ACIT, Circle-2(2), Cuttack, Cuttack V. M/s. New Age Data Net Pvt. Ltd, Cuttack

ITA 165/CTK/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3831 (ITAT-CUTTACK)
• Duration Of Justice: 4 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 22-05-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 12-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K PRADHAN
• Keywords: Period of limitation; Assessment record
• Section: 142(1); 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAV AN KUMAR GADALE, JUDICIAL MEMBER ITA NO.165 /CTK/2013 ASSESSMENT YEAR : 2007 - 08 ACIT, CIRCLE 2(2), CUTTACK VS. M/S. NEW AGE DATA NET PVT LTD., C/O. MULTI TECH COMPUTER, HIGH COURT SQUARE, CHANDIN CHOWK, CUTTACK PAN/GIR NO.AACCN 1654 G (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : WRITTEN SUBMISSION REVENUE BY : SHRI D.K.PRADHAN, DR DATE OF HEARING : 22 /05/ 2017 DATE OF PRONOUNCEMENT : 24 /05/ 2017 O R D E R PER PAVAN KUMAR G ADALE, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) - CUTTACK , DATED 26.12.2012 , FOR THE ASSESSMENT YEAR 2007 - 08. 2. ON THE DATE OF HEA RING BEFORE US, NONE APPEARED ON BEHALF OF THE ASSESSEE. HOWEVER, WRITTEN SUBMISSION DATED 27.4.2017 WAS FILED AND IS ON RECORD. 3. ALTHOUGH THE REVENUE HAS RAISED MULTIPLE GROUNDS OF APPEAL, BUT THE SOLE ISSUE REQUIRES FOR ADJUDICATION BEFORE US IS WHETHER THE ASSESSMENT ORDER AND DEMAND NOTICE DATED 29.12.2009 SERVED ON THE ASSESSEE WAS BARRED BY LIMITATION U/S.153(1) OF THE I.T.ACT, 1961 OR NOT. 2 ITA NO.165 /CTK/2013 ASSESSMENT YEAR : 2007 - 08 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY IS IN THE BUSINESS OF T RADING OF ORES AND MINERALS AND FILED THE RETURN OF INCOME ON 15.11.2007 AND THE CASE WAS SELECTED FOR SCRUTINY. NOTICES U/S. 142(1) AND 143(2) OF THE ACT WERE ISSUED TO THE ASSESSEE. SUBSEQUENTLY, THE CASE WAS FIXED FOR HEARING AND LD A.R. APPEARED AND THE CASE WAS ADJOURNED TO 29.12.2009 WITH SP ECIFIC DIRECTION T O PRODUCE FURTHER EVIDENCE/DOCUMENTS IN SUPPORT OF ALLEGED ENHANCEMENT OF SHARE CAPITAL, SUNDRY CREDITORS, ETC. SINCE, THERE WAS NO COMPLIANCE FROM THE ASSESSEE, THE ASSESSING OFFICER MADE BEST JUDGMENT ASSESSMENT U/S.144 OF THE ACT , INTER ALIA, MAKING A DDITION IN RESPECT OF DONATIONS AND SUBSCRIPTIONS, INTRODUCTION OF SHARE CAPITAL AND SUNDRY CREDITORS. 5. AGGRIEVED BY THE SAID ORDER OF THE ASSESSING OFFICER, THE ASSESSEE HAS FILED AN APPEAL BEFORE THE CIT(A). THE CIT (A) RELIED ON THE DECISION OF THIS CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2007 - 08 IN ITA NO.416/CTK/2011 AND C.O. NO.13/CTK/2012, WHEREIN, THE MATTER WAS RESTORED TO THE FILE OF THE CIT(A). THE CIT(A) EXAMINED THE ASSESSMENT RECORD FOR THE SAID ASSESSMENT YEAR AND CALLED FOR THE PHOTOCOPY OF DOCUMENTS EVIDENCING SERVICE OF ASSESSMENT ORDER AND DEMAND NOTICE FOR THE IMPUGNED ASSESSMENT , WHEREAS THE ASSESSING OFFICER VIDE LETTER DATED 13.12.2012 INTIMATED TO THE CIT(A) THAT DATE OF SERVICE OF THE ASSESSMENT ORDER IS 16.4.2010 AND COPY OF THE DEMAND NOTICE WAS RECEIVED BY THE ASSESSEE ON 16.4.2010. THE LIMITATION DATE OF THE ASSESSMENT IS 31.12.2009 WHEREAS THE ASSESSING 3 ITA NO.165 /CTK/2013 ASSESSMENT YEAR : 2007 - 08 OFFICER HAS PASSED THE ORDER U/S.144 ON 29.12.2009 AND THERE IS A DELAY O F 106 DAYS BEYOND THE STATUTOR Y PERIOD OF LIMITATION BEING 31.12.2009 AND THE CIT(A) RELIED ON THE DECISION OF CO - ORDINATE BENCH IN THE CASE OF ACIT VS. ORISSA STEVENDORS LTD. (2012) 16 ITR (TRIB) 431 (CTC), AND OBSERVED THAT THE ASSESSMENT ORDER AND DEMA ND NOTICE SERVED IS TIME BARRED BY LIMITATION AN D NON - EST IN LAW AND ALLOWED THE APPEAL OF THE ASSESSEE. 