Kolhapur Udyam Co-Op Society Ltd, Kolhapur V. Assistant Commissioner of Income-tax, Circle - 2, Kolhapur

ITA 1362/PUN/2019

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The case involves Kolhapur Udyam Coop Society Ltd., the appellant, contesting an order from the Commissioner of Income Tax (Appeals)-2, Kolhapur, which stemmed from an assessment order by the Assessing Officer under sections 143(3) r.w.s 147 of the Income Tax Act, 1961 for the assessment year 2010-11. The primary contention was regarding the validity of the notice issued under section 148 and the subsequent reassessment, which the assessee argued was beyond the permissible time frame and constituted a mere change of opinion. Additionally, the assessee contested the addition of Rs.77,49,618 as profit from the sale of industrial units, arguing that the income was not taxable in the year under consideration as it was offered in a subsequent year when the project was completed.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134146 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-02-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 06-12-2022
• Assessment Year: 2010-2011
• Appeal Filed On: 10-09-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Difference of opinion; Change of opinion
• Section: 143(3)

Judgement Text

आयकर अपीलीय अिधकरण “ए” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A” :: PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.1362/PUN/2019 िनधाᭅरण वषᭅ / Assessment Year : 2010-11 Kolhapur Udyam Coop Society Ltd., 1328/25, Y P Powar Nagar, Kolhapur – 416008. PAN: AAAAK 0364 N V s The ACIT, Circle-2, Kolhapur. Appellant/ Assessee Respondent /Revenue Assessee by Shri Pramod Shingte – AR Revenue by Shri Ramnath P Murkunde – DR Date of hearing 07/12/2022 Date of pronouncement 24/02/2023 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This appeal filed by the Assessee is directed against the order of ld.Commissioner of Income Tax(Appeals)-2, Kolhapur dated 09.07.2019 emanating from assessment order of Assessing officer dated 29.12.2017 under section 143(3) r.w.s 147 of the I.T.Act, 1961 for the A.Y.2010-11. The Assessee has raised the following grounds of appeal: “1. The learned CIT (A) erred in holding that the notice issued u/s 148 was within six years from the end of the relevant asst, year without appreciating that the learned A.O. had issued notice u/s ITA No.1362/PUN/2019 Kolhapur Udyam Co-op Society Ltd., [A] 2 148 on 01.04.2017 which was beyond six years from the end of the relevant assessment year and accordingly, the reopening and the reassessment order was invalid in law. 2. The learned CIT (A) erred in not appreciating that the reopening was beyond four years from the end of the relevant assessment year and since there was no failure on the part of the assessee to disclose fully and truly the material facts, the reopening u/s 148 was invalid in law. 3. The learned CIT (A) failed to appreciate that the reopening u/s 148 was on mere change of opinion and accordingly, the same was invalid in law and the consequential reassessment order ought to have been declared null and void 4. The learned CIT(A) erred in confirming the addition made by the learned A.O. of Rs.77,49,618/- being profit worked out on sale of industrial units / shops without appreciating that no such income was taxable in the year under consideration and accordingly, the addition made was required to be deleted. 5. The learned CIT(A) failed to appreciate that the assessee has offered the income on sale of industrial units / shops in A.Y. 2014 - 15 when the project was completed and therefore there was no reason to tax any amount in the year under consideration. 6. The learned CIT(A) failed to appreciate that the assessee had sold only one unit in the year under consideration and therefore, there was no reason to tax the income of all the units sold in the earlier years in the year under consideration and hence, the addition made may kindly be deleted. 7. The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal.” ITA No.1362/PUN/2019 Kolhapur Udyam Co-op Society Ltd., [A] 3 2. The ld.Authorised Representative(ld.AR) for the assessee has filed a note which is reproduced as under: ITA No.1362/PUN/2019 Kolhapur Udyam Co-op Society Ltd., [A] 4 3. The ld.Departmental Representative(ld.DR) for the Revenue has relied on the orders of the Lower Authorities. Findings and Discussion : 4. It is observed from the assessment order that the Assessing Officer(AO) has added Rs.77,49,618/-. It is mentioned in the assessment order that assessee society has constructed and allotted industrial units to its Members. The assessee society has received more than 90% of sale-proceeds as on 31.03.2010, but has not offered any profit for taxation. The assessee submitted before the AO that the assessee society started construction in 1996-97, the expenditure incurred on construction has been shown in Balance Sheet under the head “Construction Expenses” amounting of Rs.6,44,82,226/- and advance of Rs.7,22,31,844/-. During the assessment proceedings, the assessee claimed that profit has been offered for taxation in subsequent year. However, the AO rejected the assessee’s claim and made addition of Rs.77,49,618/- [Rs.7,22,31,844/- (-) Rs.6,44,82,226/-]. Aggrieved by the same, the assessee filed appeal before the ld.CIT(A) and the ld.CIT(A) confirmed the addition. 5. Before us, the ld.AR pleaded that similar addition based on Balance Sheet for A.Y. 2011-12 has been made in A.Y.2011-12. Assessee has opted for “Direct Tax Vivad se Vishwas Scheme ITA No.1362/PUN/2019 Kolhapur Udyam Co-op Society Ltd., [A] 5 2020”, for A.Y. 2011-12. In the paper book at page no.1 the assessee filed copy of Form No.5 issued by ld.Pr.CIT, Pune-1 for A.Y. 2011-12. The ld.AR claimed that assessee has opted for “Direct Tax Vivad se Vishwas Scheme 2020” for A.Y. 2011-12 and addition made for A.Y. 2010-11 is related to the same industrial units for which assessee paid taxes under “Direct Tax Vivad se Vishwas Scheme 2020”, hence, for A.Y. 2010-11, there will be double taxation. In these facts and circumstances of the case, we set- aside the issue to the file of the AO for verification with the direction that there shall not be any double taxation for the same account. The AO shall give opportunity to the assessee. Assessee shall file all necessary documents before the Assessing Officer. Accordingly, the grounds of appeal raised by the assessee are allowed for statistical purpose. 6. The ld.AR has no pressed Ground No.1, 2 & 3, hence, Ground No.’s.1, 2 and 3 are dismissed as not pressed. 7. In the result, appeal of the assessee is allowed for statistical purpose. Order pronounced in the open Court on 24 th February, 2023. Sd/- Sd/- (S.S.GODARA) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 24 th Feb, 2023/ SGR* ITA No.1362/PUN/2019 Kolhapur Udyam Co-op Society Ltd., [A] 6 आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “ए” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.