M/s Cooperative Cane Developement Union Ltd, Bahraich V. Commissioner of Income Tax, Faizabad

ITA 307/LKW/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92300 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 21-07-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 23-04-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VIVEK MISHRA
• Assessee Lawyers: J N SHUKLA
• Keywords: Principle of natural justice
• Section: 143(3); 263; 154

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.307/LKW/2014 ASSESSMENT YEAR:2009-10 M/S COOPERATIVE CANE DEVELOPMENT UNION LTD. BAHRAICH V. CIT FAIZABAD TAN/PAN:AAAAC8503F (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI. J. N. SHUKLA, ADVOCATE RESPONDENT BY: SHRI. VIVEK MISHRA, CIT (DR) DATE OF HEARING: 21 07 2015 DATE OF PRONOUNCEMENT: 30 07 2015 O R D E R PER SUNIL KUMAR YADAV THIS IS ASSESSEE'S APPEAL DIRECTED AGAINST THE ORDER U/S 263 OF LEARNED CIT, FAIZABAD DATED 26.03.2014 FOR A.Y. 2009 2010 CANCELLING THE ASSESSMENT ORDER PASSED U/S 143(3) DATED 16.12.2011 OF THE INCOME TAX OFFICER, BAHRAICH AND DIRECTING TO FRAME A FRESH ASSESSMENT AFTER A PROPER EXAMINATION OF ASSESSEE'S CLAIM OF DEDUCTION U/S 80P OF THE INCOME TAX ACT, 1961. 2. IT IS SEEN FROM THE RECORDS THAT DURING THE COURSE OF PROCEEDINGS U/S 263 OF THE INCOME TAX ACT, 1961, NONE APPEARED ON BEHALF OF THE ASSESSEE INSPITE OF SUFFICIENT OPPORTUNITY HAVING BEEN GIVEN TO THE ASSESSEE. 3. LEARNED CIT HAS GIVEN A CATEGORICAL FINDING THAT THE AO, WITHOUT CALLING FOR RELEVANT DETAILS AND WITHOUT EVEN EXAMINING THE ISSUE AS TO WHETHER THE ASSESSEE WAS REGISTERED UNDER THE CO-OPERATIVE SOCIETIES ACT OR UNDER ANY OTHER LAW IN FORCE HAD ALLOWED THE DEDUCTION U/S 80P.HE ACCORDINGLY HELD THE 2 ASSESSMENT ORDER TO BE ERRONEOUS SO FAR AS IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE. 4. IT IS ALSO SEEN FROM THE RECORDS THAT INCOME TAX OFFICER- I, BAHRAICH HAS PASSED THE CONSEQUENTIAL ORDER U/S 143(3) READ WITH SECTION 263 OF THE INCOME TAX ACT, 1961 ON 30/09/2014 WHEREIN HE HAS ALSO DISALLOWED THE ASSESSEE'S CLAIM U/S 80P ON THE GROUND THAT THE ASSESSEE ITSELF HAD NOT CLAIMED THE STATUS OF A CO-OPERATIVE SOCIETY BUT THAT OF AN AOP IN ITS RETURN OF INCOME. 5. THE LEARNED COUNSEL OF THE ASSESSEE WHILE DEFENDING THE ORIGINAL ASSESSMENT ORDER DATED 16.12.2011 SUBMITTED THAT THE DEDUCTION U/S 80P WAS ALLOWED BY THE AO AFTER THE ASSESSEE HAD MADE A FRESH CLAIM OF DEDUCTION U/S 154 OF THE INCOME TAX ACT, 1961. HOWEVER, NO DOCUMENTARY EVIDENCE WAS FILED BEFORE US IN SUPPORT OF THIS CONTENTION. 6. THE LEARNED DR PLEADED FOR UPHOLDING THE PROCEEDINGS U/S 263 OF THE INCOME TAX ACT, 1961. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IN THE ORIGINAL ASSESSMENT ORDER, THERE IS NO DISCUSSION REGARDING THE QUESTION AS TO HOW THE ASSESSEE'S CLAIM OF DEDUCTION U/S 80P OF THE INCOME TAX ACT, 1961 WAS CONSIDERED AND CONSEQUENTLY ALLOWED. IT IS BY NOW A SETTLED POSITION OF LAW THAT IF ASSESSMENT IS FRAMED BY THE ASSESSING OFFICER WITHOUT APPLICATION OF MIND AND WITHOUT MAKING PROPER ENQUIRY, THEN SUCH ASSESSMENT ORDER IS ERRONEOUS AS WELL AS PREJUDICIAL TO THE INTEREST OF THE REVENUE. THE HON'BLE ALLAHABAD HIGH COURT IN CIT VS. SHRI BHAGWAN DAS 272 ITR 367 (ALL) HAS HELD THAT AN ORDER WHICH HAS BEEN PASSED WITHOUT APPLICATION OF MIND, WILL ALSO FALL UNDER THE EXPRESSION ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IN THIS JUDGMENT (SUPRA) THE HON'BLE ALLAHABAD HIGH COURT WHILE DISCUSSING THE SCOPE OF SECTION 263 HAS QUOTED THE JUDGMENT OF THE HON'BLE APEX COURT IN MALABAR INDUSTRIAL CO. LTD (2000) 243 ITR 83 AS UNDER : ' ....THERE CAN BE NO DOUBT THAT THE PROVISION CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED BY THE 3 ASSESSING OFFICER. IT IS ONLY WHEN AN ORDER IS ERRONEOUS THAT THE SECTION WILL BE ATTRACTED. AN INCORRECT ASSUMPTION OF FACTS OR AN INCORRECT APPLICATION OF LAW WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOUS. IN THE SAME CATEGORY FALL ORDERS PASSED WITHOUT APPLYING THE PRINCIPLES OF NATURAL JUSTICE OR WITHOUT APPLICATION OF MIND.' (EMPHASIS SUPPLIED) 8. IN VIEW OF THE FACTS, WE ARE OF THE CONSIDERED OPINION THAT THERE WAS A FAILURE ON PART OF THE AO TO MAKE PROPER INQUIRY BEFORE ALLOWING DEDUCTION U/S 80P TO THE ASSESSEE AND THE LD. CIT WAS JUSTIFIED IN INITIATING PROCEEDINGS U/S 263 OF THE INCOME TAX ACT, 1961. W E FIND THAT THE REVISIONARY POWER HAS BEEN RIGHTLY EXERCISED BY LEARNED CIT AND WE DO NOT FIND ANY REASON TO INTERFERE IN HIS ORDER. ACCORDINGLY, WE REFUSE TO INTERFERE WITH THE ORDER PASSED U/S 263 OF THE INCOME TAX ACT, 1961. 9. IN THE RESULT, THE APPEAL THE ASSESSEE IS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE. SD/- SD/- [A. K. GARODIA] [SUNIL KUMAR YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:30 TH JULY, 2015 SS COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR ASSISTANT REGISTRAR