M/s. A.P. Fashions Pvt. Ltd., Kolkata V. ITO, Ward-11(1), Kolkata, Kolkata

ITA 347/KOL/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6152 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 27-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C J SINGH
• Assessee Lawyers: S JHAJHARIA
• Keywords: Reopening of assessment; Tangible material; Wrong claim; Difference of opinion; Change of opinion; Set aside
• Section: 143(3); 147

Judgement Text

I.T.A NO.347/KOL/2018 M/S. A.P. FASHIONS PVT. LTD ASSESSMENT YEAR: 2007-08 PAGE | 1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOLKATA BEFORE: SHRI P. M. JAGTAP, VICE PRESIDENT AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A NO.347/KOL/2018 (ASSESSMENT YEAR: 2007-08) M/S. A.P. FASHIONS PVT. LTD. APPELLANT [PAN:AACCA0846K] VS ITO, WARD-11(1), KOLKATA RESPONDENT FOR THE APPELLANT : SHRI S. JHAJHARIA, ADVOCATE FOR THE RESPONDENT : SHRI C. J. SINGH, JCIT, SR. DR DATE OF HEARING : 13.06.2019 DATE OF PRONOUNCEMENT : 07.08.2019 ORDER SHRI S.S. VISWANETHRA RAVI, JM: THIS APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 21.12.2017 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-4, KOLKATA [CIT(A)] FOR ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE RAISED GROUND NOS.1 TO 3 CHALLENGING THE CONFIRMATION OF REASSESSMENT MADE U/S 147 OF THE ACT. WITH THE CONSENT OF BOTH THE PARTIES, WE PROCEED TO HEAR GROUND NOS.1 TO 3 AS PRELIMINARY ISSUE. 3. HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE CONTENTION OF THE LD. AR IS THAT THE ASSESSING OFFICER REOPENED THE ORIGINAL ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT WITHOUT THERE BEING ANY NEW MATERIAL ON RECORD TO SHOW THAT THE INCOME ESCAPED ASSESSMENT. IN THE ORIGINAL ASSESSMENT PROCEEDINGS, I.T.A NO.347/KOL/2018 M/S. A.P. FASHIONS PVT. LTD ASSESSMENT YEAR: 2007-08 PAGE | 2 THE ASSESSEE FILED ALL THE DETAILS RELATING TO THE ISSUE ON HAND REGARDING THE CLAIM OF EXEMPTION U/S 10A OF THE ACT. THE ASSESSEE RAISED OBJECTIONS REGARDING THE REASONS RECORDED AND THE ASSESSING OFFICER WITHOUT PASSING EXPRESS ORDER ON OBJECTIONS RAISED REGARDING THE REOPENING OF ASSESSMENT IN RESPECT OF REASONS RECORDED, THE LD. AR ARGUED THAT THE ASSESSING OFFICER ON MERE CHANGE OF OPINION REOPENED THE ASSESSMENT AND THE ASSESSMENT MADE THEREON IS NOT MAINTAINABLE IN LAW. THE ASSESSEE CHALLENGED THE VALIDITY OF REASSESSMENT AND THE CIT(A) WITHOUT EXAMINING THE RECORD CONFIRMED THE ORDER OF ASSESSING OFFICER REGARDING THE VALIDITY OF REOPENING OF ASSESSMENT. THE LD. DR SUPPORTED THE ORDER OF ASSESSING OFFICER AND CIT(A). 4. WE FIND THAT THE REASONS RECORDED BY THE ASSESSING OFFICER REGARDING THE REOPENING OF ASSESSMENT COMPLETED U/S 143(3) OF THE ACT AT PAGE NO.104 OF THE PAPER BOOK WHEREIN IT IS NOTICED, THAT THE ASSESSING OFFICER ON EXAMINATION OF RECORD AVAILABLE ALREADY REOPENED THE ASSESSMENT. IT IS CLEAR FROM THE REASONS RECORDED IN PARA NO.3 THAT ASSESSING OFFICER CLEARLY MENTIONED THAT THE ASSESSEE MADE IRREGULAR CLAIM OF DEDUCTION/EXEMPTION U/S 10A OF THE ACT AND IT IS CLEAR THAT ON ALLEGED WRONG CLAIM MADE BY THE ASSESSEE, THE ASSESSING OFFICER REOPENED THE ASSESSMENT. THEREFORE IT IS ESTABLISHED THAT WITHOUT HAVING ANY NEW MATERIAL BUT ON MERE CHANGE OF OPINION, THE ASSESSMENT WAS REOPENED BY THE ASSESSING OFFICER, IN OUR OPINION, THE ASSESSMENT MADE THEREON U/S 147 OF THE ACT IS NOT MAINTAINABLE. FURTHER, THE ASSESSEE FILED OBJECTIONS QUESTIONING THE REASONS RECORDED FOR INITIATION OF PROCEEDINGS U/S 147 OF THE ACT. ON PERUSAL OF THE ASSESSMENT ORDER, IT IS NOTED THAT NOWHERE THE ASSESSING OFFICER DISCUSSED ABOUT THE OBJECTIONS RAISED BY THE ASSESSEE AND WITHOUT CONSIDERING THE SAME PROCEEDED TO REOPEN THE ASSESSMENT, IS BAD IN LAW. FURTHER WE FIND THAT THE ASSESSEE FILED ALL I.T.A NO.347/KOL/2018 M/S. A.P. FASHIONS PVT. LTD ASSESSMENT YEAR: 2007-08 PAGE | 3 THE DETAILS SUCH AS AUDITED ACCOUNTS, TAX AUDIT REPORT U/S 44AB AND REQUIRED DOCUMENTS FOR CLAIM OF EXEMPTION U/S 10A OF THE ACT IN THE ORIGINAL ASSESSMENT PROCEEDINGS ITSELF AND HAVING ACCEPTED THE SAME, THE ASSESSING OFFICER CANNOT REOPEN THE SAME ASSESSMENT AGAIN BY RECORDING THAT THE INCOME HAS ESCAPED BY VIRTUE OF BEING MAKING A WRONG CLAIM. IT IS ALSO NOTED FROM THE RECORD THAT FROM ASSESSMENT YEAR 2001-02 TO 2009-10, THE CLAIM U/S 10A OF THE ACT WERE ALLOWED EXCEPT ASSESSMENT YEAR 2007-08 WHICH IS UNDER CONSIDERATION BEFORE US. THEREFORE, IT IS CLEAR THAT THE DEPARTMENT OF REVENUE HAS BEEN GRANTING DEDUCTION U/S 10A TO THE ASSESSEE IN EARLIER ASSESSMENTS AS WELL AS IN SUBSEQUENT ASSESSMENTS. THEREFORE, AS DISCUSSED ABOVE, THERE WAS NO NEW TANGIBLE MATERIAL WAS BROUGHT ON RECORD BY THE ASSESSING OFFICER AND IN THE ABSENCE OF WHICH THE ASSESSING OFFICER IS NOT ENTITLED TO REOPEN THE ASSESSMENT AND IT IS MERELY A CHANGE OF OPINION. THE REASSESSMENT COMPLETED U/S 143(3)/147 OF THE ACT ON 25.03.2013 IS QUASHED AND THEREBY THE ORDER OF CIT(A) IS SET ASIDE. THUS GROUND NOS.1 TO 3 RAISED BY THE ASSESSEE ARE ALLOWED. 5. GROUND NO.4 RAISED BY THE ASSESSEE IS ON MERITS OF THE CASE AND IN VIEW OF THE DECISION TAKEN BY US REGARDING REOPENING OF ASSESSMENT IN THE AFOREMENTIONED PARAGRAPHS, THEREBY GROUND NO.4 BECOMES ACADEMIC AND REQUIRES NO ADJUDICATION. GROUND NO.5 IS NOT PRESSED BY THE ASSESSEE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 07.08.2019. SD/- SD/- [P. M. JAGTAP] [S.S. VISWANETHRA RAVI] VICE PRESIDENT JUDICIAL MEMBER DATED :07.08.2019 PLACE : KOLKATA RS, SR.PS I.T.A NO.347/KOL/2018 M/S. A.P. FASHIONS PVT. LTD ASSESSMENT YEAR: 2007-08 PAGE | 4 COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT M/S. A.P. FASHIONS PVT. LTD., C/O SALARPURIA JAJODIA & CO., 7, C.R. AVENUE, KOLKATA 700072. 2 RESPONDENT ITO, WARD-11(1), KOLKATA. 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA //TRUE COPY// BY ORDER, ASSISTANT REGISTRAR, ITAT, KOLKATA