M/s Geomin Industries Private Limited, Jabalpur V. Pr.Commissioner of Income Tax- 1, Jabalpur

ITA 30/JAB/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6940 (ITAT-JABALPUR)
• Duration Of Justice: 1 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 30-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SHRIABHAY KR SINGH
• Assessee Lawyers: SHRIDHIRAJGHAI
• Keywords: Reassessment proceedings; Set aside
• Section: 263

Judgement Text

ITA NO.30/JAB/2019 1 IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR BEFORE SHRI NRS GANESAN, JUDICIAL MEMBER & SHRI SANJAY ARORA,ACCOUNTANT MEMBER ITA NO.30/JAB/2019 ASSESSMENT YEAR: 2014-15 (THROUGH VIRTUAL HEARING) M/S.GEOMIN INDUSTRIES PRIVATE LIMITED, 547/1,547/2,550/1,551 & 552 KHINNI ROAD, DHARAMPURA TEHSIL SIHORA,GOSALPUR, JABALPUR (MP) (PAN AADCG8749E) VS. PR. COMMISSIONER OF INCOME TAX-2, JABALPUR (APPELLANT ) (RESPONDENT) APPELLANT BY SHRIDHIRAJGHAI, CA RESPONDENT BY SHRIABHAY KR. SINGH, C.I.T.-DR DATE OF HEARING 12/08/2020 DATE OF PRONOUNCEMENT 12/08/2020 ORDER PER NRS GANESAN, JM: 1. THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE PR. COMMISSIONER OF INCOME TAX-1. JABALPUR DATED 22.02. 2019 PASSED U/S. 263 OF THE INCOME TAX ACT. 1961 (IN SHORT 'THE ACT'.) 2. SHRI DHIRAJ GHAI, LD. REPRESENTATIVE OF THE ASS ESSEE SUBMITTED THAT THE PR. CIT IN THE GUISE OF EXERCISING HIS POWER U/S. 263 O F THE ACT FOUND THAT THE ASSESSING OFFICER HAS NOT CONDUCTED ANY ENQUIRY WIT H REGARD TO UNSECURED LOAN DISCLOSED IN THE BALANCE SHEET. REFERRING TO THE QU ERY RAISED BY THE AO, AS ITA NO.30/JAB/2019 2 QUESTION NO.154, THE LD. COUNSEL SUBMITTED THAT THE AO HIMSELF CALLED FOR DETAILS OF THE BANK LOAN OBTAINED DURING THE YEAR A ND INTEREST PAID THEREON. THE ASSESSEE HAS ALSO FURNISHED ALL THE DETAILS BEFORE THE AO. THE AO, AFTER CONSIDERING ALL THE DETAILS FILED BY THE ASSESSEE, HAS NOT MADE ANY ADDITION WITH REGARD TO UNSECURED LOAN, THEREFORE, THE PR.CIT IS NOT CORRECT IN SAYING THAT THE AO HAS NOT CONDUCTED ANY QUERY. THE LD. COUNSEL FUR THER SUBMITTED THAT IN THE REASSESSMENT PROCEEDINGS, THE AO HAS NOT MADE ADDIT ION. 3. ON THE CONTRARY, SHRI A.K. SINGH, LD. DR SUBMITT ED THAT THE AO HAS NOT MADE ANY ENQUIRY. MOREOVER, THE ASSESSEE HAS GIVEN WRONG STATEMENT IN THE COURSE OF ASSESSMENT PROCEEDINGS REGARDING THE FRES H LOAN RECEIVED BY ASSESSEE FROM TWO PARTIES. MOREOVER, THE AO HAS NOT APPLIED HIS MIND AND HE HAS NOT PASSED ANY REASONED ORDER, THEREFORE, THE PR. CIT H AS RIGHTLY FOUND THAT THE ORDER OF THE AO IS NOT ONLY ERRONEOUS BUT ALSO PREJ UDICIAL TO THE INTEREST OF THE REVENUE. ACCORDINGLY, THE PR. CIT SET ASIDE THE ORD ER OF THE AO AND REMANDED BACK TO HIM FOR FRESH ADJUDICATION. 4. HAVING HEARD THE LD. COUNSEL FOR THE ASSESSEE AN D THE LD. DEPARTMENTAL REPRESENTATIVE, THIS TRIBUNAL FINDS THAT IT IS A MA TTER OF FACT THAT THE AO CALLED FOR DETAILS OF BANK LOAN OBTAINED DURING THE YEAR A ND INTEREST PAID THEREOF. EVEN THOUGH THE ASSESSEE CLAIMS THAT DETAILS WERE FURNIS HED TO THE AO, THE COPIES OF SUCH DETAILS WERE NOT FURNISHED BEFORE THIS TRIBUNA L. MOREOVER, THE ASSESSMENT ORDER DOES NOT REFLECT APPLICATION OF MIND OF THE A O TO THE MATERIAL SAID TO BE FILED BY THE ASSESSEE IN RESPONSE TO THE QUESTIONNA IRE ISSUED TO HIM. IT IS A WELL SETTLED PRINCIPLE OF LAW THAT IN ADMINISTRATIVE/JUD ICIAL PROCEEDINGS, THE OFFICER EXERCISING HIS POWER HAS TO GIVE REASON FOR THE CON CLUSION REACHED IN THE ORDER ITSELF. IT IS NOT IN DISPUTE THAT THE PROCEEDINGS, BEFORE THE AO IS A JUDICIAL PROCEEDING, THEREFORE, IT IS ALSO MORE IMPORTANT FO R AO TO GIVE REASON FOR THE CONCLUSION REACHED IN THE ASSESSMENT ORDER. ADMITTE DLY, WITH REGARD TO UNSECURED LOAN, THERE IS NO DISCUSSION IN THE ASSES SMENT ORDER AND THE AO DOES ITA NO.30/JAB/2019 3 NOT DISCUSS ANYTHING ABOUT THE SO CALLED BANK LOAN OBTAINED DURING THE YEAR AND INTEREST PAID THEREON. 5. APPLICATION OF MIND TO THE MATERIAL AVAILABLE O N RECORD SHALL BE REFLECTED IN THE ORDER ITSELF. THE DEPARTMENT CANNOT FILE ANY ADDITIONAL MATERIAL TO SUPPORT THE CONCLUSION REACHED IN THE ASSESSMENT ORDER. WE ARE CONSCIOUS THAT VARIOUS BENCHES OF THIS TRIBUNAL AND SOME OF THE HIGH COURT S, IN THE COUNTRY HAVE FOUND THAT THE REASON MAY NOT BE RECORDED IN THE AS SESSMENT ORDER, BUT IN FACT THE SUPREME COURT IN VARIOUS JUDGMENTS CATEGORICALL Y HELD THAT REASON SHALL BE RECORDED IN THE ORDER ITSELF. IN THE LATEST ALLAHAB AD HIGH COURT JUDGMENT, IT IS MADE VERY CLEAR, AFTER REFERRING TO THIS JUDGMENT O F SUPREME COURT THAT LIVE LINK TO THE MATERIAL AVAILABLE ON RECORD AND THE APPLICA TION OF MIND OF THE OFFICER SHALL BE REFLECTED ONLY IF THE REASONS WERE RECORDE D IN THE ASSESSMENT ORDER. RECORDING OF THE REASON NOT ONLY BRING CONFIDENCE O N THE LITIGANT PUBLIC BUT ALSO AVOID ARBITRARINESS IN DECISION MAKING PROCESS. IN THIS CASE, ADMITTEDLY, NO REASONS WERE RECORDED IN THE ASSESSMENT ORDER IN RE SPECT OF UNSECURED LOAN EVEN THOUGH THAT DETAIL SAID TO BE CALLED BY AO. IN THE ABSENCE OF RECORDING OF REASONS BY THE AO, THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT THE ORDER OF THE ASSESSMENT IS NOT ONLY ERRONEOUS BUT ALSO PREJU DICIAL TO THE INTEREST OF THE REVENUE, THEREFORE, PR. CIT HAS RIGHTLY SET ASIDE T HE ORDER OF THE AO AND REMANDED BACK TO HIM FOR FRESH ENQUIRY. THIS TRIBUN AL DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE PR. CIT. ACCORDINGL Y THE SAME IS CONFIRMED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON AUGUST 12 TH , 2020. SD/- SD/- (SANJAY ARORA) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER AKS(P)/- DATED: 12 /08/2020