Indo-American Optics Ltd., Ahmedabad V. The Dy.CIT., Circle-4, Ahmedabad

CO 80/AHD/2011

• Counselvise Citation: [2016] 123 COUNSELVISE.COM (IT) 2030 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 10 month(s) 1 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 10-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 27-01-2016
• Assessment Year: 1995-1996
• Appeal Filed On: 08-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Keywords: Reopening of assessment; Unexplained cash credit; Depreciation; Difference of opinion; Competent authority; Assessment record; Change of opinion; Reassessment proceedings
• Section: 143(3); 147; 68; 148; 132

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD - , , BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ./ I.T.A. NO.623/AHD/2011 ( / ASSESSMENT YEAR : 1995-96) THE DCIT CIRCLE-4 AHMEDABAD / VS. INDO-AMERICAN OPTICS LTD. IOL HOUSE NR.SWATI APARTMENT AMBAWADI BAZAR AHMEDABAD $ ./ ./ PAN/GIR NO. : AAACI 4309 L ( $' / APPELLANT ) .. ( ()$' / RESPONDENT ) AND CO NO.80/AHD/2011 AY 1995-96 (IN ITA NO.623/AHD/2011 AY 1995-96) INDO-AMERICAN OPTICS LTD. VS. THE DCIT AHMEDABAD. CIRCLE-4 , AHMEDABAD (CROSS OBJECTOR) .. (RESPONDEN T) REVENUE BY : SMT. SONIA KUMAR, SR.DR ASSESSEE BY : SHRI ANIL KSHATRIYA, AR *+ , - / DATE OF HEARING 27/01/2016 ./ , - / DATE OF PRONOUNCEMENT 10/02/2016 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THE REVENUE AND THE ASSESSEE HAVE CHALLENGED THE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-VIII, AHMEDA BAD [CIT(A) ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 2 - IN SHORT] DATED 27/12/2010 BY FILING THE APPEAL AN D THE CROSS OBJECTION RESPECTIVELY PERTAINING TO ASSESSMENT YEAR (AY) 199 5-96. 2. FIRST, WE TAKE UP THE REVENUES APPEAL IN ITA NO .623/AHD/2011 FOR AY 1995-96. THE REVENUE HAS RAISED THE FOLLOWI NG GROUNDS OF APPEAL: 1. THE LD.CIT(A)-VIII, AHMEDABAD, HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.28,07,633/- MADE BY THE A.O. U/S.68 OF THE I.T.ACT, WITHOUT PROPERLY APPRECIATIN G THE FACT AND THE MATERIALS BROUGHT ON RECORD BY THE ASSESSING OF FICER. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD.CIT(A) OUGHT TO HAVE UPHELD THE DECISION OF THE ASSESSING OFFICER. 3. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE LEARNED CIT(A) MAY BE SET ASIDE AND THAT OF THE ASSESSING OFFICER MAY BE RESTORED TO THE ABOVE EXTENT. 2.1. BRIEFLY STATED FACTS OF THE CASE ARE THAT THIS IS A SECOND ROUND OF LITIGATION. IN EARLIER ROUND, THE MATTER TRAVELLED UPTO THE STAGE OF TRIBUNAL (ITAT C BENCH, AHMEDABAD) AND THIS TRIBUNAL HAD R ESTORED THE ISSUE OF REOPENING OF THE ASSESSMENT TO THE FILE OF ASSES SING OFFICER (AO IN SHORT) TO DECIDE THE ISSUE OF REOPENING IN THE LIGH T OF THE JUDGEMENT OF THE HONBLE APEX COURT IN THE CASE OF GKN DRIVESHAFTS ( INDIA) LTD. VS. ITO REPORTED AT (2003) 259 ITR 19 (SC). THE AO YET AG AIN MADE ADDITION OF RS.28,07,633/- BEING UNEXPLAINED CREDIT IN RESPE CT OF M/S.INDO AMERICAN CREDIT CORPORATION LTD. ON THE BASIS THAT M/S.INDO AMERICAN CREDIT CORPORATION LTD. HAD NOT FILED ITS RETURN OF INCOME NOR FILED ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 3 - ANNUAL RETURN WITH THE REGISTRAR OF COMPANIES. THE ASSESSEE BEING AGGRIEVED BY THE ASSESSMENT ORDER, PREFERRED AN APP EAL BEFORE THE LD.CIT(A) TAKING VARIOUS INCLUDING THE GROUND THAT REOPENING OF THE ASSESSMENT BEING BAD IN LAW. WHILE PARTLY ALLOWIN G THE APPEAL OF THE ASSESSEE, THE LD.CIT(A) DISMISSED THE GROUND RELATE D TO THE LEGALITY OF THE RE-ASSESSMENT. HOWEVER, ON MERIT, THE ADDITION WAS DELETED. 3. THE REVENUE HAS COME IN APPEAL BEFORE THE TRIBUN AL AGAINST THE DELETION OF ADDITION AND THE ASSESSEE BY WAY OF CRO SS-OBJECTION AGAINST THE CIT(A)S ORDER DISPUTING THE GROUND NOS.1 & 2 I N RESPECT OF ILLEGALITY OF THE RE-ASSESSMENT PROCEEDINGS. 3.1. THE ONLY EFFECTIVE GROUND IN REVENUES APPEAL IS AGAINST DELETION OF ADDITION MADE BY THE AO. THE LD.SR.DR SUBMITTED THAT THE LD.CIT(A) WAS NOT JUSTIFIED IN DELETING THE ADDITION. 3.2. ON THE CONTRARY, REGARDING THE DELETION OF ADD ITION, THE LD.COUNSEL FOR THE ASSESSEE SUPPORTED THE ORDER OF THE LD.CIT( A). 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE AO WITHOUT MAKING ANY ENQUIRY, ON THE BASIS THAT THE CREDITOR HAD NOT FILED ITS RETURN OF INCOME, PROCEE DED TO MAKE THE ADDITION. THERE IS NO MATERIAL PLACED ON RECORD TH AT THE AO HAD CARRIED OUT ANY ENQUIRY BEFORE MAKING SUCH ADDITION. IT W AS INCUMBENT UPON THE AO TO BRING MATERIAL EVIDENCE ON RECORD IN SUPP ORT OF ITS BASIS ON ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 4 - WHICH THE ADDITION IS MADE, FAILURE TO DO SO WOULD RENDER THE ADDITION UNSUSTAINABLE. THE LD.CIT(A) HAS DISCUSSED THE ISS UE AT LENGTH AND AFTER CONSIDERING THE SUBMISSIONS AND THE MATERIAL AVAILA BLE ON RECORD HAS GIVEN A FINDING ON FACT IN THE IMPUGNED ORDER, WHIC H READS AS UNDER:- 5.3 I HAVE GONE THROUGH THE ENTIRE FACTS OF THE CASE, THE FINDINGS OF THE A.O AND WRITTEN SUBMISSIONS, AS AFORESAID, FILE D BY THE APPELLANT AND DISCUSSED THE ISSUE WITH THE LEARNED AR; HIS OR AL ARGUMENTS ARE ALSO HEARD. I HAVE PERUSED THE REMAND REPORT SUBMIT TED BY THE ASSESSING OFFICER AND GONE THROUGH THE RECORDS MADE AVAILABLE. AS INCORPORATED IN PARA - 4 OF THIS ORDER, THE WHOLE O F THE ISSUE REVOLVES AROUND REOPENING THE ASSESSMENT ORIGINALLY COMPLETE D UNDER SECTION 143(3) OF THE ACT AFTER SCRUTINY ON 31 ST MARCH, 1998. THE PRESENT ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER UN DER SECTION 254/143(3) OF THE ACT (FACTUALLY IT SHOULD BE ORDE R UNDER SECTION 143(3) R.W.S. 254 OF THE ACT) WHEREBY THE AFORESAID ADDITI ON HAS BEEN MADE IN A REPETITIVE MANNER BY THE ASSESSING OFFICER. IT IS OBSERVED FROM THE ASSESSMENT RECORDS THAT ORIGINALLY, THE THEN ASSESS ING OFFICER HAD MADE ADDITIONS INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT WITH REGARD TO TWO CREDITORS VIZ. M/S. ASIATIC INFRASTRUCTURE & SH ELTERS AND M/S. INDO- AMERICAN CREDIT CORPORATION LIMITED. ON THE BASIS O F SUBMISSIONS AND EXPLANATIONS RELATING TO THE GENUINENESS OF THE SAI D UNSECURED LOANS, THE PRESENT ASSESSING OFFICER ACCEPTED THE EXPLANAT ION OF THE ASSESSEE REGARDING M/S. ASIATIC INFRASTRUCTURE & SHELTERS, H AVING CONSIDERED FULLY SATISFACTORY AND HAVING ACCEPTED UNSECURED LO AN IN THAT CASE AS GENUINE. HOWEVER, IN REGARD TO THE OTHER ENTITY I.E . M/S. INDO-AMERICAN CREDIT CORPORATION LIMITED ON THE SIMILAR SET OF FA CTS THE ASSESSING OFFICER HAS DISBELIEVED THE EXPLANATION OF THE ASSE SSEE AND MADE ADDITION. IT IS SIGNIFICANT TO NOTE THAT OUT OF THE TWO ENTITIES, ON THE SIMILAR SET OF DOCUMENTS, THE ASSESSING OFFICER HAS ACCEPTED THEM AS GENUINE IN ONE CASE AND FOR THE SECOND ONE HE HAS F OUND THE EXPLANATION NOT ACCEPTABLE. THE ASSESSING OFFICER H AS OBSERVED THAT M/S. INDO-AMERICAN CREDIT CORPORATION LIMITED HAVE JURISDICTION IN THE SAME CHARGE BUT THE SAID COMPANY HAS NOT FILED ANY RETURN OF INCOME ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 5 - FOR ANY ASSESSMENT YEAR AND ALSO OBSERVED THAT THE SAID COMPANY IS NOT EXISTING AT THE GIVEN ADDRESS. ON ONE HAND, THE ASS ESSING OFFICER IN PARA - 6 OF THE ORDER HAS OBSERVED THAT 'IT WAS GATHERED THAT INDO- AMERICAN CREDIT CORPORATION LIMITED HAS MADE INVEST MENTS TO THE EXTENT OF RS. 1.22 CRORES, WHICH PERTAINS TO A.Y. 1 995-96. AS THE SAID COMPANY HAS NOT FILED THE RETURN OF INCOME FOR THE RELEVANT YEAR, NOTICE UNDER SECTION 148 WAS ISSUED TO FURNISH THE RETURN OF INCOME.' BOTH THE OBSERVATIONS APPEAR CONTRADICTORY TO EACH OTHER. THE APPELLANT HAS FILED A NUMBER OF DOCUMENTS IN SUPPORT OF ITS CASE WHICH INCLUDED VITAL FACT THAT IN THE COURSE OF SEARCH UNDER SECTION 132 OF THE ACT, THE BOOKS OF ACCOUNT AND OTHER DOCUMENTS WERE INVENTORISED AS APPEARING IN ANNEXURE - X-15, INVENTORISED ON 21 ST DECEMBER, 1995 BY PUTTING THE IDENTIFICATION MARK DULY SIGNED AND SEA LED BY THE INCOME TAX INSPECTOR OF ADIT (INV), UNIT - 1(1), AHMEDABAD . THIS ANNEXURE - X-15 IN ORIGINAL WAS PRODUCED BEFORE THE PRESENT AS SESSING OFFICER ON 24 TH JULY, 2009 FOR VERIFICATION AND COPIES OF WHICH WE RE ALSO FILED VIDE LETTERS DATED 24 TH JULY, 2009 AND 20 TH AUGUST, 2009. THIS BEING AN INDEPENDENT DOCUMENT FOUND DURING THE COURSE OF SEA RCH ON 21 ST DECEMBER, 1995 SUPPORTED THE APPELLANT DISCHARGING IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE SAID PARTY. FURTHER, FROM THE RECORDS I FIND THAT ALL THE CREDIT/DEBIT ENTRIES TR ANSACTED ARE THROUGH BANKING CHANNEL AND CROSS-VERIFIABLE FROM THE LEDGE R ACCOUNT AND CONTRA-ACCOUNT PLACED ON RECORD. THUS, SO FAR AS TH E IDENTITY AND CREDITWORTHINESS OF THE LEANER COMPANY IS CONCERNED , IT IS NOT IN DISPUTE AS EVIDENT FROM THE APPLICABLE AND RELEVANT PORTION OF THE REMAND REPORT COUPLED WITH DOCUMENTARY EVIDENCES PERUSED. ACCORDING TO THE REMAND REPORT OF THE ASSESSING OFFICER, THE GENUINE NESS OF THE TRANSACTIONS CANNOT BE PROVED SOLELY ON THE BASIS O F LEDGER ACCOUNT OF THE LOADER COMPANY SEIZED BY THE DEPARTMENT DURING THE COURSE OF SEARCH UNDER SECTION 132 OF THE ACT. WHEN ALL THE C ORROBORATIVE DOCUMENTS AND ALSO CIRCUMSTANTIAL EVIDENCES ARE LOO KED INTO, THE FACT EMERGE FROM THE RECORD THAT IT WAS AN EXISTING AND LISTED PUBLIC COMPANY AT THE RELEVANT TIME I.E. FY 1994-95 RELEVA NT TO A.Y. 1995-96. THE ASSESSING OFFICER HIMSELF HAS STATED IN THE REA SONS RECORDED FOR REOPENING THE CASE THAT AS PER THE INTIMATION RECEI VED FROM JCIT, SPECIAL RANGE - I, M/S. INDO-AMERICAN CREDIT CORPOR ATION HAS MADE ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 6 - INVESTMENT OF RS. 1.22 CRORES WHICH PERTAINS TO A.Y . 1995-96, SO NOTICE UNDER SECTION 1489 WAS ALSO ISSUED IN THAT CASE. IT IS OBSERVED FROM THE RECORD THAT ASSESSMENT ORDER IS ALSO PASSED IN THE CASE OF THE SAID COMPANY AND BY THE VERY SAME OFFICER, DCIT, CIRCLE -4, AHMEDABAD WHO IS HAVING JURISDICTION OVER THAT CASE. NO EFFOR TS HAVE BEEN MADE BY THE ASSESSING OFFICER TO CROSS-VERIFY THE FACTS FRO M HIS OWN RECORDS WITH REFERENCE TO VARIOUS WRITTEN SUBMISSIONS MADE BY TH E APPELLANT. INSTEAD OF CAUSING ANY INQUIRY AT THE T IME OF REASSESSMENT PROCEEDINGS AND, EVEN AFTER BEING CALLED UPON BY TH IS OFFICE TO SUBMIT THE REMAND REPORT, THE ASSESSING OFFICER HAS NOT MA DE ANY INQUIRY OH THE BANK STATEMENT OF THE LEANER PARTY HAVING ALREA DY SUBMITTED AT THE TIME OF REASSESSMENT PROCEEDINGS AND THE TWO BANK S TATEMENTS OF ITS LEANER PARTY SOUGHT TO BE ADMITTED AS ADDITIONAL EV IDENCE UNDER RULE 46A, WHICH WAS RELIED UPON. THE APPELLANT HAS VEHEM ENTLY RELIED ON THE RATIO LAID DOWN BY VARIOUS JUDICIAL PRONOUNCEMENTS AS SUBMITTED ON RECORD VIDE THEIR WRITTEN SUBMISSION DATED 25 TH OCTOBER, 2010, WHICH ARE APPLICABLE TO THE FACTS AND CIRCUMSTANCES AND A LSO ON THE BASIS OF ALL THE CORROBORATIVE DOCUMENTARY EVIDENCES FURNISH ED AND ALSO THE FACTS EMERGING FROM THE APPELLANT'S CASE RECORDS. I N THE CASE ON HAND THE CREDIT ENTRY STANDS IN THE NAME OF AN INDEPENDE NT ENTITY AND NATURE AND SOURCE OF THE ENTRY IS EXPLAINED SATISFACTORILY , THE IDENTITY OF THE PARTY IS WELL ESTABLISHED AND THE CREDIT ENTRY IS A LSO PROVED GENUINE WITH ITS BANK STATEMENTS. THEREFORE, THE INITIAL BU RDEN WHICH LIES ON THE APPELLANT IS DISCHARGED. THE APPELLANT HAS ALSO PRO VED THE SOURCE OF SOURCE. 5.4 THE ASSESSING OFFICER HAS NOT BROUGHT ANY EVIDE NCE ON RECORD TO ESTABLISH THAT THE ENTRY STANDING IN THE NAME OF TH E THIRD PARTY REPRESENT THE INCOME OF APPELLANT FROM AN UNDISCLOSED SOURCE. I AM THEREFORE INCLINED TO ACCEPT THE SUBMISSIONS MADE HERE IN ABO VE BY THE APPELLANT ON THIS SCORE HAVING REGARD TO THE FACTS ON RECORD AND CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES, THE ADDITI ON MADE BY THE ASSESSING OFFICER INVOKING PROVISIONS OF SECTION 68 OF THE ACT IS NOT SUSTAINABLE. THE ASSESSING OFFICER IS DIRECTED TO D ELETE THE ADDITION FOR RS. 28,07,633 MADE UNDER SECTION 68 OF THE ACT. THU S, THE GROUND NO. 3, 4 AND 5 STAND ALLOWED IN FAVOUR OF THE APPELLANT. ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 7 - 4.1. THE ABOVE FINDING OF THE LD.CIT(A) IS NOT CONT ROVERTED BY THE REVENUE BY PLACING ANY CONTRARY MATERIAL ON RECORD. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE WITH THE FINDING OF THE LD.CIT(A), SAME IS HEREBY UPHELD. THUS, GROUND RAISED BY THE REVENUE IS DISMISSED. 5. NOW, WE TAKE UP THE CROSS OBJECTION NO.80/AHD/20 11 FOR AY 1995-96 FILED BY THE ASSESSEE (ARISING OUT OF ITA N O.623/AHD/2011 FOR AY 1995-96-REVENUES APPEAL). THE ASSESSEE HAS RAI SED FOLLOWING GROUND IN ITS CROSS-OBJECTION:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) HAS ERRED IN NOT FULLY ADJUDICATING GROUND NO.1 & 2 ON LEGALITY IN AS MUCH AS THAT THE MANDATORY SANC TION OF THE COMMISSIONER AS PROVIDED U/S.151(2) OF THE ACT WAS NEITHER OBTAINED NOR PRODUCED OF HAVING RECORDED THE SATISF ACTION ON THE REASONS RECORDED BY THE A.O. ABOUT FITNESS OF THE C ASE FOR THE ISSUE OF NOTICE U/S.148 DATED 28/3/2002 AS THE ORIGINAL A SSESSMENT WAS MADE UNDER SUB.SECTION (3) OF SECTION 143 AS THE IM PUGNED NOTICE WAS ISSUED AFTER THE EXPIRY OF 4 YEARS FROM END OF ASSESSMENT YEAR. 5.1. THE LD.COUNSEL FOR THE ASSESSEE HAS REITERATED THE SUBMISSIONS AS WERE MADE IN THE BRIEF NOTES AND ALSO HAS RELIED ON THE DECISION OF THE TRIBUNAL (ITAT C BENCH, AHMEDABAD) RENDERED IN TH E CASE OF ACIT KHEDA CIRCLE, NADIAD VS. CEEJAY FINANCE LTD., IN IT A NO.465/AHD/2013 FOR AY 1996-97,DATED 18/04/2013, AND ALSO THE JUDGE MENT OF HONBLE ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 8 - HIGH COURT OF DELHI RENDERED IN THE CASE OF CIT VS. SPLS SIDDHARTHA LTD. REPORTED AT (2012) 345 ITR 223 (DELHI). 5.2. THE LD.SR.DR HAS SUPPORTED THE ORDER OF THE AO AND SUBMITTED THAT THERE IS NO ILLEGALITY INTO THE ORDER. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AS WELL AS THE DECISION/JUDGEMENT RELIED UPON BY TH E LD.COUNSEL FOR THE ASSESSEE. THE ASSESSEE IN BRIEF NOTES HAS STATED A S UNDER:- THE ABOVE MENTIONED MATTER IS FIXED UP FOR HEARING BEFORE THE HON'BLE TRIBUNAL ON 10/12/2014 / 15/01/2015. 2. AT THE OUTSET, IT WOULD BE IN THE INTEREST OF JU STICE TO KINDLY PERUSE WORTHWHILE TO HAVE A LOOK AT THE GROUNDS RAISED BY THE APPELLANT COMPANY THROUGH THE CROSS-OBJECTIONS PREFERRED BY THE APPEL LANT, WHICH MAY BE REPRODUCED BELOW, FOR THE SAKE OF KIND INFORMATION. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT. (A) HAS ERRED IN NOT FULLY ADJUDICATING GROUND NO. 1 & 2 ON LEGALITY INASMUCH AS THAT THE MANDATORY SANCTION OF THE COMM ISSIONER OF INCOME TAX, AS PROVIDED U/S 151(1) OF THE ACT WAS N EITHER OBTAINED NOR PRODUCED OF HAVING RECORDED THE SATISFACTION ON THE REASONS RECORDED BY THE A.O. ABOUT FITNESS OF THE CASE, FOR THE ISSUE OF NOTICE DATED 28/03/2002 AS THE ORIGINAL ASSESSMENT WAS MAD E UNDER SUB- SECTION(3) OF SECTION 143 AND THE IMPUGNED NOTICE W AS ISSUED AFTER THE EXPIRY OF 4 YEARS FROM THE END OF THE ASSESSMENT YE AR.' 3. IN THIS REGARD, IT IS SUBMITTED THAT THE LD.CIT (A) HAS TAKEN NOTE OF GROUNDS NO. 1 & 2 RAISED BEFORE HIM, VIDE A COMMON PARA NO. 6 OF THE APPELLATE ORDER. AT THE END OF THAT PARE (AS APPEARING ON TOP OF PAG E 46), THE LD.CIT (A) HAS ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 9 - CATEGORICALLY TAKEN NOTE OF ASSESSEE CHALLENGING LE GALITY/VALIDITY OF THE IMPUGNED ORDER, IN FOLLOWING CLEAR TERMS:- 'THE APPELLATE HAS CHALLENGED THE LEGALITY/VALIDITY OF THE PROCEEDINGS, MAINLY ON THREE COUNTS I.E. INCORRECTNESS/INFIRMITY IN THE REASONS RECORDED, ABSENCE OF SANCTION OF COMPETENT AUTHORIT Y UNDER SECTION 151(2) AND CHANGE OF OPINION OF THE ASSESSING OFFIC ER IN THE SAME SET OF FACTS.' IT MAY BE SUBMITTED THAT ON THE ISSUE OF SA NCTION OF THE COMPETENT AUTHORITY, ALTHOUGH THE LD.C.I.T(A) HAS RECORDED TH E SUBMISSION OF THE ASSESSEE IN PARA 7 OF THE APPELLATE ORDER, YET THE LD CIT(A) HAS NOT ADVERTED. THE LD CIT(A) HAS GROSSLY ERRED IN NOT GIVING A REA SONED FINDING, AND HE HAS SIMPLY IGNORED THE MATERIAL ISSUE RAISED BEFORE HIM , WHICH GOES TO THE VERY ROOT OF THE PROCEEDINGS. SINCE ALL THE FACTS ARE ON RECORD, NO FURTHER INVESTIGATION IS WARRANTED. IN THE FITNESS OF THING S, THE HON'BLE TRIBUNAL MAY BE PLEASED TO DIRECT REVENUE TO PRODUCE ORIGINAL RE CORD ESTABLISHING THE SANCTION OF THE COMPETENT AUTHORITY U/S 151(1) OF T HE ACT AND DECIDE THE ISSUE, IN THE INTEREST OF JUSTICE AND FAIRNESS. 4. IN THE MATTER OF INCORRECTNESS/INFIRMITY IN THE REASONS RECORDED, THE APPELLATE WOULD LIKE TO SUBMIT THAT THE LD.C.I.T.(A ) HAS REPRODUCED ASSESSEE'S CONTENTIONS ON PAGE 46 TO 53 OF THE APPELLATE ORDER . IN NUT SHELL, THE SAME MAY BE HIGHLIGHTED AS FOLLOWS: (I) THE FIRST AND FOREMOST POINT IS THAT SO CA LLED REASONS ARE 'UN- DATED' AND UNSIGNED-A COPY OF SUCH UN-DATED REASONS IS SUPPLIED TO THE ASSESSEE ONLY IN APRIL,2009 VIDE A.O.'S LETTER DATED 01/04/2009, WHEN IMPUGNED NOTICE U/S 148 PURPORTEDLY ISSUED ON 28/03/2002. (II) AS PER A.O.'S OBSERVATION IN PARA 6 OF HIS ORD ER DATED 22/12/2009 DISPOSING OF OBJECTIONS RAISED AGAINST REASON RECOR DED, APPROVED OF C.I.T. IS NOT TRACEABLE, STATING THAT THE MATTER IS MORE THAN 14 YEAR OLD. (III)IN THE SAID PARA 6, THE A.O. CONFIRMS THAT THE RE WAS INCORRECTNESS IN THE REASONS RECORDED THAT M/S ASIATIC INFRASTRUC TURE & SHELTER DIDN'T FILE ITS RETURN OF INCOME FOR THE RELEVANT Y EAR, WHEN REGULAR ASSESSMENT IN THAT CASE WAS FRAMED U/S 143(3) OF TH E ACT. ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 10 - (IV) OUT OF TWO CREDITORS (CONFINED IN THE REASO NS RECORDED), THE A.O. HAS ACCEPTED THE CREDIT IN THE NAME OF M/S ASIATIC INFRASTRUCTURE & SHELTERS AS FULLY EXPLAINED IN PASSING DE-NOVO ORDE R. THIS PROVES FALSEHOOD IN THE SO-CALLED REASONS RECORDED. (V) WITH REGARD TO SECOND PARTY NAMELY M/S INDO -AMERICAN CREDIT CORPORATION LTD, THE A.O., IN HIS ORDER DATED 22/12 /2009 HAS NOTED THAT M/S INDO-AMERICAN CREDIT CORPORATION LTD. HAS MADE INVESTMENTS TO THE EXTENT OF RS.1.22 CRORES IN A.Y. 1995-96. WHEREAS, IN THE REASONS IT IS ALLEGED THAT THIS COMPANY IS N OT IN EXISTENCE. IN FACT IT WAS AN EXISTING AND LISTED PUBLIC COMPANY AND AS SESSED TO TAX BY THE VERY SAME A.O. THIS MAKES ABUNDANTLY CLEAR THAT REA SONS RECORDED WERE WHOLLY UNTRUE. (VI) AS REGARDS TEP FROM SO-CALLED BHARATBHAI PA TEL, IT SUFFERED FROM MATERIAL DETAILS AS TO ADDRESS OF PETITIONER, MODE OF RECEIPT, DATE, DESIGNATION OF THE AUTHORITY WHO HAD INITIALLY RECE IVED IT AND HOW AND WHEN IT REACHED TO THE THEN A.O. WHO RECORDED REASO NS. DEPARTMENTS ONUS FOR RELYING ON THAT DOCUMENT (TO USE AGAINST T HE ASSESSEE) WAS REALLY VERY GREAT BUT DEPT HAS NOT EVEN ATTEMPTED T O DISCHARGE ONUS. IT ANY RATE THIS COULD NOT HAVE FORMED BASIS FOR RE-OP ENING. (VII) IT IS STATED IN THE REASONS, ON PAGE FIRST THAT REGULAR ASSESSMENT IN THIS CASE WAS ORIGINALLY MADE U/S 143(3) OF THE ACT AFTER DETAILED SCRUTINY. THE ASSESSEE IS A PUBLIC LIMITED COMPANY WHOSE ACCOUNTS ARE AUDITED WHICH ARE OPEN TO GENERAL PUBLIC. THERE IS NO 'NEW INFORMATION' COMING INTO POSSESSION OF THE A.O. AND THERE WAS NO FAILURE ON THE PARA OF THE ASSESSEE AND SUCCESSOR-I N-OFFICE WISHES SOME MORE INQUIRY THEN IT ACCOUNTS TO CHARGE OF OPI NION, THE LAW DOESN'T BECOME PERMIT SUCH PRIVILEGE TO REOPEN THE ASSESSMENT ON MERE CHANGE OF OPINION. (VIII) IT IS SETTLED IN PRINCIPLES THAT IN THE REAS SESSMENT PROCEEDINGS, IT IS THE SATISFACTION OF THE ASSESSING OFFICER WHO RE CORDED REASONS FOR REOPENING THE ASSESSMENT UNDER SECTION 147 OF THE A CT AND IT SHOULD BE TOUCHSTONE TO BASE THE VALIDITY OF THE ORDER PAS SED BY THE ASSESSING OFFICER. THE PRESENT INCUMBENT CANNOT SUBSTANTIATE HIS SUBJECTIVE VIEW IN PLACE OF THE REASONS RECORDED. IF THE ACTION OF THE THEN ASSESSING OFFICER IN REOPENING WAS ILLEGAL, AS MENTIONED ABOV E, THEN THE ORDER ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 11 - PASSED CANNOT BE SUSTAINED. ALL THE SUBSEQUENT ACTI ONS CARRIED OUT ON THE ILLEGAL PROCEEDINGS ARE TO BE HELD VOID. FOR, T HIS TANTAMOUNT TO BE THE CHANGE OF OPINION, WHICH IS NOT PERMISSIBLE UND ER THE LAW. THUS, THE IMPUGNED ORDER PASSED BY THE LEARNED ASSESSING OFFICER MAY BE HELD TO BE BAD IN LAW AND IN BREACH OF THE PRINCIPL ES OF NATURALS JUSTICE. (IX) WITHOUT PREJUDICE TO THE ABOVE, A KIND REFE RENCE IS AGAIN INVITED TOWARDS ALLEGED 'REASON RECORDED'. WHILE NARRATING THE FACTS UNDER THE HEAD 'FACTS OF THE ASSESSEE'S CASE', IN THE LAS T PARA, AS APPEARING ON SECOND PAGE, THE ASSESSING OFFICER WRO TE AS UNDER: 'FROM THESE FACTS DISCUSSED IN FOREGOING PARAS, IT IS CLEAR THAT INCOME CHARGEABLE TO TAX ESCAPED ASSESSMENT FOR A. Y.1995-96 BY REASON OF FAILURE ON THE PART OF THE ASSESSEE TO DI SCUSS FULLY AND TRULY MATERIAL FACTS NECESSARY FOR THIS ASSESSMENT FOR AB OVE ASSESSMENT YEAR IN THE INSTANT CASE ALL MATERIAL FACTS INCLUDI NG INFORMATION FROM THE ASSESSEE.' IT IS ALSO PERTINENT TO MENTION THAT IN THE LAST CO NCLUDING PARA THE ASSESSING OFFICER STATED AS UNDER: 'IN VIEW OF DISCUSSION IN AFORESAID PARAS SUBSTANTI AL INCOME HAS ESCAPED ASSESSMENT IN VIEW OF SEC 147 OF THE ACT, F OR WHICH ASSESSMENT NEEDS TO BE REOPENED.' FROM THE ABOVE, IT MAY KINDLY BE APPRECIATED THAT T HE ASSESSING OFFICER HAS NOWHERE RECORDED HIS REASONS THAT HE HA D 'REASONABLE BELIEF' THAT THE 'INCOME CHARGEABLE TO TAX HAD ESCAPED ASSESSMENT'. IT IS WELL SETTLED POSITION IN LAW THAT WHERE THE ASSE SSING OFFICER HAD NOT RECORDED HIS SATISFACTION THAT HE HAD REASONS TO BE LIEVE THAT THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT, TH EN THE REOPENING OF ASSESSMENT IS NOT JUSTIFIED. 5.REGARDINO NOTICE U/S 148 ISSUED BEVOND 4 YEARS FR OM THE END OF RELEVANT ASSESSMENT YEAR. 5.1 AS PER REASONS RECORDED, IN THE UN-NUMBERED SECOND PARA, THE A.O. STATES THAT ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 12 - 'ON PERUSAL OF THE ASSESSEE'S BALANCE SHEET AND ITS SCHEDULES FILED ALONG WITH RETURN OF INCOME, IT IS FOUND THAT THE A SSESSEE HAS SHOWN UNSECURED LOANS FROM THE FOLLOWING TWO PARTIES (1) INDO AMERICAN CREDIT CORP.LTD. RS.28,07,633 /- (2) ASIATIC INFRASTRUCTURE & SHELTERS LTD RS.26 ,69,228/-' 5.2 THE UNDISPUTED FACTS ON RECORD ARE THAT THE NOT ICE U/S 148 IS ISSUED AFTER 4 YEARS FROM THE END OF THE RELEVANT A.Y., ON THE BAS IS OF MATERIAL PRODUCED BY THE ASSESSEE. IT IS ALSO UNDISPUTED FACT THAT IN SU CH CIRCUMSTANCES, PROVISO TO SEC. 147 WOULD COME INTO PLAY. UNDER SECTION 147, W HERE ASSESSMENT HAS BEEN MADE U/S143(3), NO ACTION SHALL BE TAKEN UNDER THAT SECTION, AFTER EXPIRY OF 4 YEARS FROM THE END OF RELEVANT ASSESSMENT YEAR, UNL ESS THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH A.Y. BY REAS ON OF FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERI AL FACTS NECESSARY FOR HIS ASSTT FOR THAT A.Y., THIS IS A JURISDICTIONAL REQUI REMENT. THE REASONS, WHICH HAD BEEN DISCLOSED BY THE A.O, TO THE ASSESSEE FOR REOP ENING THE A.Y. DIDN'T REVEAL THAT THERE WAS ANY FAILURE ON THE PART OF THE ASSES SEE TO DISCLOSE SUCH MATERIAL FACTS. FURTHERMORE, OUT OF THE TWO PARTIES, DEPOSIT APPEARING IN THE NAME OF SECOND PARTY IS FOUND FULLY SATISFACTORILY EXPLAINE D, IN THE DE-NOVO ORDER PASSED BY THE A.O U/S 143(3) R.W.S.254. THUS, THERE HAS BEEN NO SUPPRESSION OF FACTS, MATERIAL TO THE ASSTT, BY THE ASSESSEE. T HEREFORE, THERE IS VIOLATION OF JURISDICTIONAL CONDITION WHICH INVALIDATES NOTICE U /SL48. 6. WITHOUT PREJUDICE TO WHAT IS STATED HEREIN ABOVE ON MERITS, TRUE AND IN LAW, THE ASSESSEE BEGS TO RELY UPON THE FOLLOWING JUDICI AL PRONOUNCEMENTS:- (I) KETAN M.MEHTA V. ACIT[2012]346 ITR 254(GUJ) (II) GENERAL MOTORS INDIA(P) LTD V. DCIT [ 2013]354 ITR244(GUJ) (III) DYNACRAFT AIR CONTROLS V. SNEHA JOSHI & OTHERS. [2013]355 ITR 102(BOMBAY) (IV) AUSTIN ENGINEERING CO.LTD V. JCIT [2008]207 TAXATION 35(GUJ) / [2009] 312 ITR 70 (GUJ) (V) C.I.T V. KELVINATOR OF INDIA LTD.[2010] 228 CTR (SC)488. (VI) CADILA HEALTH CARE LTD V .DCIT [2011]334 ITR 420 (GUJ) ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 13 - 7. WITHOUT PREJUDICE, IT IS SUBMITTED THAT THE MATT ER IS ALMOST 18 YEAR OLD. WHEN THE DEPARTMENT FEELS HANDICAPPED OF, IN TRACIN G OUT DOCUMENT INDICATING SANCTION ACCORDED U/S 151(1) BY THE CIT- II, AHMEDABAD, THEN ON THE SAME FOOTING, THE CONTENTION/PLEA OF THE ASSESS EE FOR UNAVAILABLE DETAILS IF ANY FOR BEING VETTED BY THE A.O. SHOULD BE DEALT WI TH IN ASSESSEE'S FAVOUR. NEVERTHELESS, THE DEPARTMENT MAY BE ASKED TO PRODUC E RELEVANT RECORD, OF SANCTION OBTAINED UNDER THE PROVISO UNDER THE PROVI SO TO SEC 151(1) OF THE ACT. WITHOUT PREJUDICE, THE ASSESSEE RELIES UPON A RECEN T DECISION OF THE HON'BLE ITAC X C' BENCH AHMEDABAD IN THE CASE OF CJ.FINANCE IN I.T APPEAL NO.465/AHMEDABAD/2013 PRONOUNCED ON 18/04/2013, WHE REBY IT HAS BEEN UPHELD THAT IN ABSENCE OF FAILURE ON THE PART OF TH E ASSESSEE TO DISCLOSE FULLY AND TRULY MATERIAL FACTS NECESSARY FOR ITS ASSESSME NT, PROCEEDINGS U/S 147 CAN'T BEYOND 4 YEARS BE INVOKED HAS ACCORDINGLY DIS MISSED THE REVENUE'S APPEAL CHALLENGING ORDER OF THE C.I.T(A) IN QUASHIN G THE ASSESSMENT FINALIZED U/S 143 (3) R.W.S.147 OF THE ACT . THE FACTS OF THE CASE ON HAND ARE EXACTLY IDENTICAL TO THE ABOVE REFERRED CASE SINCE THERE IS TOTAL ABSENCE OF FAILURE ON THE PART OF THE APPELLANT DISCLOSE FULLY AND TRULY NECESSARY MATERIAL FOR ITS ASSESSMENT. 8. WITHOUT PREJUDICE, IT IS SUBMITTED THAT THE LD.C IT(A) HAS FAILED TO CONSIDER THE SUBMISSIONS OF THE ASSESSEE IN PROPER PERFECTIV E ALTHOUGH HE HAS RECORDED THE SUBMISSION OF THE ASSESSEE IN PARA 7 (RUNNING I NTO 22 PAGES) YET THIS SUBMISSION IS NOT OBJECTIVELY ADVERTED AND/OR VETTE D JUDICIOUSLY. THE LD.CIT (A) HAS RELIED UPON THE DECISION OF HON'BLE GUJ H.C . IN THE CASE OF PRAFUL CHUNILAL PATEL (236 ITR 832) THE ISSUE WAS ABOUT DI SCOVERY OF MISTAKE IN THE ASSESSMENT BY AUDIT PARTY WHICH WAS TREATED AS 'INF ORMATION' IN THE SECOND, I.E. CASE OF GRUH FINANCE LTD (234 ITR 482) WHEREIN ISSUE WAS ABOUT NON- EXISTENCE OF MACHINERY ON WHICH DEPRECIATION WAS ER RONEOUSLY ALLOWED. THE THIRD OR RELIED UPON IN THE CASE OF S.C. CHEMICALS 991 ITD 41 (AHD ITAT) WHEREIN ISSUE ON HAND WAS EXCESSIVE DEDUCTION U/S 8 0 HHC, BY IGNORING GUIDELINES PRESCRIBED VIDE EXPLANATION (BAA) TO SEL .SOHHC. THUS, THE FACTS OF THE CASES RELIES UPON BY THE LD.CIT (A) ARE QUITE D ISTINGUISHABLE WITH THE FACTS OF THE CASE ON HAND. THEREFORE, CONSIDERING OVERALL EFFECT BY PLACING R ELIANCE UPON THE SAID DECISIONS IS WHOLLY IRRELEVANT AND UN ACCEPTABLE. ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 14 - WITHOUT PREJUDICE FURTHER IN ALL THE REFERRED CASES RELIED UPON BY THE LD.CIT(A) ARE THOSE CASES WHEREIN, REMEDIAL ACTION U/S 147 WERE TAKEN BY THE DEPARTMENT WITHIN 4 YEARS FROM THE END OF THE RELEV ANT ASSESSMENT YEAR. 8A IT IS VERIFIABLE FROM THE RECORDS THAT IN THE CA SE ON HAND, THE REGULAR ASSESSMENT U/S 143(3) OF THE ACT WAS MADE ORIGINALL Y ON 31 ST MARCH 1998 BY THE THEN DCIT, SR. 8 AHMEDABAD, DETERMINING TOTAL I NCOME AT RS. 11,50,201/-. THE DEPARTMENT DIDN'T TAKE ANY FUR THER ACTION WITHIN 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR I.E. T ILL 31 ST MARCH 2000. CONVERSELY, THE A.O INVOKED RE-ASSESSMENT PROCEEDIN GS U/S 147 BY ISSUE OF NOTICE U/S 148 ON 28/03/2002. ALTHOUGH IT IS UNDISPUTED FACTS ON RECORD THAT THE IMPUGNED NOTICE U/S 148 OF THE ACT, HAS BEEN ISSUED ON 28/03/2002 I.E. AFTER 4 YEAR FROM THE END OF THE RELEVANT ASSTT YEAR, VIDE PARA 8.6 OF THE APPEL LATE ORDER, THE LD.CIT (A) HAS MISDIRECTED HIMSELF IN COMING TO THE CONCLUSION THAT THE ASSTT. WAS REOPENED WITHIN FOUR YEARS AND THEREBY HOLDING THE RE OPENING OF ASSESSMENT TO BE IN ORDER. 9. HAVING REGARD TO THE AFORESAID FACTUAL AS WELL A S LEGAL MATRIX, THE HON'BLE TRIBUNAL MAY BE PLEASED TO ANNUL THE IMPUGNED ASSES SMENT ORDER FRAMED U/S 143(3) R.W.S. 147 OF THE ACT, IN THE INTEREST OF JU STICE AND EQUITY. IN DO AMERICAN OPTICS LTD SD/- AUTHORISED SIGNATORY/DIRECTOR PLACE: AHMEDABAD DATE: 06/12/2014 RESPONDENT 6.1. THE LD.SR.DR DID NOT CONTROVERT THE FACTS NARR ATED IN THE BRIEF NOTES SUBMITTED BY THE ASSESSEE BY PLACING ANY CONTRARY M ATERIAL ON RECORD. THEREFORE, THE UNDISPUTED FACT REMAINS THAT THE NOT ICE U/S.148 WAS ISSUED AFTER LAPSE OF FOUR YEARS FROM THE END OF RELEVANT ASSESSMENT YEAR. AS PER SECTION 151 OF THE ACT, NO NOTICE SHALL BE ISSUED U /S.148 OF THE ACT BY AN ASSESSING OFFICER, AFTER THE EXPIRY OF A PERIOD OF FOUR YEARS FROM THE END ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 15 - OF THE RELEVANT ASSESSMENT YEAR, UNLESS THE CHIEF C OMMISSIONER OR COMMISSIONER OR JT.COMMISSIONER IS SATISFIED, ON THE REASONS RECORDED BY THE ASSESSING OFFICER, THAT IT IS A FIT CASE FOR THE ISSUE OF SUCH NOTICE. THE CASE OF THE ASSESSEE IS THAT NO SUCH SATISF ACTION WAS RECORDED AND MADE AVAILABLE TO THE ASSESSEE, THEREFORE, THE NOTI CE U/S.148 OF THE ACT WITHOUT THE SATISFACTION OF THE PRESCRIBED AUTHORIT IES WOULD BECOME BAD IN LAW. WE FIND MERIT INTO THE CONTENTION OF THE L D.COUNSEL FOR THE ASSESSEE AS PER SECTION 151 OF THE ACT, WHICH READS AS UNDER:- [COPIED FROM IT ACT, 2015] SECTION 151 : SANCTION FOR ISSUE OF NOTICE:- (1) NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSESSING OFFICER, AFTER TH E EXPIRY OF A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLESS THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIONER IS SATISFIED, ON THE R EASONS RECORDED BY THE ASSESSING OFFICER, THAT IT IS A FIT CASE FOR TH E ISSUE OF SUCH NOTICE. (2) IN A CASE OTHER THAN A CASE FALLING UNDER SUB -SECTION (1), NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSE SSING OFFICER, WHO IS BELOW THE RANK OF JOINT COMMISSIONER, UNLESS THE JOINT COMMISSIONER IS SATISFIED, ON THE REASONS RECORDED BY SUCH ASSESSING OFFICER, THAT IT IS A FIT CASE FOR THE IS SUE OF SUCH NOTICE. (3) FOR THE PURPOSES OF SUB-SECTION (1) AND SUB-SEC TION (2), THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR THE PRINCIPAL COMMISSIONER OR COMMISSIONER OR THE JOINT COMMISSIONER, AS THE CASE MAY BE, BEING SATISFIED O N THE REASONS RECORDED BY THE ASSESSING OFFICER ABOUT FITNESS OF A CASE FOR THE ISSUE OF NOTICE UNDER SECTION 148, NEED NOT ISSUE S UCH NOTICE HIMSELF.'.] ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 16 - 6.2. THIS VIEW IS FORTIFIED WITH THE JUDGEMENT OF H ONBLE HIGH COURT OF DELHI IN THE CASE OF CIT VS. SPLS SIDDHARTHA LTD.( SUPRA), WHEREIN THE HONBLE HIGH COURT UNDER THE IDENTICAL FACTS HELD A S UNDER:- 4. THE AFORESAID NOTING IN THE FILE DOES NOT REFLE CT WHAT LEARNED COUNSEL FOR THE REVENUE ARGUED. IN THE FIRST INSTAN CE, IT WOULD BE SEEN THAT THE AO HAD SPECIFICALLY SOUGHT THE APPROVAL OF THE COMMISSIONER ONLY. THEREFORE, IT CANNOT BE SAID THAT THE JOINT COMMISSIONER/ADDITIONAL COMMISSIONER HAD GRANTED TH E APPROVAL. FURTHER, NO DOUBT, THE FILE WAS ROUTED THROUGH ADDI TIONAL COMMISSIONER. HOWEVER, HE ALSO, IN TURN FORWARDED T HE SAME TO THE COMMISSIONER BY GIVING THE FOLLOWING ENDORSEMENT: 'CIT MAY KINDLY ACCORD SANCTION.' 5. IT IS CLEAR THAT THE ADDITIONAL CIT DID NOT APPL Y HIS MIND OR GAVE ANY SANCTION. INSTEAD, HE REQUESTED COMMISSIONER TO ACC ORD THE APPROVAL. IT, THUS, CANNOT BE SAID THAT IT IS AN IRREGULARITY CURABLE UNDER SECTION 292B OF THE ACT. 6. IT IS RELEVANT TO POINT OUT THAT SUB-SECTION (1) AND SUB-SECTION 2 OF SECTION 151 OF THE ACT ARE TWO INDEPENDENT PROVISIO NS. THE DEFINITION OF JOINT COMMISSIONER IS CONTAINED IN SECTION 2(28C) A ND THE DEFINITION OF COMMISSIONER GIVEN IN SECTION 2(16), WHICH ARE AS U NDER: 'JOINT COMMISSIONER MEANS A PERSON APPOINTED TO BE A JOINT COMMISSIONER OF INCOME TAX OR AN ADDITIONAL COMMISS IONER OF INCOME TAX UNDER SUB-SECTION (1) OF SECTION 117. 'COMMISSIONER' MEANS A PERSON APPOINTED TO BE A COM MISSIONER OF INCOME TAX UNDER SUB-SECTION(1) OF SECTION 117.' 7. SECTION 116 OF THE ACT ALSO DEFINES THE INCOME T AX AUTHORITIES AS DIFFERENT AND DISTINCT AUTHORITIES. SUCH DIFFERENT AND DISTINCT AUTHORITIES HAVE TO EXERCISE THEIR POWERS IN ACCORDANCE WITH LA W AS PER THE POWERS ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 17 - GIVEN TO THEM IN SPECIFIED CIRCUMSTANCES. IF POWERS CONFERRED ON A PARTICULAR AUTHORITY ARE ARROGATED BY OTHER AUTHORI TY WITHOUT MANDATE OF LAW, IT WILL CREATE CHAOS IN THE ADMINISTRATION OF LAW AND HIERARCHY OF ADMINISTRATION WILL MEAN NOTHING. SATISFACTION OF O NE AUTHORITY CANNOT BE SUBSTITUTED BY THE SATISFACTION OF THE OTHER AUT HORITY. IT IS TRITE THAT WHEN A STATUTE REQUIRES, A THING TO BE DONE IN A CE RTAIN MANNER, IT SHALL BE DONE IN THAT MANNER ALONE AND THE COURT WOULD NO T EXPECT ITS BEING DONE IN SOME OTHER MANNER. IT WAS SO HELD IN THE FO LLOWING DECISIONS: (I)CIT VS. NAVEEN KHANNA (DATED 18.11.2009 IN ITA N O.21/2009 (DHC). (II)STATE OF BIHAR VS. J.A.C. SALDANNA & ORS. AIR ( 1980) SC 326. (III)STATE OF GUJARAT VS. SHANTILAL MANGALDAS, AIR (1969) SCN 634. 8. THUS, IF AUTHORITY IS GIVEN EXPRESSLY BY AFFIRMA TIVE WORDS UPON A DEFINED CONDITION, THE EXPRESSION OF THAT CONDITION EXCLUDES THE DOING OF THE ACT AUTHORISED UNDER OTHER CIRCUMSTANCES THAN T HOSE AS DEFINED. IT IS ALSO ESTABLISHED PRINCIPLE OF LAW THAT IF A PARTICU LAR AUTHORITY HAS BEEN DESIGNATED TO RECORD HIS/HER SATISFACTION ON ANY PA RTICULAR ISSUE, THEN IT IS THAT AUTHORITY ALONE WHO SHOULD APPLY HIS/HER IN DEPENDENT MIND TO RECORD HIS/HER SATISFACTION AND FURTHER MANDATORY C ONDITION IS THAT THE SATISFACTION RECORDED SHOULD BE 'INDEPENDENT' AND N OT 'BORROWED' OR 'DICTATED' SATISFACTION. LAW IN THIS REGARD IS NOW SELL-SETTLED. IN SHEO NARAIN JAISWAL & ORS. VS. ITO, 176 ITR 35 (PAT.), I T WAS HELD: 'WHERE THE ASSESSING OFFICER DOES NOT HIMSELF EXERC ISE HIS JURISDICTION UNDER SECTION 147 BUT MERELY ACTS AT THE BEHEST OF ANY SUPERIOR AUTHORITY, IT MUST BE HELD THAT ASSUMPTION OF JURIS DICTION WAS BAD FOR NON- SATISFACTION OF THE CONDITION PRECEDENT.' 5. THE APEX COURT IN THE CASE OF ANIRUDH SINHJI KAR AN SINHJI JADEJA VS. STATE OF GUJARAT, (1995) 5 SCC 302 HAS HELD THAT IF A STATUTORY AUTHORITY HAS BEEN VESTED WITH JURISDICTION, HE HAS TO EXERCI SE IT ACCORDING TO ITS OWN DISCRETION. IF DISCRETION IS EXERCISED UNDER TH E DIRECTION OR IN ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 18 - COMPLIANCE WITH SOME HIGHER AUTHORITIES INSTRUCTION , THEN IT WILL BE A CASE OF FAILURE TO EXERCISE DISCRETION ALTOGETHER. 6. WE ARE, THEREFORE, OF THE OPINION THAT THE TRIBU NAL HAS RIGHTLY DECIDED THE LEGAL ASPECT, KEEPING IN VIEW WELL- ESTABLISHED PRINCIPLES OF LAW LAID DOWN IN CATENA OF JUDGMENTS INCLUDING THAT OF THE S UPREME COURT. 6.3. ADMITTEDLY, THE REVENUE HAS NOT PLACED SUCH SA TISFACTION ON RECORD BEFORE THIS TRIBUNAL, THEREFORE RESPECTFULLY FOLLOW ING THE AFORESAID JUDGEMENT OF HONBLE DELHI HIGH COURT, WE HEREBY QU ASH THE RE- ASSESSMENT ORDER AS BAD IN LAW AS THE PROCEDURE PRE SCRIBED UNDER SECTION 151 OF THE ACT IS NOT COMPLIED WITH. THUS, ASSESSE ES GROUNDS RAISED IN THE CO ARE ALLOWED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED, WHEREAS THE CROSS OBJECTION FILED BY THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE COURT ON WEDNESDAY, THE 10 TH DAY OF FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( MANISH BORAD ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 10/ 02 /2016 3-.., *.../ T.C. NAIR, SR. PS ITA NO.623/AHD/2011(REVENUE) AND CO NO.80/AHD/2011 (ASSESSEE) DCIT VS. INDO-AMERICAN OPTICS LTD.. ASST.YEAR 1995-96 - 19 - '#$%&'&$ / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ()$' / THE RESPONDENT. 3. 45 6 / CONCERNED CIT 4. 6 ( ) / THE CIT(A)-VIII, AHMEDABAD 5. 7*8 (45 , - 45/ , / DR, ITAT, AHMEDABAD 6. 8:; <+ / GUARD FILE. / BY ORDER, )7 ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION ..5.2.16 (DICTATION-PAD 11+ PAGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..8.2.16 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.10.2.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 10.2.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER