The ITO, Ward-9(1), Ahmedabad V. M/s. Shubh Laxmi Corporation, Ahmedabad

ITA 1404/AHD/2005

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 8868 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-03-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 04-03-2010
• Assessment Year: 1998-1999
• Appeal Filed On: 12-05-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GOVIND SINGHAL
• Keywords: Reopening of assessment; Difference of opinion; Change of opinion; Reassessment proceedings
• Section: 143(3); 142(1); 133A; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : A BENCH : A HMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA, J.M. & HON'BLE SH RI A.N. PAHUJA, A.M.) I.T.A. NO. 1404/AHD./2005 ASSESSMENT YEAR : 1998-1999 INCOME TAX OFFICER, WARD-9(1), AHMEDABAD VS.- SHU BH LAXMI CORPORATION, AHMEDABAD (PAN : AAOFS 5085 K) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI GOVIND SINGHAL, SR. D.R. RESPONDENT BY : SHRI DHIREN SHAH, C.A. O R D E R PER SHRI T.K. SHARMA, JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS AGAINST THE OR DER DATED 07.03.2005 OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-XV, AHMEDABAD F OR THE ASSESSMENT YEAR 1998-99. 2. BRIEFLY STATED THE FACTS ARE THAT FOR THE ASSESS MENT YEAR UNDER APPEAL, ORIGINAL ASSESSMENT ORDER WAS COMPLETED UNDER SECTION 143(3) ON 29.12.2 000 DETERMINING TOTAL INCOME OF RS.46,73,375/-. SUBSEQUENTLY, THE ASSESSMENT WAS RE OPENED UNDER SECTION 147(B) BY ISSUING NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT, 196 1. IN THE FRESH ASSESSMENT ORDER UNDER SECTION 143(3) READ WITH SECTION 147 DATED 31.03.20 04, THE ASSESSING OFFICER MADE THE FOLLOWING TWO ADDITIONS :- (I) DISCLOSED UNACCOUNTED BOOKING DEPOSITS RECEIPTS FROM MEMBERS AND APPORTIONED BY THE PARTNERS ARE NOT BROUGHT BACK WHICH WAS OFFERED FOR TAXATION IN AY 1994-95, WHICH IS DEDUCTED FROM COMPUTATION OF TOTAL INCOME OF THIS YEAR. RS.10,50,000/- (II) 15% OF UNEXPLAINED COST OF CONSTRUCTION OF RS.30,00,000/- DISCLOSED AT THE TIME OF SURVEY U/S. 133A AND OFFERED FOR TAXATION IN AY 1994-95, WHICH IS DEDUCTED FROM COMPUTATION OF TOTAL INCOME OF THIS YEAR. RS. 4,50,000/- 2 ITA NO. 1404/AHD/2005 3. ON APPEAL, IN THE IMPUGNED ORDER, THE LEARNED CO MMISSIONER OF INCOME TAX(APPEALS) HELD THAT REOPENING IS NOT PROPER. HE ACCORDINGLY D ECIDED THE GROUND RELATING CHALLENGING THE REOPENING OF ASSESSMENT IN FAVOUR OF THE ASSESSEE. ON MERIT, THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) DELETED THE ADDITION MADE BY TH E ASSESSING OFFICER OF RS.10,50,000/- FOR UNACCOUNTED BOOKING DEPOSITS RECEIPTS AND RS.4,50,0 00/- FOR UNEXPLAINED CONSTRUCTION COST. 4. AGGRIEVED BY THIS ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS), THE REVENUE IS IN APPEAL BEFORE US ON THE FOLLOWING GROUNDS :- (1) THE LD. CIT.(A) HAS ERRED IN LAW AND ON FACTS I N DELETING THE ADDITIONS MADE BY THE ASSESSING OFFICER OF RS.10,50,000/- FOR UNACCOUNTED BOOKING DEPOSIT RECEIPTS AND RS.4,50,000/- FOR UNEXPLAINED CONSTRUCTION COST. (2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT.(A) OUGHT TO HAVE UPHELD THE ABOVE ADDITIONS OF RS.10,5 0,000/- AND RS.4,50,000/- MADE BY THE ASSESSING OFFICER. 5. AT THE TIME OF HEARING, SHRI DHIREN SHAH, C.A. A PPEARING ON BEHALF OF ASSESSEE POINTED OUT THAT ON THE LAST DATE OF HEARING I.E. 09.12.200 9, THE LD. DEPARTMENTAL REPRESENTATIVE TOOK THE ADJOURNMENT ON THE GROUND THAT REVENUE WANTS TO FIL E THE ADDITIONAL GROUND AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS) HOLDING THAT RE-ASSESSMENT PROCEEDINGS ARE NOT VALID. SINCE TILL DATE, THE DEPARTMENT HAS NOT FILE D THE ADDITIONAL GROUND CHALLENGING THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS) WHEREBY HE HELD THAT RE-OPENING IS NOT PROPER, THE APPEAL OF THE REVENUE BE DISMISSED. 6. ON THE OTHER HAND, SHRI GOVIND SINGHAL, SR. D.R . APPEARING ON BEHALF OF THE REVENUE COULD NOT CONTROVERT THE AFORESAID CONTENTION OF TH E LD. COUNSEL OF THE ASSESSEE. THE LD. D.R. ALSO STATED THAT HE HAS RETURNED TO THE CONCERNED ASSESS ING OFFICER, BUT TILL DATE NO ADDITIONAL GROUND IS FILED. 7. HAVING HEARD BOTH THE SIDES, WE HAVE CAREFULLY G ONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER, THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) VIRTUALLY QUASHED THE ASSESSMENT BY HO LDING THAT REOPENING OF ASSESSMENT IS NOT 3 ITA NO. 1404/AHD/2005 PROPER. APART FROM THIS, HE HAS DECIDED THE OTHER G ROUNDS ON MERITS. IT IS PERTINENT TO NOTE THAT NEITHER IN THE ORIGINAL GROUND NOR TILL DATE, THE R EVENUE HAS FILED ADDITIONAL GROUND CHALLENGING THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APP EALS) WHEREBY HE HELD THAT RE-ASSESSMENT IS NOT PROPER. THE OPERATIVE PORTION OF THE ORDER O F LEARNED COMMISSIONER OF INCOME TAX(APPEALS) WHEREBY HE HELD THAT RE-ASSESSMENT PRO CEEDINGS ARE HELD TO NOT PROPER IS CONTAINED IN PARA 2.2 ON PAGES 3 & 4. THE RELEVANT PORTION OF THE DECISION IS AS UNDER :- 2.2THUS THE BASIS OF MATERIAL WHICH HAS BEEN UTILIZED FOR REOPENING OF THE PRESENT ASSESSMENT WERE ALREADY TH ERE AT THE TIME OF REGULAR ASSESSMENT AND NO NEW MATERIAL OR INFORMATION HAS B EEN RECEIVED BY THE ASSESSING OFFICER. THIS IS ALSO CLEAR FROM THE SHOW CAUSE NOTICE ISSUED BY THE ASSESSING OFFICER U/S. 142(1) DATED 20.12.2000 WHER EIN THE APPELLANT WAS ASKED TO FURNISH THE DETAILS OF TOTAL AMOUNT RECEIV ED FROM MEMBERS AND THE TOTAL COST OF CONSTRUCTION ON THE BASIS OF WHICH SU RPLUS OF THE SCHEME OF RS.44,87,880/- WAS DETERMINED AND THE SAME HAD BEEN REPLIED BY THE APPELLANT VIDE LETTERS DATED 19.12.2000 AND 26.12.2 000 THAT THE SAID TWO AMOUNTS HAD ALREADY BEEN OFFERED FOR TAXATION IN AY 1994-95 BY THE APPELLANT. ACCORDINGLY AFTER VERIFYING THE SAID CON TENTION OF THE APPELLANT NO ADDITION HAD BEEN MADE IN THE REGULAR ASSESSMENT PR OCEEDINGS AND THE ASSESSMENT WAS COMPLETED ON 29.12.2000. THEREFORE, THE APPELLANT HAS CONTENDED THAT IT IS A CASE OF CHANGE OF OPINION BY THE ASSESSING OFFICER IN REOPENING THE ASSESSMENT. THE AUTHORIZED REPRESENTA TIVE HAS CITED THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CI T VS.- BHANJI LAVJI REPORTED IN 79 ITR 582 (SUPREME COURT) AND THE DECI SIONS OF GUJARAT HIGH COURT IN THE CASE OF GARDEN SILK MILLS LTD. VS.- D CIT REPORTED IN 222 ITR 68 AND THE DECISION IN THE CASE OF CIT VS.- KESHRI MAL SAMRATHMAL VS.- ITO REPORTED IN 215 ITR 714 (GUJARAT). IN VIEW OF THE A BOVE FACTS AND CIRCUMSTANCES OF THE CASE AND ABOVE LEGAL DECISIONS , I FIND THAT ALL THE MATERIALS WERE AVAILABLE BEFORE THE ASSESSING OFFIC ER AT THE TIME OF REGULAR ASSESSMENT AND NO NEW INFORMATION HAS COME BEFORE T HE ASSESSING OFFICER TO NECESSITATE REOPENING OF ASSESSMENT. THEREFORE, THE RE-ASSESSMENT PROCEEDINGS HAVE BEEN INITIATED MERELY ON CHANGE OF OPINION ON THE SAME FACTS WHICH ERE AVAILABLE AT THE TIME OF REGULAR AS SESSMENT PROCEEDINGS. THEREFORE, REASSESSMENT PROCEEDINGS ARE HELD TO BE NOT PROPER AND THIS GROUND IS ALLOWED IN FAVOUR OF THE APPELLANT. IN VIEW OF ABOVE, WE HAVE NO OPTION BUT TO HOLD THA T NO USEFUL PURPOSE WILL BE SERVED BY ADJUDICATING TWO GROUNDS RAISED BY REVENUE IN ITS A PPEAL UNLESS DEPARTMENT IS AGGRIEVED BY THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS ) HOLDING THAT RE-ASSESSMENT PROCEEDINGS 4 ITA NO. 1404/AHD/2005 ARE NOT PROPER. WE, THEREFORE, INCLINE TO UPHOLD TH E ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS). 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. THE ORDER WAS PRONOUNCED IN THE COURT ON 05.03.201 0 SD/- SD/- (A.N. PAHUJA) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 05 / 03 / 2010 COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE (2) THE DEPARTMENT. 3) CIT(A) CONCERNED, (4) CIT CONCERNED, (5) D.R., ITAT, AHMEDABAD. TRUE COPY BY ORDER DEPUTY REGISTRAR, ITAT, AHMEDABAD LAHA/SR.P.S.