Sh. Chiman Lal Perwani, Agra V. I.T.O.-2(2), Agra

ITA 252/AGR/2012

• Counselvise Citation: 25220314 RSA 2012
• Duration Of Justice: 1 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 04-06-2014
• Assessment Year: misc
• Appeal Filed On: 11-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: WASEEM ARASHAD
• Keywords: Reassessment proceedings
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI JOGINDER SINGH, JUDICIAL MEMBER ITA NO. 252/AGRA/ 2012 ASSESSMENT YEAR 1999-2000 CHIMAN LAL PERWANI VS. INCOME TAX OFFICER 2(2), 3/141, RUI KI MANDI, AGRA SHAHGANJ, AGRA (PAN AFAPP 8969 C) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ANIL VE RMA, ADVOCATE. RESPONDENT BY : SHRI WASEEM ARASHAD, SR. D.R DATE OF HEARING : 04.06.2014 DATE OF PRONOUNCEMENT : 04.06.2014 ORDER PER PRAMOD KUMAR, ACCOUNTANT MEMBER: 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT HA S CALLED INTO QUESTION CORRECTNESS OF LEARNED CIT(A) ORDER DATED 23.12.201 1 IN THE MATTER OF ASSESSMENT UNDER SECTION 147 R.W.S. 143(3) OF THE INCOME TAX A CT, 1961 FOR THE A.Y. 1999- 2000. ITA NO.252/AGRA/2012 2 2. IN THE FIRST GROUND OF APPEAL, THE ASSESSEE HAS RAISED THE FOLLOWING GRIEVANCE:- 1. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACT S IN SUSTAINING THE ASSESSMENT WITHOUT PROPERLY APPRECIATING THAT THE R EASONS FOR RE- OPENING OF ASSESSMENT UNDER S. 148, IF RECORDED, H AVE NOT BEEN SUPPLIED TO THE ASSESSEE. HENCE THE NOTICE ISSUED U NDER S.148 IS AB- INITIO INVALID AND UNLAWFUL. 3 WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, SHRI A NIL VERMA, LEARNED COUNSEL FOR THE ASSESSEE INVITED OUR ATTENTION TO T HE FACT THAT DESPITE SEVERAL SPECIFIC REQUESTS MADE BY THE ASSESSEE IN THE COURSE OF ASSE SSMENT PROCEEDING AS ALSO UNDER THE RIGHT TO INFORMATION ACT, 2005, THE ASSESSEE IS YET TO BE FURNISHED THE REASONS RECORDED FOR REOPENING OF THE ASSESSMENT. OUR ATTE NTION IS INVITED TO THE REPLY RECEIVED FROM THE CENTRAL PUBLIC INFORMATION OFFICE R, INCOME TAX OFFICE, WHEREIN IT IS ACCEPTED THAT THE REASONS NO SPECIFIC EVIDEN CE IS AVAILABLE ON THE RECORD WHICH SUGGEST THAT THE REASONS RECORDED WERE SERVED ON THE ASSESSEE. IT IS ALSO POINTED OUT THAT ALTHOUGH THE STAND TAKEN BY THE IN COME TAX AUTHORITIES IS THAT REASONS WERE ALSO DULY RECORDED FOR REOPENING OF TH E ASSESSMENT, NONE OF THE AUTHORITY IS IN A POSITION TO FURNISH THE SAID REAS ONS NOR SUCH REASON WERE COMMUNICATED TO THE ASSESSEE, DESPITE SPECIFIC REQU ISITION TO THE EFFECT, DURING THE ASSESSMENT PROCEEDING. SHRI VERMA FURTHER POINTS OU T THAT EVEN DURING THE FIRST APPELLATE PROCEEDINGS BEFORE THE LEARNED COMMISSION ER (APPEALS), SPECIFIC REQUEST ITA NO.252/AGRA/2012 3 WAS MADE TO THE FACT THAT ASSESSEE SHOULD BE GIVEN REASONS FOR REOPENING THE ASSESSMENT, BUT LEARNED COMMISSIONER APPEAL EXPRESS HIS HELPLESSNESS IN THE MATTER, SINCE HE DID NOT HAVE POWER TO REMAND THE M ATTER TO THE FILE OF THE ASSESSING OFFICER. IT IS IN THIS BACKGROUND THAT SH RI VERMA RAISES PRELIMINARY OBJECTION TO THE EFFECT THAT ONCE THE ASSESSEE IS N OT SERVED THE REASONS FOR REOPENING THE ASSESSMENT, THE ENTIRE ASSESSMENT PROCEEDINGS A RE LIABLE TO BE SET ASIDE. HE INVITES OUR ATTENTION TO THE THIRD MEMBER DECISION OF MUMBAI BENCH IN THE CASE OF TELCO DADAJI DHACKJEE LIMITED WHEREIN IT HAS HELD THAT IF THE REASONS FOR REOPENING THE ASSESSMENT HAVE NOT BEEN FURNISHED TO THE ASSESSEE, THE ENTIRE ASSESSMENT IS LIABLE TO BE QUASHED, ON THAT SHORT G ROUND ALONE. OUR ATTENTION IS INVITED TO A DECISION OF MUMBAI BENCH, IN THE CASE OF TRENDS ELECTRONICS VS ITO ( ORDER DARED 25.3.13 IN ITA NO 902/MUM/2013; AY 2008 -09), WHEREIN, FOLLOWING THE THIRD MEMBER DECISION, THE SAME VIEW IS TAKEN. SHRI WASIM ARASHAD, LEARNED DEPARTMENTAL REPRESENTATIVE POINTS OUT THAT THE ASS ESSEES GRIEVANCE AS EVIDENT FROM PAGE NO. 3 OF THE PAPER BOOK IS RESTRICTED TO THE FACT THAT THE REASONS OF REOPENING WERE NOT ATTACHED ALONG WITH THE NOTICE U NDER SECTION 148 OF THE ACT. IT IS ALSO POINTED OUT THAT IN ANY EVENT, THE ASSESSEE HAS DULY COMPLIED WITH THE TERMS OF THE NOTICE AND COOPERATED IN THE PROCEEDINGS BEF ORE THE ASSESSING OFFICER. UNDER THESE CIRCUMSTANCES, ACCORDING TO THE DEPARTM ENTAL REPRESENTATIVE, IT ITA NO.252/AGRA/2012 4 CANNOT BE OPEN TO THE ASSESSEE TO TAKE A STAND AT T HIS STAGE THAT HIS RIGHTS ARE PREJUDICE BECAUSE OF THE REASONS RECORDED. HE POINT S OUT THAT ONCE THE ASSESSEE IS AN AWARE OF THIS FACT FOR WHICH ASSESSMENT IS REOPE NED IT CANNOT BE SAID THAT PRELIMINARY OBJECTION ON ACCOUNT OF THIS STAGE. 4. IN REJOINDER, SHRI VERMA SUBMITS THAT SO FAR AS WHAT HAS BEEN POINTED OUT BY THE LEARNED DEPARTMENTAL REPRESENTATIVE, THE ASSESS EE HAS MADE SPECIFIC REQUESTS FOR FURNISHING OF REASONS RECORDED FOR REOPENING TH E ASSESSMENT. IT IS SUBMITTED THAT SUCH REQUISITION HAS BEEN MADE ON SEVERAL OCCASION OF THE ASSESSMENT STAGE TO THE APPELLATE STAGE. OUR ATTENTION IS INVITED TO COPY O F ONE SUCH LETTER DATED 18.08.2006, WHICH IS PLACED AT PAGE NO.31 OF THE PA PER BOOK. OUR ATTENTION IS ALSO INVITED TO ANOTHER LETTER DATED 16.05.2006, WHICH W AS FILED BEFORE THE ASSESSING OFFICER MAKE A SPECIFIC REQUEST FOR FURNISHING OF T HE REASONS. IT IS, THUS, CONTENDED THAT LEARNED DEPARTMENTAL REPRESENTATIVE IS NOT COR RECT IN POINTING OUT THAT ASSESSEES OBJECTION WAS CONFINED TO THE REASONS NO T HAVING BEEN FURNISHED ALONG WITH THE NOTICE ITSELF. SHRI VERMA FURTHER POINTS O UT THAT ITS NOW A NORMAL PRACTICE THAT THE REASONS FOR REOPENING THE ASSESSMENT ARE G IVEN ALONGWITH THE NOTICE UNDER SECTION 148 OF THE ACT AND THAT IS PRECISELY WHAT W AS HELD TO BE THE CORRECT POSITION OF LAW AS HELD BY HONBLE ALLAHABAD HIGH COURT IN T HE CASE OF MITHLESH KUMAR ITA NO.252/AGRA/2012 5 TRIPATHI VS. CIT & ORS. 280 ITR 16 (ALL.). HE ONCE AGAIN URGES, THE TRIBUNAL TO QUASH THE REASSESSMENT PROCEEDING, ON THE GROUND TH AT THE REASONS FOR REOPENING THE ASSESSMENT HAVE NOT BEEN FURNISHED TO THE ASSES SEE. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSION, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTUAL MATRIX OF THE CASE AS ALSO THE APPLICABLE LEGAL POSITION. 6. AS FAR AS THE FURNISHING OF REASONS FOR REOPENIN G THE ASSESSMENT IS CONCERNED, THE POSITION IS WELL SETTLED IN LAW. THE HONBLE SUPREME COURT IN THE IN THE CASE OF GKN DRIVESHAFTS (INDIA) LTD. VS. ITO 25 9 ITR 19 HAS HELD THAT RIGHT COURSE OF ACTION IN THE CASE OF THE REOPENING OF AS SESSMENT IS THAT THE ASSESSING OFFICER SHOULD FURNISH THE REASONS FOR REOPENING TH E ASSESSMENT TO THE ASSESSEE, DEAL WITH THE ASSESSEES OBJECTIONS, IF ANY, BY WAY OF A SPEAKING ORDER AND THEN IF REOPENING IS HELD TO BE SUSTAINABLE IN LAW, PROCEED WITH THE SAME REASSESSMENT PROCEEDINGS. IN THE PRESENT CASE, UNDOUBTEDLY, THE SPECIFIC REASON FOR REOPENING THE ASSESSMENT HAVE NEITHER BEEN FURNISHED TO THE ASSES SEE AT ANY STAGE NOR HAVE THESE REASONS BEEN PRODUCED BEFORE US ALSO. AS A MATTER O F FACT, THE STAND OF THE INCOME TAX AUTHORITIES IS THAT SUCH REASONS ARE NOT TRACEA BLE AND, IN OTHER WORDS, CANNOT BE FURNISHED TO THE ASSESSEE. IN THESE CIRCUMSTANCES, IN OUR CONSIDERED VIEW, THE ITA NO.252/AGRA/2012 6 REASSESSMENT PROCEEDING CANNOT BE LAWFULLY PROCEEDE D WITH BECAUSE IT IS SINE QUA NON FOR FRAMING THE REASSESSMENT ORDER THAT THE REASON S FOR WHICH THE ASSESSMENT HAS BEEN REOPENED ARE TO BE FURNISHED TO THE ASSESS EE AND ASSESSEE IS TO BE HEARD IN RESPECT OF ANY OBJECTION WHICH HE MAY HAVE FOR REOP ENING OF THE ASSESSMENT. HOWEVER, HAVING REGARD TO THE FACT THAT THE DEPARTM ENT HAS CONSISTENTLY TAKEN THE STAND IS THAT REASONS WERE ACTUALLY RECORDED FOR R EOPENING THE ASSESSMENT AND ARE NOT TRACEABLE AND IN RESPONSE TO LEARNED DEPARTMENT AL REPRESENTATIVE REQUEST FOR GIVING ONE MORE OPPORTUNITY, WE DEEM IT FIT PROPER TO REMIT THE MATTER TO THE FILE OF THE ASSESSING OFFICER WITH A SPECIFIC DIRECTION THA T HE WILL RESUME THE REASSESSMENT PROCEEDING ONLY AFTER FURNISHING COPIES OF REASONS RECORDED FOR REOPENING OF THE ASSESSMENT, IN CASE HE CAN TRACE THE SAME, AND HEAR THE ASSESSEES OBJECTION THERETO, IN ACCORDANCE WITH LAW AND BY WAY OF A SPE AKING ORDER. UNLESS THE ASSESSING OFFICER, HOWEVER, FURNISH A COPY OF THE R EASONS RECORDED FOR REOPENING THE ASSESSMENT, AND HEARS ASSESSEES OBJECTION ON T HE SAME, THERE CANNOT BE ANY OCCASION TO FRAME THE REASSESSMENT ORDER OR PROCEED WITH THE REASSESSMENT PROCEEDINGS. 7. SH. CHIMAN LAL PERWANI-APPELLANT, WHO ALSO HAPPE NS TO BE AN ADVOCATE AND SHRI VERMA, HIS AUTHORIZED REPRESENTATIVE HAVE FAIR LY ACCEPTED THIS SUGGESTION, ITA NO.252/AGRA/2012 7 WITHOUT PREJUDICE TO THEIR STAND THAT SUCH REASONS ARE NOT AT ALL AVAILABLE AND SUFFICIENT OPPORTUNITIES, FOR THAT PURPOSE, HAVE AL READY BEEN GRANTED. ACCORDINGLY, THIS ISSUE STANDS RESTORE TO THE FILE OF THE ASSESS ING OFFICER STRICTLY IN TERMS OF OUR ORDER. GROUND NO.1 IS, THUS, ALLOWED IN PRINCIPLE, IN THE TERMS INDICATED ABOVE. IN VIEW OF THE FACT THAT REASSESSMENT PROCEEDING ITSEL F TO BE RESTORED TO THE FILE OF THE ASSESSING OFFICER ALL OTHER ISSUE RAISED IN THIS AP PEAL RENDERED ECONOMIC AND INFRUCTUOUS, AT THIS STAGE. THESE ISSUES DO NOT CAL LED FOR ANY ADJUDICATION. ACCORDINGLY, ALL THE REMAINING GROUNDS OF APPEAL AR E DISMISSED IN LIMINE AS INFRUCTUOUS AND HAS NOT CALLING FOR ADJUDICATION AT THIS STAGE. 8. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSE IN THE TERMS INDICATED ABOVE THIS ORDER WAS DICATETED IN THE OPEN COURT, IN THE PRESENCE OF LEARNED REPRESENTATIVES FROM BOTH SIDES, AT THE CONCLUSION OF HEARING ON 04.06.2014. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (JOGINDER SINGH) (PRAMOD KUMAR) JUDICIAL MEMBER ACCOUN TANT MEMBER AMIT/ ITA NO.252/AGRA/2012 8 COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT (APPEALS) CONCERNED 4. CIT CONCERNED 5. D.R., ITAT, AGRA BENCH, AGRA 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, AGRA TRUE COPY