Siddhant Jayantibhai Pawasia, Bhavnagar V. ACIT, Circle-1, Bhavnagar

ITA 244/AHD/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8701 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 10-01-2020
• Assessment Year: 2010-2011
• Appeal Filed On: 01-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NK GOEL
• Keywords: Revised return; Set aside
• Section: 143(3); 143(1); 154

Judgement Text

, SMC IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER ./ I.T.A. NO. 244/AHD/2018 ( ASSESSMENT YEAR : 2010-11) SIDDHANT JAYANTIBHAI PAWASIA PLOT NO. 2286, NEAR HILL DRIVE CIRCUIT HOUSE, OPP. MADHAV BAUG, BHAVNAGAR - 364001 / VS. ACIT CIRCLE - 1, BHAVNAGAR ./ ./ PAN/GIR NO. : AJQPP0741E ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : NONE / RESPONDENT BY : SHRI N. K. GOEL, SR. D.R. DATE OF HEARING 10/01/2020 # / DATE OF PRONOUNCEMENT 17/01/2020 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME TAX (APPEALS)-6, AHMEDABAD (CIT(A) IN SHORT), DATED 28 .12.2017 ARISING IN THE ORDER DATED 09.06.2016 PASSED BY THE ASSISTA NT COMMISSIONER OF ITA NO. 244/AHD/18 [SIDDHANT J. PAWASIA VS. ACIT] A.Y. 2010-11 - 2 - INCOME TAX (ACIT) UNDER S. 154 OF THE INCOME TAX AC T, 1961 (THE ACT) CONCERNING AY 2010-11. 2. THE GROUNDS OF APPEAL FILED BY THE ASSESSEE READ AS UNDER: 1. LD. CIT (A) ERRED IN LAW AND ON FACTS CONFIRM ING THE ORDER DATED 09.06.2016 PASSED BY AO U/S 154 ENHANCING ASS ESSED INCOME OF THE APPELLATE WITHOUT ISSUING NOTICE AND AFFORDING AN OPPORTUNITY OF HEARING TO THE ASSESSEE AS CONTEM PLATED UNDER SUB-SECTION (3) OF SECTION 154 OF THE ACT. 2. LD. CIT (A) ERRED IN LAW AND ON FACTS CONFIRMI NG THE ORDER DATED 09.06.2016 PASSED BY AO U/S 154 WITHOUT APPRE CIATING THAT THERE WAS NO ERROR APPARENT ON RECORD SO AS TO ENHANCE THE INCOME OF THE APPELLANT AS WAS ORIGINALLY ASSES SED U/S 143(3) OF THE ACT. 3. THAT LEARNED CIT(A) ERRED IN LAW AND ON FACTS CONFIRMING THE ORDER DATED 09.06.2016 PASSED BY AO U/S 154 OF THE ACT AS AO HAS FAILED TO COMPLY WITH PRIMARY TERMS OF RECTIFIC ATION ORDER U/S 154 OF THE ACT WHICH IS THAT THE MISTAKE IN THE ORIGINAL ORDER SHOULD BE APPARENT FROM THE RECORDS. 4. LD. CIT (A) ERRED IN LAW AND ON FACTS CONFIRMI NG THE ORDER DATED 09.06.2016 PASSED BY AO UNDER SECTION 154 WIT HOUT APPRECIATING THAT UNDER SUB-SECTION (8) OF SECTION 154 THE AO CANNOT ENHANCE THE ASSESSED INCOME ON A RECTIFICATI ON APPLICATION MADE BY AN ASSESSEE. 5. LD. CIT (A) ERRED IN LAW AND ON FACTS CONFIRMI NG THE ORDER DATED 09.06.2016 PASSED BY AO UNDER SECTION 154 BY RELYING UPON GOETZ (INDIA) LTD VS. CIT (2006) 284 ITR 323 ( SC) WITHOUT APPRECIATING THAT FACTS IN SAID CASE ARE CO MPLETELY DIFFERENT IN AS MUCH AS IN THE SAID CASE ASSESSEE W ITHOUT THERE BEING ANY ASSESSMENT PROCEEDINGS, ASSESSEE MADE NEW CLAIM THROUGH A LETTER WITHOUT FILING REVISED RETURN WHER EAS IN THE PRESENT CASE THE APPELLANT HAS FILED REVISED COMPUT ATION OF INCOME DURING ASSESSMENT PROCEEDING WHICH WAS DULY DISCUSSED AND ACCEPTED BY THE ASSESSING OFFICER. 3. WHEN THE MATTER WAS CALLED FOR HEARING, NONE APP EARED FOR THE ASSESSEE. IT IS SEEN THAT THE ASSESSEE HAS REMAINE D DELINQUENT IN EARLIER OCCASIONS ALSO AND NEGLECTED TO EITHER ATTE ND THE HEARING OR SOUGHT ADJOURNMENT. THE MATTER IS ACCORDINGLY PROC EEDED EX PARTE IN THE ABSENCE OF THE ASSESSEE. ITA NO. 244/AHD/18 [SIDDHANT J. PAWASIA VS. ACIT] A.Y. 2010-11 - 3 - 4. THE LEARNED DR FOR THE REVENUE RELIED UPON THE O RDER OF THE LOWER AUTHORITIES. 5. WE HAVE PERUSED THE ORDER OF THE LOWER AUTHORITI ES AND CASE RECORDS. THE ASSESSEE IN THE INSTANT CASE HAS SOUG HT TO CHALLENGE THE ACTION OF THE AO IN DENYING THE ADDITIONAL REFUND A RISING FROM THE ASSESSED INCOME QUA THE RETURN OF INCOME. 5.1 BRIEFLY NOTED, THE ASSESSEE FILED RETURN OF INC OME DECLARING TOTAL INCOME AT RS.50,36,440/-. THE ASSESSMENT WAS CARRI ED OUT UNDER S.143(3) OF THE ACT AND THE ASSESSED INCOME WAS DET ERMINED AT LOWER FIGURE OF RS.38,69,029/-. THE REFUND WAS CLAIMED A T RS.3,05,770/-. A REFUND OF RS.2,91,240/- WAS GRANTED TO THE ASSESSEE ON PROCESSING THE RETURN UNDER S.143(1) OF THE ACT BASED ON INCOME OF RS.50,36,440/- RETURNED BY ASSESSEE. HOWEVER, WHEN THE INCOME WAS ASSESSED UNDER S.143(3) OF THE ACT AT RS.38,69,029/- AS PER THE OR DER DATED 01.11.2012, THE ASSESSEE ASKED FOR ADDITIONAL REFUN D. VIDE ORDER PASSED UNDER S.154 OF THE ACT DATED 09.06.201, THE ADDITIONAL REFUND WAS DENIED ON THE GROUND THAT THE ASSESSEE HAS FAIL ED TO REVISE HIS RETURN OF INCOME TO CLAIM SUCH REFUND. THE RECTIFI CATION ORDER UNDER S.154 OF THE ACT, BEING SHORT, IS REPRODUCED FOR EA SY REFERENCE: THE ASSESSEE HAD E-FILED HIS RETURN OF INCOME SHOW ING TOTAL INCOME OF RS.50,36,439/- CLAIMING REFUND OF RS.3,05,770/-. THE SAME WAS PROCESSED U/S 143(1) BY THE CPC WITH INCOME OF RS.5 1,67,840/- RESULTING IN TO A REFUND OF RS.2,91,240/- WHICH WAS PAID TO THE ASSESSEE ON 25.05.2011. THEREAFTER, THE CASE WAS S ELECTED FOR SCRUTINY U/S 143(3) AND ASSESSMENT WAS COMPLETED ON TOTAL INCOME OF RS.38,69,029/- VIDE ASSESSMENT ORDER U/S 143(3) DTD 01.11.2012 WHICH WAS BELOW THE RETURNED INCOME. NOW, THE ASSESSEE HAS FILED AN APPLICATION FOR REC TIFICATION U/S 154 CLAIMING THAT THE AMOUNT OF REFUND PAYABLE IS R S.5,46,258/-. THE APPLICATION OF THE ASSESSEE HAS BEEN CONSIDERED CAREFULLY BUT FOUND NOT TO BE ACCEPTABLE BECAUSE OF THE FACT THAT THE ASSESSEE HAD HIMSELF FILED HIS RETURN OF INCOME DECLARING HIS TO TAL INCOME AT RS.50,36,439/-. HE DID NOT REVISE HIS RETURN OF IN COME, WHICH WAS THE CORRECT COURSE OF ACTION. INSTEAD HE SOUGHT TO REVISE HIS ITA NO. 244/AHD/18 [SIDDHANT J. PAWASIA VS. ACIT] A.Y. 2010-11 - 4 - COMPUTATION OF INCOME THEREBY ENHANCING HIS CLAIM F OR REFUND. HOWEVER, IN VIEW OF THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD. VS. CIT (284 ITR 323) T HE ASSESSED INCOME CANNOT BE BELOW THE RETURNED INCOME. THEREF ORE, THE CLAIM OF THE ASSESSEE TO CHANGE THE RETURN INCOME BY REVISIN G THE COMPUTATION OF CAPITAL GAIN IS NOT ALLOWABLE. ACCORDINGLY HIS APPLICATION FOR RECTIFICATION U/S 154 OF THE IT ACT IS HEREBY REJEC TED AND THE REVISED INCOME REMAINS THE RETURNED INCOME I.E. RS.50,36,43 9/-. REVISED ASSESSED INCOME RS.50,36,439/- ROUNDED OFF TO RS.50,36,440/- ISSUE DEMAND NOTICE AND CHALLAN, CHARGE INTEREST U/ S 234B/234C. 5.2 AGAINST THE ORDER PASSED UNDER S.154 OF THE ACT BY THE AO, THE ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A). 5.3 THE CIT(A) RELIED UPON THE DECISION OF THE HON BLE SUPREME COURT IN GOETZE (INDIA) LTD. VS. CIT [2006] 284 ITR 323 (SC) AND UPHELD THE ACTION OF THE AO. IN SHORT, THE REFUND ARISEN TO THE ASSESSEE DUE TO INCOME ASSESSED AT LESSER FIGURE TH AN THE RETURN OF INCOME WAS DENIED TO THE ASSESSEE. 5.4 THE AFORESAID ACTION OF THE CIT(A) HAS BEEN CON TROVERTED BEFORE US. 5.5 TO BEGIN WITH, WE OBSERVE THAT SECTION 154 OF T HE ACT POSTULATES RECTIFICATION OF A MISTAKE APPARENT ON RECORD. NOT WITHSTANDING THE CASE WHERE THE INCOME HAS BEEN ADMITTEDLY ASSESSED AT A LESSER AMOUNT, THE CONSEQUENCES OF SUCH ASSESSMENT WILL AU TOMATICALLY FOLLOW IN ACCORDANCE WITH LAW. THUS, AS A COROLLAR Y, THE ASSESSEE WOULD BE ENTITLED TO APPROPRIATE REFUND OF TAXES BY OPERATION OF LAW AS PAID IN EXCESS ON THE BASIS OF INCOME WRONGLY RETUR NED AT A HIGHER FIGURE. SUCH ADDITIONAL CLAIM OF REFUND DOES NOT I NVOLVE ANY LONG DRAWN PROCESS OF REASONING AND THERE CANNOT BE ANY DEBATE CONCEIVABLE ON SUCH VIEW. THEREFORE, THERE WAS NO REASON TO DENY THE REFUND ENTITLED TO THE ASSESSEE BASED ON ASSESSED I NCOME BY THE ITA NO. 244/AHD/18 [SIDDHANT J. PAWASIA VS. ACIT] A.Y. 2010-11 - 5 - APPELLATE AUTHORITY I.E. CIT(A). THE DECISION OF T HE HONBLE SUPREME COURT IN GOETZE (INDIA) LTD. (SUPRA) DOES NOT PREVENT AN APPELLATE AUTHORITY FROM DOING SUCH LOGICAL THING. THE ORDER OF THE CIT(A) IS ACCORDINGLY SET ASIDE AND THE AO IS DIRECTED TO DET ERMINE THE REFUND BASED ON ASSESSED INCOME AND CONSEQUENTLY ASSIGN AP PROPRIATE REFUND ENTITLED TO THE ASSESSEE BASED ON ASSESSED INCOME. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED EX PARTE . SD/- SD/- (MAHAVIR PRASAD) (PRADIP KUMAR KE DIA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 17/01/2020 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED IN OPEN COURT ON 17/01/202 0