BERI ARCHITECTS & ENGINEERS PVT. LTD, Kolhapur V. ACIT (HQ-II), (HOLDING CONCURRENT JURISDICTION WITH DCIT., CIRCLE-2, Kolhapur

ITA 176/PUN/2010

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 66902 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 05-11-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 29-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE: SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.176/PN/2010 ASSESSMENT YEAR : 2005 - 06 BERI ARCHITECTS & ENGINEERS PVT. LTD., GUMPHA, TARABAI PARK, KOLHAPUR VS. ASSTT. CIT (HQ-II), KOLHAPUR, DCIT CIRCLE 2, KOLHAPUR (APPELLANT) (RESPONDENT) PAN NO. AAACB7484Q APPELLANT BY: SHRI M.K. KULKARNI RESPONDENT BY: SHRI RAJESH DAMOR DATE OF HEARING : 25-04-2013 DATE OF PRONOUNC EMENT : 29-04-2013 ORDER PER R.S. PADVEKAR, JM:- IN THIS APPEAL, THE ASSESSEE HAS CHALLENGED THE IMPUGNE D ORDER OF THE LD.CIT(A), KOLHAPUR DATED 17-11-2009 FOR A.Y. 2005-06. THE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE ASSESSMENT P ROCEEDINGS WHICH ARE COMPLETED IN CONSEQUENCE OF ISSUE OF NOTICE U/S .148 OF THE INCOME-TAX ACT. THE ASSESSEE HAS RAISED TWO FOLLOWING LEGAL GROUNDS : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. C.I.T. (A) KOLHAPUR WAS NOT JUSTIFIED IN TREATING THE PROCEEDI NGS OF RE-ASSESSMENT INITIATED U/S. 147 BY ISSUE OF NOTICE U/S. 148 SERV ED ON 20-06-2006 AS VALID WHEN THE APPELLANT-COMPANY HAD FILED ITS REVISED RE TURN OF INCOME U/S. 139 (5), PRIOR TO SERVICE OF NOTICE U/S. 148 O F THE ACT. THE LD. C.I.T. (A) OUGHT TO HAVE HELD THAT IN VIEW OF THE FILING OF TH E REVISED RETURN U/S. 139 (5) THE PROCEEDINGS INITIATED U/S. 147 WERE BAD IN LAW AND WITHOUT JURISDICTION. THE RE-ASSESSMENT PROCEEDINGS BE QUAS HED. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. C.I.T. (A) - KOLHAPUR OUGHT TO HAVE FOLLOWED THE LEGAL POSITIO N THAT THE RIGHT TO FILE REVISED RETURN OF INCOME U/S. 139 (5) WAS A 'STATUT ORY RIGHT' OF THE ASSESSEE. THE LD. C.I.T. (A) WAS NOT JUSTIFIED IN REFUSING TO RECOGNISE THIS 'STATUTORY RIGHT' OF THE ASSESSEE. THE ASSESSMENT COMPLETED U/ S. 143 (3) R.W.S. 147 IS BAD IN LAW AND WITHOUT JURISDICTION. THE SAME BE QUASHED. 2. THE SHORT BUT IMPORTANT LEGAL ISSUE IS RAISED BY THE A SSESSEE THAT THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER BY ISSUANCE OF NOTICE U/S.148 IS BAD IN LAW AS BEFORE THE NOTICE U/S.148 WAS ISSUED ON 19-06-2006, THE ASSESSEE HAS ALREADY FILED REVISED RETURN OF INCOME 2 ITA NO.176/PN/2010, BERI ARCHITECTS & ENGINEERS, KO LHAPUR DISCLOSING TOTAL INCOME AT RS.13,05,460/- AND THE SAID RETUR N WAS VALID RETURN U/S.139(5) OF THE INCOME-TAX ACT AND WAS PENDING BEFORE THE ASSESSING OFFICER. 3. THE ASSESSEE COMPANY FILED THE ORIGINAL RETURN OF INCOM E FOR THE A.Y. 2005-06 DECLARING THE LOSS OF RS.32,929/- ON 31-10-20 05. IT APPEARS THAT THERE WERE SOME CENTRAL EXCISE PROCEEDING S IN RESPECT OF THE SERVICE TAX AND THEREAFTER IMMEDIATELY ASSESSEE FILED REVISED RETURN FOR THE A.Y. 2005-06 ON 12-06-2006, DECLARING TOTAL INCOME AT RS.13,05,460/-. THE REVISED RETURN WAS PROCESSED ON 08- 09-2007. MEANTIME, THE ASSESSING OFFICER ISSUED NOTICE U/S.148 TO THE ASSESSEE ON 19-06-2006 WHICH WAS SERVED ON 20-06-2006. THE AR GUMENT OF THE LEARNED COUNSEL IS THAT THE REVISED RETURN FILED BY THE AS SESSEE U/S.139(5) WAS VALID RETURN AND THERE WAS NO NECESSITY T O INITIATE THE PROCEEDINGS U/S.147 AND TO ISSUE NOTICE U/S.148 AND THE ASSESSING OFFICER COULD HAVE COMPLETED ASSESSMENT BY ISSUING NOTICE U /S.143(2) OF THE ACT. 4. SO FAR AS THE ASSESSMENT YEAR 2005-06 IS CONCERNE D, THE ASSESSEE BEING THE COMPANY, THE DUE DATE FOR FILING OF THE RETURN FOR THE A.Y. 2005-06 U/S.139 (1) OF THE ACT WAS 31 ST OCTOBER, 2005. THE ASSESSEE FILED THE ORIGINAL RETURN ON 31-10-2005 WHICH WAS AS PER T IME SPECIFIED IN THE RESPECTIVE PROVISIONS. SUBSEQUENTLY, THE ASSESSEE FILED REVISED RETURN U/S.139(5) OF THE ACT ON 12-06-2006 WHICH WAS PRO CESSED ON 08- 09-2007 BUT THE FIRST QUESTION IS WHETHER THE REVISED RE TURN FILED BY THE ASSESSEE U/S.139(5) WAS A VALID RETURN AND OUR ANSWER IS AN AFFIRMATION, AS THE ASSESSEE HAS FILED THE ORIGINAL RETURN U/S.139(1) OF T HE ACT ON THE DUE DATE SPECIFIED I.E. ON 31-10-2005. THE NEXT QUESTION IS WHETHER THE ASSESSING OFFICER WAS JUSTIFIED IN ISSUING THE NOTICE TO THE ASSESSEE U/S.148 OF THE ACT? AS PER THE ASSESSMENT ORDER, THE ORIGINAL RETURN AS WELL AS THE REVISED RETURNS WERE PROCESSED U/S.143 (1). 5. IT IS SEEN THAT WHEN THE NOTICE U/S.148 WAS ISSUED T O THE ASSESSEE ON 20-06-2006 AT THAT TIME THE REVISED RETURN FILED BY T HE ASSESSEE WAS 3 ITA NO.176/PN/2010, BERI ARCHITECTS & ENGINEERS, KO LHAPUR PENDING. THE ARGUMENT OF THE LEARNED COUNSEL IS THAT THE ASSESSING OFFICER HAD A TIME LIMIT U/S.143 (2) TO EXAMINE AND VERIFY THE PENDING RETURN WHICH WAS A VALID RETURN AND THERE WAS NO NECES SITY TO ISSUE NOTICE U/S. 148. HE ALSO RELIED ON THE FOLLOWING PRECEDENTS: 1. CIT VS. RAJENDRA G. SHAH 247 ITR 772 (BOM.) 2. CIT VS. VED AND CO. 302 ITR 328 (DELHI) 3. SARAF GRAMODYOG SANSTHA VS. ITO 298 ITR (AT) 348 (AGRA) 6. AS PER THE PROVISIONS OF SECTION 143(2) WHEN THE RETUR N HAS BEEN FURNISHED U/S.139, WHICH IS THE ASSESSEES CASE, AND IF THE ASSESSING OFFICER DESIRES TO ENQUIRE THAT THE ASSESSEE HAS NOT UND ER STATED THE INCOME, THEN AS PER THE PROVISIONS APPLICABLE TO THE A.Y. 2 005-06, HE COULD HAVE ISSUED THE NOTICE WITHIN 12 MONTHS FROM THE EN D OF THE MONTH IN WHICH THE REVISED RETURN WAS FURNISHED. IF THE A SSESSEE HAS FILED THE VALID REVISED RETURN U/S.139(5) THEN THE ORIGINAL RETURN FILED U/S.139(1) GET MERGE WITH THE REVISED RETURN AND AS PER THE PROVISIONS OF SECTION 143(2) THE ASSESSING OFFICER COULD HAVE ISSUED THE NOTICE UP TO 30-06-2007 TO VERIFY THE CORRECTNESS OF THE REVISED RE TURN FILED ON 12-06- 2006 AND THERE WAS NO NECESSITY TO ISSUE NOTICE U/S.148 ON 20-06- 2006. 6.1 IN THE CASE OF RAJENDRA G. SHAH (SUPRA) THE HON'BLE H IGH COURT HAS HELD AS UNDER: IN THE PRESENT MATTER, THE SHORT POINT WHICH AROSE F OR CONSIDERATION BEFORE THE TRIBUNAL WAS WHETHER PROCEEDINGS UNDER SE CTION 148 COULD HAVE BEEN INSTITUTED WHEN THE RETURN FILED ON JU NE 29, 1982, WAS PENDING ASSESSMENT. THE TRIBUNAL CAME TO THE CON CLUSION THAT NOTICE UNDER SECTION 148 AND PROCEEDINGS TAKEN BY T HE DEPARTMENT THEREAFTER WERE BAD IN LAW AS THERE COULD NOT HAVE BEEN REOPENING OF THE ASSESSMENT WHEN THE RETURN DATED JUNE 29, 198 2, WAS PENDING. WE HAVE EXAMINED THE RECORDS OURSELVES AND WE FIND THAT THERE IS NOTHING TO INDICATE HOW REASSESSMENT PROCE EDINGS COULD HAVE BEEN INSTITUTED WHEN THE MAIN RETURN FILED BY TH E ASSESSEE ON JUNE 29, 1982, WAS STILL PENDING ASSESSMENT. ALL PROCEEDI NGS HAVE BEEN TAKEN THEREAFTER PURSUANT TO THE REOPENING OF THE ASSESSMENT IN 1985, LOSING SIGHT OF THE FACT THAT THE MAIN RETUR N FILED BY THE ASSESSEE ON JUNE 29, 1982, WAS PENDING. IN THE ABOVE CIRCUMSTANCES, THE TRIBUNAL WAS RIGHT IN ANNULLING THE ASSESSMENT PROCEEDINGS. HENCE, NO SUBSTANTIAL QUESTION OF LAW ARISES. APPEAL IS DISMISSED. 6.2 IN THE CASE OF VED AND CO. (SUPRA) THE HON'BLE HIGH C OURT OF DELHI HELD AS UNDER: 4 ITA NO.176/PN/2010, BERI ARCHITECTS & ENGINEERS, KO LHAPUR 9. THE SUBMISSION MADE BY LEARNED COUNSEL FOR THE RE VENUE IS THAT A RETURN OF INCOME WAS FURNISHED BY THE ASSESS EE AND BEFORE ANY ASSESSMENT WAS FRAMED, IT WAS NOTICED BY THE ASSE SSING OFFICER THAT THE ASSESSEE HAD UNDERSTATED ITS INCOM E AND CLAIMED EXCESSIVE DEDUCTION IN THE RETURN AND, THEREFORE, A CTION COULD BE TAKEN UNDER SECTIONS 147 AND 148 OF THE ACT. CONSEQ UENTLY, THE CONCLUSION ARRIVED AT BY THE TRIBUNAL WAS INCORRECT. 10. WE ARE OF THE OPINION THAT IN VIEW OF THE DECIS IONS THAT WE HAVE MENTIONED ABOVE, FOR THE PURPOSES OF INITIATING R EASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER COULD NOT HAVE MAD E UP HIS MIND THAT THE INCOME OF THE ASSESSEE HAS ESCAPED ASSESSM ENT WHILE A VALID RETURN WAS STILL PENDING BEFORE HIM. IF THE ASS ESSING OFFICER HAD ALLOWED THE TIME TO ELAPSE FOR TAKING ACTION UNDER SEC TION 143(2) OF THE ACT, IT WAS ENTIRELY HIS OWN DOING. WHAT THE ASSESSING OFFICER IS NOW TRYING TO DO IN AN INDIRECT (AND INCORRECT) M ANNER IS WHAT HE COULD NOT HAVE DONE DIRECTLY. 7. ADMITTEDLY, IN THE PRESENT CASE, THE ASSESSING OFFICER H AS SUFFICIENT TIME TO ISSUE THE NOTICE U/S.143 (2) OF THE ACT TO VERIFY THE CORRECTNESS OF THE REVISED RETURN FILED BY THE ASSESSEE AND THERE WAS NO NEED TO ISSUE NOTICE U/S.148 AS THE REVISED RETURN FILED BY THE ASSESSEE WAS NOT EVEN PROCESSED. WE, THEREFORE, ALLOW GROUND NOS . 1 AND 2 TAKEN BY THE ASSESSEE THAT THE ISSUANCE OF THE NOTICE BY TH E ASSESSING OFFICER U/S. 148 IS BAD IN LAW AND WE CANCELLED THE ASSESSMENT O RDER. AS THE ASSESSEE HAS SUCCEEDED ON THE LEGAL GROUNDS, WE DO NOT CONSIDER IT NECESSARY TO GO INTO THE MERIT OF THE ADDITIONS. 8. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 29-04-2013 SD/- SD/- (G.S. PANNU) (R.S. PADVEKAR) ACCOUNTANT MEMBER JUDICIAL MEMBER RK/PS PUNE, DATED: 29 TH APRIL, 2013 COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A), KOLHAPUR 4 THE CIT - I/II, KOLHAPUR/CIT(C), PUNE 5 THE DR, ITAT, B BENCH , PUNE . 6 GUARD FI LE. //TRUE COPY// BY ORDER PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, PUNE