D- Art Furniture Systems Pvt. Ltd., New Delhi V. DCIT, Central Circle- 17, New Delhi

ITA 1354/DEL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4697 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 26-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHISKEK KUMAR
• Assessee Lawyers: VICKY KUMAR SR A CCOUNTANT
• Keywords: Reassessment proceedings; Set aside
• Section: 271(1)(c); 153A

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI B BENCH, NEW DELHI BEFORE SHRI N.K. BILLAIYA , ACCOUNTANT MEMBER, AND SHRI K.N. CHARY, JUDICIAL MEMBER ITA NO. 1354 /DEL/201 8 [ASSESSMENT YEAR: 20 08 - 09 ] D - ART FURNITURE SYSTEMS P. LTD. VS. THE D.C.I.T L - 107, KIRTI NAGAR CENTRAL CIRCLE - 17 NEW DELHI 110 015 NEW DELHI PAN: AABCD6422H [APPELLANT] [RESPONDENT] DATE OF HEARING : 14 . 0 5 .201 9 DATE OF PRONOUNCEMENT : 1 6 .0 5 .201 9 ASSESSEE BY : SHRI VICKY KUMAR, SR A CCOUNTANT . REVENUE BY : S HRI ABHISKEK KUMAR , SR . DR ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX [APPEALS] 27 , NEW DELHI DATED 10 .0 1 .201 8 PERTA INING TO ASSESSMENT YEAR 20 08 - 09 . 2 2. THE SOLITARY GR IEVANCE RAISED BY THE ASSESSEE IS THAT THE CIT(A) ERRED IN UP HOLDING PENALTY LEVIED U/S 271(1)(C) OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' ] ON TH E ADDITIONS MADE WHILE FRAMING THE ASSESSMENT ORDER DATED 12.03.2013 U/S 153A OF THE ACT. 3. THE FACTS ON RECORD SHOW THAT THE ASSESSMENT WAS COMPLETED ON AN INCOME OF RS. 2,03,35,310 / - . WHEN THE ASSESSMENT WAS ASSAILED BEFORE THE CIT(A), THE ASSESSEE COULD GET ONLY A RELIEF OF RS. 31,320/ - AND THE MA T TER TRAVELLED UPTO THE TRIBUNAL. THE TRIBUNAL IN ITA NO. 5750/DEL/2014 VIDE ORDER DATED 06.02.2019 SET ASIDE THE FINDIN G S OF THE CIT(A) AND DELETED THE ADDITION BY ALLOWING THE APPEAL OF THE ASSESSEE. 4. THE RELEVANT PART OF THE DECISION OF THE TRIBUNAL [SUPRA] READS AS UNDER: 6.4. IT IS OBSERVED THAT LD.AO MADE ADDITIONS BASED UPON AUDITED BALANCE SHEET, FILED DURING ASSESSMENT PROCEED INGS. HONBLE DELHI HIGH COURT IN CASE OF PRO.CIT VS. RAM AVTAR 3 VERMA, REPORTED IN (2017) 88 TAXMANN.COM 666, HAS HELD AS UNDER: 4. THE REVENUE URGES THAT THE NON - OBSTANTE CLAUSE IN SECTION 153A TOGETHER WITH SECTION 158BD REMOVES THE BARRIER VIS - A - VIS RESTRICTION UPON SEARCH ASSESSMENTS BEING CONFINED TO 'UNDISCLOSED INCOME'. IN OTHER WORDS, IT IS STATED THAT NONE OF THE PROVISIONS CONFINE THE ENQUIRY OF THE AO TO EVALUATING INCRIMINATING MATERIALS. THIS ASPECT, IN THE OPINION OF THE COURT, WAS EXTENSI VELY DEALT WITH IN KABUL CHAWLA V. CIT [2016] 380 ITR 573/[2015] 234 TAXMAN 300/61 TAXMANN.COM 412 (DELHI) WHICH HAS, BY NOW, BEEN FOLLOWED CONSISTENTLY IN SEVERAL APPEALS. THE NON - OBSTANTE CLAUSE, IN THE OPINION OF THE COURT, WAS NECESSARY, GIVEN THAT TH ERE IS A DEPARTURE FROM THE PREEXISTING PROVISIONS, WHICH APPLIED FOR THE PREVIOUS YEARS AND HAD A DIFFERENT STRUCTURE WHERE TWO SETS OF ASSESSMENT ORDERS WERE MADE BY THE AO DURING BLOCK PERIODS. WITH THE UNIFICATION OF ASSESSMENT YEARS FOR THE BLOCK PERI OD, I.E. ONLY ONE ASSESSMENT ORDER FOR EACH YEAR IN THE BLOCK PERIOD, IT WAS NECESSARY FOR AN OVERRIDING PROVISION OF THE KIND ACTUALLY ADOPTED IN SECTION 153A. BUT FOR SUCH A NON - OBSTANTE CLAUSE, THE REVENUE COULD POSSIBLY HAVE FACED HURDLES IN REGARD TO UNADOPTED/CURRENT ASSESSMENT YEARS AS WELL AS REASSESSMENT PROCEEDINGS PENDING AT THE TIME OF THE SEARCH IN RESPECT OF WHICH PROCEEDINGS WERE TO BE COMPLETED UNDER SECTIONS 153A/ 153C. HAVING REGARD TO THE ABOVE DIRECTIONS, WE ARE OF THE OPINION THAT THE I TAT 4 DECISION DOES NOT CALL FOR INTERFERENCE. BOTH APPEALS ARE ACCORDINGLY DISMISSED. 6.5. RESPECTFULLY FOLLOWING THE SAME, WE ALLOW GROUND NO.1 RAISED BY ASSESSEE. 5. WHEN THE FOUNDATION [ASSESSMENT] IS REMOVED, THE SUPER STRUCTURE [PENALTY] MUST FALL. 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO. 1354/DEL/2018 IS ALLOWED . THE ORDER IS PRON OUNCED IN THE OPEN COURT ON 1 6 . 0 5 .201 9 . S D / - S D / - [ K.N. CHARY ] [N.K. BILLAIYA] J UDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 6 T H MA Y , 2019. VL/ COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT ASST. REGISTRAR 4. CIT(A) ITAT, NEW DELHI 5. DR 5 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER