Shri Prakashchandra J. Wadhwa, Ahmedabad V. The Income Tax Officer, Ward-13(2), Ahmedabad

ITA 2826/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9880 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 28-12-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 07-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P M MEHTA
• Keywords: Unexplained cash credit; Invalid notice; Period of limitation; Reassessment proceedings
• Section: 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER ./ ITA NO. 2826/AHD/2015 / ASSESSMENT YEAR: 2008-09 PRAKASHCHANDRA J. WADHWA, D-71, OM TOWERS, CAMP ROAD, SHAHIBAUGH, AHMEDABAD .. APPELLANT PAN : AAGPW 7848 C VS INCOME TAX OFFICER, WARD 13 (2), AHMEDABAD .. RESPONDENT ASSESSEE(S) BY : SHRI P.M. MEHTA , AR REVENUE BY : SHRI RAKESH JHA , SR - DR / DATE OF HEARING 28/12/2015 /DATE OF PRONOUNCEMENT 06/01/2016 / O R D E R THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) -7, AHMEDABAD, DATED 14.07.2015 FOR ASSESSMENT YEAS 200 8-09. 2. IN THIS APPEAL, THE GROUNDS RAISED BY THE ASSE SSEE READ AS UNDER: 1. IN LAW AND IN THE FACTS AND CIRCUMSTANCES OF THE APPELLANTS CASE, THE IMPUGNED REASSESSMENT ORDER I S VOID AND DESERVES TO BE CANCELLED, INTER ALIA, FOR THE R EASON THAT THE REASSESSMENT PROCEEDINGS IN QUESTION HAD BEEN INITIATED BY AN INVALID NOTICE U/S 148 ISSUED ON 25.03.2013 I.E. BEFORE 26.03.2015 ON WHICH THE REAS ONS FOR REOPENING WERE RECORDED. (SMC) ITA NO. 2826 /AHD/2015 PRAKASHCHANDRA J. WADHWA VS. ITO AY : 2008-09 2 2. IN LAW AND IN THE FACTS AND CIRCUMSTANCES OF TH E APPELLANTS CASE, THE LEARNED CIT(A) HAS GROSSLY ER RED IN UPHOLDING THE ADDITION RELATED TO THE TRANSACTION O F SALE OF SHARES RESULTING INTO CAPITAL GAIN, AS UNEXPLAINED AND SHAM TRANSACTION AND THEREBY TREATING THE DIFFERENC E OF RS.8,77,932/- I.E. (PURCHASE PRICE SALE PRICE) FR OM THE SHARES AS UNEXPLAINED CREDIT U/S 68 OF THE ACT. TH E AO MAY BE DIRECTED TO DELETE THE SAME. 3. THE APPELLANT CRAVES LEAVE TO ADD TO, ALTER, AME ND AND/OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL EIT HER BEFORE OR DURING THE COURSE OF HEARING OF THE APPEA L. 3. IN THE PRESENT CASE, FOR THE ASSESSMENT YEAR UND ER CONSIDERATION, IT IS AN UNDISPUTED FACT THAT NOTICE U/S. 148 OF THE ACT, ASKING THE ASSESSEE TO FURNISH THE RETURN OF INCOME, WAS ISSUED BY THE ASSESSING OFFICER ON 25.03.2013. THE OBJECTION FOR THE SAME WAS FILED BY THE ASSESSEE ON 07.10.2013, WHICH IS PLACED ON RECORD, I.E. PAGE NOS. 6-8 OF TH E PAPER-BOOK. THE OBJECTION RAISED BY THE ASSESSEE HAS NOT BEEN D ISPOSED OF BY PASSING A SEPARATE ORDER. IN SIMILAR SET OF CIR CUMSTANCES, THE HONBLE HIGH COURT OF GUJARAT IN THE CASE OF MG M EXPORTS VS. DEPUTY COMMISSIONER OF INCOME-TAX, REPORTED IN [2010] 323 ITR 331 (GUJ.), HAS HELD AS UNDER:- 7. APPLYING THE AFORESAID SETTLED LEGAL POSITION T O THE FACTS OF THE CASE IT IS APPARENT THAT THE ACTION OF THE R ESPONDENT AUTHORITY IN FRAMING THE REASSESSMENT ORDER, WITHOU T FIRST DISPOSING OF THE PRELIMINARY OBJECTIONS RAISED BY T HE (SMC) ITA NO. 2826 /AHD/2015 PRAKASHCHANDRA J. WADHWA VS. ITO AY : 2008-09 3 PETITIONER, CANNOT BE SUSTAINED. ACCORDINGLY, THE REASSESSMENT ORDER DT. 16TH DEC., 2008 IS HEREBY QU ASHED AND SET ASIDE AND THE RESPONDENT AUTHORITY SHALL DI SPOSE OF THE PRELIMINARY OBJECTIONS BY PASSING A SPEAKING ORDER AND ONLY THEREAFTER PROCEED WITH THE REASSESSMENT PROCEEDINGS IN ACCORDANCE WITH LAW. CONSIDERING THE FACT THAT THE NORMAL PERIOD OF LIMITATION, FOR FRAMING REASSESSMENT PURSUANT TO NOTICE DT. 3RD MARCH, 2008 ISSUED UNDER S. 148 OF THE ACT, HAS ALREADY EXPIRED ON 31ST DEC., 2008, IN THE PECULIAR FACTS AND CIRCUMST ANCES OF THE CASE IT WOULD SERVE THE ENDS OF JUSTICE IF T HE RESPONDENT AUTHORITY IS DIRECTED TO ABIDE BY THE FO LLOWING SCHEDULE : (I) THE RESPONDENT AUTHORITY SHALL DISPOSE OF THE PRELIMINARY OBJECTIONS RAISED BY THE PETITIONER WIT HIN A PERIOD OF FOUR WEEKS FROM TODAY BY PASSING A SPEAKI NG ORDER IN ACCORDANCE WITH LAW; (II) THEREAFTER THE RESPONDENT AUTHORITY SHALL UNDE RTAKE REASSESSMENT PROCEEDINGS, IF NECESSARY, AND SHALL COMPLETE THE SAME WITHIN A PERIOD OF FOUR WEEKS THEREAFTER, I.E., THE DATE OF DISPOSAL OF THE PRELI MINARY OBJECTIONS; (III) NO EXTENSION OF TIME SHALL BE SOUGHT FOR BY E ITHER SIDE IN THE FACT SITUATION OF THE PRESENT CASE; (IV) THE AFORESAID SCHEDULE SHALL NOT PRECLUDE THE RIGHTS OF THE PETITIONER TO CHALLENGE THE ORDER DISPOSING OF THE PRELIMINARY OBJECTIONS, IF THE SAID ORDER IS REQUIR ED TO BE SO CHALLENGED. 4. NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE ON BEHALF OF THE REVENUE. FACTS BEING SIMILAR, SO FOLLOWING T HE SAME REASONING I SET ASIDE THE ORDER OF THE CIT(A) WHO U PHELD THE ORDER OF THE ASSESSING OFFICER WHEREIN THE ASSESSIN G OFFICER DID NOT DISPOSE OF THE PRELIMINARY OBJECTIONS RAISED BY THE ASSESSEE VIDE HIS LETTER DATED 07.10.2013 BY PASSING A SEPAR ATE ORDER IN (SMC) ITA NO. 2826 /AHD/2015 PRAKASHCHANDRA J. WADHWA VS. ITO AY : 2008-09 4 THE LIGHT OF JUDICIAL PRECEDENT IN THE CASE OF MGM EXPORTS VS. DEPUTY COMMISSIONER OF INCOME-TAX (SUPRA). ACCORDI NGLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. 4.1. SINCE WE ARE DISPOSING OF THE APPEAL ON PRELIM INARY ISSUE, WE ARE REFRAINING TO COMMENT ON THE MERIT OF THE IS SUE AT HAND. 5. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED IN THE COURT ON 6TH JANUARY, 2016 AT AHMEDABAD. SD/- ( SHAILENDRA KUMAR YADAV ) JUDICIAL MEMBER AHMEDABAD; DATED 06/01/2016 BIJU T., PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! ' ' # / CONCERNED CIT 4. ' ' # ( ) / THE CIT(A) 5. &'( ! , ' ! , / DR, ITAT, AHMEDABAD 6. (- . / GUARD FILE. / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) !', / ITAT, AHMEDABAD