Neena Wadhwa, New Delhi V. DCIT, New Delhi

ITA 1254/DEL/2012

• Counselvise Citation: 125420114 RSA 2012
• Duration Of Justice: 1 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 26-11-2013
• Assessment Year: 1997-1998
• Appeal Filed On: 14-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SUGANDHA ANAND S
• Keywords: Reopening of assessment
• Section: 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH E EE E : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI A.D. JAIN A.D. JAIN A.D. JAIN A.D. JAIN, ,, , JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO. .. .1254/DEL/2012 1254/DEL/2012 1254/DEL/2012 1254/DEL/2012 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 1997 1997 1997 1997- -- -98 9898 98 MS. NEENA WADHWA, MS. NEENA WADHWA, MS. NEENA WADHWA, MS. NEENA WADHWA, 60 6060 60- -- -B, SAINIK FARMS, B, SAINIK FARMS, B, SAINIK FARMS, B, SAINIK FARMS, C CC C- -- -5 STREET, 5 STREET, 5 STREET, 5 STREET, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 062. 110 062. 110 062. 110 062. PAN : PAN : PAN : PAN : AAAPW5822G. AAAPW5822G. AAAPW5822G. AAAPW5822G. VS. VS. VS. VS. DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -5, 5,5, 5, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SANAT KAPOOR AND MS. SUGANDHA ANAND, ADVOCATES. RESPONDENT BY : SHRI KEYUR PATEL, SR.DR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LEARNED CIT(A)-XXXI, NEW DELHI DATED 13 TH JANUARY, 2012 FOR THE AY 1997-98. 2. VARIOUS GROUNDS HAVE BEEN RAISED BY THE ASSESSEE . HOWEVER, GROUND NOS.1 TO 7 ARE AGAINST THE REOPENING OF ASSE SSMENT UNDER SECTION 148 OF THE INCOME-TAX ACT, 1961. 3. AT THE TIME OF HEARING BEFORE US, IT IS STATED B Y THE LEARNED COUNSEL THAT IN THIS CASE, ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143(1). NOTICE UNDER SECTION 148 WAS ISSUE D AFTER MORE THAN FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR AND BY THE OFFICER WHO WAS OF THE RANK OF DEPUTY COMMISSIONER OF INCOME TAX. THEREFORE, AS PER SECTION 151(2), THE PERMISSION OF JOINT COMMISSIONER OF INCOME TAX WAS REQUIRED. THAT THE ASSESSING OFF ICER REOPENED THE ASSESSMENT AFTER OBTAINING THE PERMISSION FROM THE COMMISSIONER OF ITA-1254/DEL/2012 2 INCOME TAX AND NOT FROM THE JOINT COMMISSIONER OF I NCOME TAX. THAT IN THE CASE OF CIT VS. SPLS SIDDHARTHA LTD. (201 2) 345 ITR 223 (DELHI), HON'BLE JURISDICTIONAL HIGH COURT HAS HELD THAT IF A PERMISSION IS OBTAINED FROM THE COMMISSIONER OF INCOME TAX INSTEA D OF ADDITIONAL COMMISSIONER, THE SAME CANNOT BE SAID TO BE VALID C OMPLIANCE WITH THE PROVISIONS OF SECTION 151(2). 4. LEARNED DR, ON THE OTHER HAND, RELIED UPON THE O RDERS OF LOWER AUTHORITIES AND HE STATED THAT THERE WERE VALID REA SONS FOR REOPENING OF ASSESSMENT AND LEARNED CIT(A) RIGHTLY SUSTAINED THE SAME. 5. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BO TH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. SECTION 151 OF THE ACT READS AS UNDER:- SANCTION FOR ISSUE OF NOTICE. SANCTION FOR ISSUE OF NOTICE. SANCTION FOR ISSUE OF NOTICE. SANCTION FOR ISSUE OF NOTICE. 151. 151. 151. 151. (1) IN A CASE WHERE AN ASSESSMENT UNDER SUB-SE CTION (3) OF SECTION 143 OR SECTION 147 HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO NOTICE SHALL BE ISSUED UNDER SECTION 148 [BY AN ASSESSING OFFICER, WHO IS BELOW THE RANK OF ASSISTANT COMMISSIONER [OR DEPUTY COMMISSIONER], UNLESS THE [JOINT] COMMISSIONER IS SATISFIED ON THE REASONS RECORDED BY SUCH ASSESSING OFFICER THAT IT IS A FIT CASE FOR THE ISSUE OF SUCH NOTICE] : PROVIDED PROVIDED PROVIDED PROVIDED THAT, AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, NO SUCH NOTICE SHALL BE ISSUED UNLESS THE CHIEF COMMISSIONER OR COMMISSIONE R IS SATISFIED, ON THE REASONS RECORDED BY THE ASSESSING OFFICER AFORESAID, THAT IT IS A FIT CASE FOR THE ISSUE OF S UCH NOTICE. (2) IN A CASE OTHER THAN A CASE FALLING UNDER SUB-S ECTION (1), NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSESSING OFFICER, WHO IS BELOW THE RANK OF [JOINT] COMMISSIONER, AFTER THE EXPIRY OF FOUR YEARS FROM T HE END OF THE RELEVANT ASSESSMENT YEAR, 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.] ITA-1254/DEL/2012 3 [EXPLANATION.FOR THE REMOVAL OF DOUBTS, IT IS HERE BY DECLARED THAT THE JOINT COMMISSIONER, THE COMMISSIO NER OR THE CHIEF COMMISSIONER, AS THE CASE MAY BE, BEING SATISFIED ON THE REASONS RECORDED BY THE ASSESSING OFFICER ABOUT FITNESS OF A CASE FOR THE ISSUE OF NOTICE UND ER SECTION 148, NEED NOT ISSUE SUCH NOTICE HIMSELF.]. 6. FROM THE ABOVE, IT IS EVIDENT THAT WHERE THE ORIGINAL ASSESSMENT HAS BEEN COMPLETED UNDER SECTION 143(3), THE CASE W OULD FALL WITHIN THE AMBIT OF SECTION 151(1), BUT, THE CASES WHICH A RE NOT FALLING WITHIN SUB-SECTION (1), NOTICE UNDER SECTION 148 CANNOT BE ISSUED AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT A SSESSMENT YEAR BY AN OFFICER WHO IS BELOW THE RANK OF JOINT COMMISSIO NER OF INCOME TAX UNLESS THE JOINT COMMISSIONER OF INCOME TAX IS SATI SFIED ON THE REASONS RECORDED BY THE ASSESSING OFFICER THAT IT IS A FIT CASE FOR ISSUE OF NOTICE. THE COPY OF REASONS RECORDED IS ENCLOSED AT PAGE 37 5 OF THE ASSESSEES PAPER BOOK. IN THE LAST PARAGRAPH OF TH E NOTICE, IT IS MENTIONED BY THE ASSESSING OFFICER THIS NOTICE IS BEING ISSUED AFTER OBTAINING THE NECESSARY SATISFACTION OF THE COMMISS IONER OF INCOME- TAX, CENTRAL I, DELHI . THUS, THE PERMISSION HAS BEEN OBTAINED FROM THE COMMISSIONER OF INCOME TAX AND NOT FROM THE JOINT C OMMISSIONER OF INCOME TAX. THAT THE HON'BLE JURISDICTIONAL HIGH C OURT IN THE CASE OF SPLS SIDDHARTHA LTD. (SUPRA) HELD AS UNDER:- AO HAS SPECIFICALLY SOUGHT APPROVAL OF COMMISSIONE R ONLY. THEREFORE, IT CANNOT BE SAID THAT THE JOINT COMMISSIONER/ADDITIONAL COMMISSIONER HAD GRANTED TH E APPROVAL. FURTHER, THE FILE WAS ROUTED THROUGH ADD ITIONAL COMMISSIONER. HOWEVER, HE DID NOT APPLY HIS MIND O R GAVE ANY SANCTION. INSTEAD, HE REQUESTED COMMISSIONER T O ACCORD THE APPROVAL. IT, THUS, CANNOT BE SAID THAT IT IS AN IRREGULARITY CURABLE U/S 292B. IF A STATUTORY AUTH ORITY HAS BEEN VESTED WITH JURISDICTION, HE HAS TO EXERCISE I T ACCORDING TO ITS OWN DISCRETION. IF DISCRETION IS EXERCISED UNDER DIRECTION OR IN COMPLIANCE WITH SOME HIGHER AUTHORITIES INSTRUCTION, THEN IT WILL BE CASE OF FA ILURE TO EXERCISE DISCRETION ALTOGETHER. ITA-1254/DEL/2012 4 7. THAT THE RATIO OF THE ABOVE DECISION WOULD BE SQ UARELY APPLICABLE TO THE FACTS OF THE ASSESSEES CASE. RESPECTFULLY FOLLOWING THE SAME, WE HOLD THAT PERMISSION GRANTED BY THE COMMISSIONER OF INCOME-TAX FOR REOPENING OF ASSESSMENT IS IN VIOLATION OF THE PROVISIONS OF SECTION 151(2). IN VIEW OF THE ABOVE, THE REOPENING OF ASS ESSMENT IS QUASHED AND, CONSEQUENTLY, THE ASSESSMENT ORDER PASSED IN P URSUANCE TO THE NOTICE UNDER SECTION 148 OF THE ACT IS ALSO QUASHED . 8. SINCE WE HAVE ALREADY QUASHED THE IMPUGNED ASSES SMENT ORDER, THE ADDITION MADE IN SUCH ASSESSMENT ORDER WHICH IS CHALLENGED BY THE ASSESSEE VIDE GROUND NO.8 ONWARDS DOES NOT SURVIVE AND, THEREFORE, DOES NOT REQUIRE ANY ADJUDICATION. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. DECISION PRONOUNCED IN THE OPEN COURT ON 27 TH NOVEMBER, 2013. SD/- SD/- ( (( (A.D. JAIN A.D. JAIN A.D. JAIN A.D. JAIN) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 27.11.2013 VK. COPY FORWARDED TO: - 1. APPELLANT : MS. NEENA WADHWA, MS. NEENA WADHWA, MS. NEENA WADHWA, MS. NEENA WADHWA, 60 6060 60- -- -B, SAINIK FARMS, B, SAINIK FARMS, B, SAINIK FARMS, B, SAINIK FARMS, C CC C- -- -5 STREET, NEW DELHI 5 STREET, NEW DELHI 5 STREET, NEW DELHI 5 STREET, NEW DELHI 110 062. 110 062. 110 062. 110 062. 2. RESPONDENT : DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE CENTRAL CIRCLE- -- -5, NEW DELHI. 5, NEW DELHI. 5, NEW DELHI. 5, NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR