Appeal details
Counselvise Citation
[2017] 130 COUNSELVISE.COM (IT) 8535 (ITAT-BANGALORE)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
5 month(s) 25 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
23-02-2017
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
B
Next Hearing Date
12-01-2017
Assessment Year
2007-2008
Appeal Filed On
31-08-2016
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL SMC C BENCH : BANGALORE BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NOS. 1571 & 1572/BANG/2016 ASSESSMENT YEAR : 2007-08 SMT. PARVATHAMMA PAN: AKJPP 0454G SMT. HEMANALINI C.H. PAN: AAKPH 3091E NO. 3, 3 RD CROSS, GANDHINAGAR, BANGALORE 560 009. VS. THE INCOME TAX OFFICER, W-5(2)(4), BENGALURU. APPELLANTS RESPONDENT APPELLANTS BY : NONE RESPONDENT BY : SHRI A.R. V. SREENIVASAN, JCIT(DR) (ITAT), BENGALURU. DATE OF HEARING : 16.02.2017 DATE OF PRONOUNCEMENT : 23.02.2017 O R D E R PER A.K. GARODIA, ACCOUNTANT MEMBER BOTH THESE APPEALS ARE FILED BY TWO DIFFERENT ASSE SSEES WHICH ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF THE CIT (AP PEALS)-5, BENGALURU, BOTH DATED 01/07/2016 FOR THE ASSESSMENT YEAR 2007- 08. BOTH THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. ITA NOS. 1571 & 1572/BANG/2016 PAGE 2 OF 5 2. THE GROUNDS RAISED IN BOTH THE APPEALS ARE IDEN TICAL WHICH READ AS UNDER:- ITA NO. 1571/BANG/2016 1. THE ORDER OF ASSESSMENT MADE U/S. 143(3) R.W.SEC . 147 IS LIABLE TO BE ANNULLED AS NO NOTICE U/S. 143(2) WAS ISSUED. 2. THE NOTICE U/S. 148 HAS BEEN ISSUED BY OBTAINING SATISFACTION OF THE COMMISSIONER OF INCOME (OSD), WHO IS NOT A JOIN T COMMISSIONER REFERRED TO IN SEC.151(2) AND SEC.2(28 C). 3. THE ASSESSING OFFICER HAVING TAKEN DEEMED VALUE U/S.50C OF THE ACT, AT RS. 56,96,000, IT WAS NOT OPEN TO MAKE SEPA RATE ADDITION OF NON-REFUNDABLE DEPOSIT OF RS. 6,75,000 SINCE IT IS SUBSUMED IN RS. 56,96,000. 4. THE ASSESSING OFFICER OUGHT TO HAVE COMPUTED CAP ITAL GAIN AT RS. NIL AND NOT AT RS. 6,04,990 AS UNDER:- COMPUTATION OF CAPITAL GAIN SL.NO. PARTICULARS AS PER ASSESSMENT ORDER AS PER ASSESSEE 1. CONSIDERATION 59,96,000 17,80,000 2. NON-REFUNDABLE DEPOSIT 6,75,000 6,75,000 3. TOTAL 63,71,000 24,55,000, 4. COST OF LAND 47,348 X 519/351 70,010 -- 5. COST OF LAND & RESIDENTIAL HOUSE -- 8,46,920 6. LONG TERM CAPITAL GAIN 63,00,990 16,08,080 7. EXEMPTION U/S.54 (SL.NO. 1 ABOVE) 56,96,000 -- 8. EXEMPTION U/S.54 (SL.NO. 1 ABOVE) LIMITED TO -- 16,08,080 LONG TERM CAPITAL GAIN 6,04,990 NIL 5. THE APPELLANT IS ENTITLED TO THE COST OF THIS AP PEAL IN ACCORDANCE WITH SEC.254 (2B) OF THE INCOME-TAX ACT, 1961. ITA NOS. 1571 & 1572/BANG/2016 PAGE 3 OF 5 6. EACH OF THE ABOVE GROUNDS OF APPEAL ARE INDEPEND ENT AND WITHOUT PREJUDICE TO EACH OTHER. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE AT THE T IME OF HEARING OF THE APPEALS. HOWEVER, THE ASSESSES HAVE FILED A LE TTER REQUESTING FOR ADJUDICATION OF THE APPEALS ON THE BASIS OF WRITTEN SUBMISSIONS. ACCORDINGLY, THE REVENUE WAS HEARD AND THE WRITTEN SUBMISSIONS FILED BY THE ASSESSES HAVE BEEN TAKEN INTO CONSIDERATION. I T IS SUBMITTED BY THE ASSESSEES THAT IN BOTH CASES, NOTICE WAS ISSUED BY THE AO U/S. 148 OF THE INCOME-TAX ACT, 1961 [THE ACT] AND IN REPLY THERE TO, LETTER WAS FILED BY THE ASSESSEE BEFORE THE AO REQUESTING THE AO TO TREAT T HE RETURN ALREADY FILED BY THE ASSESSEE AS A RETURN FILED IN RESPONSE TO NO TICE U/S 148 OF THE ACT. IT IS FURTHER SUBMITTED THAT AFTER THIS, THE AO HAD NO T ISSUED ANY NOTICE U/S. 143(2) OF THE ACT IN ANY OF THESE TWO CASES AND PAS SED THE ASSESSMENT ORDER U/S 143(3) R.W.S. 147 OF THE ACT ON 31/03/201 5. RELIANCE IS PLACED ON THE JUDGMENT OF HONBLE MADRAS HIGH COURT RENDERED IN THE CASE OF CIT V. ALSTOM T & D INDIA LTD., 45 TAXMANN.COM 424 (MAD) . A COPY OF THIS JUDGMENT IS ALSO FILED AND IS AVAILABLE ON RECORD W HEREIN IT WAS HELD BY THE HONBLE MADRAS HIGH COURT IN THIS CASE THAT WHEN AS SESSEE HAS REQUESTED THE AO TO TREAT THE RETURN ALREADY FILED AS ONE IN RESPONSE TO SEC. 148 PROCEEDINGS, FURTHER PROCEEDINGS REGARDING COMPLIAN CE OF THE PROCEDURE U/S. 143(2) IS MANDATORY IN NATURE AND IF NO NOTICE WAS ISSUED U/S. 143(2) OF THE ACT, THE ASSESSMENT ORDER FRAMED BY THE AO U/S. 143(3) R.W.S. 147 IS NOT VALID. IT IS SUBMITTED THAT THIS JUDGMENT OF H ONBLE MADRAS HIGH COURT IS SQUARELY APPLICABLE IN THE PRESENT CASES. ITA NOS. 1571 & 1572/BANG/2016 PAGE 4 OF 5 4. THE LD. DR OF REVENUE SUPPORTED THE ORDERS OF AU THORITIES BELOW. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND THAT THERE IS NO DISPUTE ON THE FACTS THAT NO NOTICE WAS ISSUED BY T HE AO U/S. 143(2) OF THE ACT AND WITHOUT ISSUING SUCH NOTICE, THE ASSESSMENT ORDER WAS FRAMED BY THE AO IN BOTH THESE CASES U/S. 143(3) R.W.S. 147 O F THE ACT. AS PER THE JUDGMENT OF HONBLE MADRAS HIGH COURT RENDERED IN T HE CASE OF CIT V. ALSTOM T & D INDIA LTD. (SUPRA) , IT WAS HELD BY THE HONBLE MADRAS HIGH COURT THAT PASSING OF ASSESSMENT ORDER U/S 143(3) R .W.S. 147 WITHOUT ISSUING NOTICE U/S. 143(2) IS NOT VALID. RESPECTFU LLY FOLLOWING THIS JUDGMENT OF HONBLE MADRAS HIGH COURT, I HOLD THAT THE ASSES SMENT ORDER PASSED BY THE AO U/S. 143(3) R.W.S. 147 WITHOUT ISSUING MANDA TORY NOTICE U/S. 143(2) IS NOT VALID AND THEREFORE, THE SAME IS QUASHED IN BOTH THESE CASES. AFTER HOLDING SO, NO ADJUDICATION IS CALLED FOR REGARDING MERITS OF VARIOUS ADDITIONS MADE BY THE AO AND CONFIRMED BY THE LD. C IT (APPEALS). 6. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEES ARE ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 23 RD DAY OF FEBRUARY, 2017. SD/- (A.K. GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 23 RD FEBRUARY, 2017. / DS / MS / ITA NOS. 1571 & 1572/BANG/2016 PAGE 5 OF 5 COPY TO: 1. APPELLANTS 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.
Mehul