Irshad Iqbal Sorathia, Sirsi V. ITO, Sirsi

ITA 1143/BANG/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5457 (ITAT-BANGALORE)
• Duration Of Justice: 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 31-05-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: G KAMALADHAR
• Assessee Lawyers: MANOJ D PUKALE
• Keywords: Audit objection; Assessment record
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH B BEFORE S HRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER I.T . A. NO. 1143 /BANG/20 16 (ASSESSMENT YEAR : 20 11 - 12 ) SHRI IRSHAD IQBAL SORATHIA, PROP. HAJI TRADERS, APM C, SIRSI - 581 401, UK DISTRICT, KARNATAKA . . APPELLANT. PAN AODPS 2117K VS. INCOME TAX OFFICER, WRD 1, SIRSI - 581 401 .. RESPONDENT. A PPELLANT BY : SHRI MANOJ D PUKALE, ADVOCATE. R E SPONDENT BY : SHRI G. KAMALADHAR, STANDING COUNSEL. DATE OF H EARING : 25.4.2017. DATE OF P RONOUNCEMENT : 05 .05 .201 7 . O R D E R PER SHRI VIJAY P AL RAO, J .M . : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE REVISION ORDER DT.16.3.2016 PASSED UNDER SECTION 263 OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT') BY PRIN. CIT FOR THE ASSESSMENT YEAR 2011 - 12. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : 2 IT A NO. 1143 /BANG/201 6 3 IT A NO. 1143 /BANG/201 6 4 IT A NO. 1143 /BANG/201 6 3. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENTATIVE AND CONSIDERED THE WRITTEN SUBMIS SIONS FILED BY THE ASSESSEE. T HE ASSESSMENT IN THIS CASE WAS COMPLETED UNDER SECTION 143(3) R.W.S. 147 OF THE ACT ON 7.3.2014. SUBSEQUENTLY, ON VERIFICATION OF ASSESSMENT RECORD, THE CIT FOUND THAT THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER IS PRIMA FACIE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. ACCORDINGLY, THE PRIN. CIT INVOKED THE PROVISIONS OF SECTION 263 AND ISSUED A NOTICE DT.2.12.2015 ON THE FOLLOWING ISSUES : 5 IT A NO. 1143 /BANG/201 6 6 IT A NO. 1143 /BANG/201 6 4. HAVING CONSIDER ED THE OBJECTIONS AND REPLY BY THE ASSESSEE, THE CIT HAS SET ASIDE THE ASSESSMENT ORDER AND DIRECTED THE AS SESSING OFFICER TO MAKE FRESH ASSESSMENT ORDER AFTER EXAMINATION OF THE BANK ACCOUNT STANDING IN THE NAME OF ASSESSEE. THUS THE CIT HAS DIRECTED THE ASSESSING OFFICER TO VERIFY AND EXAMINE THE FIVE BANK ACCOUNTS OF THE ASSESSEE WHEREIN THE CREDITS WERE S TANDING. THE MAIN OBJECTIONS BY THE ASSESSEE AGAINST THE IMPUGNED ORDER IS THAT CIT HAS INVOKED PROVISIONS OF SECTION 263 ON THE BASIS OF THE AUDIT OBJECTION. WE FIND THAT THE ASSESSMENT ORDER IS COMPLETELY SILENT ON THIS ISSUE AND THEREFORE THE ASSESSIN G OFFICER HAS NOT CONDUCTED ANY ENQUIRY ON THIS ISSUE. IT IS A CLEAR CASE OF LACK OF ENQUIRY ON THE PART OF THE ASSESSING OFFICER. THE ASSESSEE'S CONTENTION WAS THAT ONCE THE MATTER WAS EXAMINED BY THE ASSESSING OFFICER THEN A SPEAKING FINDING WAS NOT RE QUIRED BY THE ASSESSING OFFICER WHEN THE CLAIM OF THE ASSESSEE IS ACCEPTED. EVEN BY CONSIDERING THIS CONTENTION OF THE ASSESSEE, WE FIND THAT WHEN THE ASSESSING OFFICER HAS NOT RECORDED ANY THING IN THE ASSESSMENT ORDER TO SHOW THAT AN ENQUIRY WAS CONDUCT ED AND A DECISION WAS TAKEN THEN IT IS A CLEAR CASE OF LACK OF ENQUIRY AND ATLEAST INADEQUATE ENQUIRY ON THE PART 7 IT A NO. 1143 /BANG/201 6 OF ASSESSING OFFICER. FURTHER IF THE AUDIT REPORT BRINGS OUT CERTAIN RELEVANT FA CTS THEN THERE IS NO IMPEDIMENT FOR THE CIT FOR CONSIDERIN G THOSE FACTS FOR THE PURPOSE OF INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT. THE FACTS POINTED OUT BY THE AUDIT REPORT WILL CONSTITUTE INFORMATION AVAILABLE WITH THE CIT AS PER THE PROVISIONS OF SECTION 263. HENCE WE DO NOT FIND ANY SUBSTANCE OR M ERIT IN THIS OBJECTION RAISED BY THE ASSESSEE. THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. INFOSYS TECHNOLOGY LTD. 341 ITR 293 HAS HELD THAT A FINDING OF THE ASSESSING OFFICER SHOULD BE SUPPORTED BY A REASON HOWEVER BRIEF IT MAY BE IF T HE ASSESSING AUTHORITY F AILS IN GIVING THE R E ASON TH EN SUCH ORDER DEFINITELY CONSTITUTE AN ORDER NOT MERELY ERRONEOUS BUT ALSO PREJUDICIAL TO THE INTEREST OF REVENUE AND CONSEQUENTLY, THE CIT COULD BE JUSTIFIED IN EXERCISING THE JURISDICTION UNDER SECTION 263. SINCE THE CIT HAS NOT GIVEN ANY FINDING ON MERIT AND DIRECTED THE ASSESSING OFFICER TO CONDUCT A PROPER ENQUIRY IN RESPECT OF THESE ISSUES THEREFORE IN THE LIGHT OF THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. 8 IT A NO. 1143 /BANG/201 6 INFOSYS TECHNOLOGY LTD. (SUPRA), WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMPUGNED REVISION ORDER OF THE PRIN. CIT. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 5TH DAY OF MAY, 201 7 . SD/ - ( S. JAYARAMAN ) ACCOUNTANT MEMBER SD/ - ( VIJAY PAL RAO ) JUDICIAL MEMBER BANGALORE, DT. 05 . 05.2017. *REDDY GP COPY TO : 1 . APPEL LANT 2 . RESPONDENT 3 . C.I.T. 4 . CIT(A) 5 . DR, ITAT, BANGALORE. 6 . GUARD FILE. ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL BANGALORE.