S.P.Swaminathan, Erode V. ACIT, Erode

ITA 3100/CHNY/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86293 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 09-02-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 24-12-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S DASGUPTA
• Assessee Lawyers: S SRIDHAR
• Keywords: Opportunity of being heard; Principle of natural justice; Condonation of delay
• Section: 40A(3); 143(3); 263

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , B B ENCH, CHENNAI . , ' $ % , & ' BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ./I.T.A.NO. 3100/MDS/2014 ( / ASSESSMENT YEAR: 2009-10) MR. S.P.SWAMINATHAN, 6/59-F, MYSORE TRUNK ROAD, SATHYAMANGALAM, ERODE-638 402. VS COMMISSIONER OF INCOME- TAX-II, 63A, RACE COURSE ROAD, COIMBATORE. PAN:AHXPS5015K ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. S.SRIDHAR, ADVOCATE /RESPONDENT BY : MR. S. DAS GUPTA, JCIT /DATE OF HEARING : 9 TH FEBRUARY, 2015 /DATE OF PRONOUNCEMENT : 20 TH FEBRUARY, 2015 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF THE COMMISSIONER OF INCOME TAX-II, COIMBATORE DA TED 25.02.2014 PASSED UNDER SECTION 263 OF THE ACT. 2. THE APPEAL IS FILED WITH DELAY OF 233 DAYS. THE ASSESSEE FILED PETITION FOR CONDONATION OF DELAY ST ATING REASONS FOR DELAY IN FILING OF APPEAL. COUNSEL FOR THE ASSESSEE SUBMITS THAT COMMISSIONER OF INCOME TAX ISSUED NOTI CE PROPOSING TO REVISE ASSESSMENT ORDER PASSED UNDER S ECTION 143(3) OF THE ACT ON 20.04.2011 STATING THAT ORDER PASSED BY 2 ITA NO.3100/MDS/2014 THE ASSESSING OFFICER IS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. IN THE SHOW-CAUSE NOTICE COMMISSIONER OF INCOME TAX PROPOSED TO REVISE THE O RDER ON FIVE ISSUES NAMELY- I) INCOME FROM REAL ESTATE BUSINESS; II) DIFFERENCE IN BUS FARE COLLECTION III) ADVANCE TO M/S. TEJAS IV) CAPITAL ACCUMULATION & V) VIOLATION OF SECTION 40A(3). COUNSEL FOR THE ASSESSEE SUBMITS THAT ASSESSEE SUBM ITTED REPLY TO THE SHOW-CAUSE NOTICE. HOWEVER, THE COMMIS SIONER OF INCOME TAX BY ORDER DATED 25.02.2014 CANCELLED T HE ASSESSMENT ORDER WITH A DIRECTION TO DO ASSESSMENT AFRESH TAKING INTO ACCOUNT ALL THE RELEVANT FACTS AVAILABL E ON FILE AS WELL AS SUBMISSIONS MADE BY THE AUTHORIZED REPRESEN TATIVE. THE ASSESSEE WAS UNDER BONAFIDE IMPRESSION THAT ASS ESSING OFFICER WOULD PASS CONSEQUENTIAL ORDER TO GIVE EFFE CT TO THE ORDER PASSED UNDER SECTION 263 BY THE COMMISSIONER OF INCOME TAX BY ONLY DEALING WITH THE ISSUES WHICH WE RE CONSIDERED BY THE COMMISSIONER OF INCOME TAX IN HI S SHOW- CAUSE NOTICE AND ORDER PASSED UNDER SECTION 263. H OWEVER, THE ASSESSING OFFICER ISSUED A QUESTIONNAIRE CALLIN G FOR 3 ITA NO.3100/MDS/2014 INFORMATION ON VARIOUS ISSUES EVEN THE ISSUES OTHE R THAN THOSE PROPOSED AND DIRECTED BY THE COMMISSIONER OF INCOME TAX IN HIS ORDER UNDER SECTION 263. THE COUNSEL SUB