Vijay Srivastava, Fatehpur V. Income Tax Officer, Ward-4(2), Kanpur

ITA 382/LKW/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 9770 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 13-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PRADEEP SETH
• Keywords: Assessment record; Reassessment proceedings
• Section: 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH SMC , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 382/LKW/2017 ASSESSMENT YEAR: 2009 - 10 VIJAY SRIVASTAVA 602, LIG, AWAS VIKAS COLON Y FATEHPUR V. INCOME TAX OFFICER WARD 4(2) KANPUR T AN /PAN : AVPPS0643H (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI PRADEEP SETH, FCA RESPONDENT BY: SHRI AMIT NIGAM, D.R. DATE OF HEARING: 31 08 201 8 DATE OF PRONOUNCEMENT: 19 0 9 201 8 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THIS APPEAL PREFERRED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LD. CIT(A) - II, KANPUR DATED 31/3/2017 AS PER FOLLOWING GROUNDS OF APPEAL: - 1) THAT THE LEARNED C.I.T.(APPEALS) HAS ERRED IN LAW AND ON FACTS IN NOT APPREC IATING THAT RE - ASSESSMENT PROCEEDING UNDER SECTION 147 WERE VOID AB INITIO CONSEQUENTLY THE ASSESSMENT ORDER PASSED IN PURSUANCE OF SUCH PROCEEDING IS ALSO VOID BECAUSE NO REASONS HAVE BEEN RECORDED UNDER SECTION 148(2) OF THE INCOME - TAX ACT AS IS EVIDENT FROM THE ORDER OF THE A.O. UNDER SECTION 7(1) OF RIGHT TO INFORMATION ACT 2005 ADMITTING THAT THE REASONS RECORDED ARE NOT AVAILABLE IN HIS RECORD. 2) THAT THE LEARNED C.I.T.(APPEALS) HAS FAILED TO APPRECIATE THE FACT THAT COPY OF REASONS RECORDED UNDER SE CTION 148 WERE NOT ITA NO.382/LKW/20 17 PAGE 2 OF 5 PROVIDED TO THE ASSESSEE INSPITE OF SPECIFIC REQUEST VIDE LETTER DATED 26.11.2012 WHICH ALSO SUPPORTED THE ABOVE FACT THAT NO REASONS WERE RECORDED BY THE A.O. 3) THAT THE LEARNED C.I.T.(APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN RELYING UPON THE DECISION OF THE TRIBUNAL DELHI BENCH WHERE THE FACTS WERE TOTALLY DISTINGUISHABLE FROM THE FACTS OF THE ASSESSEE'S CASE AND IN IGNORING THE LAW DECLARED BY THE HON'BLE SUPREME COURT IN THE CASE OF GKN DRIVESHAFTS (INDIA) LTD. VS. INCOME TA X OFFICER AND OTHERS REPORTED IN 259 ITR PAGE 19 THAT ON THE ASSESSEE FILING A RETURN IN RESPONSE TO NOTICE UNDER SECTION 148 AND SEEKING REASONS FOR ISSUING NOTICE THE A.O. WAS BOUND TO FURNISH REASONS WITHIN A REASONABLE TIME. 4) THAT THE LEARNED C.I.T.( APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THE WRITTEN ARGUMENTS FILED BEFORE HIM AND THE JUDGEMENTS RELIED UPON. 5) THAT THE LEARNED C.I.T.(APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN PROCEEDING ON CONJECTURES AND SURMISES AN D WRONG ASSUMPTION OF FACTS IN HOLDING THAT THE ASSESSES WAS MADE AWARE OF THE REASONS RECORDED UNDER SECTION 148. 6) WITHOUT PREJUDICE TO THE ABOVE GROUNDS THE LEARNED C.I.T. (APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THAT THE AMO UNT DEPOSITED IN THE BANK ACCOUNT O F THE ASSESSEE AMOUNTING TO RS. 16,77,000/ - COULD NOT BE TREATED AS ASSESSEE'S INCOME AS IT WAS IMPOSSIBLE, LOOKING TO THE CIRCUMSTANCES OF THE ASSESSEE, FOR HIM TO HAVE EARNED SUCH A HUGE AMOUNT IN A SINGLE YEAR AND IN NO T APPRECIATING THE LAW DECLARED BY THE HON'BLE SUPREME COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. SMT. P.K. NOORJAHAN REPORTED IN 237 ITR PAGE 571 RELIED UPON BY THE ASSESSEE IN THE WRITTEN SUBMISSIONS. 7) THAT THE APPELLATE ORDER IS ARBITRARY, UN JUST, EXCESSIVE, BAD IN LAW AND BASED ON CONJECTURES AND SURMISES. ITA NO.382/LKW/20 17 PAGE 3 OF 5 2 . THE CRUX OF THE GRIEVANCE OF THE ASSESSEE IS THAT REASSESSMENT PROCEEDINGS INITIATED UNDER SECTION 147 WERE VOID AB - INITIO AND CONSEQUENTLY THE ASSESSMENT ORDER PASSED IN PURSUANCE OF SUCH PROCEEDINGS IS ALSO VOID , SINCE REASONS HAVE NOT BEEN RECORDED UNDER SECTION 148(2) AS WAS EVIDENT IN THE ORDER OF THE ASSESSING OFFICER. 3 . LD. A.R. OF THE ASSESSEE AT THE TIME OF HEARING SUBMITTED THAT EVEN UNDER SECTION 7(1) OF THE RIGHT TO INFORMATION ACT , 2005, IT WAS ADMITTED BY THE REVENUE AUTHORITIES THAT THE REASONS RECORDED UNDER SECTION 148 (2) WERE NOT AVAILABLE IN THE RECORD. 4 . ON A PERUSAL OF THE ORDER OF THE LD. CIT(A), IT IS EVIDENT THAT THE LD. CIT(A) HAD CALLED FOR ASSESSMENT RECORDS FROM THE AS SESSING OFFICER AND ONE OF THE QUERIES THEREIN RELATES TO THE COPY OF REASONS RECORDED UNDER SECTION 148 (2) BEFORE ISSUANCE OF NOTICE UNDER SECTION 148 AND TO THAT IT IS MENTIONED THAT DESIRED DETAILS FROM POINT NO.1 TO 6 ARE NOT AVAILABLE IN THIS OFFICE. LD. CIT(A)S ORDER ITSELF BRINGS OUT THE FACT THAT ON PERUSAL OF ASSESSMENT ORDER IT IS CLEAR THAT ORIGINAL ORDER NOTE SHEET, ORIGINAL NOTICE AND RETURN OF INCOME ARE ALL MISSING FROM THE FOLDER. LD. CIT(A) IN HIS ORDER THOUGH IN PRINCIPLE HAS AGREED WIT H THE ASSESSEE ON THE FACTUAL PARAMETERS THAT REASONS RECORDED BEFORE ISSUANCE OF NOTICE UNDER SECTION 148 WAS NOT IN THE ASSESSMENT RECORDS, BUT STILL HE HAD DISMISSED THIS GROUND IN HIS ORDER. 5 . AT THE TIME OF HEARING BEFORE US, WE HAD CALLED FOR THE ASSES SMENT RECORDS AND LD. D.R. HAS PRODUCED SAME BEFORE US ON THE DATE OF HEARING. EVEN LD. D.R. ADMITTED THAT THERE IS NO DOCUMENT OR RECORD TO SHOW THAT REASONS FOR ISSUANCE OF NOTICE UNDER SECTION 148 WAS RECORDED BY THE ASSESSING OFFICER. ITA NO.382/LKW/20 17 PAGE 4 OF 5 6 . WE HAVE PERUSED THE CASE RECORD, HEARD THE RIVAL CONTENTIONS AND ANALYSED THE FACTS OF THE CASE. WE HAVE ALREADY EXAMINED THE ASSESSMENT RECORDS OF THE ASSESSEE PRODUCED BEFORE US BY THE LD. D.R. TO CHECK AVAILABILITY OF REASONS RECORDED BY THE ASSESSING OFFICER UNDER SE CTION 148 AND LD. D.R. HAS STATED THAT NO SUCH REASONS RECORDED UNDER SECTION 148 WAS THERE IN THE ASSESSMENT ORDER. AS ON RECORD, WE FIND THAT ON AN INFORMATION SOUGHT BY THE ASSESSEE UNDER RTI ACT, THE ASSESSING OFFICER HAS ADMITTED THAT THE REASONS REC ORDED FOR ISSUANCE OF NOTICE UNDER SECTION 148 ARE NOT AVAILABLE IN HIS RECORD. 7 . HON'BLE SUPREME COURT IN UNION OF INDIA AND OTHERS VS. RAI SIONGH DEB SINIGH BIST AND ANOTHER IN CIVIL APPEAL NO.2392 TO 2403 OF 1969 HAS HELD THAT SINCE RECORDS WERE NOT PRO DUCED AND NO REASONS WERE GIVEN FOR NOT PRODUCING THEM, THE CIRCUMSTANCES GAVE RISE TO AN ADVERSE INFERENCE AGAINST THE DEPARTMENT. FURTHERMORE, THE HON'BLE APEX COURT IN GKN DRIVESHAFTS INDIA LTD. VS. INCOME TAX OFFICER AND OTHERS, 259 ITR 19 (SC) HAS HE LD THAT ASSESSEE FILING A RETURN IN RESPONSE TO NOTICE UNDER SECTION 148 AND SEEKING REASONS FOR ISSUING NOTICE, ASSESSING OFFICER WAS BOUND TO FURNISH REASONS WITHIN A REASONABLE TIME. I N THE CASE OF CIT VS. INDIAN SMELTING AND REFINING COMPANY LTD. , 196 ITR 562 (ALLD.) QUESTION BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT WAS WHETHER ON THE FACTS AND CIRCUMSTANCES, THE TRIBUNAL WAS JUSTIFIED IN QUASHING THE ASSESSMENT ORDER HOLDING THAT ISSUE OF NOTICE UNDER SECTION 148 WAS ILLEGAL, AS THE REASONS FOR IS SUE OF SAID NOTICE WAS NOT ON RECORD WHEREIN THE COURT HELD THAT IT IS IMPERATIVE FOR THE INCOME TAX OFFICER TO RECORD HIS REASONS BEFORE ISSUING NOTICE OF REASSESSMENT UNDER SECTION 148 OF THE ACT. IF HE FAILS TO DO SO, ASSESSMENT IN PURSUANCE OF SUCH NO TICE IS VOID AB - INITIO. TAKING GUIDANCE FROM THESE JUDICIAL PRINCIPLES AND THE FACTS ON RECORD, IT IS ABSOLUTELY CLEAR THAT NO REASONS WERE RECORDED BY THE ASSESSING ITA NO.382/LKW/20 17 PAGE 5 OF 5 OFFICER BEFORE ISSUANCE OF NOTICE UNDER SECTION 148 AND, THEREFORE, FOLLOWING THE JUDICIA L PRINCIPLES ENSHRINED HEREINABOVE, WE HOLD THAT NOTICE UNDER SECTION 148 WITHOUT REASONS RECORDED IS A NOTICE VOID AB - INITIO AND, THEREFORE, ANY ASSESSMENT PROCEEDINGS THEREAFTER SHALL AUTOMATICALLY BECOME VOID. WE, THEREFORE, SET ASIDE THE ORDER OF THE LD. CIT(A) AND QUASH THE REASSESSMENT ORDER PASSED UNDER SECTION 147/143(3) OF THE ACT. 8 . SINCE WE HAVE QUASHED THE REASSESSMENT ORDER, THE GROUND OF APPEAL O N MERIT BECOMES INFRUCTUOUS. 9 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 / 0 9 / 201 8 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 19 TH SEPTEMBER , 201 8 JJ: COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR