M/s. Arihant Electricals, New Delhi V. ACIT, New Delhi

ITA 2948/DEL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52680 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 01-09-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 14-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S NEGI SENIOR
• Assessee Lawyers: ASHWANI TANEJA
• Keywords: Reassessment proceedings
• Section: 147; 148

Judgement Text

BEFORE THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH A, NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.2948/DEL.2010 (ASSESSMENT YEAR : 2003-04) M/S. ARIHANT ELECTRICALS, VS. ACIT, CIRCLE 30(1) , 4866/24, ANSARI ROAD, DARYAGANJ, NEW DELHI. NEW DELHI 110 002. (PAN NO.AAAFA2753N) (APELLANT) (RESPONDENT) ASSESSEE BY : SHRI ASHWANI TANEJA, ADVOCATE DEPARTMENT BY : SHRI R.S. NEGI, SENIOR DR O R D E R PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE ASSESSEE ARISES OUT OF TH E ORDER OF THE CIT (APPEALS)-XXV, NEW DELHI DATED 23.04.2010 FOR THE A Y 2003-04. THE GROUNDS OF APPEAL READ AS UNDER :- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O. IN FRAMING IMPUGNED ASSESSMENT ORDER WITHOUT COMPLYING THE MANDATORY CONDITIONS OF SECTION 147 TO 151 OF THE INCOME TAX ACT, 1961 AND REOPENING OF THE CASE AND FRAMING THE IMPUGNED ASSESSMENT ORDER IS BAD IN LAW AND BEYOND THE JURISDICTION OF THE LD. A.O. 2. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O. IN MAKING ADDITIO N OF RS.3,55,000/- AS UNACCOUNTED MONEY IN THE HANDS OF ASSESSEE COMPANY. ITA NO.2948/DEL/2010 2 3. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER A CTION OF LD. CIT(A) IN CONFIRMING THE ACTION OF LD. A.O. IN MAKING THE ADDITION OF RS.3,55,000/- AND IN FRAMING THE IMPUGNED ASSESSMENT ORDER IS BAD IN LAW AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. AO IN FRAMING THE ASSESSMENT IN VIOLATION OF PRINCIPLES OF NATURAL JU STICE IN AS MUCH AS PASSING THE IMPUGNED ORDER WITHOUT PROVIDING THE SO CALLED INFORMATION OF INVESTIGATIO N, NEW DELHI, WITHOUT CONFRONTING THE ENTIRE ADVERSE MATERIAL USED AGAINST THE ASSESSEE AND BY RECORDING INCORRECT FACTS AND FINDINGS AND WITHOUT PROVIDING ADEQUATE OPPORTUNITY OF HEARING AND WITHOUT CROSS EXAMINATION. 5. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER A CTION OF LD. CIT(A) IN CONFIRMING THE ACTION OF LD. A.O I N MAKING THE IMPUGNED ADDITIONS/DISALLOWANCES AND FRAMING THE IMPUGNED ASSESSMENT ORDER IS CONTRARY T O LAW AND FACTS, VOID AB INITIO, BEYOND JURISDICTION AND THE SAME IS NOT SUSTAINABLE ON VARIOUS LEGAL AND FACTUAL GROUNDS. 6. THAT THE APPELLANT CRAVES THE LEAVE TO ADD, MODI FY, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHO UT PREJUDICE TO EACH OTHER. 2. THE RETURN OF INCOME FILED DECLARING INCOME AT R S.14,93,733/- ON 02.12.2003. THE CASE WAS PROCESSED U/S 143(1) ON 2 0.07.2004. ON THE BASIS OF INFORMATION RECEIVED FROM THE INVESTIGATIO N WING, THE CASE WAS REOPENED AFTER RECORDING THE REASONS. WHILE PLEADI NG ON BEHALF OF THE ASSESSEE, THE LEARNED AR SUBMITTED THAT THE OBJECTI ONS RAISED FOR ITA NO.2948/DEL/2010 3 REASSESSMENT PROCEEDINGS AS PER LETTER DATED 15.10. 2008 HAS NOT BEEN DISPOSED OFF BY MAKING A SPEAKING ORDER, THIS WAS M ANDATORY REQUIREMENT IN VIEW OF THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF GKN DRIVESHAFTS (INDIA) LIMITED VS. ITO, 259 ITR 19 (SC ). THE ASSESSEE HAS RAISED THE OBJECTIONS BY STATING THAT REASONS RECOR DED FOR THE INITIATION OF REASSESSMENT PROCEEDINGS ARE NOT THE REASONS AT ALL , THE SAME ARE NOT IN ORDER. THESE ARE JUST THE IMAGINATION OF THE DEPAR TMENT WHICH ARE INCORRECT AND FALSE. IN THE OBJECTIONS, THE ASSESS EE ALSO REQUESTED FOR ADVERSE MATERIAL WHICH WAS TO BE USED AGAINST. IT WAS ALSO REQUESTED IN OBJECTIONS THAT THE COPY OF STATEMENT RECORDED, IF ANY, MAY ALSO BE PROVIDED WITH THE OPPORTUNITY TO CROSS EXAMINE. HE SUBMITTED THAT IN VIEW OF THESE FACTS, THE MATTER MAY BE RESTORED TO THE FILE OF THE AO TO COMPLY WITH THE MANDATORY REQUIREMENT. 3. LEARNED DR WAS NOT HAVING ANY SERIOUS OBJECTION TO THIS PROPOSITION. 4. WE HAVE HEARD BOTH THE SIDES AND WE HOLD THAT WH EN A NOTICE U/S 148 OF THE INCOME-TAX ACT, 1961 IS ISSUED, THE PROP ER COURSE OF ACTION FOR ASSESSEE IS TO FILE THE RETURN, AND IF HE SO DESIRE S, TO SEEK REASONS FOR ISSUING THE NOTICES. THE AO IS BOUND TO GIVE THE R EASONS AND ON THE RECEIPT OF THE REASONS, THE ASSESSEE IS ENTITLED TO FILE THE OBJECTIONS FOR ISSUING SUCH NOTICE AND ONCE THE ASSESSEE HAS FILED THE OBJECTIONS, THE AO IS BOUND TO DISPOSE OFF THE SAME BY PASSING A SPEAK ING ORDER. IN THIS ITA NO.2948/DEL/2010 4 CASE, THE AO HAS NOT DISPOSED OFF THE OBJECTIONS RA ISED BY ASSESSEE BY PASSING AN ORDER. KEEPING THESE FACTS IN VIEW AND THE RATIO DECIDED BY THE HON'BLE SUPREME COURT IN THE CASE OF GKN DRIVES HAFTS (INDIA) LIMITED (CITED SUPRA), WE SET ASIDE THE ISSUE TO TH E FILE OF THE AO TO DECIDE DE NOVO AFTER MEETING OUT THE OBJECTIONS RAI SED BY THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THE 9 TH DAY OF SEPTEMBER, 2011. SD/- SD/- (I.P. BANSAL) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : THE 9 TH DAY OF SEPTEMBER, 2011 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A)-XXV, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR/ITAT