The ACIT, Range-1, Ahmedabad V. CLP Power India Pvt. Ltd., Ahmedabad

ITA 1127/AHD/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2422 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 01-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K DAVE
• Assessee Lawyers: S N SOPARKAR
• Section: 143(3)

Judgement Text

, C IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMEBR ./ I.T.A. NO. 1127/AHD/2015 ( ASSESSMENT YEAR : 2006-07) DCIT, CIRCLE-1(1)(2), AHMEDABAD / VS. CLP POWER INDIA PVT. LTD., 6 TH FLOOR, CHANAKYA BUILDING, OFF. ASHRAM ROAD, AHMEDABAD 380009 ./ ./ PAN/GIR NO. : AAACP6900B ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI S. K. DAVE, SR. D.R. / RESPONDENT BY : SHRI S. N. SOPARKAR, A.R. DATE OF HEARING 01/08/2018 !'# / DATE OF PRONOUNCEMENT 04/09/2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE REVENUE AGAINST THE ORDER OF THE CIT(A)-1, AHMEDABA D (CIT(A) IN SHORT), DATED 09.01.2015 ARISING IN THE ASSESSME NT ORDER DATED 30.12.2011 PASSED BY THE ASSESSING OFFICER (AO) UND ER S. 143(3) ITA NO.1127/AHD/15 [DCIT VS. CLP POWER INDIA PVT. LTD.] A.Y. 2006-07 - 2 - R.W.S. 147 OF THE INCOME TAX ACT, 1961 (THE ACT) CO NCERNING ASSESSMENT YEAR 2006-07. 2. THE GROUNDS OF APPEAL RAISED BY THE REVENUE REA DS AS UNDER:- (1) THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS B Y HOLDING THAT NOTICE U/S 143(2) OF THE ACT ISSUED ON 21-11-2011 IS BARRED BY LIMITATION AND SUCH MISTAKES CANNOT BE RECTIFIED U/S 292B OF THE ACT AND QUASHED THE REASSESSMENT AS BAD IN LAW. (2) THE LD. CIT(A) HAS NOT APPRECIATED THE FACT THA T THE ASSESSEE HAS NOT RAISED ANY OBJECTION DURING THE COURSE OF RE-ASSESSMENT PR OCEEDINGS REGARDING VALIDITY OF NOTICE U/S 143(2) OF THE ACT. (3) THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITION OFRS.36,03,711/- MADE ON ACCOUNT OF THE DIFFERENCE IN THE O & M FEES AS PER TDS CERTIFICATE ISSUED BY GPEC AND SHOWN BY THE ASSESSE E. (4) THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.71,05,644/- MADE ON ACCOUNT OF PROFESSIONAL OR T ECHNICAL SERVICES INCOME RECEIVED FROM GPEC AND NOT OFFERED FOR TAX. 3. WHEN THE MATTER WAS CALLED FOR HEARING, THE LEAR NED AR FOR THE ASSESSEE IN THE REVENUES APPEAL SUBMITTED AT T HE OUTSET THAT IN VIEW OF BELATED ISSUANCE OF NOTICE UNDER S.143(2 ) OF THE ACT FOR THE PURPOSES OF INITIATION OF THE ASSESSMENT PROCEE DINGS, THE ENTIRE ASSESSMENT PROCEEDINGS AND CONSEQUENTLY, THE ASSESSMENT ORDER PASSED UNDER S.143(3) R.W.S. 147 OF THE ACT ( WHICH IS SUBJECT MATTER OF APPEAL) IS VOID AB INITIO. SUCH BELATED NOTICE UNDER S.143(2) OF THE ACT HAS RENDERED THE ENTIRE PROCESS OF RE- ASSESSMENT AS BAD IN LAW. CONSEQUENTLY, IT WAS SUB MITTED THAT THE ITA NO.1127/AHD/15 [DCIT VS. CLP POWER INDIA PVT. LTD.] A.Y. 2006-07 - 3 - RE-ASSESSMENT ORDER DOES NOT SURVIVE AND AS A COROL LARY APPEAL OF THE REVENUE IS LIABLE TO STRUCK DOWN. THE LEARNED AR SUPPORTED HIS CASE OF INVALIDITY OF PROCEEDINGS OWING TO SUCH BELATED SERVICE OF NOTICE UNDER S. 143(2) OF THE ACT BY THE DECISIO N OF GUJARAT HIGH COURT IN THE CASE OF CIT VS. SUKHINI P. MODI [ 2014] 52 TAXMANN.COM 50 (GUJ). 4. THE LEARNED DR, ON THE OTHER HAND, CONTESTED THE ARGUMENT OF THE ASSESSEE AND SUPPORTED ITS APPEAL ON THE GRO UND THAT ASSESSEE HAS NOT RAISED ANY OBJECTION BEFORE THE AO FOR BELATED ISSUANCE AND SERVICE OF VALID NOTICE AND THEREFORE, THE ASSESSEE CANNOT SEEK ANNULMENT OF ASSESSMENT PROCEEDINGS ON THE GROUND OF BELATED SERVICE OF NOTICE UNDER S.143(2) OF THE ACT. FOR THIS PROPOSITION, THE LEARNED DR RELIED UPON; (I) JOSH B UILDERS & DEVELOPERS (P.) LTD. VS. PR.CIT [2016] 389 ITR 314 (PUNJAB & HARYANA), (II) PADINJAREKARA AGENCIES (P.) LTD. VS. CIT(A) [2017] 398 ITR 381 (KERALA) & (III) CIT VS. MRS. C. MALATH Y [2007] 294 ITR 532 (MADRAS). 5. SINCE, THE PRELIMINARY OBJECTION TOWARDS VALIDIT Y OF ASSESSMENT OWING TO BELATED SERVICE OF NOTICE UNDER S.143(2) OF THE ACT IS IN QUESTION WHICH GOES TO THE ROOT OF TH E MATTER, WE SHALL PROCEED TO DEAL WITH THE JURISDICTIONAL QUEST ION RAISED BEFORE US AT THE OUTSET. 6. FEW FACTS CONCERNING THE ISSUE ARE THAT THE ORIG INAL ASSESSMENT WAS COMPLETED IN THE CASE OF THE ASSESSE E UNDER S.143(3) OF THE ACT ON 24.07.2008. SUBSEQUENTLY, T HE ASSESSMENT ITA NO.1127/AHD/15 [DCIT VS. CLP POWER INDIA PVT. LTD.] A.Y. 2006-07 - 4 - WAS REOPENED UNDER S.148 OF THE ACT FOR WHICH NOTIC E WAS ISSUED ON 22.03.2011. IN RESPONSE THEREOF, THE ASSESSEE V IDE ITS LETTER DATED 23.03.2011 STATED THAT THE ORIGINAL RETURN OF INCOME BE TREATED AS COMPLIANCE OF THE NOTICE UNDER S.148 OF THE ACT. THEREAFTER, NOTICE UNDER S.143(2) OF THE ACT WAS IS SUED ON 21.11.2011. IT IS THE CASE OF THE ASSESSEE THAT IN VIEW OF THE ERSTWHILE PROVISION AS APPLICABLE AT THE RELEVANT T IME, THE NOTICE UNDER S.143(2) WAS STATUTORILY REQUIRED TO BE ISSUE D WITHIN SIX MONTHS FROM THE END OF THE FINANCIAL YEAR AND CONSE QUENTLY, THE LAST DATE FOR ISSUANCE OF NOTICE UNDER S.143(2) OF THE ACT IS TO BE RECKONED AS 30 TH SEPTEMBER, 2011. THE NOTICE ISSUED THEREAFTER ON 21.11.2011 IS, THUS, OF NO MOMENT AND DOES NOT HAVE ANY FORCE OF LAW. 7. AT THIS POINT, WE OBSERVE THAT THE FACT OF BELAT ED ISSUANCE OF NOTICE HAS NOT BEEN DISPUTED ON BEHALF OF THE REVEN UE. NEEDLESS TO SAY THAT NOTICE UNDER S.143(2) OF THE ACT GRANTS JURISDICTION FOR MAKING ASSESSMENT OR RE-ASSESSMENT. THE REQUIREMEN T OF LIMITATION PLACED IN PROVISO TO SECTION 143(2) OF T HE ACT TO GAIN JURISDICTION UNDER S. 143(2) OF THE ACT IS ABSOLUTE AND NEGLECT IN ATTENDING TO SUCH REQUIREMENT WILL INVALIDATE THE W HOLE PROCEEDINGS. THE JURISDICTIONAL DEFECT THUS CANNOT BE CURED. WE THUS FIND THAT THE CIT(A) HAS RIGHTLY ADJUDICATED T HE ISSUE IN FAVOUR OF THE ASSESSEE BY PLACING RELIANCE UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ACIT VS. HOTEL BLUE MOON [2010] 321 ITR 362 (SC) AND HOST OF OTHER DECISIONS AS NOTED THEREIN. IDENTICAL ISSUE HAS BEEN DECIDED IN FAVOU R OF THE ASSESSEE BY THE JURISDICTIONAL HIGH COURT IN THE CASE OF SUK HINI P. MODI (SUPRA) AS RELIED UPON ON BEHALF OF THE ASSESSEE. CONSEQUENTLY, ITA NO.1127/AHD/15 [DCIT VS. CLP POWER INDIA PVT. LTD.] A.Y. 2006-07 - 5 - WE DO NOT SEE ANY INFIRMITY IN THE ORDER OF THE CIT (A). THE CASE LAWS RELIED UPON ON BEHALF OF THE REVENUE ARE ON DI FFERENT FACTS. WE ARE, IN ANY CASE, GOVERNED BY THE DECISION OF TH E HONBLE SUPREME COURT AND HONBLE JURISDICTIONAL HIGH COURT IN PREFERENCE TO OTHER DECISIONS. WE DO NOT CONSIDER IT NECESSARY TO DWELL FURTHER ON A SQUARELY COVERED ISSUE. RESULTA NTLY, THE RE- ASSESSMENT ORDER WHICH IS SUBJECT MATTER OF APPEAL IS BAD IN LAW AND THUS, THE GRIEVANCE OF THE REVENUE ARISING FROM SUCH NONEST RE-ASSESSMENT ORDER DOES NOT SURVIVE. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. SD/- SD/- (MAHAVIR PRASAD) (PRADIP KUMA R KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 04/09/2018 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED IN OPEN COURT ON 04/09/20 18