ACIT, New Delhi V. M/s. AAA Portfolio Pvt. Ltd., New Delhi

ITA 2920/DEL/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 77796 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-05-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 10-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL BAJPAI
• Assessee Lawyers: R M MEHTA
• Keywords: Revision of order
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER AND SHRI T.S.KAPOOR, ACCOUNTANT MEMBER I.T.A .NO.-2920/DEL/2013 (ASSESSMENT YEAR-2002-03) ACIT, CIRCLE-1(1), ROOM NO.-390, C.R. BUILDING, I.P.ESTATE, NEW DELHI. (APPELLANT) VS AAA PORTFOLIO PVT. LTD., 2A, SHANKAR MARKET, CONNAUGHT CIRCUS, NEW DELHI. PAN-AAACA1931B (RESPONDENT) APPELLANT BY: SUNIL BAJPAI, CIT DR RESPONDENT BY: R.M.MEHTA, CA ORDER PER DIVA SINGH, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 15.02.2013 OF CIT(A)-V, NEW DELHI PERTAINING TO 2002-03 ASSESSME NT YEAR ON THE FOLLOWING GROUNDS:- 1. THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LAW IN HOLDING THAT THE ASSESSMENT ORDER VALIDLY PASSED IN CONSEQUENCE OF T HE REVISION ORDER U/S 263 OF THE INCOME TAX ACT HAS BECOME INFRUCTUOUS IN VIEW OF THE OBSERVATIONS OF THE ITAT IN M.A.NO.426/DEL/2009 DAT ED 16.10.2009. 2. THE LD. CIT(A) ERRED IN HOLDING THE ASSESSMENT ORDE R PASSED IN CONSEQUENCE OF THE REVISION ORDER U/S 2263 OF THE A CT AS INFRUCTUOUS AS A VALID ORDER PASSED WITHIN LIMITATION CANNOT BE DECL ARED AS INFRUCTUOUS FOR FAILURE TO CARRY OUT A DIRECTION ISSUED SUBSEQUENT TO PASSING OF ASSESSMENT ORDER. 3. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIGHT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT ANY TIME B EFORE OR DURING THE HEARING OF THIS APPEAL. 2. RIGHT AT THE OUTSET IT WAS SUBMITTED BY THE LD. AR THAT THE POINTED ISSUE IS FULLY COVERED IN ASSESSEES FAVOUR AS SUCH THE DEPA RTMENTS APPEAL DESERVES TO BE 2 I.T.A .NO.-2920/DEL/2013 DISMISSED. SINCE THIS IS AN APPEAL FILED BY THE RE VENUE LD. CIT DR WAS REQUIRED TO ADDRESS WHETHER HE WOULD WANT TO ARGUE FIRST OR WOULD HE LIKE THE LD. AR TO POINT OUT HOW THE POINT AT ISSUE IS STATED TO BE COVERED IN ASSESSEES FAVOUR. LD. CIT DR STATED THAT LET THE LD. AR FIRST ARGUE AS TH EN HE WOULD BE ABLE TO ADDRESS THE SAID CLAIM OF THE ASSESSEE ALSO. IN THE SAID B ACKGROUND THE LD. AR INVITING ATTENTION TO THE ASSESSMENT ORDER DATED 24.08.2007 POINTED OUT THAT THE SAME HAS BEEN PASSED PURSUANT TO THE DIRECTIONS DATED 13.03. 2007 ISSUED BY THE CIT(A), CIRCLE-2, NEW DELHI VIDE HIS ORDER U/S 263. REFERR ING TO THE IMPUGNED ORDER AND THE PAPER BOOK RUNNING INTO 8 PAGES FILED BY THE AS SESSEE AVAILABLE WITH THE PARTIES IT WAS SUBMITTED THAT THE CO-ORDINATE BENCH OF THE TRIBUNAL IN ITA. NO- 2176/DEL/2007 HAD UPHELD THE ACTION OF THE CIT(A) I N INVOKING SECTION 263 OF THE ACT AND CONSIDERING THE SUBMISSIONS OF THE ASSESSEE THAT THE ISSUE HAS TO BE DECIDED IN THE LIGHT OF THE DECISION OF THE APEX CO URT IN THE CASE OF S.A. BUILDERS LTD. VS CIT(APPEALS) & ANOTHER, (2007) 288 ITR 1 ( SC) HAD MODIFIED THE DIRECTION ISSUED TO THE AO GIVEN BY THE CIT(A) AND THE AO AS PER THE MODIFIED DIRECTION WAS DIRECTED TO DECIDE THE ISSUE ON MERIT , KEEPING THE JUDGEMENT OF THE APEX COURT IN S.A. BUILDERS IN CONSIDERATION. ATTE NTION WAS INVITED TO PAGE 3 PARA 3 OF THE ORDER OF THE CO-ORDINATE BENCH DATED 10.11 .2008. FOR READY-REFERENCE THE SAME IS REPRODUCED HEREUNDER :- 3.WE HAVE CONSIDERED THE FACTS OF THE CASE AND RIV AL SUBMISSIONS. IN VIEW OF THE REVISED STAND TAKEN BY THE LEARNED COUNSEL BEFO RE US, WE NEED NOT DEAL WITH THE JURISDICTION OF THE COMMISSIONER OF INCOME TAX U/S 263. SUFFICE IT TO SAY THAT IN THE ASSESSMENT PROCEEDINGS CONSEQUENT UPON ORDER U/S 263, THE AO SHALL DECIDE THE ISSUE ON MERIT WITHOUT ANY PRE-CON DITION, I.E., HE AND THE ASSESSEE WILL BE FREE TO BRING ANY EVIDENCE ON RECO RD IN THEIR SUPPORT. NEEDLESS TO SAY THAT THE DECISION OF THE APEX COURT HAS TO BE FOLLOWED BY HIM, AND THEREFORE, HE WILL ALSO EXAMINE THE CASE IN THE LIGHT OF THE AFORESAID DECISION. 2.1. INVITING ATTENTION TO THE MA FILED BY THE DEPA RTMENT AGAINST THE SAID ORDER, COPY OF WHICH IS PLACED AT PAGE 5 OF THE PAPER BOOK , IT WAS POINTED OUT THAT MA- 3 I.T.A .NO.-2920/DEL/2013 426/DEL/2009 WAS DISMISSED BY THE TRIBUNAL VIDE ITS ORDER DATED 16.10.2009. ACCORDINGLY BASED ON THE ABOVE FACTS WHERE THE IMPU GNED ORDER ORIGINATED FROM THE ORDER WHICH STOOD MODIFIED THERE IS NO PURPOSE IN DECIDING THE APPEAL ON MERITS. IT WAS EMPHASIZED THAT THE ORDER PASSED PU RSUANT TO THE DIRECTION GIVEN BY THE CIT U/S 263 WHICH STANDS MODIFIED THE ASSESSME NT BECOMES INFRUCTUOUS AND THE DEPARTMENTAL APPEAL CONSEQUENTLY CANNOT ESCAPE THE SAME FATE. INVITING ATTENTION TO PARA 9 OF THE IMPUGNED ORDER IT WAS P OINTED OUT THAT IT IS NOTED THAT THE AO HAS STILL NOT CARRIED OUT THE DIRECTIONS OF THE ITAT GIVEN IN ITS ORDER 10.11.2008 AND RE-ITERATED AGAIN WHILE DISMISSING T HE DEPARTMENTS MA ON 16.10.2009. THE VIEW IT WAS SUBMITTED IS FOUND SUP PORTED BY THE ORDER OF THE CO- ORDINATE BENCH IN THE CASE OF ADITI DEVELOPERS, MU MBAI VS DCIT IN ITA NO- 7342/MUM/2011 WHEREIN THE ORDER DATED 10.10.2012 HA S BEEN UPHELD BY THE HONBLE BOMBAY HIGH COURT AS WAS NOTED BY THE CO-OR DINATE BENCH IN PARA 4. IN THESE CIRCUMSTANCES, THE DEPARTMENTS APPEAL DESERV ES TO BE DISMISSED. 2.2. LD. CIT DR ON PERUSING THE IMPUGNED ORDER AND THE COPIES OF THE ORDERS OF THE TRIBUNAL IN ASSESSEES APPEAL AGAINST THE 263 P ROCEEDINGS AND THE ORDER OF THE CO-ORDINATE BENCH IN MA FILED BY THE DEPARTMENT PLA CE RELIANCE UPON THE ASSESSMENT ORDER. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS SEEN THAT THERE IS NO DISPUTE ON THE ASPECT THAT IN THE FACTS OF THE PRESENT CASE THE INCOME U/S 143(3) WAS COMPLETED AT A LOSS OF RS.1,64,42,317/- AS AGAINST THE RETURNED LOSS OF RS.1,72,03,625/-. THE SAID ORDER WAS SUBJECTED TO REVISIONARY POWER OF THE COMMISSIONER OF INCOME TA X WHO INVOKING HIS POWERS U/S 263 VIDE ORDER DATED 13.03.20005 SET ASIDE THE ASSESSMENT ORDER WITH THE DIRECTION TO FRAME THE SAME AFRESH. THE SAID ORDER AS PER RECORD HAS BEEN CHALLENGED BY THE ASSESSEE AND THE ITAT HAS MODIFIE D THE DIRECTION GIVEN TO THE AO BY THE CIT(A) TO SPECIFICALLY DIRECTING THE AO T O EXAMINE THE CASE IN THE LIGHT 4 I.T.A .NO.-2920/DEL/2013 OF THE DECISION OF THE APEX COURT IN THE CASE OF S. A. BUILDERS LTD. THE RECORD SHOWS THAT BEFORE THE RECEIPT OF THIS ORDER THE AO HAD ALREADY COMPLETED THE PROCEEDINGS FOLLOWING THE DIRECTION OF THE COMMISSI ONER OF INCOME TAX ON 24.08.2007 WHICH EVIDENTLY STOOD MODIFIED. IN THE CIRCUMSTANCES THE DEPARTMENT FILED AN MA BEFORE THE ITAT WHICH WAS DISMISSED BY THE ITAT VIDE ITS ORDER DATED 16.10.2009. THE CO-ORDINATE BENCH WHILE CONS IDERING THE DEPARTMENTS PETITION DISMISSED THE DEPARTMENTS MA HOLDING AS U NDER :- . ON THE CONTRARY, ON PASSING OF THE ORDER OF THE TRI BUNAL, THE ORDER OF THE AO BECOMES INFRUCTUOUS AS HE HAS TO PASS AN ORDER IN CONFORMITY WITH THE DIRECTIONS GIVEN BY THE TRIBUNAL. IN THESE CIRCUMS TANCES, WE DO NOT FIND ANY ERROR IN THE ORDER OF THE TRIBUNAL. 3.1. IT IS ALSO PERTINENT TO OBSERVE THAT THE CIT( A) FOLLOWING THE ORDERS OF THE TRIBUNAL ALLOWED THE APPEALS OF THE ASSESSEE AND A LSO OBSERVED AS UNDER:- 9. IT WILL BE PERTINENT TO MENTION HERE THAT THE L D. AO HAS NOT YET CARRIED OUT THE DIRECTIONS GIVEN IN ITAT ORDER DATED 10.11. 2008 AND REITERATED BY THE ITAT AGAIN ON 16.10.2009. 4. IN THE AFORE-MENTIONED FACTS AND CIRCUMSTANCES W E FIND NO INFIRMITY IN THE IMPUGNED ORDER AS THE ASSESSMENT ORDER UNDER CONSID ERATION IS INFRUCTUOUS. BEING SATISFIED BY THE REASONING AND FINDING ARRIVED AT I N THE IMPUGNED ORDER, THE DEPARTMENTS GROUNDS ARE DISMISSED. 5. IN THE RESULT THE APPEAL OF THE DEPARTMENT IS DI SMISSED AS PER THE PRONOUNCEMENT MADE ON THE DATE OF HEARING ITSELF IN THE PRESENCE OFF THE PARTIES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 11 TH OF JULY 2014. SD/- SD/- (T.S.KAPOOR) (DIVA SINGH) ACCOUNTANT MEMBER JUDIC IAL MEMBER DATED:-11 /07/2014 *AMIT KUMAR* 5 I.T.A .NO.-2920/DEL/2013 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGIS TRAR ITAT NEW DELHI