ACIT-2(1)(1), MUMBAI V. THE BOMBAY DYEING AND MANUFACTURING COMPANY LTD., MUMBAI

ITA 1895/MUM/2023

AI Insights

The case involves The Bombay Dyeing and Manufacturing Company Limited, which faced an assessment order under Section 143(3) read with Section 263 of the Income-tax Act, 1961, for the assessment year 2015-16. The original assessment was challenged, and a subsequent order under Section 263 was issued by the Pr. Commissioner of Income Tax, declaring the assessment order as erroneous and prejudicial to the interest of the Revenue. This led to a fresh assessment order, which was later quashed by a co-ordinate Bench. The CIT (A) annulled the subsequent assessment order, leading to the current appeal by the Assessing Officer before the Income Tax Appellate Tribunal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 125141 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 04-09-2023
• Assessment Year: 2015-2016
• Appeal Filed On: 24-05-2023
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S. SRINIVASU
• Section: 263; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM AND MS. KAVITHA RAJAGOPAL, JM ITA No.1895/Mum/2023 (Assessment Year: 2015-16) ACIT -2( 1) ( 2) R oom N o. 561, Aayak ar B hav an, Mahar is hi K ar v e Mar g, Mum bai-400 020 Vs. The Bombay Dyeing and Manufacturing Company Limited Neville House, J.N. Heredia Marg, Ballard Estate, Mumbai-400 001 (Appellant) (Respondent) PAN No. AAACT2328K Assessee by : Shri Chaitanya Joshi & Ms. Sukanya Jayaram, ARs Revenue by : Shri S. Srinivasu, CIT DR Date of hearing: 05.09.2023 Date of pronouncement : 08.09.2023 O R D E R PER PRASHANT MAHARISHI, AM: 01. ITA No.1895/Mum/2023 is filed by the learned Asst. Commissioner of Income Tax, 2(1)(1), Mumbai (the learned AO) against the appellate order passed by National Faceless Appeal Centre, Delhi [ the ld. CIT (A)] for A.Y. 2015-16 dated 28 th March, 2023, wherein the appeal filed by the assessee against the assessment order passed on 31 st October, 2021 by NFAC, Delhi under Section 143(3) read with section 263 of the Income-tax Act, 1961 (the Act) was allowed holding that when the tribunal has quashed the order passed under Section 263 of the Act, consequent order passed by the learned Page | 2 ITA No.1895/Mum/2023 The Bombay Dyeing and Manufacturing Co. Ltd.; A.Y. 2015-16 Assessing Officer under Section 143(3) read with section 263 of the Act dated 31 st October, 2021, cannot exist and therefore, allowing the appeal of the assessee the assessment order was annulled. 02. The learned Assessing Officer is aggrieved with that is in appeal before us. 03. Briefly stated fact shows that Assessee Company engaged in the business of manufacturing and export of textile etc. and development of real estate. It filed its return of income on 30 th November, 2015 at ₹ nil. Assessment under Section 143(3) of the Act was made on 29 th December, 2017, assessing the total income of ₹59,09,64,070/-. Subsequently, against that assessment order assessee preferred an appeal before the learned CIT (A). 04. However, on another aspect the Pr. Commissioner of Income Tax issued notice under Section 263 of the Act which culminated into an order under Section 263 of the Act dated 18 th March, 2020, holding that assessment order passed by the learned Assessing Officer is erroneous and prejudicial to the interest of the Revenue. The learned CIT directed the learned Assessing Officer to pass a fresh assessment order after making due enquiries and verification. 05. Assessee challenged order u/s 263 of The Act before the co-ordinate Bench. The co-ordinate Bench vide order dated 13 th September, 2021 in ITA No. 30/Mum/2021 for Page | 3 ITA No.1895/Mum/2023 The Bombay Dyeing and Manufacturing Co. Ltd.; A.Y. 2015-16 A.Y. 2015-16 has held that order passed under Section 263 of the Act is not proper and therefore, quashed. 06. Meanwhile, the learned Assessing Officer passed an assessment order pursuant to that direction under Section 263 of the Act on 31 st October, 2021. 07. Such Assessment order was challenged before the learned CIT (A), who held that when the order under Section 263 of the Act itself has been quashed, consequential order passed by the learned Assessing Officer cannot exist and therefore, the learned CIT (A) allowed the appeal of the assessee. Now ld. Ao is in appeal before us against that appellate order. 08. After hearing the parties, we find no merit in the appeal of the learned Assessing Officer since the assessment order which was passed pursuant to order of the learned PCIT under Section 263 of the Act has already been quashed, therefore, subsequent order made on that basis cannot survive. It may be true that Revenue might have not accepted the decision of the co-ordinate Bench and has challenged it before the Hon'ble High Court. But that cannot go into the way of disposal of this appeal. Merely, because the Revenue has not accepted the decision of the co-ordinate Bench, without pointing out any material on record or submitting that Assessment order is sustainable, we are not inclined to upset the order of ld. CIT (A). We find no infirmity with the order of the learned CIT (A) in allowing the appeal of the assessee. Page | 4 ITA No.1895/Mum/2023 The Bombay Dyeing and Manufacturing Co. Ltd.; A.Y. 2015-16 09. Accordingly, we confirm the order of the learned CIT (A) and dismiss the appeal of the learned Assessing Officer. Order pronounced in the open court on 08.09.2023. Sd/- Sd/- (KAVITHA RAJAGOPAL) (PRASHANT MAHARISHI) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Mumbai, Dated: 08.09.2023 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Mumbai