DEPUTY COMMISSIONER OF INCOME TAX, RAIPUR V. SHRI AMBIKA PRASAD SHUKLA, REWA

MA 2/RPR/2025

AI Insights

The case involves a Miscellaneous Application filed by the Deputy Commissioner of Income Tax, Ward-1(1), Raipur, against Ambika Prasad Shukla, challenging the ITAT's earlier decision which quashed the reassessment order for the Assessment Year 2010-11. The revenue argued that the ITAT had incorrectly relied on the decision of Hariom Ingots and Power (P) Ltd., claiming the facts were distinguishable. The tribunal, however, found that the Assessing Officer had not adequately recorded the reasons for reopening the assessment as required under section 147 of the Income Tax Act, leading to the dismissal of the revenue's application.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 469631 (ITAT-RAIPUR)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-03-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Other Referred Cases: Hariom Ingots and Power (P) Ltd. vs. Pr. Commissioner of Income Tax & Ors.
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYANKA PATEL
• Assessee Lawyers: S.R. RAO
• Keywords: Reassessment proceedings; Depreciation; Reason to believe; Tangible material
• Section: 147; 143(3); 143(1); 254(2); 56; 153; 139; 40(a)(ia)

Judgement Text

"आयकर अपीलȣय अͬधकरण, रायपुर Ûयायपीठ, रायपुर IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR Įी रͪवश सूद, ÛयाǓयक सदèय एवं Įी अǽण खोड़ͪपया, लेखा सदèय क े सम¢ । BEFORE SHRI PARTHA SARATHI CHAUDHURY, JM & SHRI ARUN KHODPIA, AM (Miscellaneous Application No. 02/RPR/2025) (Arising out of ITA No. 314/RPR/2024) (Assessment Year: 2010-11) आदेश / O R D E R Per Arun Khodpia, AM: The present MA is filed by the department arising out of order of this tribunal in ITA No. 314/RPR/2024 for the AY 2010-11 dated 30.08.2024, in the case of respondent assessee. The grievance raised by the petitioner i.e., the Deputy Commissioner of Income Tax, Ward-1(1), Raipur (in short “Ld. AR”), in the aforesaid Miscellaneous Application (MA), is culled out for the sake of completeness and clarity: Dy. Commissioner of Income Tax-1(1), Raipur, CG V s Ambika Prasad Shukla, (Through L/H Shri Rishi Kumar Shukla) Nidhi Hostel Marg, Anantpur Ward-9, Huzur, Rewa- 486001 PAN: AJKPS0785M (अपीलाथȸ/Appellant) . . (Ĥ×यथȸ / Respondent) Ǔनधा[ǐरती कȧ ओर से /Assessee by : Shri S. R. Rao, Adv. राजèव कȧ ओर से /Revenue by : Dr. Priyanka Patel, Sr. DR सुनवाई कȧ तारȣख/ Date of Hearing : 21.03.2025 घोषणा कȧ तारȣख/Date of Pronouncement : 25.03.2025 2 Miscellaneous ApplicaƟon No. 02/RPR/2025 Dy. CIT-1(1), Raipur Vs Ambika Prasad Shukla 4. Comments of AO: The order of Hon'ble ITAT is not found acceptable due to the following observations: (i) The Hon'ble !TAT relying upon the decision of jurisdictional High Court in the case of Hariom Ingots and Power (P) Ltd. (supra), quashed the assessment framed u/s 143(3) rws 147 dated 09.11.2017 in this case for the year under consideration. However, on verification, it is noticed that the facts involved in the case of Hariom Ingots and Power (P) Ltd. are distinguishable from the instant case of the assessee. The relevant para of the said decision which is also mentioned in the ITAT order is reproduced below: \"6. Perusal of aforementioned provisions under s. 56 of the IT Act would reflect that s.56 mentions about the income from other sources. Sec. 56(vii) talks about the income received by an individual or a Hindu undivided family in any previous year. Petitioner is a company and in view of specific provision under s. 56(2 vi) of the IT Act, relied by the AO for issuance of notice will not be applicable to the petitioner who is a company. For issuance of notice under 148 of the IT Act, there should be tangible material and mandatory compliance of section 147 of the IT Act, proceedings of reassessment has been initiated against company after lapse of 4 years of submission of return, which is not in dispute. Under first proviso to s. 147 of the IT Act, for starting the reassessment proceedings after lapse of 4 years, AO has to record his conclusion that there was failure on the part of assessee in not disclosing fully and truly all material facts necessary for assessment of that particular assessment year, which is not appearing from the reading of the Annexure i.e. reasons for issuance of notice.\" However, the case of the assessee for AY 2010-11 was reopened after recording the following reasons by the AO and notice u/s 148 of the Act was issued after taking necessary approval from the Pr. CIT-1, Raipur (being after the expiry of four years from the end of the relevant assessment year) as per provision of the Act:- Reasons recorded u/s 148{2) for issue of notice u/s 148 for AV 2010-11 in the case of Shri Ambika Prasad Shukla, Moudhapara, Raipur [PAN: AJKPS0785M] In the case the return of income was e-filed by the assessee on 28-04-2011 declaring total income of Rs.15,66,710/-. The return was processed u/s 143(1) of 28-09-2011 and scrutiny assessment was completed in this case on 28-02-2013 at total assessed income at Rs.17,76,710/-. Verification reveals that addition of Rs.64,15,070/- was made in the capital account of the assessee during the relevant financial year 2009-10. This aspect was not scrutinized during the course of assessment hence the source of credit remained unexplained in the case of the assessee for the relevant assessment year 2010-11. Further, verification of record shows that an amount of Rs.23,67,016/- has been debited in its profit and loss account under the head vehicle hire charges. In this connection, the assessee has also failed to deduct tax on such payment under the 3 Miscellaneous ApplicaƟon No. 02/RPR/2025 Dy. CIT-1(1), Raipur Vs Ambika Prasad Shukla provisions of section 1941 of the IT Act, thereby violating the provisions of section 40(a)(ia) of the Act, 1961. In view of the above facts, I have reasons to believe that income of Rs.87,82,086/- chargeable to tax has escaped assessment for assessment year 2010-11. In order to rope into the escaped income and to assessee such income, recourse to the provisions of section 148 to 153 is to be taken subject to approval from Pr. CIT-1, Raipur. The provision of section 147 of the Act is also produced below: Income escaping assessment. 147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year): Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year From the reasons recorded above, it is clearly evident that there was failure on the part of assessee in not disclosing fully and truly all material facts necessary for assessment of that particular assessment year. Accordingly, the case was rightly reopened as per provision of the Act. However, the Hon'ble !TAT decided in the issue in favour of the assessee relying upon the decision of jurisdictional High Court in the case of Hariom Ingots and Power (P) Ltd. (supra) which is not applicable in this case. Further, the ITAT has also held in its order that there was no whisper in the reasons recorded for reopening u/s 148 about the failure on part of the assessee to disclose materials facts fully and truly necessary for the assessment while the assessment was completed u/s 143(3) for that relevant assessment year which is also not found acceptable in view of the reasons recorded above. Therefore, Miscellaneous Application may be filed in this case before the Hon'ble ITAT on the following grounds. 4 Miscellaneous ApplicaƟon No. 02/RPR/2025 Dy. CIT-1(1), Raipur Vs Ambika Prasad Shukla Grounds of Miscellaneous Application 1. \"Whether on the point of law and on the facts and circumstances of the case, Hon'ble ITAT was justified in quashing the Assessment order passed by the AO in the case of the assessee for want of valid assumption of jurisdiction, ignoring the fact that the AO has followed due procedure as prescribed under the provisions of section 147 of the Income Tax Act, 1961 before re-opening the case?\" 2. \"Whether on the point of law and on the facts and circumstances of the case, Hon'ble ITAT was justified in quashing the Assessment order relying on the decision of the of the Hon'ble High Court of Chhattisgarh in the case of Hariom Ingots and Power (P) Ltd. where the facts of the case was quite different from that of the assessee?\" 2. The order of the Id. ITAT is erroneous both in law and on facts. 3. Any other ground that may be adduced at the time of hearing. 2. With the aforesaid contention, it was the submission by Ld. Sr. DR, Dr. Priyanka Patel, that the order of the tribunal may be recalled as there are reasons of failure on the part of the assessee to disclose fully and truly all material evidence necessary for the relevant assessment year, whereas it is held by the Tribunal that the reopening u/s 147 was without adherence to the 1st proviso to section 147, as there was no whisper in the reasons recorded about the failure on the part of assessee to disclose material facts fully and truly necessary for the assessment. 3. Per contra, Shri S. R. Rao, Ld. AR, vehemently supported the order of ITAT and submitted that as per the reasons recorded in the case of the assessee, which are also a part of the decision of ITAT, there was no mention qua the failure on the part of the assessee in disclosing the material facts fully and truly necessary for assessment; accordingly, the decision in the case of 5 Miscellaneous ApplicaƟon No. 02/RPR/2025 Dy. CIT-1(1), Raipur Vs Ambika Prasad Shukla Hari Om Ingots and Power (P) Ltd. vs. Pr. Commissioner of Income Tax & Ors. reported in (2022) 444 ITR 306 (Chhattisgarh), squarely applies to the facts of the present case, and, therefore, the ITAT has rightly allowed the appeal of the assessee. Therefore, there is no mistake apparent from the order of the tribunal so as to dispute the same by way of a Miscellaneous Application and to request for recalling of the same. 4. We have considered the rival submissions, perused the material available on record, and the jurisprudence relied upon by the parties. Before us, the grievance of the department is that the facts of the present case are distinguishable from the facts in the case of Hari Om Ingots and Power (P) Ltd. (supra), wherein Ld. AO has not recorded his conclusion that there was a failure on the part of the assessee in not disclosing fully and truly all material facts necessary for assessment of that particular assessment year, which is not appearing from the reading of the Annexure, i.e., reasons for issuance of notice, thus, Hon’ble High Court had quashed the proceedings u/s 148 r.w.s. 147 of the Act. On perusal of the MA filed by the revenue, as there is nothing emanating from the record that demonstrate that the Ld. AO has recorded the satisfaction qua the failure of the assessee in disclosing the material facts fully and truly necessary for assessment, therefore, we do not find any substance in the contention raised by the revenue; accordingly, the MA filed by the revenue warrants to be dismissed. Even otherwise, as the tribunal has decided the issue following the judgment of the Jurisdictional High Court in the case of 6 Miscellaneous ApplicaƟon No. 02/RPR/2025 Dy. CIT-1(1), Raipur Vs Ambika Prasad Shukla Hari Om Ingots and Power (P) Ltd. (supra), though there is no material available to support the contentions of revenue, however, even if there is some substance in the contentions raised by the revenue in their MA to recall an order, once it is considered and observed that the facts of the case are covered by the judgment of the Hon’ble Jurisdictional High Court, the tribunal is not empowered to revisit and review its own order under the provisions of section 254(2) of the Act; therefore, on this count also the MA of the department cannot sustain. 5. In result, MA filed by the revenue in MA No. 02/RPR/2025 stands dismissed in terms of our aforesaid observations. Order pronounced in the open court on 25/03/2025. Sd/- (PARTHA SARATHI CHAUDHURY) Sd/- (ARUN KHODPIA) Ɋाियक सद˟ / JUDICIAL MEMBER लेखा सद˟ / ACCOUNTANT MEMBER रायपुर/Raipur; Ǒदनांक Dated 25/03/2025 Vaibhav Shrivastav आदेश कȧ ĤǓतͧलͪप अĒेͪषत/Copy of the Order forwarded to : आदेशानुसार/By order (Senior Private Secretary) आयकर अपीलीय अिधकरण ,रायपुर/ITAT, Raipur 1. अपीलाथȸ / The Appellant- DCIT-1(1), Raipur 2. Ĥ×यथȸ / The Respondent-Ambika Prasad Shukla 3. आयकर आयुƅ(अपील) / The CIT(A), 4. आयकर आयुÈत / CIT 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, रायपुर/ DR, ITAT, Raipur 6. गाड[ फाईल / Guard file. // सȑािपत Ůित True copy // "