M/s Bharat Brick Field, Lakhimpur-Kheri V. Income Tax Officer, Lakhimpur-Kheri

ITA 27/LKW/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4386 (ITAT-LUCKNOW)
• Duration Of Justice: 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 12-07-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 22-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Condonation of delay
• Section: 143(3); 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH SMC, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER ITA NO.27/LKW/2016 ASSESSMENT YEAR 2010-11 INCOME TAX OFFICER, WARD II, LAKHIMPUR KHERI VS M/S BHARAT BRICK FIELD CHITIHA, BELRAYAN, DISTT.- LAKHIMPUR KHERI PAN AAJFB 1186 D (RESPONDENT) (APPELLANT) SHRI K.R. RASTOGI , CA APPELLANT BY SHRI AMIT NIGAM, DR RESPONDENT BY 12/07/2016 DATE OF HEARING 15 /0 7 /2016 DATE OF PRONOUNCEMENT O R D E R THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST TH E ORDER OF THE LD. CIT(A), INTER ALIA ON FOLLOWING GROUNDS: (1) THE LD. C.I.T. (APPEALS) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ISSUANCE OF NOTICE U/S 148 OF, THE I.T. ACT WIT HOUT APPRECIATING THAT ESCAPEMENT OF INCOME HAS BEEN INF ERRED ON THE BASIS OF THE EXPENDITURE OF A. Y. 2011-12. (2) THE LD. C.I.T. (A) FAILED TO APPRECIATE THAT TH E REASONS FOR ISSUANCE OF NOTICE U/S 148 OF I.T. ACT ARE ONLY REA SON TO SUSPECT AND NOT VALID FOR REOPENING THE CASE. (3) THE LD. C.I.T. [A] FAILED TO APPRECIATE THAT NO ADDITION HAS BEEN MADE ON THE BASIS OF THE REASONS RECORDED HENCE THE PRESENT ASSESSMENT ORDER IS INVALID AS IT IS PASSED WITHOUT HAVING VALID JURISDICTION. WITHOUT PREUDICE TO THE ABOVE. (4) THE LD. C.I.T. (A) DID NOT APPRECIATED THAT IN THE COURSE OF ASSESSMENT PROCEEDING IT WAS EXPLAINED THAT OUT OF TOTAL VAT PAID RS. 4,17,070/- ONLY I RS. 338840/- PERTAINS TO A. Y. 2010-11 2 AND RS. 79130/- RELATES TO PREVIOUS YEARS PAID DURI NG THE YEAR AS PER GOVERNMENT NOTIFICATION OF SAMADHAN / SCHEME . (5) THE C.I.T. (A) ERRED ON FACTS AND IN LAW IN CON FIRMING THE ESTIMATED SALES AU RS. 42,30,000/- AND ESTIMATED PR OFIT @ 12% RS. 5,07,600/-. 2. DURING THE COURSE OF HEARING, MY ATTENTION WAS I NVITED TO THE FACT THAT THE APPEAL WAS FILED LATE BY 41 DAYS FOR WHICH AN A PPLICATION FOR CONDONATION OF DELAY IS FILED, EXPLAINING THE REASONS FOR THE D ELAY IN FILING OF THE APPEAL. SINCE THE ASSESSEE HAS SATISFACTORILY EXPLAINED THE DELAY IN FILING THE APPEAL, I CONDONE THE SAME AND ADMIT THE APPEAL FOR HEARING. 3. DURING THE COURSE OF HEARING, LD. COUNSEL FOR TH E ASSESSEE HAS INVITED MY ATTENTION THAT THIS ASSESSMENT WAS REOPENED ON A N ISSUE THAT THE ASSESSEE HAS INCURRED MORE EXPENSES ON ACCOUNT OF T AX PAID IN COMPARISON TO THE EXPENSES INCURRED UNDER THIS HEAD DURING THE ASSESSMENT YEAR 2011- 12. BUT WHILE COMPLETING THE ASSESSMENT, NO ADDITIO N WAS MADE UNDER THIS HEAD, THEREFORE, REOPENING IS BAD AND THE ASSESSMEN T FRAMED CONSEQUENT THERETO DESERVES TO BE SET ASIDE. IN SUPPORT OF THI S PROPOSITION OF LAW, HE PLACED RELIANCE UPON THE ORDER OF THE TRIBUNAL IN T HE CASE OF M/S BABA BRICK INDUSTRIES VS. ITO IN ITA NO.114/LKW/2015. 4. LD. DR OF THE REVENUE PLACED RELIANCE UPON THE O RDER OF THE CIT(A). 5. HAVING CAREFULLY EXAMINED THE ORDERS OF THE LOWE R AUTHORITIES AND IN VIEW OF RIVAL SUBMISSIONS, I FIND THAT UNDISPUTEDLY THE ASSESSING OFFICER HAS REOPENED THE ASSESSMENT ON THE POINT THAT THE ASSES SEE HAS INCURRED MORE EXPENDITURE ON ACCOUNT OF TAX PAID OR PAYABLE & VAT IN COMPARISON TO ASSESSMENT YEAR 2011-12. IN THE IMPUGNED ASSESSMENT YEAR 2010-11, THE ASSESSEE HAS INCURRED THE EXPENDITURE OF RS.4,17,97 0/- AGAINST GROSS TURNOVER OF RS.31,79,746/- ON ACCOUNT OF TAX PAID O R PAYABLE & VAT, BUT IN THE ASSESSMENT YEAR 2011-12, THE ASSESSEE HAS INCUR RED THE EXPENSES AT RS.2,65,000/- AGAINST THE TURNOVER OF RS.34,97,183/ - BUT WHILE COMPLETING 3 THE ASSESSMENT, NO ADDITION WAS MADE UNDER THIS HEA D. THEREFORE, IT HAS BEEN ESTABLISHED FACT THAT NO ADDITION WAS MADE IN THE ASSESSMENT FRAMED U/S 143(3) R.W.S. 147 OF THE ACT ON AN ISSUE FOR WH ICH ASSESSMENT WAS REOPENED. THIS ASPECT WAS EXAMINED BY THE TRIBUNAL IN THE CASE OF M/S BABA BRICK INDUSTRIES (SUPRA), IN WHICH IT HAS BEEN HELD THAT ONCE THE ASSESSING OFFICER HAS FAILED TO MAKE AN ADDITION ON AN ISSUE ON WHICH ASSESSMENT WAS REOPENED, HE CANNOT ASSESS OR REASSESS OTHER INCOME WHICH ESCAPED ASSESSMENT AND CAME TO HIS NOTICE DURING THE COURSE OF HEARING. COPY OF ORDER IS PLACED ON RECORD . I, THEREFORE, FOLLOWING THE ORDER OF THE TRIBUNAL HOLD THAT SINCE NO ADDITION WAS MADE ON AN ISSUE ON WHICH ASSESSMENT WAS REOPENED, THE ASSESSMENT FRAMED CONSEQUENT THERETO IS NOT VALID AND DESERVES TO BE QUASHED. ACCORDINGLY, I SET ASIDE TH E ORDER OF CIT(A) AND QUASH THE ASSESSMENT. SINCE I HAVE QUASHED THE ASSE SSMENT ITSELF, I FIND NO JUSTIFICATION TO DEAL WITH THE ISSUE ON MERIT. ACCO RDINGLY, APPEAL OF THE ASSESSEE IS ALLOWED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE STANDS ALL OWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DAT E MENTIONED ON THE CAPTION PAGE) SD/- (S.K. YAD AV ) JUDICIAL MEMBER DATED: 15/07/2016 AKS COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR