ACIT, Tuticorin V. M/s. K.S.P.S.Natarajan & Co., Tuticorin

ITA 1123/CHNY/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52058 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 14-11-2011
• Assessment Year: 2000-2001
• Appeal Filed On: 16-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Keywords: Reopening of assessment; Reason to believe; Reassessment proceedings
• Section: 143(3); 147

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL CHENNAI D BENCH, CHENNAI. BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER & SHRI GEORGE MATHAN, JUDICIAL MEMBER I.T.A. NO. 1123/MDS/2011 ASSESSMENT YEAR: 2000-01 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I, TUTICORIN. VS. M/S. K.S.P.S. NATARAJAN & CO., 13A/1, MEENAKSHIPURAM WEST TUTICORIN 628 002. [PAN: AAAFK9908R] (APPELLANT) (RESPONDENT) REVENUE BY : SHRI K.E.B. RENGARAJAN, JR. STANDING COUNSEL ASSESSEE BY : NONE DATE OF HEARING : 1 4 . 1 1 .2011 DATE OF PRONOUNCEMENT 18.11.2011 ORDER PER N.S. SAINI, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A) I, MADURAI DATED 01.03.2011 BY TAKING THE FO LLOWING GROUNDS OF APPEAL: 1. THE LEARNED CIT(A) OUGHT TO HAVE NOTED THAT AS PER SECTION 80IA(5), THE DEDUCTION SHOULD BE ALLOWED ON THE BAS IS THAT THE ELIGIBLE BUSINESS IS THE ONLY SOURCE OF INCOME. IF IT IS SO, THERE WILL BE LOSSES IN THE WIND MILL UNIT IN THE EARLIER YEARS AND IT SHOU LD BE SET OFF AGAINST THIS YEARS PROFIT. THEN THERE WILL BE NO POSITIVE INCOME AFTER SETTING OFF THE EARLIER YEARS LOSSES. 2. THE DECISION OF HONBLE MADRAS HIGH COURT IN TH E CASE OF VELAYUTHASAMY SPINNING MILLS LTD. RELIED ON BY THE ITAT IN ASSESSEES OWN CASE WHICH WAS FOLLOWED BY THE CIT(A) HAS NOT R EACHED THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1 11 1123 123123 123/ // /MDS/ MDS/ MDS/ MDS/11 1111 11 2 FINALITY. 3. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE AD DUCED AT THE TIME OF HEARING, IT IS PRAYED THAT THE ORDER OF THE CIT(A) MAY BE REVERSED AND THAT OF THE ASSESSING OFFICER RESTORED . 2. NOTICE OF HEARING WAS SENT TO THE RESPONDENT AS SESSEE BY RPAD ON 07.09.2011 AND WAS RECEIVED BY THE ASSESSEE ON 10.0 9.2011 AS PER THE AD CARD OF THE POSTAL AUTHORITY PLACED ON RECORD. NONE WAS PRESENT ON BEHALF OF THE RESPONDENT ASSESSEE WHEN THE CASE WAS CALLED FO R HEARING NOR ANY ADJOURNMENT APPLICATION WAS FILED. HENCE, THE APPEA L WAS HEARD EX-PARTE QUA THE ASSESSEE AND IS BEING DECIDED ON THE BASIS OF THE ARGUMENTS OF THE LD. DR AND THE MATERIAL AVAILABLE ON RECORD. 3. WE HAVE HEARD THE LD. DR, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND MATERIAL AVAILABLE ON RECORD. IN THE INSTANCE C ASE, THE IMPUGNED ASSESSMENT WAS MADE UNDER SECTION 147 R.W.S. 143(3) OF THE ACT. THE ASSESSEE, BEFORE THE LD. CIT(A) AND AMONGST OTHER A LSO, CHALLENGED THE VALIDITY OF INITIATION OF REASSESSMENT PROCEEDINGS IN THE INSTANT CASE. THE ABOVE JURISDICTIONAL GROUND RAISED BY THE ASSESSEE WAS DECIDED IN FAVOUR OF THE ASSESSEE BY THE LD. CIT(A) BY OBSERVING AS UNDE R: 5. RELEVANT ITMR WAS CALLED FOR AND PERUSED. IT I S NOTED THAT AUDIT OPINION FORMED THE BASIS FOR THE ASSESSING OF FICERS REASON TO BELIEVE ESCAPEMENT OF INCOME. HENCE, IN MY VIEW , REOPENING OF ASSESSMENT IS NOT PROPER. THE CASE IS DECIDED ON MERITS ALSO. 4. FROM THE GROUNDS OF APPEAL RAISED BEFORE US BY THE REVENUE, IT IS OBSERVED THAT THE REVENUE HAS CHALLENGED THE ORDER OF THE LD. CIT(A) ON THE I.T.A. I.T.A. I.T.A. I.T.A. NO. NO. NO. NO.1 11 1123 123123 123/ // /MDS/ MDS/ MDS/ MDS/11 1111 11 3 MERIT OF THE ISSUE INVOLVED AND HAS NOT CHALLENGED THE FINDING OF THE LD. CIT(A) THAT INITIATION OF REASSESSMENT PROCEEDINGS IN THE INSTANT CASE WAS BAD IN LAW. AS THE JURISDICTIONAL ISSUE STANDS DECI DED IN FAVOUR OF THE ASSESSEE, THE INSTANT APPEAL OF THE REVENUE IS ONLY ACADEMIC IN NATURE AND REQUIRES NO ADJUDICATION BY US. IN THE ABOVE CIRCUM STANCES, WE DISMISS THE APPEAL OF THE REVENUE AS INFRUCTUOUS. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 18.11.2011. SD/- SD/- (GEORGE MATHAN) JUDICIAL MEMBER (N.S.SAINI) ACCOUNTANT MEMBER CHENNAI, DATED, THE 18.11.2011 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.