ACIT, Circle - 10(2), Kolkata, Kolkata V. M/s. Vesuvius India Ltd., Kolkata

ITA 2332/KOL/2017

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 8903 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 1999-2000
• Appeal Filed On: 17-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH KUMAR CIT SRDR
• Assessee Lawyers: PRASHANT JAISWALAR
• Keywords: Reopening of assessment; Tangible material; Difference of opinion; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 143(3); 143(1); 147; 148

Judgement Text

, C , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI S.S.GODARA, JUDICIAL MEMBER ITA NO.2332/KOL/2017 ASSESSMENT YEAR:1999-00 ACIT, CIRCLE-10(2), P-7, CHOWRINGHEE SQUARE, 3 RD FLOOR, KOLKATA-69 / V/S . M/S VESUVIUS INDIA LTD. P-104, TARATOLLA ROAD, KOLKATA-700 088 [ PAN NO.AAACV 8995 Q ] /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SAURABH KUMAR, ADDL. CIT-SR-DR /BY RESPONDENT SHRI PRASHANT JAISWAL,AR /DATE OF HEARING 05-12-2018 /DATE OF PRONOUNCEMENT 26-12-2018 /O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS REVENUES APPEAL FOR ASSESSMENT YEAR 1999-00 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-11, KOLKATAS ORDER DATED 19.09.2017 PASSED IN CASE NO.609/CIT(A)-11/KOL/2014-15 INVOLVING PROC EEDINGS U/S 147 R.W.S.143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. THE R EVENUE RAISES FOLLOWING SUBSTANTIVE GROUNDS IN ITS INSTANT APPEAL READS AS UNDER:- 1) THE LEARNED. CIT(A) WAS NOT CORRECT IN LAW AND I N FACTS BY QUASHING THE ORDER PASSED BY THE ASSESSING OFFICER U/S. 147/143(3) OF THE IT ACT , 1961 FOR THE A.Y 1999-2000. 2) THE LEARNED. CIT(A) WAS NOT CORRECT IN LAW AS W ELL AS FACTS IN HOLDING THAT NOT NEW TANGIBLE MATERIAL WAS AVAILABLE WITH ASSESSING OFFI CER FOR REOPENING OF ASSESSMENT AND THEREFORE THE NECESSARY INGREDIENTS OF SECTION 147 OF IT ACT, 1961 WERE NOT FULFILLED FOR THE AY 1999-2000. ITA NO. 2332/KOL/2017 A.Y. 1999 -00 ACIT, CIR-10(2), KOL. VS. M/S VESUVIUS IND IA LTD. PAGE 2 3) THE LD. CIT(A) WAS NOT CORRECT IN LAW AS WELL AS FACTS IN FAILING TO APPRECIATE THAT WHERE THE INITIAL RETURN IS PROCESSED UNDER SECTION 143(1 ) OF THE ACT, THE AO CAN FORM REASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT BY EXAMI NING THE VERY RETURN AND / OR THE DOCUMENTS ACCOMPANYING THE RETURN. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. WE NOTICE IN THE BACKDROP OF REVENUES ABOVE PLE ADINGS THAT THE CIT(A) HAS QUASHED THE IMPUGNED RE-OPENING / RE-ASSESSMENT ON ACCOUNT OF LACK OF NEW TANGIBLE MATERIAL AS FOLLOWS:- DECISION: 1. GROUND OF APPEAL NO.1 IS AGAINST REOPENING OF THE C ASE U/S. 147. I THIS BACKGROUND, NOTICE U/S. 148 HAS BEEN ISSUED ON 27-12-2004 INITI ATING REASSESSMENT PROCEEDINGS U/S. 147 AND THE REASONS FOR INITIATING REASSESSMENT PR OCEEDING HAS BEEN DULY PROVIDED TO THE ASSESSEE THAT THE USE OF THE TERM DERIVED FROM IN T HE RELEVANT POSITION OF THE AT INDICATES THE RESTRICTED MEANING TO COVER ONLY THE PROFIT AND GAINS DIRECTLY ACCRUING FROM THE CONDUCT OF THE BUSINESS OF THE UNDERTAKING AND THUS DEDUCTION U/S. 80IA HAD BEEN GRANTED AT HIGHER VALUE THAN ACTUALLY ALLOWABLE AS PER ACT. IN RESPONSE TO THE SAID NOTICE THE ASSESSEE VIDE LETTER DATED 19-01-2005 STATED THAT R EVISED RETURN BE TREATED AS RETURN FILED IN RESPONSE TO NOTICE U/S. 148 1.1 IN APPEAL IT IS SUBMITTED THAT THE REOPENING OF THE CASE BY THE AO BY ISSUE OF NOTICE U/S. 147 WAS NOT JUSTIFIED AS THERE WAS NO FRESH MA TERIAL FACT S AVAILABLE BEFORE THE AO AND THAT THE SAME WAS CHANGE OF OPINION ON PAT OF T HE ASSESSING OFFICER. FOR THE ABOVE SUBMISSIONS RELIANCE HAS BEEN PLACED ON THE DECISIO N IN CIT VS. KELVINATOR OF INDIA LIMITED (2002) 256 ITR 1 (DEL)(FB),, AMIYA SALES & INDUSTRIES VS. ASSTT.CIT (2005) 274ITR 25 (CAL) AS WELL AS JAGATDAL JUT & INDUSTRIE S LTD. VS. DCIT (2004) 91 TTJ 770 (KOL) AND PRESSMAN ADVERTISING & MARKETING LTD. V S.- ACIT (2004) 90 TTJ 483 (KOL) ETC. IT WAS FURTHER SUBMITTED THAT IN THE APPELLANT S CASE, THERE WAS NO CHANGE OF LAW AND NO FRESH MATERIAL HAD COME ON RECORD ENABLING THE A O TO INVOKE THE POWER U/S. 147 OF THE ACT. THIS IS A CASE OF MERE CHANGE OF OPINION WHICH DO NOT AFFORD JURISDICTION TO INITIATE PROCEEDINGS U/S. 147 OF THE ACT. 1.2 THE AR VIDE THE SUPPLEMENTARY SUBMISSION FILED ON 18-09-2017, FURTHER SUBMITTED THAT IN THE CASE OF CIT VS. ORIENT CRAFT LTD. (2013) 3 54 ITR 536 (DEL), THE HON'BLE HIGH COURT HELD THAT: SEC. 147 MAKES NO DISTINCTION BETWEEN AN ORDER PASS ED U/S. 143(3) AND THE INTIMATION U/S. 143(1). IT IS NOT PERMISSIBLE TO ADOPT DIFFERE NT STANDARDS WHILE INTERPRETING THE WORDS REASON TO BELIEVE VIS-A-VIS SEC. 143(1) AND SEC. 143(3). WHERE THE REASON FOR REASSESSMENT DISCLOSES THAT TH E AO HAS FORMED HIS BELIEF ON THE BASIS OF THE RETURN OF INCOME, IT IS NOTHING BUT A REVIEWS OF EARLIER PROCEEDINGS, NOT PERMISSIBLE IN VIEW OF APEX COURT DECISION IN CIT VS.-KELVINATOR OF INDIA LTD. (2010) 320 ITR 561 (SC) 1.3 FURTHER, IT WAS ALSO SUBMITTED THAT SIMILAR ISS UE HAS BEEN DECIDED IN FAVOUR OF THE APPELLANT BY THE HON'BLE KOLKATA ITAT IN AY 2002-03 (ITA NO. 2138/KOL/2013) VIDE ORDER DATED 03-05-2017. 1.4 THE CONTENTION OF THE APPELLANT AGAINST REOPENI NG OF THE CASE U/S. 1147 HAVE BEEN DULY CONSIDERED. PLACING RELIANCE IN THE CASE OF C IT VS.- ORIENT CRAFT LTD. (SUPRA) AND THE DECISION OF THE HON'BLE KOLKATA ITAT IN THE APP ELLANTS OWN CASE FOR AY 2002-03,IT IS HELD THAT AS NO NEW TANGIBLE MATERIAL WAS AVAILABLE WITH THE AO FOR REOPENING THE ITA NO. 2332/KOL/2017 A.Y. 1999 -00 ACIT, CIR-10(2), KOL. VS. M/S VESUVIUS IND IA LTD. PAGE 3 ASSESSMENT, THEREFORE THE REASSESSMENT PROCEEDING D ESERVES TO BE QUASHED. SINCE THE REASSESSMENT PROCEEDING OF THE AO IS QUASHED ON THE PRELIMINARY GROUND OF ASSUMPTION OF JURISDICTION BY THE AO FOR THE ASSESSMENT YEAR U NDER APPEAL, SO I REFRAIN ON GIVING MY OPINION ON THE MERITS OF THE ADDITIONS MADE IN THE REASSESSMENT. 3. SUFFICE TO SAY, LEARNED CIT(A) HOLDS THAT THERE IS NO FRESH TANGIBLE MATERIAL AVAILABLE WITH THE ASSESSING OFFICER FOR SETTING IN TO MOTION THE IMPUGNED RE-OPENING SEC. 147 R.W.S. 148 OF THE ACT. WE FIND THERE IS NO REBUTTED COMING FROM REVENUES SIDE INDICATING ANY DISTINCTION ON FACTS VIS--VIS THOSE IN ASSESSEES FAVOUR IN ASSESSMENT YEAR 2002-03 AS TAKES NOTE OF IN CITS F INDINGS UNDER CHALLENGE. WE THEREFORE QUOTE THIS TRIBUNALS CO-ORDINATE BENCHS DECISION IN ASSESSEES OWN CASE ITSELF IN ASSESSMENT YEAR 2002-03 (SUPRA) TO CONCLU DE THAT THE CIT(A) HAS RIGHTLY ADOPTED JUDICIAL CONSISTENCY TO ACCEPT ASSESSEES L EGAL GROUND RAISED IN LOWER APPELLATE PROCEEDINGS. 4. THIS REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 26/12/2018 SD/- SD/- ( &) (( &) (J.SUDHAKAR REDDY) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER *DKP-SR.PS ) - 26/12/2018 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-ACIT,CIR-10(2), P-7, CHOWRINGHEE SQ. 3 RD FL. KOLKATA-69 2. /RESPONDENT-M/S VESUVIUS INDIA LTD.P-104,TARATOLLA ROAD, KOLKATA-088 3. , - / CONCERNED CIT 4. - - / CIT (A) 5. . ((, , , /DR, ITAT, KOLKATA 6. 2 / GUARD FILE. BY ORD ER/ , /TRUE COPY/ / ,,