M/s. Technico Agri Sciences Ltd., Chandigarh V. ACIT, New Delhi

ITA 3110/DEL/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74305 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 12-03-2014
• Assessment Year: 2001-2002
• Appeal Filed On: 17-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMEER SHARMA
• Assessee Lawyers: ATUL GANDHI
• Keywords: Reopening of assessment; Wrong claim; Difference of opinion; Competent authority; Assessment record; Change of opinion
• Section: 143(3); 147; 148; 2; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH H HH H : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG, ,, , JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO. .. .3110/DEL/2013 3110/DEL/2013 3110/DEL/2013 3110/DEL/2013 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2001 2001 2001 2001- -- -02 0202 02 M/S TECHNICO AGRI SCIENCES M/S TECHNICO AGRI SCIENCES M/S TECHNICO AGRI SCIENCES M/S TECHNICO AGRI SCIENCES LTD., LTD., LTD., LTD., (FORMERLY KNOWN AS (FORMERLY KNOWN AS (FORMERLY KNOWN AS (FORMERLY KNOWN AS CHAMBAL CHAMBAL CHAMBAL CHAMBAL AGRITECH LTD.), AGRITECH LTD.), AGRITECH LTD.), AGRITECH LTD.), SCO SCO SCO SCO- -- -835, 1 835, 1 835, 1 835, 1 ST STST ST & 2 & 2 & 2 & 2 ND NDND ND FLOOR, FLOOR, FLOOR, FLOOR, NAC MANIMAJRA, NAC MANIMAJRA, NAC MANIMAJRA, NAC MANIMAJRA, CHANDIGARH CHANDIGARH CHANDIGARH CHANDIGARH 160 101. 160 101. 160 101. 160 101. PAN : PAN : PAN : PAN : AAACC9811G. AAACC9811G. AAACC9811G. AAACC9811G. VS. VS. VS. VS. ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -3(1), 3(1), 3(1), 3(1), NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ATUL GANDHI, CA. RESPONDENT BY : SHRI SAMEER SHARMA, SR.DR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-IV, NEW DELHI DATED 27 TH FEBRUARY, 2013 FOR THE AY 2001-02. 2. GROUND NOS.1 & 2 OF THE ASSESSEES APPEAL READ AS UNDER :- 1. THAT THE IMPUGNED ORDER PASSED BY THE LEARNED CIT(A) UNDER SECTION 147/143(3) IS CONTRARY TO THE L AW AND FACTS OF THE CASE. 2. THAT THE LEARNED CIT(A) ERRED IN LAW AND IN FACT S IN DECIDING AGAINST THE ASSESSMENT U/S 147 WITHOUT APPRECIATING THE FACTS AND SETTLED LAW IN THIS REGARD. ITA-3110/DEL/2013 2 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND P ERUSED RELEVANT MATERIAL PLACED BEFORE US. THE ASSESSMENT YEA R UNDER CONSIDERATION IS 2001-02. NOTICE UNDER SECTION 148 O F THE INCOME-TAX ACT, 1961 WAS ISSUED ON 15.02.2008 WHICH WAS ADMITTEDL Y BEYOND FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. ORI GINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143(3). WITH REG ARD TO REOPENING OF ASSESSMENT, THE FACTUAL FINDING RECORDED IN PARAGRAPH 2 OF THE ASSESSMENT ORDER READS AS UNDER:- IT WAS FOUND ON THE PERUSAL OF ASSESSMENT RECORDS THAT THE ASSESSEE HAS MADE A PROVISION FOR TECHNOLOGY ENHANCEMENT FEES OF RS.2384758/-. THE PROVISION BEING UNASCERTAINED LIABILITY IS NOT ALLOWABLE UNDER THE AC T AND HENCE THE ASSESSEE MADE WRONG CLAIM OF EXPENSES. THIS OMISSION RESULTED IN UNDER ASSESSMENT OF INCOME OF RS.2384758/-. ACCORDINGLY THE CASE WAS REOPENED U/S 14 7 AFTER RECORDING THE REASONS WITH THE APPROVAL OF THE COMPETENT AUTHORITY. 4. AFTER CONSIDERING THE ARGUMENTS OF BOTH THE SIDES AN D THE FACTS OF THE CASE, IN OUR OPINION, REOPENING OF ASSESSMENT WAS NOT VALID IN VIEW OF THE PROVISO TO SECTION 147 OF THE ACT WHICH READS AS UNDER:- PROVIDED THAT WHERE AN ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 143 OR THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO ACTION SHALL BE TAKEN UNDE R THIS SECTION AFTER THE EXPIRY OF FOUR YEARS FROM THE E ND OF THE RELEVANT ASSESSMENT YEAR, UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH ASSESSMENT YEAR BY REASON OF THE FAILURE ON THE PART OF THE ASSESSEE TO MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION (1) OF SEC TION 142 OR SECTION 148 OR TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT, FOR THAT ASSESSMENT YEAR: ITA-3110/DEL/2013 3 5. THUS, AS PER PROVISO, IF THE ORIGINAL ASSESSMENT WAS C OMPLETED UNDER SECTION 143(3), NO ACTION CAN BE TAKEN UNDER SECTION 147 AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVAN T ASSESSMENT YEAR UNLESS ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT BY REASON OF THE FAILURE ON THE PART OF THE ASSESSEE TO (I) TO MAKE A RETURN UNDER SECTION 139 OR (II) DISCLOSE FULLY AND TRULY AL L MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT. ADMITTEDLY, IN THIS CASE, ORI GINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) AND REOPEN ING OF ASSESSMENT IS MADE AFTER FOUR YEARS FROM THE END OF THE R ELEVANT ASSESSMENT YEAR. ADMITTEDLY, THERE IS NO FAILURE ON THE PART OF THE ASSESSEE TO FURNISH THE RETURN OF INCOME. THEREFORE, TH E ONLY QUESTION WHICH REMAINS IS WHETHER THERE WAS ANY FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS N ECESSARY FOR HIS ASSESSMENT. FROM THE REASONS RECORDED BY THE ASSESSING OFFIC ER HIMSELF, IT IS CLEAR THAT THE ASSESSEE HAS DISCLOSED THE FAC TS AND THE SAME WERE AVAILABLE IN THE ASSESSMENT RECORD. THE ASSESSI NG OFFICER HAS RECORDED IT WAS FOUND ON THE PERUSAL OF ASSESSMENT RE CORDS. THIS CLEARLY ESTABLISHES THAT THE FACTS WERE DULY DISCLOSE D BY THE ASSESSEE. THERE IS NO FINDING BY THE ASSESSING OFFICER OF ANY FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE THE PROVISION MADE B Y THE ASSESSEE FOR TECHNOLOGY ENHANCEMENT FEES OF ` 23,84,758/-. THE REOPENING BY THE ASSESSING OFFICER IS ONLY ON THE BASIS O F CHANGE OF OPINION ON THE SAME FACTS WHICH ARE ALREADY ON RECORD . IN VIEW OF THE ABOVE, IN OUR OPINION, THE REOPENING OF ASSESSMENT IS BA D IN LAW IN VIEW OF THE PROVISO TO SECTION 147. ACCORDINGLY, T HE REOPENING OF ASSESSMENT IS QUASHED AND CONSEQUENTLY, THE ASSESSMENT ORDER DATED 29 TH SEPTEMBER, 2008 PASSED UNDER SECTION 147 READ WITH S ECTION 143(3) IS ALSO QUASHED RESTORING THE ORIGINAL ASSESSMENT OR DER. ITA-3110/DEL/2013 4 6. SINCE WE HAVE ALREADY QUASHED THE ASSESSMENT ORDER, T HE OTHER GROUNDS OF APPEAL RAISED BY THE ASSESSEE AGAINST THE ADDI TION OF ` 23,84,758/- DO NOT SURVIVE FOR ADJUDICATION. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 14 TH MARCH, 2014. SD/- SD/- ( (( (CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMB MEMB MEMB MEMBER ERER ER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT DATED : 14.03.2014 VK. COPY FORWARDED TO: - 1. APPELLANT : M/S TECHNICO AGRI SCIENCES LTD., M/S TECHNICO AGRI SCIENCES LTD., M/S TECHNICO AGRI SCIENCES LTD., M/S TECHNICO AGRI SCIENCES LTD., (FORMERLY KNOWN AS CHAMBAL AGRITECH LTD.), (FORMERLY KNOWN AS CHAMBAL AGRITECH LTD.), (FORMERLY KNOWN AS CHAMBAL AGRITECH LTD.), (FORMERLY KNOWN AS CHAMBAL AGRITECH LTD.), SCO SCO SCO SCO- -- -835, 1 835, 1 835, 1 835, 1 ST STST ST & 2 & 2 & 2 & 2 ND NDND ND FLOOR, NAC MANIMAJRA, FLOOR, NAC MANIMAJRA, FLOOR, NAC MANIMAJRA, FLOOR, NAC MANIMAJRA, CHANDIGARH CHANDIGARH CHANDIGARH CHANDIGARH 160 101. 160 101. 160 101. 160 101. 2. RESPONDENT : ASSISTANT COMMI ASSISTANT COMMI ASSISTANT COMMI ASSISTANT COMMISSIONER OF INCOME TAX, SSIONER OF INCOME TAX, SSIONER OF INCOME TAX, SSIONER OF INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -3(1), NEW DELHI. 3(1), NEW DELHI. 3(1), NEW DELHI. 3(1), NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR