Smt. Paramjit Kaur, Ludhiana V. Pr.CIT-2, Ludhiana

ITA 337/CHANDI/2020

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 4427 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 23-11-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Audit objection; Rule of consistency; Set aside
• Section: 263; 143(3); 205

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ,च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, “B”, CHANDIGARH BEFORE SHRI N.K. SAINI, VICE PRESIDENT & SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER आयकरअपीलसं ./ITA No. 337/CHD/2020 नधा रणवष / Assessment Year :2011-12 Smt. Paramjit Kaur, H.No.7227/3, St. No. 18, Daba Road, New Janta Nagar, Ludhiana 141003 बनाम The PCIT- 2, Ludhiana थायीलेखासं./PAN NO: AGWPK2730M अपीलाथ /Appellant यथ /Respondent नधा रती क ओर से /Assessee by : Sh. Sudhir Sehgal, Advocate राज व क ओर से/ Revenue by : Sh. Sarabjeet Singh, CIT DR स ु नवाई क तार$ख/Date of Hearing : 26.07.2022 घोषणा क तार$ख/Date of Pronouncement : 22. 08.2022 आदेश /Order Per SudhanshuSrivastava, Judicial Member: This appeal is preferred by the assessee against order dated 28.02.2020 passed by the Ld. Pr. Commissioner of Income Tax, Ludhiana (hereinafter called the Ld. PCIT) wherein for assessment 2011-12, the Ld. PCIT, vide order passed under section 263 of the Income Tax Act,1961 (hereinafter called the Act) has held that the assessment order dated 30.11.2019 passed under section 143(3) r.w.s. 148 of the Act accepting the returned 2 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana income of the assessee was erroneous and prejudicial to the interest of the revenue and wherein the Ld. PCIT has set-aside the said assessment order to the file of the Assessing Officer (AO) for the purpose of passing a fresh order in respect of the issue relating to purchase of property. 2.0 The brief facts of the case are that based on information regarding purchase of plot amounting to Rs.11,50,000/-, the assessee’s case was reopened by issuing notice under section 148 of the Act and, subsequently, in response to the said notice, the return of income was filed declaring taxable income at Rs.2,14,160/-. During the course of such assessment proceedings, on being required to explain the contents of an agreement to sell, the assessee submitted before the AO that no agreement to purchase any property, (specifically the plot under question measuring 200 sq. yards.), from one Shri Nihal Singh, jointly with the husband Shri Inderjit Singh Singh had taken place in the captioned assessment year and further that the purchase was executed on 25.03.2013 and the payments were also were made at that point of time. It was submitted before the AO that the said transaction took place in assessment year 2013- 14 and evidences were filed before the AO in that regard. In view 3 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana of the submissions of the assessee, the AO accepted the returned income. 2.1 Subsequently, the Ld. PCIT issued a show cause notice under section 263 of the Act and it was pointed out by the Ld. PCIT during the proceedings before him that an agreement to sell dated 01.11.2010 existed and payments of Rs.6,00,000/- and 2,50,000/- had been made on 28.11.2010 and 01.12.2010 respectively. As per the Ld. PCIT, the assessee could not explain these documents and, therefore, the Ld. PCIT reached the conclusion that there was a complete lack of enquiry and non- application of mind by the AO and that the assessing officer had failed to reconcile facts stated by the assessee in her statement in response to particular summons issued by the CIT (A)-2, Ludhiana (basis of information for re-opening the case) and further that the AO had not raised any query regarding dates of payments mentioned in the agreement to sell and had passed the assessment order in haste thereby making the impugned order erroneous as well as prejudicial to the interest of the revenue. The Ld. PCIT set-aside the assessment order and directed the AO to frame a fresh assessment after duly considering the issues pointed out in the show cause notice. 4 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana 2.2 Aggrieved by this order of the Ld. PCIT, the assessee is now in appeal before this Tribunal and has raised the following Grounds of appeal: 1. That the Ld. Pr. CIT-2, Ludhiana has erred in assuming the jurisdiction u/s 263 of the Income Tax Act 1961 and holding that the assessment as framed by the Assessing Officer vide order, dated 30.11.2018 is erroneous and prejudicial to the interest of revenue and, thereby, setting aside the case to the file of Assessing Officer again. 2. That the Ld. Pr. CIT has also erred in assuming the jurisdiction, which is not valid and the recourse to the proceedings u/s 263 has been taken only on the basis of audit objection, dated 30.11.2018 and, therefore, the proceedings u/s 263 are void ab initio. 3. Notwithstanding the above said ground of appeal, the Pr. CIT has failed to appreciate the fact that the Assessing Officer has passed the order after considering all the facts and circumstances and assessment has been framed after due application of mind and on the basis of documents submitted during the course of assessment proceedings and further, the possession had been handed over only in Asstt. Year 2013-14 and the amount was also paid during the same year. 5 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana 4. That the order of the Pr. CIT is bad in law and, therefore, deserves to be set aside. 5. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off. 3.0 At the outset, the Ld. AR submitted that the Registry of the Tribunal has pointed out that there was a delay of 205 days in filing of this appeal before the Tribunal. It was submitted that the due date for filing of the appeal was 03.05.2020 whereas a country-wide lockdown has been announced on 22.03.2020 in view of the Covid -19 situation. It was further submitted that the appeal was filed on 24.11.2020 when the Covid-19 situation in the country had improved a little. He further placed reliance on the order of the Hon’ble Apex Court as reported in (2021) 432 ITR 206 (SC) wherein the Hon'ble Apex Court had directed that in computing the period of limitation for any suit, appeal, application or proceedings, the period from March 15,2020 till March 14, 2021 shall stand excluded. It was submitted that in view of this order of the Hon’ble Apex Court, there was no actual delay in filing of the appeal before the Tribunal. 4.0 The Ld. CIT DR did not refute the contentions of the Ld. AR vis-à-vis the issue of condonation of delay. 6 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana 5.0 Accordingly, looking into the facts of the case and also the cause of the delay, as has been explained by the Ld. AR, and respectfully following direction of the Hon’ble Apex Court as aforesaid, we admit the appeal for the purpose of hearing by holding that there is no delay in the filing of this appeal. 6.0 The Ld. AR submitted that the assessee is working as a teacher in Ludhiana and on the basis of information received in the case of the assessee as well as her husband Shri Inderjit Singh, their cases were reopened on the basis of identical reasons. It was submitted that as per the reasons recorded in the cases of both the assessee as well as her husband, they had jointly purchased a plot of land measuring 200 sq yrds. from one Sri Nirmal Singh. It is was further submitted as per the said information, the agreement to sell was entered into in A.Y. 2011- 12 for which stamp papers were purchased on 01.11.2010 and the assessee and her husband were said to have paid an amount of 11,50,000/- during assessment year 2011-12. It was further stated in the information that though substantial part of purchased consideration was paid during assessment year 2011- 12, the sale deed was executed on 25.03.2013. 7 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana 6.1 The Ld. AR submitted that the statement on which the said information has been based had been made during the course of appellate proceedings in the case of Shri Nirmal Singh and the assessee’s case was re-opened. It was further submitted that the correct factual position was that the assessee had made no payments towards the purchase of plot in A.Y. 2011-12 and even the sale deed came to be executed in assessment year 2013-14 only. It was further submitted that this fact was duly brought to the knowledge of the AO during the course of assessment proceedings and further, the assessee had also stated before the AO that she had earlier mentioned the date of payment wrongly before the Ld. CIT (A) in her statement as at that point of time she could not recollect the date correctly. 6.2 The Ld. AR argued that the AO had taken a concious decision of accepting the returned income of the assessee after duly considering her submissions and also after duly verifying the fact from the agreement to sell that there was no signature of the assessee on the said agreement. 6.3 The Ld. AR further submitted that even the reassessment proceedings in the case of the assessee’s husband, after duly 8 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana considering the facts and circumstances, which were identical both in the case of the assessee as well as her husband, were dropped by the AO. Our attention was drawn to the assessment order in the case of the assessee’s husband in this regard. 6.4 The Ld. AR relied on numerous judicial precedents to support his contention that where the AO has passed an assessment order after due application of mind and after duly considering the various evidences and documents, the Ld. CIT would not be justified in resorting to revisionary proceedings under 263 of the Act. It was submitted that the AO had accepted the returned income only after due application of mind and verification of facts. 6.5 It was further argued by the Ld. AR that even on the principle of consistency, the impugned order does not survive as identical issue in the case of the husband had been accepted with the AO dropping the re-assessment proceedings and the Ld. PCIT choosing not to initiate revisionary proceedings in the case of the husband. 7.0 Per Contra, the Ld. CIT DR argued that the AO had erred in not considering the statement of the assessee wherein she had 9 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana admitted that the payment of Rs.11,50,000/- had been made in assessment year 2011-12. It was argued that, apparently, the AO had not applied his mind to the reasons for which the reassessment proceedings had been initiated and that he had accepted the version of the assessee without making due enquiries. It was further submitted that the case of the assessee’s husband cannot be relied upon by the assessee for the simple reason that each and every case as an independent case and further the fact remained that no enquiry had been conducted by the AO in the case of the assessee. 8.0 We have heard the rival submissions and have also perused the material on record. It is seen that the assessee, in response to the notice issued by the AO, had clarified before the AO that no payment towards purchase of plot had been made during assessment year 2011-12 and the AO had accepted this contention of the assessee as the assessee cannot be expected to prove the negative. In our considered view, if the Ld. PCIT doubted the contentions of assessee, he himself should have brought evidence to the contrary on record but this was not done. Further, the Ld. PCIT has referred to a particular agreement to sell which the assessee has denied as having entered into with 10 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana the seller Shri Nirmal Singh. It is also note-worthy that the said agreement to sell does not contain the signature of the assessee. In absence of her signatures, no evidentiary value can be attached to the said agreement to sell. 8.1 Therefore, in our considered view, based on the record before him, the AO took a conscious view after due application of mind and after deciding that no further enquires were required, he accepted the returned income of the assessee. Thus, the AO took one of the possible views which he could have taken and he chose to accept the contention of the assessee. It is settled law that no assessment order would become erroneous and/or prejudicial to the interest to the revenue only because the AO has accepted the contention of the assessee. 8.2 On the issue of lack of enquiry and inadequate enquiry, it would be relevant to make a reference to the order of the co- ordinate Bench in the case of Sanjay Jain & Others reported in 96 ITR (Trib) 1 (Chd), wherein, the co-ordinate Bench relied upon the judgment of the Hon'ble Delhi High Court in the case of CIT Vs. Sunbeam Auto Ltd. reported in (2011) 332 ITR 167 (Del) and also the judgment in the case of ITO Vs. DG Housing Projects 11 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana Ltd. (2012) 343 ITR 329 (Delhi), wherein the Hon'ble Delhi High Court has ruled that one has to keep in mind the distinction between lack of inquiry and inadequate inquiry and further if any inquiry was found to be inadequate, that would not by itself give occasion to the Commissioner to pass the order under section 263 of the Act, merely because he has a different opinion in the matter. Further, the Ld. PCIT has not pointed out as to what further inquiries were required to be made and how without those inquiries, the order of the Assessing Officer was erroneous in so far as being prejudicial to the interests of revenue. 8.3 We are also conscious of the landmark judgment of the Hon’ble Apex Court reported in Malabar Industrial Co. Ltd. Vs. CITR (2000) 243 ITR 83 (SC) and also the judgment of the Hon'ble jurisdictional High Court in the case of CIT Vs. Unique Autofelts (P) Ltd. (2009) 30 DTR 231, in which , it has been held as under:- “5. From the finding of the Tribunal, it is clear that the assessee had given proper explanation by filing the necessary confirmations view of such a finding, the Tribunal rightly held that power under section 263 of the Act could be exercised where view taken by an Assessing Officer was erroneous. While exercising such 12 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana power, the Commissioner was bound to take into account all relevant facts. If order invoking the said power proceeds on an erroneous assumption, the same could be set-aside by the Tribunal. Finding of the Tribunal is not shown to be perverse. No substantial question of law arises.” 8.4 Reliance by the assessee on various judgments quoted as mentioned supra in the case of PCIT Vs. Kesoram Industries Ltd. (Hon’ble Calcutta High Court) reported in (2020) 423 ITR 180 (Cal), is also relevant, in which, it has been held as under:- “Revision-Powers of Commissioner- order of Tribunal setting aside revision order on ground issues raised by Commissioner, had been considered by the Assessing Officer and order not erroneous – Reasoned order based on facts – Need not be interfered with – Income tax Act, 1961 m SS 253, 254 , 263.” 8.5 Further, the contention of the assessee that in the case of husband, Shri Inderjit Singh, on similar facts and circumstances, 148 proceedings were filed has also to be duly considered as on the same set of facts, there cannot be two separate conclusions and further on account of consistency, the order of the ITAT Chandigarh Bench in the case of Smt. Amarjit Kaur Vs. ITO in 13 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana ITA Nos. 40 & 41/Chd/2019 is quite relevant and the relevant finding in the case of above order is almost on identical facts and the same is being reproduced as under:- “13. Therefore by keeping in view the ratio down by the Hon'ble Supreme Court and Hon'ble Jurisdictional High Court in the aforesaid referred to cases, I am of the view that the Department ought to have maintained consistency and that the addition sustained by the Ld. CIT (A) was not justified particularly when an identical addition made in the hands of the co-owner of the same property i.e. Husband of the assessee, has been deleted by the Ld. CIT(A) and the said order was not challenged before the higher Forum. In view of the above the addition made by the AO and sustained by the Ld. CIT (A) is deleted. 14. In ITA No.41/Chd/2019 for the Assessment Year 2008-09, the facts are similar as were in ITA No. 40/Chd/2019 for the Assessment Year 2006-07, the only difference is in the amount involved, therefore may findings given in the former part of this order shall apply mutatis mutandis for this Assessment Year also.” 8.6 Thus, both on the issue of application of mind and adequate inquiry having been made by the Assessing Officer as well as on the issue of consistency, as elaborated above, we have no 14 337-Chd-2020 (A.Y. 2011-12) – Smt. Paramjit Kaur, Ludhiana hesitation to quash the order as passed by the Ld. PCIT under section 263 of the Act. 9.0 In the final result, the appeal of the assessee stands allowed. O rde r p ro no un c e d o n 22. 0 8. 2 02 2 Sd/- Sd/- ( N.K. SAINI) (SUDHANSHU SRIVASTAVA) Vice President Judicial Member Dated : 22.08.2022 “आर.के.” आदेशक त*ल+पअ,े+षत / Copy of the order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent 3. आयकरआय ु -त/ CIT 4. आयकरआय ु -त (अपील)/ The CIT(A) 5. +वभागीय त न0ध, आयकरअपील$यआ0धकरण, च2डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड फाईल/ Guard File आदेशान ु सार / By order, सहायकपंजीकार/ Assistant Registrar