS HANDED OVER TO THE ASSESSING OFFICER, WHO HAD JURISDI C T I ON OVER THE CASE. TH E CIT(A) NOT ONLY ADMITTED THE ADDITIONAL GROUNDS OF THE ASSESSEE, BUT ALSO FINDING MERIT IN THE LEGAL OBJECTIONS OF THE ASSESSEE WITH REGARD TO INITIATION OF PROCEEDINGS UNDER S.147 AND NOT UNDER S.153C OF THE ACT, SET ASIDE THE ASSESSMENT, ON THE GROUND OF THE SAME BEING VOID AB INITIO. HAVING HELD SO, THE CIT(A) DID NOT GO INTO THE ORIGINAL GROUNDS RAISED BY THE ASSESSEE IN THE APPEAL BEFORE HIM ON MERITS. 4. AGGRIEVED, REVENUE PREFERRED THE APPEAL ITA NO.909/HYD/2013 CONTESTING THE FINDING OF THE CIT(A) THAT THE PROCEEDING UNDER S.147 INITIATED BY THE ASSESSING OFFICER IS VOID AB INIO , WHEREAS THE GROUNDS OF THE ASSESSEE IN HIS CROSS OBJECTIONS RELATE TO THE MERITS OF THE ADDITIONS MADE IN THE ASSESSMENT AND NON - ADJUDICATION BY THE CIT(A) ON THE GROUNDS ORIGINALLY RAISED BEFORE HIM IN RELATION THERETO. 5. WE HAVE CON S I D ERED THE RIVAL SUBMISSIONS AND PERUSED THE O R DERS OF HE LOWER AUTHO R ITI E S. IT IS EVIDENT FROM THE REASONS RECORDED FOR REOPENING THE ASSESSMENT UNDER S.147 OF THE ACT, WHICH HAVE BEEN EXTRACTED BY THE CIT(A) IN PARA 9 OF THE IMPUGNED ORDER, THAT IT IS THE INFORMATION RECEIVED FROM THE CENTRAL RANGE - 1, HYDERABAD UPON SEARCH OPERATIONS CARRIED ON IN THE PREMISES OF M/S. JANAPRIYA ENGINEERS SYNDICATE P. LTD., WHICH FORMED THE BASIS FOR INITIATION OF THE PROCEEDINGS UNDER S.147 OF THE ACT. IT IS SETTLED POSITION OF LAW THAT IN ALL MATTERS, EMANATING FROM SEARCH ACTION THAT PROCEEDINGS HAV E TO BE INITIATED UNDER S.153C OF THE ACT, AND NOT UNDER S.147 OF THE ACT. IT IS I TA NO. 909/ HYD/2013 & CO THEREIN SHRI MIRZA RAFIULLAH BAIG, HYDERABAD 3 WORTHWHILE TO REFER TO MENTION THAT THE PROV I SION S OF S.153C OF THE ACT BEGIN WITH A NON - OBSTENTE CLAUSE, VIZ. NOTWITHSTANDING ANYTHING CONTAIN E D IN SECTION 139, SE C TION 147 , SECTION 148, SECTION 149, SECTION 151 AND SECTION 153, WH E RE THE ASSESSING OFFICER IS SATISFIED THAT ANY M ONEY... A NON - OBSTANTE CLAUSE OVERWRITES THE PROVISIONS ELSEWHERE SPECIFIED IN SUCH CLAUSE. THAT BEING SO, EXISTENCE OF SUCH A NON - OBSTANTE CLAUS E IN S.153C FALLING IN CHAPTER XII , PRECLUDES THE JURISDICTION OF THE ASSESSING OFFICER UNDER THE PROVISION S SPECIFIED IN THAT SECTION , VIZ. SECTION 139, SE C TION 147, SECTION 148, SECTION 149, SECTION 151 AND SECTION 153 . IN THAT VIEW OF THE MATTER, PROCEEDINGS HAVE TO BE INITIATED IN ALL THE CASES COVERED BY CHAPTER XIV ONLY UNDER S.153C AND NOT UNDER ANY OTHER SECTION SPECIFIED IN THE SAID NON - OBSTANTE CLAUSE. CONSIDERING THIS STATUTORY BAR IN THE FORM OF A NON - OBSTANTE C LAUSE CONTAINED IN S.153C OF THE ACT, THE PROCEEDINGS INITIATED UNDER S.147 IN THE PRESENT CASE , BASED ON THE INFORMATION THAT CAME TO LIGHT AS A RESULT IN THE COURSE OF SEARCH ON THE PREMISES OF JANAPRIYA ENGINEERS SYNDICATE AND MADE AVAILABLE TO THE ASSE SSING OFFICER BY THE CENTRAL CIRCLE, HA S NO LEGAL SANCTITY, AS THE SAME IS AGAINST THE SPIRIT OF PROVISIONS OF S.153C OF THE ACT. WE ARE SUPPORTED IN THIS BEHALF BY THE RATIO LAID DOWN BY THE OF THE APEX COURT IN THE CASE OF CIT V/S. SURESH N.GUPTA (297 ITR 322), WHEREIN THE SCOPE OF APPLICABILITY OF THE PROVISIONS CONTAINED IN OTHER CHAPTERS OF THE ACT, TO THE CASES FALLING UNDER CHAPTER XII, HAS BEEN EXAMINED. IN THIS VIEW OF THE MATTER, AND CONSIDERING THE FACT THAT THE IMPUGNED ORDER OF THE CIT(A) IS IN CONSONANCE WITH THE RATIO LAID DOWN IN THE DECISIONS OF THE MADHYA PRADESH HIGH COURT IN THE CASE OF RAMBALLABH GUPTA V/S. ACIT(288 ITR 347); AND OF THE AMRITRSAR BENCH OF THE TRIBUNAL IN THE CASE OF ITO V.S. ARUN KUMAR KAPOOR(2011) 58 DTR 201, WHICH A RE DIRECTLY ON THE POINT AT DISPUTE IN THIS CASE, AND ARE IN FAVOUR OF THE ASSESSEE, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A). WE ACCORDINGLY UPHOLD THE SAME ON THIS ISSUE AND REJECT THE GROUNDS OF THE REVENUE IN THIS APPEAL. 6. AS FOR THE CROSS - OBJECTIONS OF THE ASSESSEE, THE ONLY GRIEVANCE OF THE ASSESSEE IS AGAINST THE ACTION OF THE CIT(A) IN NOT CONSIDERING THE MERITS OF THE ASSESSMENT. THE CIT(A), HAVING HELD THE ASSESSMENT TO BE VOID AB INITIO AND I TA NO. 909/ HYD/2013 & CO THEREIN SHRI MIRZA RAFIULLAH BAIG, HYDERABAD 4 ACCORDINGLY SET ASIDE TH E SAME, HAS NOT GONE INTO THE MERITS OF THE ASSESSMENT MADE. WHEN ASSESSMENT ITSELF DOES NOT SURVIVE IN VIEW OF THE FINDING THAT THE PROCEEDINGS UNDER S.147 OF THE ACT ARE WAS HELD AS VOID AB INITIO , CONSIDERATION OF THE GROUNDS ON THE MERITS OF THE ASSE SSMENT BECOME ONLY OF ACADEMIC NATURE, AND THE SAME NEED NOT BE CONSIDERED. IN VIEW OF OUR DECISION ON THE APPEAL OF THE REVENUE, THE CROSS - OBJECTIONS OF THE ASSESSEE BECOME INFRUCTUOUS. WE ACCORDINGLY DISMISS THE SAME. 7. IN THE RESULT, REVENUES APP EAL AS WELL AS ASSESSEES CROSS - OBJECTIONS ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 8.1.2014 SD/ - SD/ - (CHANDRA POOJARI ) (ASHA VIJAYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER DT/ - 8 TH JANUARY, 2014 COPY FORWARDED TO: 1. SHRI MIRZA RAFIULLAH BAIG, 9 - 4 - 135/9, VALI COLONY, TOLI CHOWKY, HYDERABAD HYDERABAD 2 . INCOME TAX OFFICER WARD 6( 3 ), HYDERABAD 3. COMMISSIONER OF INCOME - TAX(APPEALS) I V, HYDERABAD 4. COMMISSIONER OF INCOME - TAX III HYDERABAD 5. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S