Kaushalendra Pratap Singh, Kolkata V. ITO, Ward - 28(2), Kolkata, Kolkata

ITA 1747/KOL/2010

• Counselvise Citation: 174723514 RSA 2010
• Duration Of Justice: 9 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2011
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 08-09-2010
• Court: TRIBUNAL
• Department Lawyers: D R SINDHAL CIT
• Assessee Lawyers: RAJEN DHAR
• Keywords: Opportunity of being heard; Principle of natural justice; Difference of opinion; Reason to believe
• Section: 234B; 194C

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL : C BENCH : KOLKATA ( ) . . , , . . , , ) [BEFORE HONBLE SRI B.R. MITTAL, J.M. & HONBLE SRI C.D. RAO, A.M.] ! ! ! ! / I.T.A NO. 1747/KOL/2010 '# $% / ASSESSMENT YEAR : 2005-2006 KAUSHALENDRA PRATAP SINGH, KOLKATA -VS.- IN COME TAX OFFICER, WARD-28(2), KOLKATA (PAN : AGVPS 7754 J) (APPELLANT ) (RESPONDENT ) FOR THE APPELLANT : SHRI RAJEN DHAR, AR. FOR THE RESPONDENT : SHRI D.R. SINDHAL, CIT & / ORDER PER SHRI B. R. MITTAL, JUDICIAL MEMBER/ . . , : SINCE THERE WAS A DIFFERENCE OF OPINION BETWEEN TH E LD. MEMBERS CONSTITUTING THE DIVISION BENCH OF ITAT, KOLKATA WITH REGARD TO THE FOLLOWING QUESTIONS, THE MATTER WAS REFERRED TO THIRD MEMBER UNDER SECTION. 255(4) OF T HE I.T. ACT, 1961 FOR HIS OPINION :- THE LD. ACCOUNTANT MEMBER HAS SET OUT THE FOLLOWING QUESTION :- WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THE ORDERS OF THE AUTHORITIES BELOW ARE REQUIRED TO BE SET ASI DE AND THE MATTER REMANDED BACK TO THE FILE OF THE ASSESSING O FFICER FOR RE-ADJUDICATION AS HELD BY THE LD. JM OR THE APPEAL IS REQUIRED TO BE HEARD ON MERIT AS HELD BY THE LD. AM. THE LD. JUDICIAL MEMBER HAS PROPOSED THE FOLLOWING QUESTION :- WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE PROPOSED ORDER OF LD. JM IS JUSTIFIED OR ACTION SUG GESTED BY THE LD. AM IS JUSTIFIED? 2. HONBLE PRESIDENT, ITAT NOMINATED SHRI G.D. AGRA WAL, HONBLE VICE PRESIDENT (AZ/KZ) AS THIRD MEMBER. THE HONBLE THIRD MEMBER V IDE HIS ORDER DATED 26.05.2011 HAS CONCURRED WITH THE FINDINGS OF LD. JUDICIAL MEMBER THAT GROUNDS NO. 3 TO 5 OF THE APPEAL ARE ALLOWED FOR STATISTICAL PURPOSES, WHEREAS GROUNDS N O. 1 & 2 OF THE APPEAL ARE REJECTED ITA N O. 1747/KOL./2010 2 AND GROUND NO. 6 DOES NOT REQUIRE ADJUDICATION. THEREFORE, IN ACCORDANCE WITH THE MAJORITY VIEW, THE APPEAL OF THE ASSESSEE IS ALLOWE D IN PART FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10.06.2011. SD/- SD/- [C.D. RAO/ . . ] [ B.R. MITTAL / . . ] ACCOUNTANT MEMBER/ JUDICIAL MEMBER/ DATED : 10/ 06/ 2011 COPY OF THE ORDER FORWARDED TO: 1. KAUSHLENDRA PRATAP SINGH, 98, GARDEN REACH ROAD, KO LKATA-700 523; 2 ITO, WARD-28(2), KOLKATA, 3. COMMISSIONER OF INCOME-TAX (APPEALS)- , KOLKATA, 4 CIT, KOLKATA- 5 . DR, KOLKATA BENCHES, KOLKATA (TRUE COPY) BY ORDER ASSIS TANT REGISTRAR, I.T.A.T., KOLKATA LAHA, SR. P.S. ITA N O. 1747/KOL./2010 3 IN THE INCOME TAX APPELLATE TRIBUNAL : C BENCH : KOLKATA [ BEFORE SHRI G.D.AGRAWAL, V.P. AS THIRD MEMBER ] I.T.A. NO. 1747 (KOL) OF 2010 ASSESSMENT YEAR 2005-06 KAUSHALENDRA PRATAP SINGH, -VS- INCOME-TAX O FFICER, WARD- 28(2), KOLKATA (PAN-AGVPS7754J) KOLKATA. [ APPELLANT ] [ RESPONDENT ] APPELLANT BY : SRI RAJEN DHAR RESPONDENT BY : SRI D.R.SINDHAL, CI T. O R D E R SINCE THERE WAS A DIFFERENCE OF OPINION BETWEEN T HE LD. MEMBERS CONSTITUTING C BENCH OF I.T.A.T., KOLKATA IN RESPECT OF THE AFORES AID APPEAL, I WAS NOMINATED AS THIRD MEMBER BY THE HONBLE PRESIDENT, I.T.A.T. U/S.255(4 ) OF I.T. ACT, 1961. 2. THE LD. MEMBERS CONSTITUTING THE BENCH HAVE PRO POSED THEIR SEPARATE QUESTIONS FOR REFERENCE U/S. 255(4) OF THE ACT. THE LD. ACCO UNTANT MEMBER HAS SET OUT THE FOLLOWING QUESTION : WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDERS OF THE AUTHORITIES BELOW ARE REQUIRED TO BE SET ASIDE AND THE MATTER R EMANDED BACK TO THE FILE OF THE ASSESSING OFFICER FOR READJUDICATION AS HELD BY THE LD. J.M. OR THE APPEAL IS REQUIRED TO BE HEARD ON MERIT AS HELD BY THE LD. A. M. THE LD. JUDICIAL MEMBER HAS PROPOSED THE FOLLOWING QUESTION :- WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE PROPOSED ORDER OF LD. J.M. IS JUSTIFIED OR ACTION SUGGESTED BY THE LD. A.M. IS JUSTIFIED ? HOWEVER, I FIND THAT THE ONLY ISSUE INVOLVED IN BOT H THESE QUESTIONS IS RESTRICTED AS TO WHETHER THE MATTER IN DISPUTE SHOULD BE SENT BACK T O A.O. FOR READJUDICATION OR THE SAME SHOULD BE ADJUDICATED AND DISPOSED OF BY THE T RIBUNAL ITSELF. 3. THE BRIEF FACTS OF THE CASE AS FOUND BY THE LD. MEMBERS ARE THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF TRANSPORTATION AND H IRE OF HEAVY VEHICLES UNDER THE TRADE NAME M/S. PRATAP CARRIER. RETURN WAS PROCESSED U /S. 143(1) OF THE ACT. INITIALLY, THE ITA N O. 1747/KOL./2010 4 CASE WAS NOT SELECTED FOR SCRUTINY AS NO NOTICE U/S . 143(2) WAS ISSUED. HOWEVER, SUBSEQUENTLY FINDING THAT AS PER AUDITORS REPORT N O TDS WAS DEDUCTED AS REQUIRED U/S. 194C OF THE ACT FROM THE PAYMENT OF FREIGHT CHARGES , THE A.O. FORMED AN OPINION THAT INCOME HAD ESCAPED ASSESSMENT AND THUS WITH A VIEW TO SCRUTINY, THE CASE WAS REOPENED BY ISSUING NOTICE U/S. 148 DATED 07/5/2007, SERVED UPON THE ASSESSEE ON 15/5/2007. IN RESPONSE, THE ASSESSEE REQUESTED THE A.O. TO TREAT THE RETURN ORIGINALLY FILED ON 29/10/2005 AS RETURN IN RESPONSE TO THE SAID NOTICE U/S. 148 OF THE ACT. ON SEVERAL DATES, THE CASE WAS FIXED FOR HEARING BEFORE THE A. O. HOWEVER, ON SOME OF THE DATES, THE ASSESSEE OR HIS AUTHORIZED REPRESENTATIVES WERE NOT PRESENT. HOWEVER, IN COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE FURNISHED WRIT TEN SUBMISSIONS, COMPUTERIZED BOOKS OF ACCOUNT, BANK STATEMENT, OFFICE COPY OF BI LLS FOR HIRE CHARGES & TRANSPORT CHARGES SHOWING MONTH-WISE NUMBER OF TRIPS AND LIST OF LABOURS EMPLOYED FOR LOADING & UNLOADING OF GOODS TRANSPORTED. THE A.O. REQUIRED T HE ASSESSEE TO PRODUCE THE ORIGINAL BILLS IN RESPECT OF FREIGHT CHARGES, TYRE EXPENSES, LOADING & UNLOADING EXPENSES AND ON 26/12/2008, THE ASSESSEES A/R APPEARED AND INFORME D HIS INABILITY TO PRODUCE THOSE ORIGINAL DOCUMENTS, BUT ASSURED THAT AS AND WHEN TH E THESE DOCUMENTS WOULD BE AVAILABLE, THE SAME WILL BE FURNISHED. ON THE ABOV E FACTS, THE A.O. INFERRED THAT THE FINAL ACCOUNTS SUBMITTED BY THE ASSESSEE HAD NO BAS IS AND HENCE HE REJECTED THE STATEMENT OF ACCOUNT FILED ALONG WITH THE RETURN U/ S. 145(3) OF THE ACT. THE ASSESSMENT WAS ULTIMATELY COMPLETED U/S. 144 R.W.S. 147 OF THE ACT ON 29/12/2008 ON A TOTAL INCOME OF RS. 18,17,573/- BY DISALLOWING THE ABOVE EXPENDI TURE AND ADDING THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. 4. BEING AGGRIEVED, THE ASSESSEE PREFERRED APPEAL BEFORE THE LD. C.I.T.(A) AGITATING PASSING OF THE ASSESSMENT ORDER U/S. 144 R.W.S. 147 OF THE ACT AND ALSO CHALLENGING THE ADDITIONS MADE THEREUNDER UNDER SEVERAL HEADS. WHIL E DEALING WITH THE TECHNICAL/LEGAL ISSUE REGARDING ISSUANCE OF NOTICE U/S. 148 AND SUB SEQUENTLY PASSING OF ORDER U/S. 144/147 OF THE ACT, THE C.I.T.(A) OBSERVED THAT THE RETURN OF THE ASSESSEE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION WAS ONLY PROCES SED U/S. 143(1) AND NO REGULAR ASSESSMENT WAS COMPLETED. FURTHER, TDS AS REQUIRED U/S. 194C OF THE ACT HAD NOT BEEN ITA N O. 1747/KOL./2010 5 DEDUCTED, WHICH WAS A VALID REASON TO BELIEVE THAT INCOME HAD ESCAPED ASSESSMENT. HE, THEREFORE, HELD THAT THERE WAS NO LEGAL INFIRMITY I N ISSUING NOTICE U/S. 148 OF THE ACT AND THUS ASSESSMENT WAS COMPLETED AS PER LAW U/S. 144/1 47 OF THE ACT. ON MERITS OF THE CASE, THE C.I.T.(A) GAVE PARTIAL RELIEF TO THE ASSE SSEE IN SO FAR AS DISALLOWANCE OF LOADING & UNLOADING EXPENSES ARE CONCERNED. HE, HOWEVER, U PHELD THE ACTION OF THE A.O. WITH REGARD TO DISALLOWANCES/ADDITIONS ON ACCOUNT OF FRE IGHT CHARGES, TYRE EXPENSES AND SUNDRY CREDITOR. BEING DISSATISFIED WITH THE SAID O RDER OF C.I.T.(A), THE ASSESSEE CAME IN APPEAL BEFORE THE TRIBUNAL ON THE FOLLOWING GROUNDS :- 1) FOR THAT LD CIT(A) SHOULD HAVE HELD THAT ASSE SSMENT ORDER DATED 29.12.2008 SERVED ON 05.01.2009 WAS BARRED BY LIMITATION, INVA LID AND INOPERATIVE IN LAW. 2) FOR THAT LD CIT(A) SHOULD HAVE HE LD THAT PROCEEDINGS U/S 144 OF THE I.T. ACT 61 AND THAT U/S 147 OF THE ACT ARE DIFFERENT PROCEEDIN GS AS SEC 153 OF THE I.T. ACT 1961 PROVIDES DIFFERENT TIME LIMIT FOR EACH OF THE PROCEEDINGS AND THEREFORE AN ORDER U/S 144 OF THE ACT 1961 IN A PROCEEDINGS U/S 147 OF THE 1.T. ACT 1961 IS MISLEADING, UNWORKABLE AND INOPERATIVE IN LAW. 3) FOR THAT LD CIT(A), SHOULD HAVE H ELD THAT ALL AND EACH DISALLOWANCES AND ADDITIONS WERE FANCIFUL SURMISE AND SHOULD HAVE DEL ETED THEM. 4) FOR THAT LD CIT(A) WAS NOT JUSTIF IED IN HOLDING THAT THE PROCEEDINGS U/S 147 OF THE ACT WAS VALID EVEN IN ABSENCE OF FRESH INFORMAT ION. 5) FOR THAT LD CIT(A) WRONGLY HELD T HAT THE ASSESSEE WAS LIABLE U/S 194C OF THE ACT TO DEDUCT TAX AT SOURCE FROM FREIGHT CHARGES THOUGH THE LORRIES HIRED BY THE ASSESSEE CARRIED GOODS ONLY. 6) FOR THAT LD CIT(A) SHOULD HAVE THA T THE ASSESSEE WAS NOT LIABLE TO PAY ADVANCE TAX ON ADDITIONS & DISALLOWANCES U/S 208 OF THE I.T . ACT 1961 BUT ON CURRENT INCOME ONLY AND CONSEQUENTLY WAS NOT LIABLE TO PAY INTEREST U/S 234B OF THE 1.T. ACT 1961 AND THAT MOREOVER HE HAD PAID EXCESS ADVAN CE TAX OF RS.60,395/ WHICH HE CLAIMED TO BE REFUNDED. 5. IN REGARD TO THE FIRST DISPUTE VIDE GROUNDS NO. 1 & 2 ABOVE, THERE WAS NO DISPUTE BETWEEN THE LD. MEMBERS ABOUT REJECTING THE GROUNDS OF THE ASSESSEE. 6. IN REGARD TO GROUNDS NO. 3 TO 5 OF THE GROUNDS OF APPEAL, I FIND THAT THE ASSESSEE SUBMITTED BEFORE THE TRIBUNAL THAT REASONS FOR REOP ENING OF THE ASSESSMENT WERE NOT ITA N O. 1747/KOL./2010 6 VALIDLY RECORDED, INASMUCH AS THE A.O. ALONG WITH T HE NOTICE U/S. 148 DATED 07/5/2007 DID NOT DISCLOSE THE REASONS RECORDED TILL 05/12/20 07 BY STATING THAT THE CASE WAS REOPENED FOR SCRUTINY. IT WAS FURTHER SUBMITTED ON BEHALF OF THE ASSESSEE THAT RETURN WAS PROCESSED U/S. 143(1) OF THE ACT AND REFUND AS PER RETURN WAS ALLOWED TO THE ASSESSEE, WHICH PROVED THE SATISFACTION OF THE A.O. ABOUT THE ACCOUNTS OF THE ASSESSEE AND AUDIT REPORT. IT WAS FURTHER SUBMITTED THAT THE A.O. DID NOT ISSUE ANY NOTICE U/S. 142(1), BUT ISSUED NOTICE U/S. 148 ON 07/5/2007, IN RESPONSE TO WHICH THE ASSESSEE FILED/PRODUCED BEFORE THE A.O. AUDITED BOOKS OF ACC OUNT, COMPUTERIZED BOOKS OF ACCOUNT, BANK STATEMENT, OFFICE COPY OF BILLS FOR H IRE CHARGES & TRANSPORT CHARGES, LIST OF LABOURS EMPLOYED FOR LOADING & UNLOADING OF GOODS T RANSPORTED ETC.. THE A.O., HOWEVER, PASSED BEST JUDGMENT ASSESSMENT ON 29/12/2008, SERV ED UPON THE ASSESSEE ON 05/1/2009, WITHOUT ALLOWING ANY FURTHER OPPORTUNITY TO THE ASSESSEE ON THE PLEA THAT ORIGINAL BILLS/VOUCHERS IN RESPECT OF HIRE CHARGES & TRANSPORT CHARGES WERE NOT FURNISHED. THE LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHER H AND, APART FROM RELYING UPON THE ORDERS OF THE AUTHORITIES BELOW SUBMITTED THAT THE A.O. ISSUED REASONS RECORDED ALONG WITH THE NOTICE U/S. 148 AND IN SUPPORT OF SUCH CON TENTION, HE FILED A COPY OF SUCH HAND- WRITTEN REASONS FOUND RECORDED IN THE ORDER SHEET D ATED 07/5/2007. THE LD. DEPARTMENTAL REPRESENTATIVE, THEREFORE, SUBMITTED T HAT THE A.O. HAD RIGHTLY ISSUED NOTICE U/S. 148 OF THE ACT AND PASSING OF CONSEQUEN TIAL ORDER U/S. 144/147 OF THE ACT BY HIM WAS IN ORDER, WHICH HAS RIGHTLY BEEN UPHELD BY THE C.I.T.(A). 7. THE LD. JUDICIAL MEMBER (J.M.) AFTER HEARING TH E PARTIES AND KEEPING IN VIEW THE PRINCIPAL OF NATURAL JUSTICE AND TO MEET THE ENDS O F JUSTICE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORE THE MATTER RELATING T O PROCEEDING U/S. 147 OF THE ACT TO THE FILE OF THE A.O. WITH DIRECTION TO PASS A FRESH ASSESSMENT ORDER AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE TO CONSIDER THE DOCUMENTARY EVIDENCES AS MAY BE PRODUCED BY THE ASSESSEE BEFORE HIM. THE OBSERVATION OF LD. J.M. IN HIS PROPOSED ORDER VIDE PARA 6.1. IS AS UNDER :- 6.1. IN REGARD TO OTHER ALLEGATION OF THE LD. A/R THAT REASONS RECORDED WERE NOT DISCLOSED ALONG WITH THE NOTICE U/S. 148 DATED 7/5/2007, WE OBSERVE THAT THE ASSESSEE DURING APPELLATE PROCEEDING BROUGHT TO THE NOTICE OF THE LD. C.I.T.(A) OF ITA N O. 1747/KOL./2010 7 THE SAID FACT AND THE LD. C.I.T.(A) ON PAGE-7 OF HI S ORDER HAS REPRODUCED THE SAID CLAIM OF THE ASSESSEE AS UNDER :- HOWEVER HE DID NOT DISCLOSE THE RECORDED REASONS TILL 05.12.2008 (THREE YEARS AFTER THE RETURN WAS FILED & PROCESSED AND 24 DAYS BEFORE PASSING THE ORDER) WHEN HE SAID THE CASE WAS REOPENED FOR SECURITY (P.P. 2 PARA 7 LAST LINE) SO LONG HE KEPT IT SECRET EVEN AFTER SEV ERAL HEARINGS FROM 16.08.2007 TO 23.09.2008. CIT V/S SMT. VARSHA GOYAL (2009) 319 ITR 92 (P&H). THE LD. DEPARTMENTAL REPRESENTATIVE FILED A COPY OF ORDER SHEET DATED 7/5/2007 CONTAINING REASONS RECORDED BY THE A.O. FOR HIS BEL IEF THAT INCOME ESCAPED ASSESSMENT. SUBSEQUENT ENTRY IN THE SAID ORDER SHEE T WAS DATED 15/5/2007 WHEREIN IT IS WRITTEN NOTICE U/S 148 SERVED ON THE ASSESSEE. TEAR OFF PLACED IN THE RECORD. FROM THESE TWO ENTRIES IN THE ORDER S HEET, WHICH IS A PART OF THE RECORD OF THE DEPARTMENT, WE FIND NO MENTION THAT T HE REASONS RECORDED IN THE ORDER SHEET ON 7/5/2007 WAS ACTUALLY SERVED ALONG W ITH THE NOTICE U/S. 148 SERVED ON THE ASSESSEE ON 15/5/2007. THE LD. C.I.T.(A) IS ALSO SILENT ON THE ISSUE. HOWEVER, AS PER ASSESSEE, THE A.O. DID NOT DISCLOSE HIS REASONS RECORDED TILL 5/12/2008, I.E. 24 DAYS BEFORE PASSING THE ORDER U/ S. 144/147 OF THE ACT. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTA NCES OF THE CASE AND KEEPING IN VIEW THE PRINCIPLE OF NATURAL JUSTICE, IN OUR CONSI DERED OPINION, IT WOULD MEET THE ENDS OF JUSTICE IF THE ASSESSEE IS PROVIDED WITH AN OTHER OPPORTUNITY TO COMPLY WITH THE REASONS RECORDED BY THE A.O. IN TERMS OF PROCEE DING U/S. 148 OF THE ACT. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDERS OF THE A UTHORITIES BELOW AND RESTORE THE MATTER TO THE FILE OF A.O., WHO IS DIRECTED TO GIVE ADEQUATE OPPORTUNITY OF BEING HEARD AND TO CONSIDER SUCH DOCUMENTARY EVIDEN CE, AS MAY BE FILED BEFORE HIM AND PASS A FRESH ASSESSMENT ORDER. WE ORDER ACCORD INGLY. 7.1. SINCE THE MATTER WAS SENT BACK TO THE FILE OF A.O. FOR FRESH ADJUDICATION IN RESPECT OF REASONS RECORDED, THE LD. J.M. DID NOT A DJUDICATE THE OTHER GROUNDS OF APPEAL RAISED AGAINST DISALLOWANCES/ADDITIONS MADE ON ACCO UNT OF SEVERAL EXPENSES AS MENTIONED IN PARA 7 OF HIS PROPOSED ORDER AND DIRECTED THE A. O. TO CONSIDER THE CLAIM OF THE ASSESSEE AFRESH AFTER CONSIDERING THE EVIDENCES AS MAY BE FURNISHED BEFORE HIM AND AFTER ALLOWING OPPORTUNITY OF BEING HEARD TO THE AS SESSEE. 