DHILAN D KANAKIA, MUMBAI V. ACIT 17(2), MUMBAI

ITA 250/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3251 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2007-2008
• Appeal Filed On: 09-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B S BIST
• Assessee Lawyers: R C JAIN SHRI AJAY DAGA
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D, MUMBAI BEFORE SHRI SAKTIJIT DEY(JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 250 /MUM/2015 ASSESSMENT YEAR: 2007-08 DHILAN D KANAKIA VS. ACIT 17(2) 148 VYAS BHAWAN, PIRAMAL CHAMBERS , HINDU COLONY RD, LAL BUAG 6 SADAR (E) MUMBAI- 400012 MUMBAI - 400014 PAN NO. AABPK8036D (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI. R.C. JAIN SHRI. AJAY DAGA REVENUE BY : SHRI. B.S. BIST DATE OF HEARING : 18/08/201 6 DATE OF PRONOUNCEMENT : 24/08/2016 ORDER PER N.K. PRADHAN, A.M THE APPEAL HAS BEEN FILED BY THE ASSESSEE. THE RELE VANT ASSESSMENT YEAR IS 2007-08. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE LEARNED CIT(A) 29 AT MUMBAI, AND ARISES OUT OF ASSESSMENT COMP LETED BY THE ASSESSING OFFICER (AO) UNDER SECTION 147 R.W.S 148 OF THE INC OME TAX ACT 1961 (HEREINAFTER THE ACT). 2. GROUND NO. 1 OF THE APPEAL RAISED BY THE ASSESSE E IS THAT THE LEARNED CIT(A) ERRED IN HOLDING THAT THE AO HAD VALIDLY ASS UMED JURISDICTION UNDER SECTION 147 OF THE ACT, AND ACCORDINGLY ERRED IN HO LDING THAT THE RE- ASSESSMENT MADE WAS VALID. 3. BRIEFLY STATED, THE FACTS ARE THAT THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE AY 2007-08 ON 28/10/2007 SHOWING INCOME OF RS. 94,48,796/-. THE AO MADE AN ASSESSMENT UNDER SECTION 143(3) ON 14/12/20 09 DETERMINING THE INCOME AT RS. 97,17,350/-. SUBSEQUENTLY THE AO REOP ENED THE ASSESSMENT BY ISSUING NOTICE UNDER SECTION 148 ON 18/10/2011. THI S REOPENING MADE BY THE AO BY ISSUING NOTICE UNDER SECTION 148 IS THE CRUX OF GROUND NO. 1 FILED BY THE ASSESSEE. THE LEARNED CIT(A) DISMISSED THE APPEAL F ILED BY THE ASSESSEE AGAINST THE SAID REOPENING MADE BY THE AO . 4. THE LEARNED COUNSEL OF THE ASSESSEE TOOK US TO T HE REASONS OF REOPENING RECORDED BY THE AO AND THE SATISFACTION S IGNED BY THE ADDL. COMMISSIONER OF INCOME TAX, RANGE 17(2) (ADDL. CIT) , MUMBAI. IT WAS STATED BY HIM THAT THE ADDL. CIT HAS ONLY SIGNED AT COLUMN 12 AND HE HAS NOT AT ALL MENTIONED WHETHER HE IS SATISFIED ON THE REASONS RE CORDED BY THE AO THAT IT IS A FIT CASE FOR THE ISSUE OF A NOTICE U/S 148. THE L EARNED COUNSEL THEN RELIED ON THE JUDGMENT IN THE CASE OF CIT VS. S. GOYANKA LIME & CHEMICAL LTD. [2015] 231 TAXMAN 73 (MP) &[2015] 64 TAXMAN. COM 313 (SC) 5. THE LEARNED DR SUPPORTED THE ORDER PASSED BY THE LEARNED CIT(A). 6. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERU SING THE RELEVANT MATERIAL ON RECORD WE OBSERVE THAT THE ADDL. CIT HA S ONLY PUT HIS SIGNATURE ON THE PROPOSAL SENT BY THE AO FOR REOPENING THE ASSE SSMENT. HE HAS NOT MENTIONED WHETHER HE IS SATISFIED WITH THE REASONS GIVEN BY THE AO THAT IT IS A FIT CASE FOR ISSUE OF A NOTICE UNDER SECTION 148. W E MAY NOW REFER TO THE DECISION IN THE CASE OF S .GOYANKA LIME & CHEMICAL LTD . (SUPRA). IN THE SAID CASE THE JOINT COMMISSIONER HAD ACCORDED THE SANCTI ON FOR REOPENING THE ASSESSMENT UNDER SECTION 147 BY STATING I AM SATIS FIED. THE HONBLE HIGH COURT FOLLOWED THE DECISION OF A COORDINATE BENCH I N THE CASE OF ARJUN SINGH VS. ASSISTANT DIRECTOR OF INCOME TAX [2000] 246 ITR 363 (MP) WHEREIN THE FOLLOWING PRINCIPLES ARE LAID DOWN : THE COMMISSIONER ACTED, OF COURSE, MECHANICALLY IN ORDER TO DISCHARGE HIS STATUTORY OBLIGATION PROPERLY IN THE MATTER OF RECO RDING SANCTION AS HE MERELY WROTE ON THE FORMAT YES, I AM SATISFIED WHICH IND ICATES AS IF HE WAS TO SIGN ONLY ON THE DOTTED LINE. AGAINST THE ABOVE JUDGEMENT, THE REVENUE FILED SLP BEFORE THE SUPREME COURT. THE SLP WAS DISMISSED BY THE HONBLE SUPREME COURT. 6.1 WE MAY MENTION HERE THAT IN THE INSTANT APPEAL THE ADDL. CIT HAS NOT MENTIONED ANYTHING WHILE PUTTING HIS SIGNATURE IN C OLUMN 12. HE HAS NOT GIVEN HIS SATISFACTION ON THE REASONS RECORDED BY T HE AO THAT IT IS A FIT CASE FOR THE ISSUE OF A NOTICE UNDER SECTION 148. HE IS TOTA LLY SILENT ON THIS. 6.2 RESPECTFULLY FOLLOWING THE JUDGEMENT IN THE CAS E OF S.GOYANKA LIME & CHEMICAL LTD .(SUPRA), WE COME TO A FINDING THAT THE REASSESSMEN T PROCEEDING BASED ON THE NOTICE ISSUED UNDER SECTION 148 IS BAD IN LAW. WE, THEREFORE, SET ASIDE THE FINDINGS OF THE LEARNED CI T(A) AND QUASH THE RE- ASSESSMENT ORDER MADE BY THE AO UNDER SECTION 147 R .W.S 148 OF THE ACT. 6.3 AS WE HAVE QUASHED THE REASSESSMENT ORDER, WE D O NOT FIND IT NECESSARY TO GO INTO THE MERIT OF THE CASE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 24/08/2016 SD/- SD/- (SAKTIJIT DEY) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMB ER MUMBAI; DATED: 24/08/2016 AG(ON TOUR) COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI