Rajarambapu Patil SSK Ltd, Sangli V. Deputy Commissioner of Income-tax, Circle - 2, Sangli

ITA 395/PUN/2018

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 1515 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2000-2001
• Appeal Filed On: 25-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Keywords: Set aside; CHAPTER IV
• Section: 113; 22

Judgement Text

आयकर अपीलीय अिधकरण “ए” Ɋायपीठ पुणे मŐ। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपीलसं. / ITA No.395/PUN/2018 िनधाᭅरणवषᭅ / Assessment Year : 2000-01 Rajarambapu Patil SSK Ltd., Sakharale, Tal: Walwa, Dist. Sangli – 415414. PAN: AAAAR 0790 D Vs . The DCIT, Circle-2, Sangli. Appellant/ Assessee Respondent /Revenue Assessee by Prasanna Joshi – AR Revenue by Shri S P Walimbe – DR Date of hearing 12/08/2022 Date of pronouncement 29/08/2022 आदेश/ ORDER Per S.S.Godara, JM: This assessee’s appeal for Assessment Year 2000-01 is directed against the Commissioner of Income Tax(Appeals)-1, Kolhapur’s order dated 27.12.2017 passed in appeal no.Sli/413/2006- 07, in proceedings u/s.143(3) of the Income Tax Act, 1961 [in short “the Act”]. Heard both the parties. Case files perused. 2. The assessee raises the following substantive grounds in the instant appeal. “1. On the facts and in the circumstances of the case, the learned CIT(A) erred in confirming loss incurred by appellant of Rs.1,89,82,242 on diversion of sugarcane to other sugar factories. 2. On the facts and in the circumstances of the case, the Ld.CIT(A) has wrongly ignored the submissions and supporting ITA No.395/PUN/2018 for A.Y. 2000-01 (A) Rajarambapu Patil SSK Ltd., 2 evidences which are already on records and has come to wrong inference and recorded wrong findings in the matter. 3. Ld. CIT(A) erred in concluding that the appellant was itself responsible for the loss incurred on diversion of sugarcane. 4. Without prejudice to all of the above, on the facts and in the circumstances of the case, it may be held that the loss incurred is an allowable deduction while computing profits and gains of business of the appellant under Chapter IV-D of the Act.” 3. It emerges at the outset that the instant appeal raises the first and foremost issue of legality of the impugned proceedings itself since the same have arisen on account of the CIT(A)-Kolhapur’s remand order dated 04.08.2005 issuing directions to the Assessing Officer for examining the assessee’s losses arising from diversion of sugarcane to other sugar factories. The CIT(A) first round remand directions form part of the case records before us at pages 26 to 98 in the assessee’s paper book. 4. Learned Departmental Representative has raised a very strong objection that the instant legal issue could not be allowed to be raised in light of the assessee’s pleadings in this second round of consequential proceedings. 5. We find no merit in the Revenue’s foregoing technical objections. Hon’ble jurisdictional high court’s landmark decision in [1993] 199 ITR 351 (Bom) Ahmedabad Electricity Company Limited Vs. CIT has settled the law long back that the clinching statutory expression in section 254(1) defining contours of this ITA No.395/PUN/2018 for A.Y. 2000-01 (A) Rajarambapu Patil SSK Ltd., 3 tribunal’s jurisdiction “may pass such order as it thinks fit” has to be interpreted in its widest sense. This is coupled with their lordship’s yet another decision 194 ITR 548 (Bom) Inventors Industrial Corporation Vs. CIT and P.V.Doshi Vs. CIT 113 ITR 22 (Guj) holding that a legal issue going to route of the matter could very well allowed to be raised in consequential proceedings as well as since there is no waiver of jurisdiction in income-tax proceedings. 6. We keep in mind the foregoing settled legal proposition and note that the Assessing Officer had framed his first round assessment making the impugned disallowance of the assessee’s business loss of Rs.1,89,82,242/- arising from diversion of sugarcane to other factories. The assessee appears to have preferred its appeal before the CIT(A) Kolhapur; who in turn, remitted the issue back to the Assessing officer in his first round lower appellate order dated 04.08.2005. We make it clear that his remand directions are contained in para 17.4.1 page 94 in assessee’s paper book. Such a course of action is admittedly not available to the CIT(A)’s as the clinching statutory expression “or he may set aside” in sec 251(1)(a) of the Act stood omitted by the Finance Act, 2001 w.e.f 01.06.2001. We conclude in this factual backdrop that once the CIT(A) had committed a patent illegality in setting aside the instant issue back to the Assessing Officer, the instant round of consequential proceedings ITA No.395/PUN/2018 for A.Y. 2000-01 (A) Rajarambapu Patil SSK Ltd., 4 deserve to be quashed as non-est in the eyes of the law. We order accordingly. All other pleadings on merits are rendered academic. 7. This assessee’s appeal is allowed in above terms. Order pronounced in the open Court on 29 th August, 2022. Sd/- Sd/- (DR. DIPAK P. RIPOTE (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 29 th Aug, 2022/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “ए” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.