DCIT, C.C.-XIX, Kolkata, Kolkata V. M/s. Darjeeling Jalpaiguri Tea Co. Ltd., Kolkata

ITA 2075/KOL/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7962 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2010
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2001-2002
• Appeal Filed On: 07-12-2009
• Court: TRIBUNAL
• Department Lawyers: M HUSSAIN
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME - TAX APPELLATE TRIBUNAL, C BENCH : KOLKATA BEFORE HON. SHRI B.R. MITTAL, JM AND HON. SHRI B. C. MEENA , AM ITA NO. 2075 (KOL) OF 2009 : ASSESSMENT YEAR : 200 1 - 0 2 DY. COMMISSIONER OF INCOME TAX - VS. - M/S. DARJEELING JALPAIGURI TEA CO. LTD. CC - XIX, KOLKATA [PAN : A A BCD - 1545M ] [ APPELLANT ] [RESPONDENT] AND C.O. NO. 4/KOL/2010 IN ITA NO.2075/KOL/2009 ASSESSMENT YEAR : 2001 - 02 M/S. DARJEELING JALPAIGURI TEA CO. LTD. - VS. - DY. COMMISSIONER OF INCOME TAX/CC - XIX [CROSS OBJECTOR] [RESPONDENT] DEPARTMENT BY : SHRI M. HUSSAIN ASSESSEE BY : SHRI SOUMITRA CHOWDHURY PER B. R. MITTAL, JM THE DEPARTMENT HAS FILED THIS APPEAL FOR THE ASSESSMENT YEAR 200 1 - 0 2 AGAINST THE ORDER OF THE LD. CIT(A) DATED 14.08.2009 ON THE FOLLOWING GROUNDS : - ( 1 ) THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A), CENTRAL - II, KOL. HAS ERRED IN LAW BY ADOPTING HIS OWN CALCULATION AND RATIOS INSTEAD OF THE SPECIFIC PROVISIONS LAID DOWN IN RULE 8 OF I.T. RULES, 1962. ( 2 ) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A), CENTRAL - II, KOL. HAS ERRED IN LAW BY NOT CONSIDERING THE PROFIT OF RS.32,50, 820/ - ATTRIBUTABLE TO SALE OF TEA LEAVES WHICH THE ASSESSING OFFICER HAD ARRIVED WITH A REASONABLE ANALYSIS. ( 3 ) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A), CENTRAL - II, KOL. HAS ERRED IN LAW BY APPLYING A COMPLICATED COMPUTATION MET HOD DETERMINATION OF COMPOSITE INCOME IN CONTRADICTION TO THE ESTABLISHED AND PRESCRIBED 60 : 40 RATIO. ( 4 ) THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A), CENTRAL - II, KOL. HAS ERRED IN LAW IN DIRECTING THE ASSESSING OFFICER TO CALCULA TE THE TAXABLE INCOME AT 45.7% INSTEAD OF 40% OF THE COMPOSITE IN COME, RESULTING THE REASSESSED INCOME AT RS.12,06,210/ - WHICH IS LOWEST THAN THE ORIGINAL ASSESSED INCOME AT RS.14,18,830/ - . 2. THE ASSESSEE HAS FILED THE CROSS OBJECTION ON THE FOLLOWING GR OUNDS : - ( 1 ) FOR THAT ON THE FACTS OF THE CASE, THE LD. CIT(A) WAS WRONG IN NOT CONSIDERING OF THE FACT THAT THE INITIATION OF PROCEEDING U/S. 147 OF THE 2 I.T. ACT AFTER A LAPSE OF FOUR YEARS WHICH IS COMPLETELY ARBITRARY, UNJUSTIFIED AND ILLEGAL. ( 2 ) FOR THAT ON THE FACTS OF THE CASE, THE LD. CIT(A) SHOULD HAVE CANCELLED THE ASSESSMENT ORDER PASSED U/S. 143(3)/147 OF THE I.T. ACT AFTER A LAPSE OF FOUR YEARS AND SAME SET OFF FACTS WHICH IS COMPLETELY ARBITRARY, UNJUSTIFIED AND ILLEGAL. 3. THE CROSS OBJECTION TAKEN BY THE ASSESSEE RELATE TO THE LEGAL ISSUE WHICH GO ES TO THE VALIDITY OF THE ASSESSMENT ORDER. THEREFORE, WE TAKE UP THE CROSS OBJECTION FIRST, FOR OUR CONSIDERATION. 4. AT THE TIME OF HEARING, IT WAS OBSERVED THAT CROSS O BJECTION FILED BY THE ASSESSEE DO ES NOT ARISE OUT OF THE ORDER OF THE LD . CIT(A). SINCE CROSS OBJECTION IS RELATING TO THE LEGAL ISSUE, WE ADMIT THE GROUNDS OF CROSS OBJECTION FOR OUR CONSIDERATION BY FOLLOWING THE DECISION OF HONBLE APEX COURT IN THE CASE OF NATIONAL THERMAL POWER CO. VS. CIT [1998] 229 ITR 383 (SC) . 5. DURING THE COURSE OF HEARING, IT WAS POINTED OUT THAT IT IS TO BE ASCERTAINED AS TO WHETHER THERE WAS FULL DISCLOSURE BY FACTS BY THE ASSESSEE AT THE TIME, ASSESSMENT WAS MADE U/S. 143(3) OF THE ACT. PROVISO OF SECTION 147 OF THE ACT PROVIDES THAT NO ACTION CAN BE TAKEN TO INITIATE RE ASSESSMENT PROCEEDINGS AFTER THE EXPIRY OF 4 YEARS FROM THE RELEVANT ASSESSMENT YEAR WHERE AN ASSESSMENT UNDER SUB - SECTION (3) OF SECTION 143 HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEABLE TO ASSESSMENT FOR SUCH ASSESSMENT YEAR HAS ESCAPED ASSESSMENT INTER ALIA BY REASON OF THE FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACT NECESSARY FOR THE ASSESSMENT FOR THAT ASSESSMENT YEAR. THERE IS NO DISPUTE TO THE FACT THAT THE ORIGINAL ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE ACT ON 31.03.2004 AND THE NOTICE U/S. 148 HAS BEEN ISSUED BY THE ASSESSING OFFICER ON 31.03.2008. THEREFORE, WE CONSIDER IT PRUDENT TO RESTORE THIS ISSUE TO THE FILE OF THE LD. CIT(A) TO DECIDE AS TO WHETHER INI TIATION OF REASSESSMENT PROCEEDING S BY THE ASSESSING OFFICER U/S. 147 OF THE ACT IS BARRED BY LIMITATION AS PER PROVISO TO SECTION 148 OF THE ACT OR NOT , AFTER CONSIDERING SUCH EVIDENCES AS MAY BE FURNISHE D BY THE ASSESSEE AND AFTER GIVING DU E OPPORTUNITY OF HEARING TO BOTH THE PARTIES. THEREFORE, GROUND IN THE CROSS OBJECTION TAKEN BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES BY RESTORING THE ISSUE TO THE FILE OF THE LD. CIT(A). 3 6. SINCE THE GROUN D CROSS OBJECTION GOES TO THE ROOT OF THE VALIDITY OF THE ASSESSMENT ORDER PASSED B Y THE ASSESSING OFFICER IS RESTORED TO THE LD. CIT(A) FOR HIS ADJUDICATION, WE DO NOT CONSIDER IT PRUDENT TO DECIDE THE GROUNDS OF APPEAL TAKEN BY THE DEPARTMENT DISPUTING T HE DELETION OF ADDITION S MADE BY THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT U/S. 143(3)/147 OF THE ACT DATED 24.12.2008. 7. IN THE RESULT, THE CROSS OBJECTION OF THE ASSESSEE AS WELL AS APPEAL OF THE DEPARTMENT BOTH ARE ALLOWED FOR STATISTICAL PURPOSES AS INDICATED ABOVE. 8. ORDER PRONOUNCED IN THE PRESENCE OF THE LD. REPRESENTATIVES OF BOTH THE PARTIES ON 17.03.2010. SD/ - SD/ - [ B. C. MEENA ] [ B. R. MITTAL ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 1 7 TH MARCH, 2010. COPY FORWARDED TO THE - 1. DY. COMMISSIONER OF INCOME TAX/CC - XIX, 18, RABINDRA SARANI, KOLKATA. 2. M/S. DARJEELING JALPAIGURI TEA CO. LTD., 17, R.N. MUKHERJEE ROAD, KOLKATA - 1. 3. CIT(A) - KOLKATA. (4) CIT - KOLKATA. 5 . D.R., I.T.A.T., KOLKATA. (TRUE COPY) BY ORDER DEPUTY REGISTRAR (KKC) I.T.A.T., KOLKATA.