ITO, WD-4(1), KOLKATA, Kolkata V. M/s RST Holdings (P) Ltd., Kolkata

ITA 163/KOL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1528 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2002-2003
• Appeal Filed On: 04-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K BANDOPADHYAY
• Assessee Lawyers: A V KESHRI
• Section: 143(3); 148

Judgement Text

1 ITA NOS.162 & 163/KOL/2016 RST HOLDINGS (P) LTD.., AY- 2001-02 & 2002-03 , C , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA ( ) BEFORE . , /AND . . , ) [BEFORE SHRI J. SUDHAKAR REDDY, AM & SHRI A. T. VA RKEY, JM] I.T.A. NOS. 162 & 163/KOL/2016 ASSESSMENT YEARS: 2001-02 & 2002-03 INCOME-TAX OFFICER, WD-4(1), KOLKATA VS. M/S. R S T HOLDINGS (P) LTD. (PAN: AABCR4072M) APPELLANT RESPONDENT DATE OF HEARING 13.12.2017 DATE OF PRONOUNCEMENT 15.02.2018 FOR THE APPELLANT SHRI A. K. BANDOPADHYAY, ADDL. CI T, SR. DR FOR THE RESPONDENT SHRI A. V. KESHRI, AR ORDER PER SHRI A.T.VARKEY, JM BOTH THESE APPEALS FILED BY THE REVENUE ARE AGAINST THE SEPARATE ORDERS OF LD. CIT(A)- 2, KOLKATA DATED 09.11.2015 FOR AYS 2001-02 AND 200 2-03. 2. THE MAIN GRIEVANCE OF THE REVENUE IS AGAINST TH E ACTION OF THE LD. CIT(A) IN ANNULLING THE ASSESSMENT ORDERS PASSED IN PURSUANCE OF THE ITATS ORDER DATED 01.09.2011. 3. THIS IS THE SECOND ROUND BEFORE THIS TRIBUNAL . BRIEF FACTS OF THE CASE FOR BOTH THE YEARS ARE THAT THE ORIGINAL ASSESSMENT U/S. 143(3) OF THE ACT WAS DONE AFTER REOPENING THE ASSESSMENTS BY ISSUANCE OF NOTICE U/S. 148 OF THE A CT. WHEN THE MATTER TRAVELLED UP TO THE TRIBUNAL IN THE FIRST ROUND, THE TRIBUNAL NOTED THA T THE ASSESSEE HAD OBJECTED TO THE REOPENING SUGGESTED BY THE AO. HOWEVER, THE TRIBUN AL TOOK NOTE OF THE FACT THAT THE AO HAS NOT DISPOSED OF THE OBJECTIONS RAISED BY THE AS SESSEE AS DIRECTED BY THE HONBLE SUPREME COURT IN GKN DRIVESHAFT (INDIA) LTD. VS. IT O & ORS. (2003) 259 ITR 19 (SC). THEREFORE, THE TRIBUNAL VIDE ORDER DATED 01.09.2011 REMANDED THE MATTER BACK TO THE FILE OF THE AO TO FIRST DECIDE THE OBJECTION RAISED BY THE ASSESSEE AGAINST THE REOPENING AND THEREAFTER TO PROCEED IN ACCORDANCE TO LAW. THEREA FTER, PURSUANT TO THE TRIBUNALS DIRECTION, 2 ITA NOS.162 & 163/KOL/2016 RST HOLDINGS (P) LTD.., AY- 2001-02 & 2002-03 THE AO HAS PASSED THE ORDER ON 20.12.2012. HOWEVER , THE TRIBUNALS DIRECTION TO THE AO TO ADDRESS/DISPOSE OF THE ASSESSEES CHALLENGE AGAINST REOPENING WAS NOT HEEDED TO BY THE AO BEFORE PASSING THE ASSESSMENT ON 20.12.2012. TAKIN G NOTE OF THE OMISSION ON THE PART OF THE AO IN NOT DISPOSING OF THE CHALLENGE RAISED BY THE ASSESSEE AGAINST REOPENING WHICH WAS AGAINST THE EXPLICIT DIRECTION OF THE HONBLE SUPRE ME COURT IN GKN DRIVESHAFT (INDIA) LTD. (SUPRA) WAS FOUND TO HAVE BEEN AGAIN FLOUTED BY THE AO. THEREFORE, THE LD. CIT(A) HAS ANNULLED THE ASSESSMENT PROCEEDINGS. AGGRIEVED, TH E REVENUE IS BEFORE US. 4. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE TRIBUNAL VIDE ORDER DATED 0 1.09.2011 HAD REMANDED THE ORIGINAL ASSESSMENT ORDER PURSUANT TO REOPENING, BACK TO THE FILE OF AO, AND DIRECTED THE AO TO FIRST DISPOSE OF THE CHALLENGE/OBJECTION RAISED BY THE AS SESSEE AGAINST REOPENING OF THE ASSESSMENT AS HELD BY THE HONBLE SUPREME COURT IN GKN DRIVESHAFT (INDIA) LTD. PURSUANT TO THE SAME, THE AO, HAS PASSED THE ORDER ON 20.12. 2012 WITHOUT ADDRESSING THE OBJECTION RAISED BY THE ASSESSEE AGAINST THE REOPENING OF THE ASSESSMENT. THIS IS IN FLAGRANT VIOLATION OF THE HONBLE SUPREME COURTS DIRECTION IN GKN DRI VESHAFT (INDIA) LTD. (SUPRA). THE LD. DR COULD NOT BRING TO OUR NOTICE AS TO WHETHER THE AO HAS DISPOSED OF THE CHALLENGE RAISED BY THE ASSESSEE AGAINST THE REOPENING. WITHOUT DOI NG SO, THE ORDER PASSED BY THE AO IS UNSUSTAINABLE. IT HAS TO BE REMEMBERED THAT AS PER ARTICLE 141 OF THE CONSTITUTION, THE LAW LAID BY THE HONBLE SUPREME COURT IS BINDING ON ALL COURTS. THE AO WHILE FRAMING THE ASSESSMENT IS ACTING AS A QUASI JUDICIAL AUTHORITY AND IS BOUND TO FOLLOW THE DECISION OF THE HONBLE SUPREME COURT. VIOLATION OF THE SAME MAKES THE ORDER OF ASSESSMENT FRAGILE IN THE EYES OF LAW AND, THEREFORE, WE UPHOLD THE ACTION OF THE LD. CIT(A) FOR BOTH THE ASSESSMENT YEARS IN QUESTION AND CONSEQUENTLY DISMISS BOTH THE APPEALS OF THE REVENUE. 5. IN THE RESULT, APPEALS OF THE REVENUE ARE DISMIS SED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 15.02.201 8 SD/- SD/- (J. SUDHAKAR REDDY) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 15TH FEBRUARY, 2018 JD.(SR.P.S.) 3 ITA NOS.162 & 163/KOL/2016 RST HOLDINGS (P) LTD.., AY- 2001-02 & 2002-03 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT ITO, WARD-4(1), KOLKATA. 2 RESPONDENT M/S. RST HOLDINGS (P) LTD., 3B, LAL BAZAR STREET, 2 ND FLOOR, KOLKATA-700 001. 3. THE CIT(A) KOLKATA 4. 5. CIT KOLKATA DR, ITAT, KOLKATA. / TRUE COPY, BY ORDER, SR. PVT. SECRETARY