8. THE LD. A.M. DISAGREED WITH THE SAID VIEW OF LD . J.M. AND PROPOSED A SEPARATE ORDER. HE HELD THAT NO GROUND HAS BEEN TAKEN BY THE ASSESSEE WITH REFERENCE TO PROVIDING OF REASONS RECORDED FOR REOPENING THE ASS ESSMENT, NOR PERMISSION WAS SOUGHT ITA N O. 1747/KOL./2010 8 TO ADMIT SUCH A NEW OR ADDITIONAL GROUND BEFORE THE TRIBUNAL. HE WAS, THEREFORE, OF THE OPINION THAT THE TRIBUNAL DOES NOT HAVE THE JURISDI CTION TO ADJUDICATE UPON SUCH A NEW GROUND. THE FINDINGS RECORDED IN THE PROPOSED ORDER OF LD. A.M. ARE AS UNDER :- 4. THE LD. JM. HOWEVER, IN PARA 6.1 OF THE PROPOSED ORDER HAS ADJUDICATED SUCH NEW GROUND. THE GROUND ADJUDICATED UPON BY THE LD. JM IS TOTALLY A NEW GROUND. IT HAS NO CONNECTION WITH THE SUBJECT MATTER OF APPEAL , WHICH HAS BEEN AGITATED BY THE APPELLANT IN THE GROUNDS OF APPEAL APPENDED IN FORM NO.36. 5. A NEW GROUND CAN BE TAKEN AT ANY STAGE OF THE PR OCEEDING ONLY WHEN THE SAME CHALLENGES THE JURISDICTION OF ANY AUTHORITY TO PAS S AN ORDER. 6. THE HONBLE APEX COURTS DECISION IN THE CASE OF ADDL.CIT VS. GURJAR GRAVURES PVT. LTD [L11 ITR 1] WHILE DECIDING THE ISSUE OF TH E JURISDICTION OF THE 1ST APPELLATE AUTHORITY HAS CLEARLY LAID DOWN THAT SUBJECT MATTER OF APPEAL BEFORE THE AAC CANNOT TRAVEL BEYOND THAT OF THE SUBJECT MATTER BEF ORE THE AO. SUBSEQUENTLY, THE HONBLE SUPREME COURT IN THE CASE OF JUTE CORPO RATION OF (I) LTD VS. CIT [187 ITR 688] HAS EXPLAINED THE RATIO LAID DOWN BY THE H ONBLE APEX COURTS SAID DECISION IN THE CASE OF GURJAR GRAVURES PVT. LTD (S UPRA). 7. THE HONBLE ALLAHABAD HIGH COURT IN THE CASE OF DR.(MISS) CHANDRAVATI VS. CIT [301 ITR 1721 HAS DISTINGUISHED THE CASE OF JUTE CO RPORATION OF (I) LTD AND HELD THAT A PLEA, WHICH WAS NOT RAISED EITHER BEFORE THE AO OR 1ST APPELLATE AUTHORITY COULD NOT BE RAISED FOR THE FIRST TIME BEFORE THE T RIBUNAL. THUS, EVEN IF THE APPELLANT SOUGHT TO RAISE A PLEA BEFORE THE TRIBUNA L, WHICH WAS NOT RAISED BY HIM BEFORE THE 1 ST APPELLATE AUTHORITY, THE SAME CANNOT BE ADMITTED/A DJUDICATE BY THE TRIBUNAL. 8. IN THIS VIEW OF THE MATTER, I HOLD THAT NEITHER THE ASSESSEE CAN RAISE SUCH A PLEA FOR THE FIRST TIME BEFORE THE TRIBUNAL NOR THE SAME CAN BE ADMITTED/ADJUDICATED BY US. THE ORDERS OF THE AUTHO RITIES BELOW, THEREFORE, CANNOT BE SET ASIDE AND THE MATTER CANNOT BE REMAND ED BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION ON THIS GROUND. WE ARE RE QUIRED TO DECIDE THE GROUNDS TAKEN BY THE ASSESSEE ON MERIT. 9. I HAVE HEARD THE PARTIES AND PERUSED THE MATERI AL AVAILABLE ON RECORD. I HAVE ALSO CAREFULLY GONE THROUGH THE DISSENTING ORDERS PROPOS ED BY THE LD. MEMBERS. IN THIS CASE THE ASSESSMENT ORDER WAS PASSED U/S. 144/147 OF THE ACT ON 29/12/2008 MAKING THEREBY SEVERAL DISALLOWANCES OF EXPENSES AND ADDIT IONS THEREOF TO THE TOTAL INCOME OF THE ASSESSEE FOR THE ASSESSMENT YEAR UNDER CONSIDER ATION. IT WAS THE ALLEGATION OF THE ITA N O. 1747/KOL./2010 9 ASSESSEE THAT REASONS RECORDED WERE NOT DISCLOSED A LONG WITH THE NOTICE U/S. 148 DATED 07/5/2007 AND WHEN THE MATTER WAS BROUGHT TO THE NO TICE OF THE C.I.T.(A), HE ON PAGE-7 OF HIS ORDER HAS STATED THAT THE A.O. DID NOT DISCL OSE THE RECORDED REASONS TILL 05/12/2008, I.E. A FEW DAYS BEFORE PASSING THE ORDE R U/S. 144/147 OF THE ACT, ALTHOUGH SEVERAL HEARINGS BETWEEN 16/8/2007 TO 23/9/2008 WER E CONDUCTED. THEREFORE, IT IS EVIDENT THAT THE ASSESSEE WAS NOT MADE AVAILABLE WI TH THE RECORDED REASONS DURING THE ASSESSMENT PROCEEDINGS U/S. 144/147 OF THE ACT. IT WAS ONLY A FEW DAYS BEFORE THE ASSESSMENT ORDER WAS PASSED THAT THE REASONS RECORD ED WAS RECEIVED BY THE ASSESSEE. IT WAS IN THIS CONTEXT THAT THE LD. J.M. CONSIDERING T HE PRINCIPLE OF NATURAL JUSTICE PROPOSED TO SEND THE MATTER BACK TO THE FILE OF A.O. TO ENAB LE THE ASSESSEE TO COMPLY WITH THE REASONS RECORDED BY THE A.O. IN TERMS OF SEC. 148 O F THE ACT. HOWEVER, REFERRING TO THE GROUNDS OF APPEAL REPRODUCED ABOVE, THE LD. A.M. HA S STATED THAT NO GROUND HAS BEEN TAKEN BY THE ASSESSEE BEFORE THE TRIBUNAL WITH REFE RENCE TO PROVIDING OF REASONS RECORDED FOR REOPENING THE ASSESSMENT, NOR THE ASSE SSEE HAS SOUGHT PERMISSION OF THE TRIBUNAL TO ADMIT SUCH A NEW AND/OR ADDITIONAL GROU ND. HE, THEREFORE, DISAGREEING WITH THE LD. J.M. PROPOSED THAT THE MATTER CANNOT BE REM ANDED BACK TO THE FILE OF A.O. FOR FRESH ADJUDICATION AND THE TRIBUNAL IS REQUIRED TO DECIDE THE GROUNDS TAKEN BY THE ASSESSEE ON MERITS. 9.1. I FIND THAT THE ASSESSEE VIDE GROUND NO.4 OF THE APPEAL HAS RAISED THE FOLLOWING GROUND :- 4) FOR THAT LD CIT(A) WAS NOT JUSTIFIED IN HOLD ING THAT THE PROCEEDINGS U/S 147 OF THE ACT WAS VALID EVEN IN ABSENCE OF FRESH INFOR MATION. IN MY CONSIDERED OPINION, THE ABOVE GROUND IS WIDE ENOUGH TO CHALLENGE THE ENTIRE PROCEEDING INITIATED BY THE A.O. U/S. 148 AND CONSE QUENTIALLY PASSING OF ORDER U/S. 144/147 OF THE ACT BY THE A.O. AND ANY OBJECTION AN D/OR ARGUMENTS ADVANCED IN THIS REGARD CANNOT BE SAID TO BE OUT OF THE CONTEXT OF T HE GROUND WHICH HAS NOT BEEN TAKEN BEFORE THE TRIBUNAL. WHEN THE ASSESSEE CHALLENGES T HE VERY PROCEEDING U/S. 147 OF THE ACT, IT IMPLIES THE OTHER INGREDIENTS WHICH, IN HIS OPINION, MAKE THE PROCEEDING INVALID IN LAW. IN TUNE WITH THAT, THE ASSESSEE MADE SUBMISSIO NS BEFORE THE TRIBUNAL. ON PERUSAL OF ITA N O. 1747/KOL./2010 10 THE ORDER OF C.I.T.(A), IN PARTICULAR THE OBSERVATI ON MADE ON PAGE-7 OF HIS ORDER WHICH IS ALREADY REPRODUCED IN PARA 6.1 OF LD. J.M.S ORDER, IT IS OBSERVED THAT THE A.O. KEPT THE REASONS RECORDED SECRET EVEN AFTER SEVERAL HEARINGS FROM 16/8/2007 TO 23/9/2008 AND FURTHER IT IS NOT DISPUTED THAT THE A.O. DID NOT DI SCLOSE HIS REASONS RECORDED TO THE ASSESSEE TILL 5/12/2008, I.E. 24 DAYS BEFORE PASSIN G THE IMPUGNED ORDER U/S. 144/147 OF THE ACT. IT HAS BEEN HELD BY HONBLE APEX COURT IN THE CASE OF GKN DRIVESHAFT (I) LTD. VS. ITO [259 ITR 19 (SC)] THAT ALTHOUGH THE ASSESS EE CANNOT ASK FOR THE COPY OF THE REASONS RECORDED BY THE ASSESSING OFFICER AT THE ST AGE OF FILING THE RETURN IN RESPONSE TO THE NOTICE U/S.148, YET COPY OF THE SAID REASONS IS LIABLE TO BE SUPPLIED TO THE ASSESSEE AFTER THE ASSESSEE FILES THE RETURN. THE RELEVANT P ORTION OF THE OBSERVATION OF HONBLE APEX COURT IN THE SAID CASE READS AS UNDER: WHEN A NOTICE UNDER SECTION 148 OF THE INCOME-TAX A CT, 1961, IS ISSUED, THE PROPER COURSE OF ACTION FOR THE NOTICEE IS TO FILE THE RETURN AND, IF HE SO DESIRES, TO SEEK REASONS FOR ISSUING THE NOTICES. THE ASSESSING OFFICER IS BOUND TO FURNISH REASONS WITHIN A REASONABLE TIME. ON RECEIPT OF REASONS, THE NOTICEE IS ENTITLED TO FILE OBJECTIONS TO ISSUANCE OF NOTICE AND THE ASSESSING OFFICER IS BOUND TO DISPOSE OF THE SAME BY PASSING A SPEAKING ORDER. 9.2. FROM THE ABOVE IT IS EVIDENT THAT THE HONBLE APEX COURT HAS LAID DOWN THE PROCEDURE WHICH IS TO BE FOLLOWED WHEN A NOTICE U/S . 148 IS ISSUED. AS PER HONBLE APEX COURT, ON RECEIVING THE NOTICE THE ASSESSEE IS TO F IRST FILE THE RETURN OF INCOME AND THEREAFTER HE CAN SEEK THE REASONS RECORDED FOR ISS UING THE NOTICE. THE A.O. IS BOUND TO FURNISH THE REASONS RECORDED WITHIN A REASONABLE TI ME. ON RECEIPT OF REASONS RECORDED, THE ASSESSEE IS ENTITLED TO FILE OBJECTION TO THE I SSUANCE OF NOTICE. ADMITTEDLY, IN THIS CASE, THE A.O. HAS NOT FOLLOWED THE PROCEDURE LAID DOWN BY THE HONBLE APEX COURT. HE HAS NOT ISSUED THE COPY OF REASONS RECORDED TO THE ASSESSEE WITHIN REASONABLE TIME. THEREFORE, CONSIDERING THE ABOVE DECISION OF HONBL E APEX COURT AS WELL AS THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, I AM OF THE OPINION THAT THE LD. J.M. WAS JUSTIFIED IN SETTING ASIDE AND REMANDING THE MATTER BACK TO THE FILE OF A.O. FOR READJUDICATION AFTER SUPPLYING THE COPY OF REASONS RECORDED. I, THEREFORE, CONCUR WITH THE FINDING OF THE LD. J.M. ITA N O. 1747/KOL./2010 11 10. NOW COMING TO OTHER GROUNDS OF APPEAL RAISED A GAINST DISALLOWANCES/ADDITIONS MADE ON ACCOUNT OF (A) LOADING & UNLOADING EXPENSES ; (B) FREIGHT CHARGES; (C) TYRE EXPENSES; AND (D) BOGUS CREDIT AS UNDISCLOSED INCOM E, SINCE I HAVE CONCURRED WITH THE PROPOSED ORDER OF LD. J.M. IN SETTING ASIDE THE REA SSESSMENT PROCEEDING U/S. 144/147 OF THE ACT TO THE FILE OF A.O. FOR FRESH ADJUDICATION, I FIND NO INFIRMITY IN THE ORDER OF LD. J.M. ON THIS ISSUE AS WELL IN DIRECTING THE A.O. TO CONSIDER THE ABOVE EXPENSES OF THE ASSESSEE AFRESH AFTER GIVING DUE OPPORTUNITY OF HEA RING TO THE ASSESSEE AND CONSIDERING SUCH EVIDENCES AS MAY BE FURNISHED BEFORE HIM. IN VIEW OF THE ABOVE, I AGREE WITH THE LD. J.M. ON THESE ISSUES ALSO. 11. THE MATTER WILL NOW GO TO THE REGULAR BENCH FO R PASSING THE ORDER AS PER THE MAJORITY VIEW. SD/- [G.D.AGRAWAL] VICE-PRESIDENT (AZ/KZ) AS 3 RD MEMBER. (DKP) DATED : 26-05-2011 .