Solapur Janata Sahakari Bank Ltd, Solapur V. Assistant Commissioner of Income-tax, Circle - 2, Solapur

ITA 24/PUN/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 5020 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 25-04-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 04-01-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Keywords: Competent authority
• Section: 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE . , , BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.24/PUN/2018 / ASSESSMENT YEAR : 2009-10 SOLAPUR JANATA SAHAKARI BANK LTD., SHIVSMARAK SANKUL, GOLD FINCH PETH, SOLAPUR-413007. PAN : AAAAS3627C ....... / APPELLANT / V/S. ACIT, CIRCLE-2, SOLAPUR. / RESPONDENT ASSESSEE BY : SHRI PRAMOD SHINGTE REVENUE BY : SHRI S. P. WALIMBE / DATE OF HEARING : 19.11.2019 / DATE OF PRONOUNCEMENT : 21.11.2019 / ORDER PER D. KARUNAKARA RAO, AM: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-7, PUNE DATED 17.10.2017 FOR THE ASSESSMENT YEAR 2009-10. 2. THE ASSESSEE RAISED VARIOUS GROUNDS (GROUND NOS.1 TO 5) AND QUESTIONED THE VALIDITY OF THE REASSESSMENT MADE BY THE ASSESSING OFFICER U/S 147 OF THE ACT (GROUND NO.2). STATING THAT THESE ARE THE LEGAL ISSUE, LD. COUNSEL FOR THE ASSESSEE FILED ADDITIONAL GROUND ALSO AND THE SAME IS EXTRACTED AS UNDER :- ON THE FACTS & CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LOWER AUTHORITIES HAVE ERRED IN INITIATING THE PROCEEDINGS U/S 147 WITHOUT RECORDING APPROPRIATE SATISFACTION U/S 151 OF HONBLE PRINCIPLE 2 ITA NO.24/PUN/2018 COMMISSIONER OF INCOME TAX-6, PUNE. IN VIEW OF THE FACT THE ENTIRE PROCEEDINGS U/S 147 ARE VOID AB INITIO. 3. BEFORE US, AT THE OUTSET, REFERRING TO THE SAID ADDITIONAL GROUND, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS IS CASE WHERE THE NOTICE U/S 148 OF THE ACT WAS ISSUED WITHOUT COMPLYING WITH THE STATUTORY REQUIREMENT OF OBTAINING PRIOR APPROVAL U/S 151 OF THE ACT FROM THE COMPETENT AUTHORITY RELATING TO SANCTION FOR ISSUE OF NOTICE. AS PER THE PROVISIONS OF SUB-SECTION (1) OF SECTION 151 OF THE ACT, NO NOTICE SHALL BE ISSUED U/S 148 OF THE ACT BY AN ASSESSING OFFICER, AFTER THE EXPIRY OF A PERIOD OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLESS THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIONER IS SATISFIED, ON THE REASONS RECORDED BY THE ASSESSING OFFICER, THAT IT IS A FIT CASE FOR THE ISSUE OF SUCH NOTICE. REFERRING TO THE SAID PROVISIONS OF THE ACT AND THE LINKING FACTS THAT HAPPENED IN THE INSTANT CASE, LD. COUNSEL SUBMITTED THAT THE NOTICE U/S 148 OF THE ACT WAS ISSUED ON 23.03.2016. THE SAME WAS SERVED ON THE ASSESSEE ON 26.03.2016; WHEREAS THE APPROVAL REFERRED TO IN SECTION 151 OF THE ACT, LD. COUNSEL FOR THE ASSESSEE DEMONSTRATED A PROPOSAL FOR SUCH APPROVAL WAS MADE ON 14.03.2016 TO THE PCIT. THE CONTENTS ON ITNS-10 SUPPORT THE SAME. THUS, THE APPROVAL WAS OBTAINED ON 31.03.2016 AND THE SAME IS EVIDENT FROM THE PRINTED PAGE OF THE SCREEN SHORT FROM THE COMPUTER RELATING TO THE APPROVAL SCREEN FOR CASES U/S 147 OF THE ACT. 3 ITA NO.24/PUN/2018 4. FURTHER, WHEN THE ISSUE WAS RAISED BY THE BENCH REGARDING THE EXACT DATE OF APPROVAL BY THE PCIT U/S 151 OF THE ACT, IT IS SUBMITTED THAT THE ITO, HQ-6(1), PUNE WROTE A LETTER TO THE JOINT COMMISSIONER OF INCOME TAX, ITAT-I, PUNE INFORMING THAT THE DATE OF APPROVAL IS 31.03.2016 ONLY. THUS, THE LD. COUNSEL SUBMITTED THAT THIS IS A CASE WHERE NOTICE U/S 147 OF THE ACT WAS ISSUED ON 23.03.2016 AND AGAINST WHICH THE APPROVAL OF THE PCIT WAS OBTAINED LATER ON 31.03.2016. 5. ACCORDING TO THE LD. COUNSEL FOR THE ASSESSEE, NOTICE ISSUED U/S 147 OF THE ACT IS NOT IN ACCORDANCE WITH PROVISIONS OF SECTION 151 OF THE ACT. THEREFORE, THE SAME SHOULD BE QUASHED. IN THIS REGARD, THE ASSESSEE RELIED ON VARIOUS BINDING JUDGEMENTS INCLUDING JUDGEMENT OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF AKSHAR ANSHUL CONSTRUCTION LLP VS. ACIT, WRIT PETITION NO.14302 OF 2018 DATED 01 ST MARCH, 2019. 6. ON THE OTHER HAND, LD. DR FOR THE REVENUE RELIED FAIRLY ON THE ORDER OF THE ASSESSING OFFICER AND THE FACTS AVAILABLE ON RECORD. LEGAL ISSUE 7. WE HAVE HEARD THE LEGAL ISSUE RELATING TO THE VALIDITY OF THE NOTICE U/S 148 R.W.S. 151 OF THE ACT. THE RELEVANT CORRESPONDENCES IS EXTRACTED AS UNDER :- (I) THE LETTER WRITTEN BY THE ITO (HQ), CIT, ITAT-1, PUNE DATED 29.04.2019 TO THE ITO, WARD-2(1), SOLAPUR AND THE RELEVANT LINES FROM THE SAID LETTER ARE AS UNDER :- 4 ITA NO.24/PUN/2018 2. THIS OFFICE IS IN RECEIPT OF SATISFACTION NOTE FORWARDED VIDE YOUR ABOVE CITED LETTER. THE ABOVE APPEAL CAME UP FOR HEARING BEFORE THE HON'BLE 'A' BENCH OF THE ITAT, PUNE. IN THIS REGARD, IT IS REQUESTED TO FORWARD A COPY OF THE COMMENTS OF THE PR.CIT ON THE SAME, AS THE SAME IS ALSO REQUIRED TO BE PRODUCED BEFORE THE HON'BLE BENCH. 3. IT IS REQUESTED TO SEND THE SAME BY 01/05/2019 WELL IN TIME BEFORE THE NEXT DATE OF HEARING WHICH IS ON 20/05/2019. (II) THE LETTER WRITTEN BY THE ITO HQ-6(1) (FOR THE PR.CIT-6, PUNE) DATED 07.06.2019 TO THE JOINT COMMISSIONER OF INCOME TAX, ITAT-1, PUNE AND THE RELEVANT LINES FROM THE SAID LETTER ARE AS UNDER :- 2. IN THIS REGARD, I AM DIRECTED TO MENTION THAT AS PER CBDT'S INSTRUCTIONS, ONLINE APPROVAL ALONG WITH THE REQUISITE COMMENTS OF THE THEN PR, CIT-6, PUNE, FOR RE-OPENING OF THE ABOVE CASE WAS GIVEN FOR THE A.Y. 2009-2010. SCREEN SHOT OF THE ONLINE APPROVAL DATED 31.03.2016 IS ENCLOSED. 8. FROM THE ABOVE CORRESPONDENCES, IT IS EVIDENT THAT THE DATE OF APPROVAL FOR ISSUE OF NOTICE U/S 151 OF THE ACT IS 31.03.2016. FURTHER, IT IS UNDISPUTED FACT THAT THE DATE OF ISSUE OF NOTICE IS 23.03.2016 AND THE SAME IS SERVED ON 26.03.2016. THERE IS ANOTHER LETTER FILED BY THE DEPARTMENT DATED 23.03.2016 WHICH ALSO MENTIONED ABOUT THE DATE OF APPROVAL FOR ISSUANCE OF NOTICE IN A GROUP OF CASES I.E. A CONSOLIDATED APPROVAL IN RESPECT OF 22 CASES, WHERE THE ASSESSEE IS ONE OF THEM. THIS LETTER DATED 23.03.2016 IS NOT SUPPORTED BY THE ONLINE APPROVAL OF THE COMPETENT AUTHORITY IN ANY FASHION AS REQUIRED U/S 151 OF THE ACT. TO THAT EXTENT, THIS LETTER DATED 23.03.2016 CONTRADICTS WITH THE DETAILS AVAILABLE ON THE SCREEN SHORT TAKEN FROM THE ONLINE APPROVALS U/S 147 OF THE ACT. IT IS STATED POSITION OF THE REVENUE THAT DURING THAT PERIOD THE APPROVAL U/S 151 OF THE ACT IS SOUGHT ONLINE AND ALSO GIVEN ONLINE. THEREFORE, CONSIDERING THE SAME, WE ARE OF THE OPINION THAT THE NOTICE ISSUED U/S 148 OF THE ACT IS WITHOUT APPROVAL OF THE COMPETENT AUTHORITY. 5 ITA NO.24/PUN/2018 ACCORDINGLY, THE REASSESSMENT MADE BASED ON SUCH DEFECTIVE NOTICE OF DISPUTE HAS TO BE QUASHED AS VOID AB INITIO . THUS, THE ADDITIONAL GROUND RAISED BY THE ASSESSEE ON LEGAL ISSUE IS ALLOWED. 9. CONSIDERING THE RELIEF GRANTED TO THE ASSESSEE ON LEGAL ISSUE, THE ADJUDICATION OF OTHER REGULAR GROUNDS BECOMES ACADEMIC EXERCISE ONLY. THEREFORE, OTHER REGULAR GROUNDS RAISED BY THE ASSESSEE ARE DISMISSED AS ACADEMIC. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 21 ST DAY OF NOVEMBER, 2019. SD/- SD/- ( /VIKAS AWASTHY) ( . /D. KARUNAKARA RAO) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / PUNE; / DATED : 21 ST NOVEMBER, 2019. SUJEET / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(A)-7, PUNE. 4. THE CCIT, PUNE. 5. , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / BY ORDER, // TRUE COPY // SENIOR PRIVATE SECRETARY , / ITAT, PUNE.