Kerala Tourism Dev. Corpn Ltd, Trivandrum V. DCIT, Trivandrum

ITA 416/COCH/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64976 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2012
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 17-10-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 23-05-2011
• Court: TRIBUNAL
• Department Lawyers: SUSAN GEORGE VARGHESE
• Keywords: Depreciation; Principle of natural justice; Assessment record

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND B.R.BASKAR AN, AM I.T.A. NO. 416/COCH/11 ASSESSMENT YEAR 2006-07 KERALA TOURISM DEVELOPMENT CORPORATION LTD.. P.B. NO. 5424, VIKAS BHAVAN P.O., MASCOT SQUARE, TRIVANDRUM. [PANAABCK 0385J]: VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-1(1), TRIVANDRUM. (ASSESSEE -APPELLANT) (REVENUE-RES PONDENT) ASSESSEE BY NONE REVENUE BY SMT. SUSAN GEORGE VARGHESE, SR.DR DATE OF HEARING 17/10/2012 DATE OF PRONOUNCEMENT 30/11/2012 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL OF THE ASSESSEEE IS DIRECTED AGAINS T THE ORDER DATED16-03-2011 PASSED U/S. 263 OF THE ACT BY THE LD COMMISSIONER OF INCOM E-TAX, TRIVANDRUM AND IT RELATES TO THE ASSESSMENT YEAR 2006-07. THE ASSESSEE IS CHALL ENGING THE VALIDITY OF INITIATION OF REVISION PROCEEDING. NONE APPEARED ON BEHALF OF TH E ASSESSEE. THE COUNSEL FOR THE ASSESSEE HAS FILED ARGUMENT NOTES BEFORE US. HENCE WE PROCEEDED TO HEAR THE APPEAL EX-PARTE, QUA THE ASSESSEE. 2. THE FACTS RELATING TO THE SAID ISSUE ARE STA TED IN BRIEF. THE ADMINISTRATIVE COMMISSIONER, WHILE EXAMINING THE ASSESSMENT RECORD , NOTICED THAT THE ASSESSING OFFICER DID NOT EXAMINE FOLLOWING POINTS WHILE COMP LETING THE ASSESSMENT:- (A) DEPRECIATION CLAIM MADE BY THE ASSESSEE (B) SHORT TERM CAPITAL GAIN (C) EXPENDITURE IN RESPECT OF EXEMPTED INCOME. I.T.A. NO.416/COCH/2011 2 ACCORDINGLY, AFTER HEARING THE ASSESSEE, THE LD CIT DIRECTED THE AO TO EXAMINE THE ABOVE SAID ISSUES AFRESH. THE ASSESSEE IS AGGRIEVE D BY THE SAID DIRECTION OF THE LD. CIT. 3. WE HAVE HEARD LD D.R AND PERUSED THE ARGUMEN T NOTES FILED BY THE COUNSEL OF HE ASSESSEE AND ALSO THE RECORD. IN THIS REGARD, IT I S PERTINENT TO REFER TO THE DECISION RENDERED BY HONBLE SUPREME COURT IN THE CASE OF MA LABAR INDUSTRIAL CO. LTD VS. CIT (248 ITR 83). THE FOLLOWING OBSERVATIONS MADE BY T HE HONBLE APEX COURT ARE RELEVANT HERE. THERE CAN BE NO DOUBT THAT THE PROVISION CANNOT BE INVOKED TO CORRECT EACH AND EVERY TYPE OF MISTAKE OR ERROR COMMITTED B Y THE ASSESSING OFFICER, IT IS ONLY WHEN AN ORDER IS ERRONEOUS THAT THE SECTION WILL BE ATTRACTED. AN INCORRECT ASSUMPTION OF FACTS OR AN INCORRECT APPLICATION OF LAW WILL SATISFY THE REQUIREMENT OF THE ORDER BEING ERRONEOUS. IN THE SAME CATEGORY FALL ORDERS PASSED WITHOUT APPLYING T HE PRINCIPLES OF NATURAL JUSTICE OR WITHOUT APPLICATION OF MIND THE PHRASE PREJUDICIAL TO THE INTERESTS OF THE R EVENUE HAS TO BE READ IN CONJUNCTION WITH AN ERRONEOUS ORDER PASSED BY THE A SSESSING OFFICER. EVERY LOSS OF REVENUE AS A CONSEQUENCE OF AN ORDER OF THE ASSESSING OFFICER, CANNOT BE TREATED AS PREJUDICIAL TO THE INTERESTS O F THE REVENUE, FOR EXAMPLE, WHEN AN INCOME-TAX OFFICER ADOPTED ONE OF THE COURSES PERMISSIBLE IN LAW AND IT HAS RESULTED IN LOSS OF REVENUE, OR WHERE TWO VIEWS ARE POSSIBLE AND THE INCOME-TAX OFFICER HAS TAKEN ONE VIEW WITH WHICH THE COMMISSIONER DOES NOT AGREE, IT CANNOT BE TREATED AS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF T HE REVENUE UNLESS THE VIEW TAKEN BY THE INCOME-TAX OFFICER IS UNSUSTAINABLE IN LAW. 4. THUS THE NON-APPLICATION OF MIND ON THE PART OF THE AO ALSO RENDERS THE ASSESSMENT ORDER TO BE ERRONEOUS ONE. FURTHER, WH AT IS IMPORTANT IS THAT AO SHOULD HAVE APPLIED HIS MIND AND SHOULD HAVE TAKEN ONE PLAUSIBLE VIEW ON THE MATTER UNDER DISPUTE. EVEN FOR A MOMENT, IT IS PRES UMED THAT THE AO DID APPLY HIS MIND; THE SAME SHOULD BE BROUGHT IN THE ASSESSM ENT ORDER. IN THIS CONNECTION, WE FEEL IT PERTINENT TO EXTRACT THE FOL LOWING OBSERVATIONS MADE BY THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. TOY OTA MOTOR CORPORATION (306 ITR 49), WHICH HAS BEEN APPROVED BY HONBLE SUPREME COURT IN THAT CASE REPORTED IN 309 ITR 52 :- I.T.A. NO.416/COCH/2011 3 WE FIND THAT THE ORDER PASSED BY THE ASSESSING OF FICER IS CRYPTIC, TO SAY THE LEASE, AND IT CANNOT BE SUSTAINED. THE TRIBUN AL CANNOT SUBSTITUTE ITS OWN REASONING TO JUSTIFY THE ORDER PASSED BY THE A SSESSING OFFICER WHEN THE ASSESSING OFFICER HIMSELF DID NOT GIVE ANY REA SON IN THE ORDER PASSED BY HIM. UNDER THE CIRCUMSTANCES, WE ANSWER THE QU ESTION IN THE AFFIRMATIVE, IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE AND REMAND THE MATTER BACK TO THE FILE OF THE ASSESSIN G OFFICER TO DECIDE THE ISSUE AFRESH IN TERMS OF THE ORDER PASSED BY THE C OMMISSIONER OF INCOME TAX UNDER SECTION 263 OF THE ACT. IN THE INSTANT CASE, THE IMPUGNED ASSESSMENT ORDER IS A CRYPTIC ONE. IT DOES NOT SPEAK OF THE RESULT OF EXAMINATION OF THE VARIOUS I SSUES THAT WERE POINTED OUT BY LD CIT. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE REVISION ORDER PASSED BY LD CIT U/S 263 OF THE ACT. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. PRONOUNCED ACCORDINGLY ON 30-11-2 012. SD/- SD/- (N.R.S.GANESAN) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 30TH NOVEMBER, 2012 GJ COPY TO: 1. KERALA TOURISM DEVELOPMENT CORPORATION LTD.. P.B. NO. 5424, VIKAS BHAVAN P.O., MASCOT SQUARE, TR IVANDRUM. 2.THEASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-1 (1), TRIVANDRUM. 3.THE COMMISSIONER OF INCOME-TAX, TRIVANDRUM.I 4. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 5. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T, COCHIN