6 . AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVENUE HAS FILE D AN APPEAL WITH THE TRIBUNAL .THE LD D.R ARGUED ON THE GROUND S THAT THE CIT(A) ERRED IN T REATING THE SERVICE AS BARRED BY LIMITATION AND ACTION OF SERVICE OF ASSESSMENT ORDER AS NON - EST IN LAW . WHEREAS THE DEMAND NOTICE AND THE ASSESSMENT ORDER ARE NOT BARRED BY LIMITATION U/S.153(1) OF THE ACT. LD D.R. RELIED ON THE PROVISIONS OF SECTION 15 3(2) OF THE I.T.ACT, 1961, AND THE DECISION OF HONBLE CALCUTTA HIGH COURT IN THE CASE OF BADRI PRASAD BAJORIA VS CIT (197) 64 ITR 362 (CAL) AND OTHER JUDICIAL DECISIONS AND CONTENDED THAT THE ACTION OF THE CIT(A) IS NOT IN ACCORDANCE WITH LAW AND PRAYED FOR RESTORING THE ORDER OF THE ASSESSING OFFICER. 7 . WE PERUSED THE WRITTEN SUBMISSIONS FILED BY THE ASSESSEE A ND JUDICIAL DECISIONS SUPPORTING THE ACTION OF THE CIT(A) . I) KARNANI INDUSTRIAL BANK LTD., (1978) 113 ITR 380 (CAL) II) VISWANATHAN CHETTIAR, 25 ITR 79 (MAD) III) N. SUBBA RAO, 48 ITR 808 (MYS) IV) BADRI PRASAD BAJORIA(1967) 64 ITR 362 (CAL) V) ANDHRA PRADESH VS M RAMA KRISHITAH & CO. (1994) 93 STCZ 406 (SC) VI) TULSI MOHYAPATRA (ITA NOS.412 & 413/CTK/2011) 4 ITA NO.165 /CTK/2013 ASSESSMENT YEAR : 2007 - 08 VII) DELHI FOOT WEAR VS SALES TAX OFFICER ORDER DATED 25.9.2014 IN W.P(C0 NO.2971 OF 2009 8 . AFTER CONSIDERING THE WRIT TEN SUBMISSIONS OF THE ASSESSEE AND THE FINDINGS OF THE ASSESSING OFFICER AND THE ARGUMENTS OF LD D.R., WE ARE OF THE CONSIDERED OPINION THAT THIS ISSUE IS SIMILAR TO THE DECISION OF THIS BENCH OF THE TRIBU NAL IN THE CASE OF ORISSA STEVE DORS LTD (SUPRA), WHEREIN, IT HAS BEEN HELD AS UNDER: THAT THE DEMAND NOTICES AND ASSESSMENT ORDERS WERE SERVED ON THE SAME DAY I.E. MARCH 26,2010 THOUGH THEY WERE PURPORTEDLY MADE ON DECEMBER 29, 2009. THERE WAS NO MATERIAL IN THE ASSESSMENT RECORDS WHICH C OULD INDICATE THAT INITIATIVE WAS TAKEN BY THE AO TO SERVE THE ASSESSMENT ORDERS ALONGWITH DEMAND NOTICES IMMEDIATELY AFTER PASSING OF THE ASSESSMENT ORDERS ON DECEMBER 29,2009. THE COMMISSIONER (APPEALS) RIGHTLY CAME TO THE CONCLUSION THAT THE ASSESSMENT ORDERS IN THESE CASES THOUGH MADE ON DECEMBER 29,2009 WERE SERVED ON THE ASSESSEE ON MARCH 26,2010 I.E. AFTER 85 DAYS FROM THE DATE OF ORDER. SINCE THERE WAS A DELAY OF 85 DAYS IN SERVING THE ASSESSMENT ORDERS ALONGWITH DEMAND NOTICES THE ASSESSMENT ORDE RS FOR THESE YEARS WERE BARRED BY LIMITATION AND ACCORDINGLY THEY WERE INEFFECTIVE AND NON - EST IN LAW. 9 . WE ALSO PERUSED THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF DELHI FOOT WEAR VS SALES TAX OFFICER ORDER DATED 25.9.2014 IN W.P( C0 NO.2971 OF 2009, WHEREIN, THE HONBLE HIGH COURT HELD THAT IF THE NOTICE ISSUED IS IN VALID FOR ANY REASON, THEN THE PROCEEDING INITIATED IN PURSUANCE OF SUCH NOTICE WOULD BE ILLEGAL AND INVALID. IN THE CASE BEFORE US, THE ASSESSMENT ORDER WAS MADE ON 2 9.12.2009 AND SERVED ON THE ASSESSEE ALONGWITH DEMAND NOTICE ON 16.4.2010, AND, THERE I S A DELAY OF 106 DAYS, WHICH IS BEYOND THE LIMITATION TIME . ACCORDINGLY, WE FIND THAT THE DISPUTED ISSUE IS COVERED BY THE DECISION OF THE CO - ORDINATE BENCH OF THE TR IBUNAL IN 5 ITA NO.165 /CTK/2013 ASSESSMENT YEAR : 2007 - 08 THE CASE ORISSA STEVEDORS LT D (SUPRA) AND THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF DELHI FOOT WEAR (SUPRA) , AND WE RESPECTFULLY FOLLOW THE SAME AND CONCUR WITH THE OBSERVATIONS OF THE CIT(A) AND DISMISS THE GROUND TAKEN BY THE REVENUE. 10 . IN T HE RESULT, APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24 /05/2017 IN THE PRESENCE OF PARTIES. SD/ - SD/ - ( N.S SAINI ) ( PAVAN KUMAR GADALE) A CCOUNTANT MEMBER JUDICIAL MEMBER CUTTACK; DATED 24 /05/2017 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, SR.PRIVATE SECRETARY ITAT, CUTTACK 1. THE APPELLANT : ACIT, CIRCLE 2(2), CUTTACK 2. THE RESPONDENT. M/S. NEW AGE DATA NET PVT LTD., C/O. MULTI TECH COMPUTER, HIGH COURT SQUARE, CHANDIN CHOWK, CUTTACK 3. THE CIT, CUTTACK 4. PR.CIT, CUTTACK 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//