THE DY. COMMISSIONER OF INCOME TAX, CENRAL CIRCLE-5(1), MUMBAI V. NITIN RAJMAL SHAH, MUMBAI

ITA 2782/MUM/2022

AI Insights

The case involves an appeal by the Revenue against the order of the Ld. Commissioner of Income-tax (Appeals)-53, Mumbai, concerning the validity of two assessment orders passed under section 153A rws 143(3) for the assessment year 2019-2020. The first order was digitally signed and uploaded on the ITBA system, while the second was passed manually and was not signed. The Revenue contended that the second order should be considered valid despite the absence of a digital signature, referencing a Supreme Court decision that unsigned orders are invalid. The tribunal examined the procedural validity of both orders and the implications of having two orders for the same assessment year.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 123170 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-12-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 25-12-2022
• Assessment Year: 2019-2020
• Appeal Filed On: 30-10-2022
• Other Referred Cases: Smt Burman & ors vs Commissioner of Income Tax, CIT vs. Raj Construction Co.
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 263; 132; 143(3); 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “B” MUMBAI BEFORE SHRI ABY T VARKEY (JUDICIAL MEMBER) AND SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) ITA No. 2782/MUM/2022 Assessment Year: 2019-2020 The Dy. CIT, Central Circle-5(1), Room No. 1928, 19 th floor, Air India Building, Nariman Point, Mumbai-400021. Vs. Nitin Rajmal Shah, Room No.-2, 4 th floor, 477/479, Maulana Azad Road Gole Deval, Mumbai-400 004. PAN No. AADPS 5476 M Appellant Respondent Assessee by : None Revenue by : Mr. Ashok Kumar Kardam, CIT-DR Date of Hearing : 26/12/2022 Date of pronouncement : 29/12/2022 ORDER PER OM PRAKASH KANT, AM This appeal has been preferred by the Revenue against order dated 05.08.2022 passed by the Ld. Commissioner of Income-tax (Appeals)-53, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2019-2020, raising following grounds : "(i) Whether on the facts and in the circumstances of the case and in law, the Ld. CIT (A) is right in treating the order the order u/s. 153A dated 30.09.2021 vide DIN ITBA/AST/S/153A/2021-22/1036093516(1) dated 30.09.2021 as valid order even though the same was not digitally signed and was s Assessing Officer and the Ld CIT(A) ought to have treated the order us. 153A dated 30.09.2021 [DIN ITBA/COM/S/91/21 as valid order?" "(ii) Whether on the facts and in the circumstances of the case and in law, the Ld CIT(A) erred in law by holding that the order u/s 153A digitally signed as a valid order ignoring the decision of Hon'ble Supreme Court in the case of Smt Burman & ors vs Commissioner of Income Taxman 346(SC) dated 08.02.1996) wherein it was held that the unsigned order is no order 2. Briefly stated, facts of the case are that in this case the Assessing Officer has passed dated 30.09.2021. The First order was having document identification No. DIN ITBA/AST/S/153A/2021 was uploaded on the Income document identification number as 21/1036656245(1) which were issued physically. The Ld. CIT(A) after a detailed finding on the issue passed u/s 153A, where no addition was made by the Assessing Officer, as valid. The relevant finding of the Ld. CIT(A) on the issue in-dispute is reproduced as under: 30.09.2021 as valid order even though the same was not digitally signed and was sent inadvertently by the Assessing Officer and the Ld CIT(A) ought to have treated the order us. 153A dated 30.09.2021 [DIN ITBA/COM/S/91/21-21/1036656245(1)] of A.Y. 2019 as valid order?" Whether on the facts and in the circumstances of the and in law, the Ld CIT(A) erred in law by holding that the order u/s 153A dated 30.09.2021 which was not digitally signed as a valid order ignoring the decision of Hon'ble Supreme Court in the case of Smt Kilasho Devi Burman & ors vs Commissioner of Income Tax (1996) Taxman 346(SC) dated 08.02.1996) wherein it was held the unsigned order is no order.?" Briefly stated, facts of the case are that in this case the Assessing Officer has passed two assessment order dated 30.09.2021. The First order was having document identification No. DIN ITBA/AST/S/153A/2021-22/1036093516(1) uploaded on the Income-tax portal and the second order document identification number as DIN ITBA/COM/S/91/21 6245(1) which were issued physically. The Ld. CIT(A) after a detailed finding on the issue-in-dispute held the first order where no addition was made by the Assessing . The relevant finding of the Ld. CIT(A) on the issue dispute is reproduced as under: Nitin Rajmal Shah ITA No. 2782/M/2022 2 30.09.2021 as valid order even though the same was not ent inadvertently by the Assessing Officer and the Ld CIT(A) ought to have treated the order us. 153A dated 30.09.2021 [DIN 21/1036656245(1)] of A.Y. 2019-20 Whether on the facts and in the circumstances of the and in law, the Ld CIT(A) erred in law by holding that dated 30.09.2021 which was not digitally signed as a valid order ignoring the decision of Kilasho Devi Tax (1996) (85 Taxman 346(SC) dated 08.02.1996) wherein it was held Briefly stated, facts of the case are that in this case the assessment orders u/s 153A dated 30.09.2021. The First order was having document 22/1036093516(1), and the second order having DIN ITBA/COM/S/91/21- 6245(1) which were issued physically. The Ld. CIT(A) dispute held the first order where no addition was made by the Assessing . The relevant finding of the Ld. CIT(A) on the issue- “4.1 During the appellate proceedings, the AR of the appellant has raised an objection that in the case of the appellant for A.Y. 2019 153A rws 143(3) was passed on 30.09.2021 and it was uploaded in the ITBA system and received by the appellant on 30.09.2021. The order us. 153A ws 143(3) dated 30.09.2021 was passed having DIN ITBA/AST/S/153A/2021 30.09.2021. Subsequently, another order u/s. 153A rws 143(3) was passed by t which was physically received by the AR of the appellant. In the first order dated 30.09.2021, the A accepted the returned income amounting to Rs. 4,57,34,580/ the Return of Income filed us. 153A on 04.12.2020 and in the notice u/s. 156 of the Act, bearing DIN ITBA/AST/S/156/2021 30.09.2021, the A raised a demand of Rs. 3/ second order us. 153A dated 30.09.2021, the demand notice was issued u/s. 156 dated 30.09.2021 in which a démand of Rs: 90,05,182/ 4.2 There were 2 orders us. 153A ws 143(3) for A.Y. 2019 20 made by the AO, therefore, a remand report was called for from the AO vide letter No: CIT(A) 53/Late Nitin R. Shah/Remand Report/2022 response to that, the AO submitted a remand report/vide letter DQlf CC 5(1)/Remand Report/2022 18.04.2022 which was forwarded by the Addi.CIT, CR 5, Mumbai. In the remand report, the AO has stated that 4.1 During the appellate proceedings, the AR of the appellant has raised an objection that in the case of the appellant for A.Y. 2019-20, the assessment order u/s. 153A rws 143(3) was passed on 30.09.2021 and it was ded in the ITBA system and received by the appellant on 30.09.2021. The order us. 153A ws 143(3) dated 30.09.2021 was passed having DIN ITBA/AST/S/153A/2021-22/1036093516(1) dated 30.09.2021. Subsequently, another order u/s. 153A rws 143(3) was passed by the AQ manually on 30.09.2021 which was physically received by the AR of the appellant. In the first order dated 30.09.2021, the A accepted the returned income amounting to Rs. 4,57,34,580/- shown in the Return of Income filed us. 153A on 04.12.2020 and in the notice u/s. 156 of the Act, bearing DIN ITBA/AST/S/156/2021-22/1036093558(1) dated 30.09.2021, the A raised a demand of Rs. 3/ second order us. 153A dated 30.09.2021, the demand notice was issued u/s. 156 dated 30.09.2021 in which a Rs: 90,05,182/- was raised for A.Y. 2019 There were 2 orders us. 153A ws 143(3) for A.Y. 2019 20 made by the AO, therefore, a remand report was called for from the AO vide letter No: CIT(A) 53/Late Nitin R. Shah/Remand Report/2022-23 dated 12.04.20 response to that, the AO submitted a remand report/vide letter DQlf CC 5(1)/Remand Report/2022-23 dated 18.04.2022 which was forwarded by the Addi.CIT, CR 5, Mumbai. In the remand report, the AO has stated that Nitin Rajmal Shah ITA No. 2782/M/2022 3 4.1 During the appellate proceedings, the AR of the appellant has raised an objection that in the case of the 20, the assessment order u/s. 153A rws 143(3) was passed on 30.09.2021 and it was ded in the ITBA system and received by the appellant on 30.09.2021. The order us. 153A ws 143(3) dated 30.09.2021 was passed having DIN 22/1036093516(1) dated 30.09.2021. Subsequently, another order u/s. 153A rws he AQ manually on 30.09.2021 which was physically received by the AR of the appellant. In the first order dated 30.09.2021, the A accepted the shown in the Return of Income filed us. 153A on 04.12.2020 and in the notice u/s. 156 of the Act, bearing DIN 22/1036093558(1) dated 30.09.2021, the A raised a demand of Rs. 3/-. In the second order us. 153A dated 30.09.2021, the demand notice was issued u/s. 156 dated 30.09.2021 in which a was raised for A.Y. 2019-20. There were 2 orders us. 153A ws 143(3) for A.Y. 2019- 20 made by the AO, therefore, a remand report was called for from the AO vide letter No: CIT(A) 53/Late Nitin R. 23 dated 12.04.2022. In response to that, the AO submitted a remand report/vide 23 dated 18.04.2022 which was forwarded by the Addi.CIT, CR 5, Mumbai. In the remand report, the AO has stated that - 2. The assessee has filed return of response to notice us. declaring total income at Rs. 4,57,34,580/ assessment us. 153A ws 143(3) was completed in this case On 30.09.2021 determining total income at Rs, 6,92, 44,580/ the I.T. Act, 1961 of Rs. 2,35,10,000/ commission income earned on account of unsecured loans. 3. In respect of remand called for by the Ld. CIT(A), it is clarified that the order received by the assessee vide DIN ITBA/COM/S/91/21 considered as valid order. As per this order, the total income of the assessee is determined at Rs. 6,92,44,580/ Act, 1961 of Rs. 2.35.10.000/ income earned on account of unsecured loans. assessee order 4.3 The assessment orders passed by the AQ wis. 153A rws 143(3) dated 30.09.2021 (uploaded on the system), another order us. 153A ws 143(3) dated (passed manually), the submissions made by the appellant as well as the remand report of the AO also have been considered. was conducted u/s. 132 on 06.11.2019 was issued on 04.12.2020 and in response to that, the appellant filed his return of income u/ 2. The assessee has filed return of income in response to notice us. 153A on 04.12.2020 declaring total income at Rs. 4,57,34,580/-. assessment us. 153A ws 143(3) was completed in this case On 30.09.2021 determining total income at Rs, 6,92, 44,580/- after making addition us. 69 of the I.T. Act, 1961 of Rs. 2,35,10,000/ commission income earned on account of unsecured 3. In respect of remand called for by the Ld. CIT(A), it is clarified that the order received by the assessee vide DIN ITBA/COM/S/91/21-21/1036656245(1) is onsidered as valid order. As per this order, the total income of the assessee is determined at Rs. 6,92,44,580/- after making addition us 69 of the I.T. Act, 1961 of Rs. 2.35.10.000/- as commission income earned on account of unsecured loans. assessee has also filed appeal against the same The assessment orders passed by the AQ wis. 153A rws 143(3) dated 30.09.2021 (uploaded on the system), another order us. 153A ws 143(3) dated 30.09.2021 (passed manually), the submissions made by the nt as well as the remand report of the AO also have been considered. In the case of the appellant, a search was conducted u/s. 132 on 06.11.2019 A notice us. 153A was issued on 04.12.2020 and in response to that, the appellant filed his return of income u/s. 153A showing Nitin Rajmal Shah ITA No. 2782/M/2022 4 income in 153A on 04.12.2020 . Scrutiny assessment us. 153A ws 143(3) was completed in this case On 30.09.2021 determining total income at after making addition us. 69 of the I.T. Act, 1961 of Rs. 2,35,10,000/- as commission income earned on account of unsecured 3. In respect of remand called for by the Ld. CIT(A), it is clarified that the order received by the assessee 21/1036656245(1) is onsidered as valid order. As per this order, the total income of the assessee is determined at Rs. making addition us 69 of the I.T. as commission income earned on account of unsecured loans. The has also filed appeal against the same The assessment orders passed by the AQ wis. 153A rws 143(3) dated 30.09.2021 (uploaded on the system), 30.09.2021 (passed manually), the submissions made by the nt as well as the remand report of the AO also have In the case of the appellant, a search A notice us. 153A was issued on 04.12.2020 and in response to that, the s. 153A showing total income of Rs. 4,57,34,580/ dated 30.09.2021, the AO has accepted the returned income without making any addition or disallowance and a demand of Rs. 3/ on 30.09.2021 in the ITBA/AST/S/153A/2021 30.09.2021. Another order us. 153A dated 30.09.2021 for the same assessment year i.e. in which addition of Rs. 2,35,10,000/ commission income ear and a demand of Rs. was communicated ITBA/COM/S/91/21 of the appellant, 2 orders us. 153A ws 143(3) have been passed for the same as the remand report, the AO has stated that the assessment order u/s 153A dated 30.09.2021 communicated to the assessee vide DIN ITBA/COM/S/91/21 21/1036656245(1) is a valid order. But the fact is that one order us. 153A f ITBA/AST/S/153A/2021 30.09.2021 was uploaded in ITBA system and communicated to the assessee on Another order u/s assessment year i.e. and communicated to the assessee vide DIN ITBA/COM/S/91/21 total income of Rs. 4,57,34,580/-. In one order us. 153A dated 30.09.2021, the AO has accepted the returned income without making any addition or disallowance and a demand of Rs. 3/- was raised. This order was uploaded on 30.09.2021 in the ITBA system with DIN ITBA/AST/S/153A/2021-22/1036093516(1) dated Another order us. 153A dated 30.09.2021 for the same assessment year i.e. A.Y. 2019-20 was passed by the AO in which addition of Rs. 2,35,10,000/- u/s. 69 as commission income earned on unsecured loans was made demand of Rs. 90,05,182 was raised. That order communicated to the assessee vide DIN ITBA/COM/S/91/21-21/1036656245(1)Thus, in the case of the appellant, 2 orders us. 153A ws 143(3) have been passed for the same assessment year i.e. A.Y. 2019 the remand report, the AO has stated that the assessment 153A dated 30.09.2021 communicated to the assessee vide DIN ITBA/COM/S/91/21 21/1036656245(1) is a valid order. But the fact is that one order us. 153A for A.Y. 2019-20 bearing DIN ITBA/AST/S/153A/2021-22/1036093516(1) passed on 30.09.2021 was uploaded in ITBA system and communicated to the assessee on 30.09.2021. Another order u/s 153A dated 30.09.2021 for the same assessment year i.e. A.Y. 2019-20 was passed manually and communicated to the assessee vide DIN ITBA/COM/S/91/21-21/1036656245(1). The DIN Nitin Rajmal Shah ITA No. 2782/M/2022 5 . In one order us. 153A dated 30.09.2021, the AO has accepted the returned income without making any addition or disallowance and was raised. This order was uploaded ITBA system with DIN 22/1036093516(1) dated Another order us. 153A dated 30.09.2021 for the same 20 was passed by the AO u/s. 69 as unsecured loans was made 90,05,182 was raised. That order to the assessee vide DIN 21/1036656245(1)Thus, in the case of the appellant, 2 orders us. 153A ws 143(3) have been 2019-20. In the remand report, the AO has stated that the assessment 153A dated 30.09.2021 communicated to the assessee vide DIN ITBA/COM/S/91/21- 21/1036656245(1) is a valid order. But the fact is that one 20 bearing DIN 22/1036093516(1) passed on 30.09.2021 was uploaded in ITBA system and 153A dated 30.09.2021 for the same 20 was passed manually and communicated to the assessee vide DIN 21/1036656245(1). The DIN sequence clearly indicate that the order which was passed manually is the subsequent order. Therefore, for A.Y. 2019-20, the order us. 153 communicated to the assessee vide DIN ITBA/AST/S/153A/2021 order and the AO u/s. 1534 dated 30.09.2021, which was communicated vide DIN ITBA/COM/S/91/21 21/1036656245(1) is the second order. 4.4 It is a settled legal position that, for the same assessment year, there cannot be two assessment orders under the same section. In the case of the CIT vs. Raj Construction Co. [1990] 33 ITD 454 (AHD), the ITAT, Ahmedabad has held that where two different assessment orders were passed in respect of same assessment year, it is second assessment order which could be held invalid. In this case, the ITAT has held as under: ...In the instant case when the second order was passed, the first order was in existence and the second order could not have been passed without setting aside the first order. During the existence of the first order the second order could not be passed and if passed, it was non est. It was of course true that two assessment orders could not be passed but what was it that brought about this situation where there were two assessment orders? The answer was that it was the passing of the second order sequence clearly indicate that the order which was passed manually is the subsequent order. Therefore, for A.Y. 20, the order us. 153A dated 30.09.2021 which was communicated to the assessee vide DIN ITBA/AST/S/153A/2021-22/1036093516(1) is the first order and the subsequent order passed manually by the AO u/s. 1534 dated 30.09.2021, which was communicated vide DIN ITBA/COM/S/91/21 036656245(1) is the second order. 4.4 It is a settled legal position that, for the same assessment year, there cannot be two assessment orders under the same section. In the case of the CIT vs. Raj Construction Co. [1990] 33 ITD 454 (AHD), the ITAT, bad has held that where two different assessment orders were passed in respect of same assessment year, it is second assessment order which could be held invalid. In this case, the ITAT has held as under: ...In the instant case when the second order was ssed, the first order was in existence and the second order could not have been passed without setting aside the first order. During the existence of the first order the second order could not be passed and if passed, it was non est. It was of course true that two assessment orders could not be passed but what was it that brought about this situation where there were two assessment orders? The answer was that it was the passing of the second order Nitin Rajmal Shah ITA No. 2782/M/2022 6 sequence clearly indicate that the order which was passed manually is the subsequent order. Therefore, for A.Y. A dated 30.09.2021 which was communicated to the assessee vide DIN 22/1036093516(1) is the first subsequent order passed manually by the AO u/s. 1534 dated 30.09.2021, which was communicated vide DIN ITBA/COM/S/91/21- 4.4 It is a settled legal position that, for the same assessment year, there cannot be two assessment orders under the same section. In the case of the CIT vs. Raj Construction Co. [1990] 33 ITD 454 (AHD), the ITAT, bad has held that where two different assessment orders were passed in respect of same assessment year, it is second assessment order which could be held invalid. ...In the instant case when the second order was ssed, the first order was in existence and the second order could not have been passed without setting aside the first order. During the existence of the first order the second order could not be passed and if passed, it was non est. It was of course true that two assessment orders could not be passed but what was it that brought about this situation where there were two assessment orders? The answer was that it was the passing of the second order which brought about this situation. It was, therefore, the second order which was invalid. The AAC was, therefore, not justified in holding that it was first assessment order which was invalid. 4.5 In view of the above facts, the first order passed us. 153A ws 143(3) dated was commu ITBA/AST/S/153A/2021 order and the subsequent order passed for the same assessment year which was communicated to the assessee vide DIN ITBA/COM/S/91/21 21/1036656245(1) is an invalid order. 3. In our opinion, once the first order having DIN ITBA/AST/S/153A/2021 Income-tax web portal Assessing Officer and became final order and in case of any error in the same order, the only remedy which was move to the Pr. Commissioner of Income invoking section 263 of the Act. The Assessing Officer was not having valid authority returned income, communicated to the assessee CIT(A) on the issue-in any infirmity in the same. Accordingly, we uphold the same. which brought about this situation. It was, therefore, econd order which was invalid. The AAC was, therefore, not justified in holding that it was first assessment order which was invalid. 4.5 In view of the above facts, the first order passed us. 153A ws 143(3) dated 30.09.2021 for AY. 2019-20 which was communicated to the assessee vide DIN ITBA/AST/S/153A/2021-22/10360935/16(1) is. a valid order and the subsequent order passed for the same assessment year which was communicated to the assessee vide DIN ITBA/COM/S/91/21 21/1036656245(1) is an invalid order.” In our opinion, once the first order having DIN ITBA/AST/S/153A/2021-22/1036093516(1) has been uploaded tax web portal and which went beyond the reach of the Assessing Officer and got communicated to the assessee and in case of any error in the same order, the was available with the Assessing Officer was to move to the Pr. Commissioner of Income-tax (in short ‘the PCIT’) invoking section 263 of the Act. The Assessing Officer was not authority to issue another order making addition to the despite one order stands signed and communicated to the assessee. In our opinion, order of the Ld. in-dispute is well reasoned and we do not find in the same. Accordingly, we uphold the same. Nitin Rajmal Shah ITA No. 2782/M/2022 7 which brought about this situation. It was, therefore, econd order which was invalid. The AAC was, therefore, not justified in holding that it was first 4.5 In view of the above facts, the first order passed us. 20 which nicated to the assessee vide DIN 22/10360935/16(1) is. a valid order and the subsequent order passed for the same assessment year which was communicated to the assessee vide DIN ITBA/COM/S/91/21- In our opinion, once the first order having DIN 22/1036093516(1) has been uploaded on beyond the reach of the to the assessee, that order and in case of any error in the same order, the available with the Assessing Officer was to tax (in short ‘the PCIT’) for invoking section 263 of the Act. The Assessing Officer was not to issue another order making addition to the one order stands signed and . In our opinion, order of the Ld. dispute is well reasoned and we do not find in the same. Accordingly, we uphold the same. 4. In the result, the appeal filed by the Revenue is dismissed. Order pronounced in the open Court/under Rule 34(4) of the ITAT Rules, 1963 on Sd/- (ABY T VARKEY JUDICIAL MEMBER Mumbai; Dated: 29/12/2022 Rahul Sharma, Sr. P.S. 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. //True Copy// In the result, the appeal filed by the Revenue is dismissed. Order pronounced in the open Court/under Rule 34(4) of the ITAT Rules, 1963 on 29/12/2022. Sd/ ABY T VARKEY) (OM PRAKASH KANT MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Sr. Private Secretary) ITAT, Mumbai Nitin Rajmal Shah ITA No. 2782/M/2022 8 In the result, the appeal filed by the Revenue is dismissed. Order pronounced in the open Court/under Rule 34(4) of Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Sr. Private Secretary) ITAT, Mumbai