Renukaben D. Patel, Ahmedabad V. ITO Ward-3(2)(4), Ahmedabad

ITA 2115/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8684 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 25-09-2017
• Court: TRIBUNAL

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI RIFAUR RAHMAN, ACCOUNTANT MEMBER ./ ITA NO.2115/AHD/2017 / ASSTT. YEAR: 2012-13 RENUKABEN D. PATEL C/O. UMESH B. BRAHMBHATT5, BHAGYODAYA FLATS SATTAR TALUKA SOCIETY NR.C.U. SHAH COLLEGE NAVJIVAN AHMEDABAD 380 015. VS. ITO, WARD-3(2)(4) AHMEDABAD. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI PRASANT SHAH, AR REVENUE BY : SHRI DINESH SINGH, SR.DR ! / DATE OF HEARING : 20/06/2019 '#$ ! / DATE OF PRONOUNCEMENT: 15 /07/2019 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST O RDER OF THE LD.CIT(A)-3, AHMEDABAD DATED 8.8.2017 PASSED FOR TH E ASSTT.YEAR 2012-13. 2. ASSESSEE HAS TAKEN SIX GROUNDS OF APPEAL, WHICH ARE NOT IN CONSONANCE WITH RULE 8D OF THE INCOME TAX (APPELLAT E TRIBUNAL) RULES; THEY ARE DESCRIPTIVE AND ARGUMENTATIVE IN NA TURE. IN BRIEF, HER GRIEVANCE REVOLVES AROUND A SINGLE ISSUE VIZ. T HE LD.CIT(A) HAS ERRED IN UPHOLDING REOPENING OF ASSESSMENT. ITA NO.2115/AHD/2017 2 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAD SOLD AN IMMOVABLE PROPERTY ON 27.5.2011 VIDE REGISTERED SAL E DEED NO.1852/2011. THE SALE CONSIDERATION HAS BEEN SHOW N IN THE SALE DEED AT RS.9 LAKHS. HOWEVER FOR THE PAYMENT OF STA MP DUTY ITS VALUE WAS WORKED OUT AT RS.11,74,500/- AND STAMP DU TY WAS LEVIED AT RS.60,300/-. ACCORDING TO THE AO, SHE HA D FAILED TO FURNISH RETURN OF INCOME UNDER SECTION 139 OF THE A CT AND DISCLOSE THE AFORESAID PROPERTY TRANSACTION AS WELL AS CONSE QUENT CAPITAL GAIN FOR TAX. THE ASSESSMENT OF THE ASSESSEE WAS R EOPENED BY RECORDING REASONS. COPY OF SUCH REASONS HAS BEEN P LACED BY THE LD.COUNSEL FOR THE ASSESSEE IN THE PAPER BOOK, AND THE SAME READS AS UNDER: REASONS FOR RE-OPENING ASSESSMENT NAME AND ADDRESS OF THE ASSESSEE : RENUKABEN DINE SHBHAI PATEL B/3 AVADHPURI BUNGLOWS NR RATNADEEP SOCIETY, DHOLKA ROAD, BAVLA TA.: BAVLA DIST: AHMEDABAD PA NUMBER : AMYPP1774E F.Y : 2011-12 A.Y. : 2012-13 STATUS : INDIVIDUAL IN VIEW OF THE INFORMATION AVAILABLE WITH THE DEPAR TMENT IT IS NOTICED THAT THE ASSESSEE HAD SOLD IMMOVEABLE PROPERTY ON 27/05/2011 JOR RS. 9,00,000/- DURING THE YEAR .HOWEVER AS PER THE JANTRI RATE, TH E SAME IS VALUED AT RS. H.,74,500/- THUS THERE IS A DEFERENCE OF RS. 2,74,5 00/- U/S 50C OF THE I.T. ACT, WHICH IS CHARGEABLE TO TAX HAS ESCAPED ASSESSM ENT HOWEVER THE ASSESSEE HAD NOT FILED HIS RETURN OF INCOME FOR THE A.Y. 201 2-13 IT IS THEREFORE REQUIRED TO VERIFY THE GENUINENESS OF TRANSACTION MADE BY THE ASSESSEE. IN VIEW OF THE ABOVE, I HAVE REASON TO BELIEVE THAT THE INCOME TO THE EXTENT OF RS.2,74,500/- CHARGEABLE TO TAX HAS ESCAPED ASSESSM ENT. THEREFORE THE ASSESSMENT IS REOPENED U/S 147 OF THE IT ACT 1961. ACCORDINGLY A NOTICE UNDER SECTION 148 OF THE INCOM E-TAX ACT, 1961 IS BEING ISSUED. SD/- (B.K. SOLANK1) INCOME-TAX OFFICER WARD-3(2)(4), AHMEDABAD PLACE : AHMEDABAD DATE : 11-2-2016 ITA NO.2115/AHD/2017 3 4. IT FURTHER EMERGES OUT THAT NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT WAS ISSUED ON 25.2.2016 VIDE WHICH T HE ASSESSEE WAS DIRECTED TO FURNISH RETURN. ACCORDING TO THE A O, SHE FAILED TO FURNISH RETURN OF INCOME IN RESPONSE TO NOTICE UNDE R SECTION 148 OF THE ACT. THEREAFTER, HE ISSUED ONE MORE LETTER ON 6.4.2016 APPRAISING THE ASSESSEE TO COMPLY NOTICE UNDER SECT ION 148 OF THE ACT. THE AO THEREAFTER ISSUED NOTICE UNDER SECTION 142(1) ALONG WITH QUESTIONNAIRE ON 27.6.2016. ACCORDING TO THE AO NO RESPONSE CAME ON BEHALF OF THE ASSESSEE. HE FURTHE R ISSUED NOTICE UNDER SECTION 142(1) ON 15.7.2016, AND THERE AFTER ON 3.8.2016. HE PASSED EX PARTE ASSESSMENT ORDER ON 30.11.2016 UNDER SECTION 144 R.W.S. 147 OF THE ACT. THE LD.AO HAS DETERMINED THE TAXABLE INCOME OF THE ASSESSEE AT RS .4,96,230/-. 5. APPEAL TO THE CIT(A) DID NOT BRING ANY RELIEF TO THE ASSESSEE. 6. BEFORE US, THE LD.COUNSEL FOR THE ASSESSEE WHILE IMPUGNING ORDERS OF THE LD.REVENUE AUTHORITIES HAS RAISED THR EE FOLD SUBMISSIONS. HE CONTENDED THAT AN APPLICATION FOR PERMISSION TO RAISE ADDITIONAL GROUND OF APPEAL WAS FILED IN THE TRIBUNAL ON 2.2.2019. THIS GROUND IS A LEGAL GROUND, WHEREBY T HE ASSESSEE HAS PLEADED THAT ASSESSMENT ORDER PASSED UNDER SECT ION 144 R.W.S. 147 WITHOUT ISSUE OF NOTICE UNDER SECTION 14 3(2) OF THE ACT, IS INVALID AND DESERVE TO BE QUASHED. FOR BUTTRESS ING THIS CONTENTION OF THE ASSESSEE AND HIS PROPOSITION, HE CONTENDED THAT THE ASSESSEE HAS FILED COPY OF LETTER BEFORE THE AO CONTENDING THEREIN THAT SHE HAS FILED RETURN OF INCOME UNDER S ECTION 139(1) OF THE ACT AND THAT RETURN BE TREATED AS RETURN IN RES PONSE TO NOTICE UNDER SECTION 148. ONCE THAT LETTER WAS BEING FILE D BY THE ASSESSEE BEFORE OBTAINING REASONS FOR REOPENING, TH EN ON SUCH ITA NO.2115/AHD/2017 4 RETURNS A NOTICE UNDER SECTION 143(2) OUGHT TO BE I SSUED BEFORE TAKING UP THE ASSESSMENT PROCEEDINGS. THE LD.COUNS EL FOR THE ASSESSEE DREW OUR ATTENTION TOWARDS PAGE NO.51 OF T HE PAPER BOOK, WHEREBY COPY OF LETTER DATED 21.9.2016 FILED BEFORE THE LD. AO ON 9.11.2016 IS AVAILABLE. HE ALSO DREW OUR ATT ENTION TOWARDS PAGE NO.53 WHERE COMPUTATION OF INCOME FOR THIS ASS ESSMENT YEAR IS AVAILABLE. HE ALSO DREW OUR ATTENTION TOWARDS ACKNOWLEDGEMENT OF RETURN FILED BY THE ASSESSEE AVA ILABLE ON SUPPLEMENTARY PAPER BOOK. THIS RETURN WAS FILED ON 30.3.2013. APART FROM THAT, HE RELIED UPON THE JUDGMENT OF HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS. JAI SHIV SHANKAR TRADERS P.LTD. AND IN THE CASE OF CIT VS. GREATER NOIDA INDUSTRIAL DEVELOPMENT AUTHORITY. HE PLACED ON RECORD COPIES OF THESE JUD GMENTS. 7. ON THE DIRECTION OF THE TRIBUNAL, REVENUE HAS PR ODUCED THE RECORD. COPY OF THE LETTER DATED 21.9.2016 IS AVAI LABLE ON THE FILE OF REVENUE. THOUGH IN THE COPY FILED BEFORE THE TR IBUNAL CERTAIN HAND-WRITING NARRATIONS AVAILABLE IN THE ORIGINAL, ARE NOT PART OF THE LETTER FILED IN THE PAPER BOOK. IN THE ORIGINA L LETTER AVAILABLE IN THE ASSESSMENT RECORD, THE COUNSEL FOR THE ASSESSEE PUT IN HIS HAND-WRITING THAT RETURN FILED ORIGINALLY BE TREATE D AS FILED IN RESPONSE TO THIS NOTICE. 8. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. THERE IS NO DISPUTE WITH REGARD TO THE PROPOSITION THAT IF AN ASSESSEE HAS FILED RETUR N IN RESPONSE TO NOTICE UNDER SECTION 148 THEN THE AO WAS DUTY BOUND TO ISSUE NOTICE UNDER SECTION 143(2) FOR TAKING COGNIZANCE O F SUCH RETURN. IT IS ALSO IMPORTANT TO NOTE THAT A PERUSAL OF SECT ION 143(2) CONTEMPLATES TWO CONDITIONS, VIZ. IT GIVES POWER TO THE AO TO ITA NO.2115/AHD/2017 5 SCRUTINIZE THE RETURN FILED UNDER SECTION 139(1) AN D SUCH POWER ARE TO BE EXERCISED WITHIN THE TIME LIMIT PROVIDED IN THE PROVISO APPENDED TO THIS SECTION; SECOND CONDITION IS THAT BEFORE ISSUING A QUESTIONNAIRE IT CONTEMPLATES FOR PROVIDING AN OPPO RTUNITY TO THE ASSESSEE WHAT HE/SHE WANTS TO SUBMIT IN SUPPORT OF HIS RETURN FILED UNDER SECTION 139(1) OF THE ACT. AS FAR AS A SSUMPTION OF JURISDICTION FOR SCRUTINIZING THE RETURN IS CONCERN ED, THAT SITUATION IS NOT AVAILABLE IN THE PRESENT PROCEEDINGS, BECAUS E, THE ASSESSMENT HAS BEEN COMMENCED UNDER SECTION 148 FOR REOPENING. THE AO HAS ASSUMED JURISDICTION BY VIRT UE OF SECTION 148. THE SECOND SITUATION IS THAT IN RESPONSE TO T HE NOTICE UNDER SECTION 148 THE ASSESSEE SHOULD FILE RETURN, AND TH EREAFTER THE AO WOULD ISSUE NOTICE UNDER SECTION 143(2) PROVIDING A N OPPORTUNITY TO THE ASSESSEE TO SUBMIT ANYTHING IN SUPPORT OF TH E RETURN. IN THE PRESENT CASE, 148-NOTICE WAS ISSUED ON 25.2.201 6. THE ASSESSEE DID NOT FILE RETURN UPTO SEPTEMBER, 2016. FOR THE FIRST TIME, A LETTER WAS SUBMITTED BY THE ASSESSEE PLEADI NG THEREIN THAT ORIGINAL RETURN FILED BY HER TO BE TREATED IN RESPO NSE TO THE NOTICE UNDER SECTION 148 OF THE ACT. HOWEVER, PRIOR TO THA T THE LD.AO HAS ALREADY SET THE ASSESSMENT MACHINERY IN MOTION, AND ISSUED QUESTIONNAIRE UNDER SECTION 142(1). IN THIS SITUAT ION, WE ARE OF THE VIEW THAT THE AO IS NOT DEPENDED UPON THE ASSES SEE TO COMMENCE ASSESSMENT PROCEEDINGS. ONCE HE HAS GIVEN AN OPPORTUNITY TO THE ASSESSEE TO SUBMIT RETURN IN 30 DAYS OR IN A PARTICULAR TIME ALONG WITH NOTICE UNDER SECTION 148 , AND THE ASSESSEE FAILED TO FILE RETURN IN THAT TIME, THEN H E HAS SET THE ASSESSMENT MACHINERY IN MOTION. THEREAFTER ASSESSE E CANNOT COMPLAIN THAT ON THAT RETURN HE HAS NOT ISSUED NOTI CE UNDER SECTION 143(2) OF THE ACT. LET US TAKE AN EXAMPLE; THE ASSESSEE ITA NO.2115/AHD/2017 6 DID NOT CHOOSE TO FILE RETURN IN RESPONSE TO THE NO TICE UNDER SECTION 148, AND THE ASSESSMENT WOULD BE GOING TO B E TIME BARRED ON 31 ST DECEMBER; THE ASSESSEE FILED THE RETURN ON 29 TH DECEMBER; CAN THE ASSESSEE EXPECT THAT THE AO SHOUL D HAVE ISSUED NOTICE UNDER SECTION 143(2) AND ON HIS FAILU RE THE ASSESSMENT DESERVES TO BE QUASHED. ANSWER TO THE A BOVE IS NO, BECAUSE THE ASSESSMENT PROCEEDING HAS TO BE CONDUCT ED IN ACCORDANCE WITH THE PROCEDURE AND NOT DEPENDED UPON THE MERCY OF THE ASSESSEE. THEREFORE, WE DO NOT FIND ANY MER IT IN THE FIRST FOLD OF CONTENTION RAISED BY THE ASSESSEE. 9. IN THE NEXT FOLD OF CONTENTIONS, THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT WHILE GRANTING APPROVAL, TH E JOINT COMMISSIONER HAS NOT RECORDED A SATISFACTION. THER EFORE, THE ASSESSMENT ORDER DESERVES TO BE QUASHED. 10. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORD CAREFULLY. WE HAVE GONE THROUGH THE LETTER DATED 17.2.2016 VIDE WHICH APPROVAL OF JOINT COMMIS SIONER TO THE AO FOR REOPENING OF THE ASSESSMENT WAS GRANTED. TH IS LETTER READS AS UNDER: NO.JT.CIT/R-3(2)/U/S.L48/RDP/2015-16 DATE:17/02/2 016 THE INCOME TAX OFFICER WARD3(2)(4), AHMEDABAD. SUB: APPROVAL FOR ISSUE OF NOTICE U/S.148 OF THE I.T.ACT IN THE CASE OF RENUKABEN DINESHBHAI PATEL FOR A.Y.2012-13-REG. REFERENCE IS INVITED TO YOUR PROPOSAL D ATED 11.02.2016 FOR INITIATING PROCEEDINGS U/S.148 OF THE INCOME TAX AC T. 2. THE RECORDS OF THE ASSESSES AND REASONS REC ORDED BY YOU FOR INITIATING PROCEEDINGS U/S.147 OF THE INCOME TAX AC T FOR ASSESSMENT YEAR 2012-13 HAVE BEEN GONE THROUGH AND CONSIDERED BY THE UNDERSIGNED. ITA NO.2115/AHD/2017 7 3. APPROVAL IN TERMS OF THE PROVISION OF SECT ION 151 OF THE INCOME TAX ACT; 1961 IN RESPECT OF THE ASSESSMENT YEAR 201 2-13 IS HEREBY GRANTED. SD/- (RAJ DEEP SINGH) JT.COMMISSIONER OF INCOME-TAX RANGE-3(2), AHMEDABAD 11. ON PERUSAL OF THIS LETTER, WE ARE SATISFIED THA T DUE PROCEDURE HAS BEEN FOLLOWED. THE LD.JCIT HAS GONE THROUGH TH E RECORD AND APPLIED HIS MIND, AND THEREAFTER GRANTED THE APPROV AL. THERE IS NO MERIT IN THE CONTENTIONS OF THE LD.COUNSEL FOR THE ASSESSEE. 12. IN THE NEXT FOLD OF CONTENTIONS, THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THERE IS NO COHERENCE OR NE XUS BETWEEN INFORMATION AVAILABLE WITH THE AO VIS--VIS THE REA SONS RECORDED FOR REOPENING OF THE ASSESSMENT. HE EMPHASISED THE LACUNAE WHICH CREPT IN THE REASON IS THAT ACCORDING TO THE AO, THE ASSESSEE HAD NOT FILED HIS RETURN OF INCOME FOR THE ASSTT.YE AR 2012-13. THIS FACT IS FACTUALLY INCORRECT. THE AO HAS NOT VERIFI ED THE RECORD. IN FACT THE ASSESSEE HAS FILED RETURN, AND THEREFORE, THE BASIS FOR FORMING AN OPINION THAT INCOME HAS ESCAPED THE ASSE SSMENT, IS WRONG AND REOPENING DESERVES TO BE QUASHED. FOR BU TTRESSING THIS PROPOSITION, HE MAINLY RELIED UPON THE JUDGMEN T OF THE HONBLE GUJARAT HIGH COURT RENDERED IN SPECIAL CIVI L APPLICATION NO.21030 OF 2017 RENDERED IN THE CASE OF MUMTAX HAJ I MOHMAD MEMON VS. ITO. HE PLACED ON RECORD COPY OF THE JUD GMENT. HE TOOK US THROUGH THE REASONS NOTICED BY THE HONBLE HIGH COURT, AND THEREAFTER FINDING RECORDED BY THE HONBLE HIGH COURT IN PARA 10 TO 12. HE ALSO RELIED UPON THE DECISION OF ITAT , AHMEDABAD BENCH IN THE CASE OF MAHADEV TRADING CO. VS. ITO, 14 3 TTJ 492. HE PLACED ON RECORD COPY OF THIS ORDER OF THE TRIBU NAL. ITA NO.2115/AHD/2017 8 13. WE HAVE DULY CONSIDERED RIVAL CONTENTIONS AND G ONE THROUGH THE RECORD. WE HAVE EXTRACTED REASONS RECORDED BY THE AO IN THE OPENING PARAGRAPH OF THIS ORDER. NO DOUBT AN EFFOR T IS BEING MADE TO STRIKE PARITY BETWEEN THE FACTS AVAILABLE WITH T HE HONBLE HIGH COURT IN THE CASE OF MUMTAZ HAJI MOHMAD MEMON (SUPR A) AS WELL AS WITH THE CASE OF THE PRESENT ASSESSEE. IN THE C ASE OF MUMTAZ HAJI MOHMAD MEMON (SUPRA) THE ASSESSEE HAS SOLD A P ROPERTY AND ASSESSMENT WAS REOPENED BY MAKING A REASON THAT THE ASSESSEE HAS NOT FILED RETURN. ASSESSEE DID NOT DISCLOSE CA PITAL GAIN ON SUCH SALE. THIS FINDING WAS FOUND TO BE FACTUALLY INCORRECT AT THE END OF THE REVENUE. ACCORDING TO THE HONBLE HIGH COURT, THE ASSESSEE HAS FILED RETURN AND DISCLOSED CAPITAL GAI N. IT IS TRUE THAT THERE SHOULD BE A LIVE-NEXUS BETWEEN THE INFORMATIO N AVAILABLE WITH THE AO VIS--VIS FORMATION OF BELIEF THAT THE INCOME HAS ESCAPED ASSESSMENT. IN THE PRESENT CASE, NO DOUBT THERE IS AN ERROR AT THE END OF THE AO WHILE TAKING COGNIZANCE OF THE FACT WHICH GOAD HIM TO HARBOR A BELIEF THAT INCOME HAS E SCAPED THE ASSESSMENT, AND THAT ERROR IS THAT THE ASSESSEE HAS NOT FILED RETURN WHEREAS THE ASSESSEE HAS FILED THE RETURN. NOW QUESTION IS, WHETHER SUCH AN ERROR IS SO FATAL THAT RE-ASSES SMENT IS TO BE QUASHED ? WE HAVE PERUSED THE RETURN. THE ASSESSEE DID NOT DISCLOSE THE SALE TRANSACTION OF THE PROPERTY AND D ID NOT OFFER INCOME UNDER THE HEAD CAPITAL GAIN ON TRANSFER OF REAL-ESTATE. THIS IS THE DIFFERENCE BETWEEN THE FACTS AVAILABLE BEFORE THE HONBLE HIGH COURT VIS--VIS IN THE PRESENT CASE. EVEN IF THE AO HAS TAKEN COGNIZANCE OF THE RETURN OF INCOME FILED BY THE ASSESSEE, AND HE HAS OBSERVED THAT RETURN WAS PERUS ED, RESULT WOULD THE SAME, BECAUSE THE TRANSACTION IS NOT AVAI LABLE IN THE RETURN. THEREFORE, THIS ERROR DOES NOT AFFECT THE FORMATION OF ITA NO.2115/AHD/2017 9 BELIEF OF THE AO. IT IS NOT RELEVANT IN THE PRESEN T SET OF FACTS. IN OTHER WORDS, IT NOWHERE GOADS THE AO ON WRONG CONCL USION; MEANING THEREBY THAT HAD THE AO PERUSED THE RETURN, THEN HE WOULD NOT HAVE FORMED THIS OPINION. WE ARE OF THE VIEW THAT EVEN IF THE RETURN WOULD HAVE BEEN PERUSED, THE OPINION WOULD BE THE SAME BECAUSE CAPITAL GAIN HAS NOT BEEN SHOWN BY THE ASSESSEE IN THE RETURN. THEREFORE, THE ASSESSEE CANNOT DRAW AN Y BENEFIT FROM ANY OF THE JUDGMENTS CITED BEFORE US. WE DO NOT FI ND ANY ERROR IN THE FINDING OF THE REVENUE AUTHORITIES, AND THIS AP PEAL IS DEVOID OF ANY MERIT. IT IS DISMISSED. 14. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER PRONOUNCED IN THE COURT ON 15 TH JULY, 2019. SD/- SD/- (RIFAUR RAHMAN) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER