DCIT, New Delhi V. M/s. Vodafone Essar South Ltd., New Delhi

ITA 4502/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65861 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 21-08-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 07-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MRS SHUMANA SEN
• Section: 143(3); 263

Judgement Text

ITA NO.4502/DEL/2011 ASSTT. YEAR: 2004-05 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI CHNADRAMOHAN GARG, JUDICIAL MEMBER ITA NO. 4502/DEL/2011 ASSTT. YEAR: 2004-05 JT. COMMISISONER OF INCOME TAX, VS M/S VODAFONE E SSAR SOUTH LTD., CIRCLE 17(1), NEW DELHI. (FORMER LY HUTCHISON ESSAR SOUTH LTD.), C-48, OKHLA INDUSTRIAL AREA, PHASE-II , NEW DELHI-110020 (APPELLANT) (RESPONDENT) APPELLANT BY: MRS. SHUMANA SEN, SR.DR RESPONDENT BY: SHRI SANAT KAPOOR O R D E R PER CHANDRAMOHAN GARG, J.M. THIS APPEAL HAS BEEN PREFERRED BY THE REVENUE AGAI NST THE ORDER OF CIT(A)-XIX, NEW DELHI DATED 15 TH JULY 2011 FOR AY 2004-05. 2. THE GROUNDS OF APPEAL READ AS UNDER:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX(A) HAS ERRED IN QUASHING THE ORDER U/S 263 FOR LACK OF JUR ISDICTION BY IGNORING THE HONBLE APEX CORUT DECISION IN THE CASE OF M.S GEE VEE ENTERPRISES VS ADDL. COMMISSIONER OF IN COME TAX 99 ITR 375. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX(A) HAS ERRED IN RELYING ON THE ORDER OF THE HONBLE ITAT IN ITA NO. ITA NO.4502/DEL/2011 ASSTT. YEAR: 2004-05 2 3238/DEL/2009 DATED 24.06.2011 WHICH HAS NOT BEEN ACCEPTED BY THE DEPARTMENT. 3. BRIEF FACTS GIVING RISE TO THIS APPEAL ARE THAT THE ASSESSEES RETURN WAS PROCESSED U/S 143(1) OF THE ACT, 1961 (FOR SHORT TH E ACT) AND HIS CASE WAS SELECTED FOR SCRUTINY AND NOTICES U/S 143(2) AND 14 3(3) WERE ISSUED AGAINST THE ASSESSEE. THE AO MADE CERTAIN DISALLOWANCES UN DER THE NORMAL PROVISIONS OF THE ACT RESULTING IN REDUCTION OF LOS SES TO RS.2,29,92,11,019 INSTEAD OF RETURNED LOSS OF RS.2,34,75,55,861. 4. SUBSEQUENTLY, THE CIT(A)-IV, NEW DELHI VIDE ORDE R DATED 30.03.2009 U/S 263 OF THE ACT SET ASIDE THE ABOVE ASSESSMENT O RDER DATED 29.12.2006 PASSED U/S 143(3) OF THE ACT WITH CERTAIN DIRECTION S. CONSEQUENT TO THE ORDER OF CIT(A)-IV, NEW DELHI U/S 263 OF THE ACT, THE AO PASSED ASSESSMENT ORDER ON 31.12.2009 BY ADDING CERTAIN AMOUNTS. THE AGGRIEVED ASSESSEE FILED AN APPEAL BEFORE THE CIT(A)-XIX, NEW DELHI DA TED 15.07.2011 ALLOWING THE APPEAL OF THE ASSESSEE. NOW, THE REVE NUE IS IN APPEAL BEFORE THIS TRIBUNAL. 5. WE HAVE HEARD RIVAL ARGUMENTS OF BOTH THE PARTIE S AND CAREFULLY PERUSED THE RECORD. THE DR SUBMITTED THAT THE CIT( A) HAS ERRED IN QUASHING THE ORDER U/S 263 FOR LACK OF JURISDICTION BY IGNO RING THE JUDGEMENT OF HONBLE SUPREME COURT IN THE CASE OF MS/ G.V. ENTER PRISES VS ACIT 99 ITR 375(SC). THE DR ALSO SUBMITTED THAT THE CIT(A) HAS ALSO ER RED IN ITA NO.4502/DEL/2011 ASSTT. YEAR: 2004-05 3 RELYING ON THE ORDER OF THE ITAT DELHI H BENCH PA SSED IN ITA NO.3238/DEL/2009 DATED 23.6.2011 AS THE SAME HAS NO T BEEN ACCEPTED BY THE DEPARTMENT. 6. REPLYING TO THE ABOVE CONTENTIONS, THE ASSESSEE S REPRESENTATIVE SUBMITTED A COPY OF THE JUDGMENT OF ITAT DELHI H BENCH IN ITA NO.3238/DEL/2009 (SUPRA). THE AR SUBMITTED THAT WH EN THE ORDER OF COMMISSIONER OF INCOME TAX(A)-IV, NEW DELHI U/S 263 OF THE ACT HAS BEEN QUASHED BY THE ITAT FOR LACK OF JURISDICTION, THEN IN THE ABSENCE OF ANY OTHER ORDER, THE COMMISSIONER OF INCOME TAX(A)-XIX, NEW DELHI HAD NO OPTION BUT TO FOLLOW IT VERBATIM. THEREFORE, THE I MPUGNED ORDER IS NOT PERVERSE OR ILLEGAL AND AT THE SAME TIME THE APPEAL OF THE REVENUE IS DEVOID OF ANY MERIT. 7. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUM STANCES OF THIS CASE, WE OBSERVE THAT ON SPECIFIC QUERY FROM BOTH THE PAR TIES, WE HAVE BEEN INFORMED THAT THERE IS NO SUBSEQUENT ORDER TO THE O RDER OF ITAT H BENCH PASSED IN ITA NO. 3238/DEL/2009 DATED 24.06.2011 IN ASSESSEES OWN CASE FOR AY 2004-05. ON BARE READING OF THE IMPUGNED OR DER, WE OBSERVE THAT THE COMMISSIONER OF INCOME TAX(A) HELD THAT SINCE T HE ORDER DATED 30.02.2009 PASSED U/S 263 IS VACATED, WHICH WAS THE BASIS OF SUBSEQUENT ASSESSMENT ORDER DATED 31.12.2009, THEN THE ORDER P ASSED U/S 143(3)/263 OF ITA NO.4502/DEL/2011 ASSTT. YEAR: 2004-05 4 THE ACT DOES NOT SURVIVE AND HE FINALLY HELD THAT T HE IMPUGNED ASSESSMENT ORDER DATED 31.12.2009 STOOD CANCELLED. 8. AT THIS STAGE, IT WOULD BE APPROPRIATE TO REPROD UCE THE SUBMISSIONS OF THE AR VIDE LETTER DATED 14.07.2011 BEFORE THE COMM ISSIONER OF INCOME TAX(A) WHICH READS AS UNDER:- WE REFER TO THE CAPTIONED APPEAL AND THE HEARING HELD TODAY AT YOUR OFFICE WITH RESPECT TO AFORESAID APPEALS. IN THIS CONNECTION, WE WISH TO SUBMIT THAT THE CAPTIONED APPEAL WAS FILED BY VESL AGAINST THE ORDE R PASSED BY THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 17(1) ['LEARNED AO'] UNDER SECTION 143( 3) READ WITH SECTION 236 OF THE INCOME TAX ACT, 1961 ( 'ACT') FOR THE SUBJECT A Y. THE AFORESAID ASSESSMENT ORDER WAS PASSED PURSUANT TO THE REVISIONARY ORDER PASSED BY THE COMMISSIONER OF INCOME TAX IV(CIT IV), FOR THE SUBJECT AY ON MARCH 30, 2009 (COPY OF THE ORDER PAS SED BY HON'BLE CIT-IV UNDER SECTION 263 OF THE ACT FOR THE SUBJECT AY IS ANNEXED AS ANNEXURE 1). -PURSUANT TO AFORESAID REVISIONARY ORDER OF THE HON 'BLE CIT -IV, VESL PREFERRED AN APPEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL ['TRIBUNAL'], CHALLENGING TH E VALIDITY OF INITIATION PROCEEDINGS UNDER SECTION 26 3 OF THE ACT, AS WELL AS THE REVISIONARY/REMAND ORDER OF THE CIT- IV UNDER SECTION 263 OF THE ACT. THE HON'BLE TRIBUN AL, VIDE ORDER DATED JUNE 24,2011, QUASHED THE ORDER OF HON'BLE CIT-IV ON THE GROUND OF LACK OF JURISDICTIO N (COPY OF THE ORDER PASSED BY HON'BLE TRIBUNAL IS ANNEXED AS ANNEXURE 2). THEREFORE, WE WISH TO SUBMIT THAT THE PRESENT APPEA L HAS BECOME INFRUCTUOUS AND HAVE TO BE DISPOSED OFF ACCORDINGLY.' ITA NO.4502/DEL/2011 ASSTT. YEAR: 2004-05 5 9. THE ITAT DELHI BENCH H IN ITA NO. 3238/DEL/200 9 DATED 24.06.2011 OBSERVED AS UNDER:- 6.1 CONSIDERING THE PRESENT CASE ON THE ANVIL OF THE AFORESAID CASE LAW, WE FIND THAT ASSESSING OFFICER DID ENQUIRE ON ALL THE THREE ITEMS AND ASSESSEE RESPOND ED BY GIVING THE BREAKUP OF EXPENDITURE. THOUGH, ASSESSME NT ORDER DOES NOT GIVE REASON FOR ALLOWING THE EXPENDI TURE AND ASSESSING OFFICER DID NOT MAKE FURTHER ENQUIRY, IT CANNOT BE SAID THERE WAS LACK OF ENQUIRY IN THIS CA SE. IN THIS VIEW OF THE MATTER, THE RATIO FROM THE HON'BLE JURISDICTIONAL HIGH COURT DRAWN ABOVE IS APPLICABLE FULLY. THERE IS DUE ENQUIRY BY THE ASSESSING OFFICER, THOU GH IT HAS BEEN CONSIDERED TO BE INADEQUATE BY THE CIT, RECOUR SE U/S 263 CANNOT BE MADE. 7. IN THE BACKGROUND OF THE AFORESAID DISCUSSION AN D PRECEDENT, AND IN OUR CONSIDERED OPINION, THE ORDER U/S 236 OF THE IT ACT PASSED BY THE LD. COMMISSIONER OF LNCOME TAX IS LIABLE TO BE QUASHED AND ACCORDINGLY, THE SAME IS QUASHED FOR LACK OF JURISDICTION. 10. AS WE HAVE OBSERVED HEREINABOVE THAT THE DR EXP RESSED HIS INABILITY TO SUBMIT ANY ORDER OR JURISDICTION AGAINST THE ABO VE ORDER OF THE ITAT H BENCH. IN VIEW OF ABOVE, WE HAVE NO REASON TO SEE ANY PERVERSITY OR ILLEGALITY IN THE IMPUGNED ORDER AS THE COMMISSIONE R OF INCOME TAX(A) IS BOUND TO FOLLOW THE DECISION OF THE TRIBUNAL. IT I S OPEN TO THE REVENUE TO AVAIL THE AVAILABLE COURSE OF REMEDY AGAINST THE OR DER OF THE ITAT H BENCH BUT THE COMMISSIONER OF INCOME TAX(A) CANNOT IGNORE IT AS THE SAME IS BINDING ON HIM AGAINST THE ORDER OF THE ITAT H BENCH (SUPRA). ITA NO.4502/DEL/2011 ASSTT. YEAR: 2004-05 6 11. ACCORDINGLY, WE HAVE NO REASON TO INTERFERE WIT H THE IMPUGNED ORDER AND WE ARE INCLINED TO HOLD THAT THIS APPEAL IS DEV OID OF MERIT AND DESERVES TO BE DISMISSED. 12. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16.11.2012. SD/- SD/- (SHAMIM YAHYA ) (CHANDRAMOHAN GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DT. 16 TH NOVEMBER, 2012 GS COPY FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. COMMISSIONER OF INCOME TAX(A) 4. C.I.T. 5. DR BY ORDER ASSTT.REGISTRAR