INCOME TAX OFFICER 29(2)(5), MUMBAI V. M/S.PRIVI ASSOCIATES LLP, MUMBAI

ITA 4136/MUM/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7629 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 11-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUMAR PADMAPANI BORA
• Keywords: Reason to believe; Reassessment proceedings
• Section: 143(3); 143(2); 13; 148

Judgement Text

IN THE IN COME TAX APPELLATE TRIBUNAL C , BENCH MUMBAI BEFORE SHRI M. BALAGANESH , A M & SHRI RAVISH SOOD , J M ITA NO. 4136 /MUM/201 8 ( ASSESSMENT YEAR : 2012 - 13 ) INCOME TAX OFFICER 29(2)(5) MUMBAI NO.206, INCOME TAX OFFICES PRATYAKSHAKAR BHAVAN BAND RA - KURLA COMPLEX BANDRA (E) MUMBAI 400 051 VS. M/S. PRIVI ASSOCIATES LLP SATGURU SUPREME, MIRANI NAGAR VALJI LADHA ROAD MULUND (WEST) MUMBAI 400 080 PAN/GIR NO. AALFP7516J (APPELLANT ) .. (RESPONDENT ) REVENUE BY SHRI KUMAR PADMAPANI BORA ASSESSEE BY SHRI NIMESH VORA DATE OF HEARING 28 / 01 /2020 DATE OF PRONOUNCEMENT 29 / 01 /2020 / O R D E R PER M. BALAGANESH (A.M) : THIS APPEAL IN ITA NO. 4136/MUM/2018 FOR A.Y. 2012 - 13 ARISES OUT OF THE ORDER BY THE LD. COMMISSIONER OF IN COME TAX (APPEALS) - 40, MUMBAI IN APPEAL NO. CIT(A) - 40/IT - 172/2016 - 17 DATED 01/03/2018 (LD. CIT(A) IN SHORT) AGAINST THE ORDER OF ASSESSMENT PASSED U/S.143(3) R.W.S. 147 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT) DATED 31/03/2016 BY THE LD. INCOME TAX OFFICER, WARD 29(2)(5), MUMBAI (HEREINAFTER REFERRED TO AS LD. AO). ITA NO. 4136/MUM/2018 M/S. PRIVI ASSOCIATES P. LT D 2 2. REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) HAS ERRED IN QUASHING THE ORDER U/S 143(3) R .W.S. 147 ON THE GROUND THAT THE NOTICE ISSUED U/S 148 WAS INVALID AS THE ASSESSMENT PROCEEDINGS U/S 143(3) WERE ALREADY IN PROGRESS ON ACCOUNT OF ISSUANCE OF NOTICE U/S 143(2). 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) HAS ERRED IN QUASHING THE ORDER PASSED U/S 143 (3) R.W.S.147 ON THE GROUND THAT THE NOTICE ISSUED U/S 148 WAS INVALID BY MAINLY RELYING UPON THE HON'BLE SUPREME COURT DECISION IN THE CASE OF THE TRUSTEES OF H.E.H. THE NIZAM'S SUPPLEMENTAL FAMILY TRUST VS CIT REPORT ED IN 242 1TR 381 WITHOUT APPRECIATING THE FACT THAT THE POSITION OF LAW IN RESPECT OF INITIATION OF PROCEEDINGS U/S 147 IN THE AFORESAID CASE TOR 1962 - 63 WAS QUITE DIFFERENT TO THAT APPLICABLE IN THE CASE OF THE ASSESSEE FOR A.Y.2012 - 13. 3. ON THE FACTS AND CIRCUMSTANCES OF THE AND IN LAW THE LD CIT(A) HAS ERRED BY HOLDING THAT THE NOTICE ISSUED US 148 WAS INVALID WITHOUT APPRECIATING THAT THE NOTICE ISSUED U/S 148 WAS VALID EVEN WHEN THE NOTICE U/S 143(2) WAS ISSUED, AS HAS BEEN HELD BY THE H ON'BLE PAT NA HIGH COURT IN THE CASE OF DEEPAK KUMAR PODDAR RAJENDRA...VS UNION OF INDIA (UO1) AND ORS.(1997) 224 ITR 95 (PATNA). 3 . WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT THE FOLLOWING FACTS ARE UNDISPUTED: - A ) RETUR N OF INCOME WAS FILED BY THE ASSESSEE FOR THE A.Y.2012 - 13 ON 29/09/2012 . B ) THE CASE WAS SELECTED FOR SCRUTINY BY ISSUANCE OF NOTICE U/S.143(2) OF THE ACT ON 23/09/2013. C ) THE ASSESSMENT WAS FRAMED PURSUANT TO THE SAID SCRUTINY NOTICE ON 12/03/2015 U/S.143(3) O F THE ACT. D ) WHEN THE SAID ORIGINAL ASSESSMENT PROCEEDINGS WERE PENDING, NOTICE U/S.148 OF THE ACT WAS ISSUED BY THE LD. AO REOPENING THE ASSESSMENT ON 10/10/2014. E ) RE - ASSESSMENT WAS FRAMED U/S.143(3) R.W.S. 147 OF THE ACT ON 31/03/2016. ITA NO. 4136/MUM/2018 M/S. PRIVI ASSOCIATES P. LT D 3 3. 1. FROM THE ABOVE NARRATION OF FACTS, IT COULD BE SAFELY CONCLUDED THAT THE ASSESSMENT FOR THE A.Y.2012 - 13 WAS REOPENED BY THE LD. AO WHEN THE SCRUTINY ASSESSMENT PROCEEDINGS FOR THE ORIGINAL RETURN FILED WERE PENDING BEFORE HIM. THE LAW IS NOW WELL SETTLED BY THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF TRUSTEES OF H.E.H. NIZAMS SUPPLEMENTARY FAMILY TRUST VS. CIT REPORTED IN 242 ITR 381 THAT WHEN THE PROCEEDING IS PENDING, THE LD. AO C OULD NOT HAVE REASON TO BELIEVE THAT INCOME OF THE ASSESSEE HAD ESCAPED ASSES SMENT WARRANTING HIM TO REOPEN THE ASSESSMENT DURING THE PENDENCY OF THE SCRUTINY PROCEEDINGS. THE RELEVANT OPERATIVE PORTION OF THE SAID JUDGMENT IS REPRODUCED HEREUNDER: - IT IS SETTLED LAW THAT UNLESS THE RETURN OF INCOME ALREADY FILED IS DISPOSED OF N OTICE FOR REASSESSMENTS UNDER SECTION 148 CANNOT BE ISSUED, I.E., NO REASSESSMENT PROCEEDINGS CAN BE INITIATED SO LONG AS ASSESSMENT PROCEEDINGS PENDING ON THE BASIS OF THE RETURN ALREADY FILED ARE NOT TERMINATED. 3.2 . WE FIND THAT THE LD. CIT(A) HAD PLACED RELIANCE ON THE AFORESAID DECISION AMONG OTHERS AND QUASHED RE - ASSESSMENT PROCEEDINGS. WE DO NOT FIND ANY INFIRMITY IN THE SAID ACTION OF THE LD. CIT(A). ACCORDINGLY, THE GROUNDS RAISED BY THE REVEN UE ARE DISMISSED. 4 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29 / 01 /2020 SD/ - ( RAVISH SOOD ) SD/ - (M.BALAGANESH) JUDICIAL MEMBER ACCO UNTANT MEMBER MUMBAI ; DATED 29 / 01 / 2020 ITA NO. 4136/MUM/2018 M/S. PRIVI ASSOCIATES P. LT D 4 KARUNA , SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//