Devarsons Industries Pvt.Ltd., Ahmedabad V. The ACIT.,(OSD),Range-1, Ahmedabad

ITA 259/AHD/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 76697 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2014
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 01-02-2011
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Assessee Lawyers: B T THAKKAR
• Section: 143(3); 147; 148

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD 0 00 0 0 00 0 , , , , !'# !$ !'# !$ !'# !$ !'# !$0 00 0! !! !0 00 0 %$ %$ %$ %$, , , , &' ( &' ( &' ( &' ( & & & & BEFORE SHRI G.C. GUPTA, VICE-PRESIDENT AND SHRI N.S. SAINI, ACCOUNTANT MEMBER ITA NO. 259/AHD/2011 ASSESSMENT YEAR 2003-04 DEVARSONS INDUSTRIES PRIVATE LIMITED AHMEDABAD. PAN: AAACD9671M VS ACIT(OSD), RANGE-1, AHMEDABAD. )*/ APPELLANT ,-)* / RESPONDENT REVENUE BY : SHRI P.L. KUREEL, SR. DR ASSESSEE(S) BY : SHRI B.T. THAKKAR, AR $'. / 0'/ // / DATE OF HEARING : 20/05/2014 123 / 0' / DATE OF PRONOUNCEMENT : 23/05/2014 &4 &4 &4 &4/ // / O R D E R PER SHRI N.S. SAINI, ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST T HE ORDER OF THE CIT(A), AHMEDABAD DATED 22.12.2010. 2. IN GROUND NO. 1 OF THE APPEAL, THE ASSESSEE HAS CHALLENGED THE ORDER OF THE CIT(A) ON THE GROUND THAT THE CIT(A) E RRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN REOPENING THE AS SESSMENT U/S. 147 OF THE INCOME TAX ACT, 1961 BY ISSUANCE OF NOTICE U/S. 148 OF THE ACT ON 08.04.2008 WHICH IS AFTER THE EXPIRY OF 4 YEARS FRO M THE END OF THE RELEVANT ASSESSMENT YEAR 2003-04, WHEN THE ASSESSEE HAS DISC LOSED FULLY AND TRULY ALL RELEVANT FACTS AT THE TIME OF THE ASSESSMENT AN D THE ASSESSMENT U/S. ITA NO. 259/AHD/2011 DEVARSONS INDUSTRIES PVT. LTD. VS. ACIT(OSD) RANGE- 1, AHD FOR A.Y. 2003-04 - 2 - 143(3) OF THE ACT WAS MADE BY THE ASSESSING OFFICER AFTER CONSIDERING THE MATERIALS ON RECORD. 2. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED TH E ORDERS OF LOWER AUTHORITIES AND MATERIAL AVAILABLE ON RECORD. IN T HE INSTANT CASE, THE ASSESSMENT U/S. 143(3) OF THE ACT WAS FRAMED ON 31.03.2009 AND NOTICE U/S. 148 OF THE ACT WAS ISSUED ON 08.04.2008 WHICH IS BEYOND THE PERIOD OF 4 YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR 2003-04. THE ASSESSING OFFICER HAS ISSUED NOTICE U/S. 148 OF THE ACT FOR REOPENING OF THE ASS ESSMENT BY RECORDING THE FOLLOWING REASONS: SCRUTINY OF RECORDS REVEALED THE ASSESSEE COMPANY WAS ALLOWED DEDUCTION OF RS 1,29,22,540/- (30% OF RS 4,30,75,13 4). HOWEVER, THIS AMOUNT INCLUDED INCOME OF RS 35,27,458 ON A/C OF EXPORT INCENTIVE. THIS INCOME WAS REQUIRED TO BE EXCLUDED WHILE WORKING OUT DEDUCTION U/S. 80IA IN VIEW OF THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF CIT VS. STERLING FOODS LTD. 237 ITR 579. HOWEVER, THIS WAS NOT DONE WHICH RESULTED INTO EXCESS RELIEF OF R S 10,58,237. 3. A READING OF THE ABOVE QUOTED REASONS SHOWS THA T IN THE ABOVE RECORDED REASONS, THERE IS NOT A WHISPER BY THE ASS ESSING OFFICER THAT THE ASSESSEE HAS FAILED TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT FOR THE ASSESSMENT YEAR WHICH LED TO ALLOWING EXCES S DEDUCTION U/S. 80IA OF RS 10,58,237/-. THE HON. DELHI HIGH COURT IN THE CASE OF E.I. DUPON T INDIA PVT. LTD. AND ANOTHER (2013) 351 ITR 290 (DEL) HAS HELD THAT NOTICE UNDER SECTION 148 AFTER 4 YEARS WITHOUT AN ALLEGATION IN NOTICE OF FAILURE ON THE PART OF ASSESSEE TO DISCLOSE ANY MATERIAL FACTS NECESSAR Y FOR THE ASSESSMENT, THE SAID NOTICE IS NOT VALID. TO THE SAME EFFECT IS THE DECISION OF THE HON. GUJARAT HIGH COURT IN THE CASE OF PARLE SALES AND S ERVICES PVT. LTD. VS. ITO (2011) 337 ITR 203 (GUJ) WHERE IT WAS HELD THAT IN THE ENTIRE REASONS RECORDED, THERE WAS NOTHING TO INDICATE THAT THERE WAS ANY FAILURE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS ON THE PART OF T HE ASSESSEE. IN THE CIRCUMSTANCES, THE BASIC REQUIREMENT OF INVOKING TH E PROVISIONS OF SECTION 147 AFTER THE EXPIRY OF PERIOD OF 4 YEARS FROM THE END OF THE RELEVANT YEAR ITA NO. 259/AHD/2011 DEVARSONS INDUSTRIES PVT. LTD. VS. ACIT(OSD) RANGE- 1, AHD FOR A.Y. 2003-04 - 3 - WAS NOT SATISFIED. HENCE, THE A.O. COULD NOT HAVE V ALID JURISDICTION UNDER SECTION 147 OF THE ACT. THE NOTICE UNDER SECTION 14 8 OF THE ACT FOR RE- OPENING OF THE ASSESSMENT UNDER SECTION 147 OF THE ACT, THEREFORE COULD NOT BE SUSTAINED. THEREFORE, THE CONSEQUENTIAL RE-ASSE SSMENT MADE IN PURSUANCE TO SUCH A NOTICE IS ALSO BAD IN LAW AND H ENCE WE QUASH THE RE- ASSESSMENT ORDER PASSED UNDER SECTION 147 OF THE AC T ON 31.03.2009. THUS, THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 5. IN VIEW OF OUR ABOVE DECISION, THE OTHER GROUND S OF APPEAL RAISED BY THE ASSESSEE ON THE MERITS OF THE ADDITION HAVE BECOME INFRUCTUOUS AND HENCE THE SAME ARE DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE COURT ON FRIDAY, THE 23 RD OF MAY, 2014 AT AHMEDABAD. SD/- SD/- (G.C. GUPTA) VICE PRESIDENT ( N.S. SAINI) ACCOUNTANT MEMBER AHMEDABAD; DATED 23/05/2014 GHANSHYAM MAURYA, SR. P.S. TRUE COPY &4 / ,5 6&53 &4 / ,5 6&53 &4 / ,5 6&53 &4 / ,5 6&53/ COPY OF THE ORDER FORWARDED TO : 1. )* / THE APPELLANT 2. ,-)* / THE RESPONDENT. 3. ## 7 / CONCERNED CIT 4. 7() / THE CIT(A)-III, AHMEDABAD 5. 5': ,$ , , / DR, ITAT, AHMEDABAD 6. ;< =. / GUARD FILE. &4$ &4$ &4$ &4$ / BY ORDER, / // / # # # # ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD