ITO, Rohtak V. Smt. Nandini Singla, Rohtak

ITA 2232/DEL/2016

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4139 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 1
• Next Hearing Date: 16-11-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 26-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: NAVEEN GUPTA
• Section: 143(3); 147; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-1 : NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER ITA NO.2232/DEL/2016 ASSESSMENT YEAR : 2007-08 ITO, WARD-2, ROHTAK. VS. NANDINI SINGLA, MA GAYATRI COMPLEX, MODEL TOWN, ROHTAK. PAN: ARGPS1919K ITA NO.1751/DEL/2016 ASSESSMENT YEAR : 2007-08 ITO, WARD-2, ROHTAK. VS. LALIT SINGLA, MAA GAYATRI COMPLEX, MODEL TOWN, ROHTAK. PAN: ANGPS6806B (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI NAVEEN GUPTA, ADVOCATE DEPARTMENT BY : SHRI ANIL SHARMA, SR. DR DATE OF HEARING : 16.11.2016 DATE OF PRONOUNCEMENT : 17.11.2016 ORDER THESE TWO APPEALS BY THE REVENUE RELATING TO THE A SSESSMENT YEAR 2007-08 INVOLVE TWO DIFFERENT, BUT, RELATED ASSESSE ES. SINCE THE FACTUAL ITA NOS2232 &1751/DEL/2016 2 MATRIX AND THE GROUNDS TAKEN BEFORE THE TRIBUNAL IN BOTH THE APPEALS ARE COMMON, I AM, THEREFORE, PROCEEDING TO DISPOSE THEM OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. BRIEFLY STATED, THE FACTS OF THE APPEAL IN THE CASE OF SHRI LALIT SINGLA ARE THAT NOTICE U/S 148 OF THE INCOME-TAX, 1961 (HE REINAFTER ALSO CALLED THE ACT) WAS ISSUED ON 29.3.2014 REQUIRING THE AS SESSEE TO FILE HIS RETURN OF INCOME FOR THE AY 2007-08. THE AO COMPLE TED THE ASSESSMENT U/S 144 BY MAKING AN ADDITION OF RS.39,0 7,975/- TOWARDS UNEXPLAINED SOURCE OF INVESTMENT IN PROPERTY. THE LD. CIT(A) QUASHED THE NOTICE ISSUED U/S 148 BY FINDING THAT THIS CAS E WAS COVERED BY SECTION 151(2) AND THE AO GOT THE APPROVAL FROM CIT BEFORE ISSUING NOTICE U/S 148 INSTEAD OF JCIT/ADDL.CIT. THE REVENU E IS AGGRIEVED AS UNDER :- 1. KEEPING IN VIEW OF THE FACT THAT THE ASSESSEE H AS NEVER OBJECTED TO THE VALIDITY OF NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE DECISION O F CIT(A), ROHTAK IS NOT ACCEPTABLE BECAUSE AS PER SECTION 292B ( SIC 292BB ) OF THE INCOME TAX ACT, 1961 NOTICE DEEMED TO BE VALID IN P REVAILING CIRCUMSTANCES OF THE CASE. ITA NOS2232 &1751/DEL/2016 3 3. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE RELEVANT MATERIAL ON RECORD. MATERIAL PART OF SECTION 151, PRIOR TO ITS SUBSTITUTION BY THE FINANCE ACT, 2015, READS AS UNDER :- `SANCTION FOR ISSUE OF NOTICE. 151. (1) IN A CASE WHERE AN ASSESSMENT UNDER SUB-SECTIO N (3) OF SECTION 143 OR SECTION 147 HAS BEEN MADE FOR THE RELEVANT A SSESSMENT YEAR, NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSE SSING OFFICER, WHO IS BELOW THE RANK OF ASSISTANT COMMISSIONER OR DEPU TY COMMISSIONER, UNLESS THE JOINT COMMISSIONER IS SATISFIED ON THE R EASONS RECORDED BY SUCH ASSESSING OFFICER THAT IT IS A FIT CASE FOR TH E ISSUE OF SUCH NOTICE : PROVIDED THAT, AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, NO SUCH NOTICE SHALL BE ISSUED UNL ESS THE CHIEF COMMISSIONER OR COMMISSIONER IS SATISFIED, ON THE R EASONS RECORDED BY THE ASSESSING OFFICER AFORESAID, THAT IT IS A FIT C ASE FOR THE ISSUE OF SUCH NOTICE. (2) IN A CASE OTHER THAN A CASE FALLING UNDER SUB-S ECTION (1), NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSESSING O FFICER, WHO IS BELOW THE RANK OF JOINT COMMISSIONER, AFTER THE EXP IRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLES S THE JOINT COMMISSIONER IS SATISFIED, ON THE REASONS RECORDED BY SUCH ASSESSING OFFICER, THAT IT IS A FIT CASE FOR THE ISSUE OF SUC H NOTICE. 4. A BARE PERUSAL OF SUB-SECTION (1) OF SECTION 151 REVEALS THAT SANCTION FOR ISSUE OF NOTICE SHOULD BE OBTAINED BY THE AO FROM JCIT. IN CASE A PERIOD OF FOUR YEARS FROM THE END OF THE REL EVANT ASSESSMENT YEAR HAS EXPIRED AND THE ORIGINAL ASSESSMENT WAS MADE U/ S 143(3) OR SECTION ITA NOS2232 &1751/DEL/2016 4 147, THEN, NO NOTICE CAN BE ISSUED WITHOUT SEEKING SANCTION FROM THE CHIEF COMMISSIONER OF INCOME-TAX OR COMMISSIONER OF INCOME-TAX. SUB-SECTION (2) OF SECTION 151, ON THE OTHER HAND, APPLIES TO CASES NOT FALLING UNDER SUB-SECTION (1). THE EFFECT OF SUB-S ECTION (2) IS THAT WHERE NO ASSESSMENT WAS EARLIER MADE, NOTICE CAN BE ISSUE D BY AN AO U/S 148 AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR ONLY AFTER OBTAINING SANCTION FROM JCIT. THUS , IT IS APPARENT THAT THERE ARE TWO CATEGORIES OF CASES REQUIRING SANCTIO N FOR ISSUE OF NOTICE U/S 148 VIZ., THOSE IN WHICH ASSESSMENT WAS EARLIER MADE U/S 143(3) OR SECTION 147, WHICH ARE COVERED U/S 151(1) OF THE AC T AND REST OF THE CASES, WHICH ARE COVERED U/S 151(2) OF THE ACT. 5. ADVERTING TO THE FACTS OF THE INSTANT CASE, IT IS FOUND AS AN ADMITTED POSITION THAT THE ASSESSMENT OF THE ASSESSEE WAS NO T MADE EARLIER U/S 143(3) OR SECTION 147. IN THAT VIEW OF THE MATTER, THE CASE BEING COVERED U/S 151(2), IT WAS OBLIGATORY ON THE PART OF THE AO TO OBTAIN SANCTION FOR ISSUANCE OF NOTICE FROM JCIT AS THE PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR STOOD EXPIRED AT THE T IME OF ISSUANCE OF ITA NOS2232 &1751/DEL/2016 5 NOTICE ON 29.3.2014. AS THE AO IN THE INSTANT CASE OBTAINED SANCTION FROM THE CIT AND NOT THE JCIT, IT DID NOT CONFER A VALID JURISDICTION TO HIM TO PROCEED WITH THE ASSESSMENT. THE HONBLE J URISDICTIONAL HIGH COURT IN CIT VS. SPLS SIDDHARTHA LTD. (2012) 345 ITR 223 (D EL) DEALT WITH ALMOST SIMILAR SITUATION AS IS PREVAILING BEFO RE ME. THE AO IN THAT CASE SOUGHT APPROVAL OF COMMISSIONER ONLY. THE HON BLE HIGH COURT HELD THAT IT COULD NOT BE SAID THAT THE JOINT COMMI SSIONER/ADDITIONAL COMMISSIONER HAD GRANTED THE APPROVAL AND ACCORDING LY SET ASIDE THE NOTICE AND THE CONSEQUENTIAL ASSESSMENT. 6. SECTION 292B INVOKED BY THE LD. DR ALSO DOES NOT COME TO THE RESCUE OF THE REVENUE BECAUSE IT SIMPLY PROVIDES TH AT NO NOTICE, ETC., SHALL BE INVALID MERELY BY REASON OF ANY MISTAKE, D EFECT OR OMISSION IN SUCH NOTICE, ETC., IF SUCH NOTICE, ETC., IS IN SUBS TANCE AND IN EFFECT IN CONFORMITY WITH OR ACCORDING TO THE INTENT AND PURP OSE OF THE ACT. IT IS SIMPLE AND PLAIN THAT LACK OF JURISDICTION CANNOT B E MADE GOOD BY VIRTUE OF THE PROVISIONS OF SECTION 292B. AS THE AO IN TH E EXTANT CASE OBTAINED SANCTION FROM THE CIT BEFORE ISSUING NOTICE U/S 148 INSTEAD OF THE JCIT, ITA NOS2232 &1751/DEL/2016 6 THE ISSUE OF NOTICE AND THE CONSEQUENTIAL ASSESSMEN T, IN MY CONSIDERED OPINION, HAVE RIGHTLY BEEN QUASHED BY THE LD. CIT(A ). I, THEREFORE, ENDORSE THE VIEW TAKEN BY THE LD. FIRST APPELLATE A UTHORITY. 7. BOTH THE SIDES ARE IN AGREEMENT THAT THE FACTS A ND CIRCUMSTANCES OF THE OTHER ASSESSEE, NAMELY, SMT. NANDINI SINGLA, WH O IS WIFE OF SHRI LALIT SINGH, ARE IDENTICAL. FOLLOWING THE VIEW TAK EN HEREINABOVE, I COUNTENANCE THE VIEW TAKEN BY THE LD. CIT(A). 8. IN THE RESULT, BOTH THE APPEALS ARE DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 17.11.201 6. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED, 17.11.2016. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.