MITS THAT EVEN THE ISSUES WHICH WERE ALREADY CONCLUDED IN THE ORIGINAL ASSESSMENT, THE ASSESSING OFFICER IS NOW RACKING UP AND CALLING FOR INFORMATION. IN VIEW OF THIS COUNSEL SU BMITS THAT ASSESSEE WAS ADVISED TO FILE AN APPEAL AGAINST THE ORDER PASSED UNDER SECTION 263 OF THE ACT. SINCE THE ASSE SSING OFFICER IS GOING BEYOND THE SHOW-CAUSE NOTICE AND THE ISSUES IN THE ORDER OF THE COMMISSIONER OF INCOME T AX PASSED UNDER SECTION 263 OF THE ACT, THE ASSESSEE F ILED THIS APPEAL WITH DELAY OF 233 DAYS. THEREFORE, THE DELAY IN FILING OF APPEAL IS NOT INTENTIONAL AND DUE TO THE CIRCUMSTAN CES BEYOND THE CONTROL OF THE ASSESSEE . THUS, COUNSEL PRAYS FOR CONDONATION OF DELAY OF 233 DAYS. 3. DEPARTMENTAL REPRESENTATIVE VEHEMENTLY OPPOSED F OR CONDONING THE DELAY IN FILING OF APPEAL. 4. ON GOING THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE AFFIDAVIT FILED BY THE ASSESSEE FOR CONDONATION OF DELAY, WE FIND THAT DELAY IN FILING OF APPEAL IS NOT INTENTIONAL 4 ITA NO.3100/MDS/2014 AND FILING OF APPEAL WAS TRIGGERED FOR THE REASON T HAT ASSESSING OFFICER ISSUED QUESTIONNAIRE TO COMPLETE THE ASSESSMENT CONSEQUENT TO THE ORDER UNDER SECTION 26 3 CALLING FOR VARIOUS DETAILS EVEN THE DETAILS FOR TH E ISSUES OTHER THAN THOSE WHICH WERE CONSIDERED BY THE COMMISSIONE R OF INCOME TAX IN HIS SHOW-CAUSE NOTICE AND THE ORDER. IN THE CIRCUMSTANCES, THE DELAY IS CONDONED AND THE APPEAL IS ADMITTED FOR HEARING. 5. COMING TO THE MERITS OF THE CASE, THE ASSESSEE H AS RAISED GROUNDS STATING AS UNDER:- 1. THE ORDER OF COMMISSIONER OF INCOME TAX IS BAD AND ERRONEOUS AND AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THE CIT ERRED IN EXCEEDING HIS JURISDICTION INASMUCH AS HE CANCELLED THE ENTIRE ASSESSMENT WITH A DIRECTION TO THE ASSESSING OFFICER TO RE-DO THE ASSESSMENT AFRESH, INSTEAD OF SETTING ASIDE THE ASSESSMENT TO THE EXTENT OF POINTS WHICH WERE PREJUDICIAL AND ERRONEOUS TO THE INTEREST OF REVENUE. 6. COUNSEL FOR THE ASSESSEE SUBMITS THAT COMMISSION ER OF INCOME TAX SHOULD HAVE DIRECTED THE ASSESSING OFFIC ER TO EXAMINE ONLY THOSE ISSUES WHICH WERE CONSIDERED IN THE SHOW CAUSE NOTICE AND THE ORDER PASSED UNDER SECTIO N 263 OF 5 ITA NO.3100/MDS/2014 THE ACT INSTEAD OF CANCELLING THE ASSESSMENT ORDER AND DIRECTING THE ASSESSING OFFICER TO REDO THE ASSESSM ENT. THUS HAVING NOT GIVEN SUCH DIRECTION, THE COMMISSIONER O F INCOME TAX EXCEEDED HIS JURISDICTION. 7. DEPARTMENTAL REPRESENTATIVE, REFERRING TO THE PROVISIONS OF SECTION 263 OF THE ACT, SUBMITS THAT POWERS OF COMMISSIONER ARE WIDE AND HE CAN PASS AN ORDER ENHA NCING OR MODIFYING THE ASSESSMENT OR CANCELLING THE ASSES SMENT AND DIRECTING A FRESH ASSESSMENT. THEREFORE, HE SUB MITS THAT THERE IS NO INFIRMITY IN PASSING ORDER BY THE COMMI SSIONER OF INCOME TAX IN CANCELLING THE ASSESSMENT AND DIRECTI NG THE ASSESSING OFFICER TO DO THE ASSESSMENT AFRESH. 8. HEARD BOTH SIDES. PERUSED ORDER OF COMMISSION ER OF INCOME TAX PASSED UNDER SECTION 263 OF THE ACT AND SHOW- CAUSE NOTICE ISSUED BY THE COMMISSIONER. WE FIND F ROM THE SHOW-CAUSE NOTICE THAT THE COMMISSIONER PROPOSED TO REVISE THE ASSESSMENT ON FIVE ISSUES NAMELY, INCOME FROM REAL ESTATE BUSINESS; DIFFERENCE IN BUS FARE COLLECTION; ADVANCE TO M/S. TEJAS; CAPITAL ACCUMULATION AND VIOLATION OF SECTION 40A(3) STATING THAT ON GOING THROUGH THE RECORDS, CERTAIN 6 ITA NO.3100/MDS/2014 ERRORS AND DISCREPANCIES FOUND IN THE ASSESSMENT WH ICH ARE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE R EVENUE. THE VERY SAME ISSUES REFERRED TO ABOVE WERE CONSIDE RED BY THE COMMISSIONER OF INCOME TAX WHILE PASSING THE O RDER UNDER SECTION 263 AND IN CONCLUSION, THE COMMISSIO NER OF INCOME TAX OBSERVED AS UNDER:- IN VIEW OF THE ABOVE, IT IS FOUND THAT THE ORDER PASSED BY THE ASSESSING OFFICER IS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE DUE TO NON-APPLICATION OF MIND AND HENCE THE ORDER IS CANCELLED WITH DIRECTION TO THE ASSESSING OFFICER TO RE-DO THE ASSESSMENT AFRESH AF TER TAKING INTO ACCOUNT OF ALL RELEVANT FACTS AVAILABLE ON FILE AS WELL AS THE SUBMISSIONS MADE BY THE AUTHORIZED REPRESENTATIVE. NEEDLESS TO MENTION THAT THE ASSESS EE SHALL BE GIVEN AN OPPORTUNITY OF BEING HEARD WHILE FRAMING THE FRESH ASSESSMENT ORDER. 9. AS COULD BE SEEN FROM THE ABOVE, THE COMMISSIONE R OF INCOME TAX HAS DIRECTED THE ASSESSING OFFICER TO RE DO THE ASSESSMENT AFRESH TAKING INTO ACCOUNT ALL THE RELEV ANT FACTS AVAILABLE ON FILE AS WELL AS SUBMISSIONS MADE BY AUTHORIZED REPRESENTATIVE. THIS CLEARLY SHOWS THAT COMMISSIONER OF INCOME TAX CANCELLED THE ASSESSMENT AND DIRECTED THE ASSESSING OFFICER TO RE-DO REASSESSMEN T AFRESH ONLY ON THOSE ISSUES WHICH WERE CONSIDERED BY HIM I N HIS ORDER WITH REFERENCE TO THE SUBMISSIONS MADE BY THE AUTHORIZED REPRESENTATIVE. THUS, WE DO NOT FIND TH E 7 ITA NO.3100/MDS/2014 COMMISSIONER OF INCOME TAX HAS DIRECTED THE ASSESSI NG OFFICER TO REDO THE ENTIRE ASSESSMENT AFRESH AND A T THE SAME TIME, WE DO NOT AGREE WITH THE COUNSEL FOR THE ASSE SSEE THAT COMMISSIONER OF INCOME TAX HAS EXCEEDED HIS JURISDI CTION BY PASSING ORDER UNDER SECTION 263 OF THE ACT. IN ANY CASE, ASSESSEE CAN ALWAYS RAISE THESE CONTENTIONS IN THE PROCEEDINGS GIVING EFFECT TO THE ORDER PASSED UNDE R SECTION 263 OF THE ACT. THEREFORE, THE GROUNDS RAISED BY TH E ASSESSEE STATING THAT COMMISSIONER OF INCOME TAX EX CEEDED HIS JURISDICTION ARE REJECTED. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH DAY OF FEBRUARY, 2015 AT CHENNAI. SD/- SD/- ( . ) ( ( *+ ) ( A.MOHAN ALANKAMONY ) ( CHALLA NAGENDRA PRASAD ) - / ACCOUNTANT MEMBER * - / JUDICIAL MEMBER * /CHENNAI, / /DATED 20 TH FEBRUARY, 2015 SOMU 12 32 / COPY TO: 1. APPELLANT 2. RESPONDENT 3. 4 () /CIT(A) 4. 4 /CIT 5. 2 7 /DR 6. /GF .