BALDEV SINGH MANKOO, MUMBAI V. ITO WD 24(1)(3), MUMBAI

ITA 5192/MUM/2009

• Counselvise Citation: 519219914 RSA 2009
• Duration Of Justice: 2 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-10-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 10-09-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G P TRIVEDI
• Keywords: Reassessment proceedings

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B MUMBAI BEFORE SHRI B.R. MITTAL (JUDICIAL MEMBER) AND SHRI R.K. PANDA (ACCOUNTANT MEMBER) ITA NO. 5192/MUM/2009 ASSESSMENT YEAR-2006-07 SHRI BALDEV SINGH MANKOO, GURUCHARAN NIWAS, 2 ND FLOOR, LALA LAJPATRAI ROAD, GORASWADI, MALAD (W), MUMBAI-400 064 PAN-AFYPM 2957D VS. THE ITO, WARD 24(1)(3), MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI HARESH P. SHAH RESPONDENT BY: SHRI G.P. TRIVEDI DATE OF HEARING : 11.10.2011 DATE OF PRONOUNCEMENT: 14.10.2011 O R D E R PER B.R. MITTAL, JM : THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT YEAR 2006-07 AGAINST ORDER OF LD. CIT(A) DT. 9 TH JULY 2009 DISPUTING THE VALIDITY OF INITIATION OF REASSESSMENT PROCEEDINGS BY ISSUING NOTICE U/S. 148 DT. 17 TH OCTOBER, 2007. 2. THE RELEVANT FACTS GIVING RISE TO THIS APPEAL AR E THAT ASSESSEE FILED RETURN OF INCOME FOR ASSESSMENT YEAR UNDER CONSIDER ATION ON 12.01.2007 DECLARING TOTAL INCOME OF RS. 1,82,500/-. THE ASSE SSING OFFICER INITIATED THE REASSESSMENT PROCEEDINGS BY ISSUING NOTICE U/S. 148 DT. 17.10.2007 AND COMPLETED THE ASSESSMENT VIDE ORDER DT. 11.7.2008. THE ASSESSEE FILED APPEAL BEFORE FIRST APPELLATE AUTHORITY DISPUTING VALIDITY OF INITIATION OF REASSESSMENT PROCEEDINGS ON THE GROUND THAT WHEN SUFFICIENT TIME WAS AVAILABLE BEFORE AO TO MAKE REGULAR ASSESSMENT BY ISSUING NOTICE U/S. 1 43(2) OF THE ACT, ISSUE OF NOTICE U/S. 148 IS NOT VALID. HOWEVER, LD. CIT(A) DID NOT ACCEPT THE ITA NO. 5192/M/09 2 CONTENTION OF THE ASSESSEE AND CONFIRMED ACTION OF AO. HENCE, ASSESSEE IS IN FURTHER APPEAL BEFORE TRIBUNAL. 3. DURING THE COURSE OF HEARING, LD. AR SUBMITTED T HAT ASSESSEE FILED RETURN OF INCOME FOR ASSESSMENT YEAR UNDER CONSIDER ATION ON 12.1.2007 AND WHEN TIME WAS AVAILABLE WITH AO FOR ISSUING NOTICE U/S. 143(2) OF THE ACT AND TO MAKE REGULAR ASSESSMENT, INITIATION OF REASSESSM ENT PROCEEDINGS BY ISSUING NOTICE U/S. 148 OF THE ACT WAS NOT VALID AS WITHOUT COMPLETING THE ASSESSMENT, THERE COULD BE NO RECORDING OF VALID RE ASON TO BELIEVE THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT. TO SUBSTANTIATE HIS SUBMISSION, LD AR PLACED RELIANCE ON THE DECISION O F HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS. K.M. PACHAYAPPAN 304 I TR 264 AND THE DECISION OF ITAT JAIPUR BENCH IN THE CASE OF B.R. INDUSTRIES (2008) 23 SOT 53. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE SUPPORT ED THE ACTION OF AO. HE SUBMITTED THAT EVEN IF TIME IS AVAILABLE WITH AO TO MAKE REGULAR ASSESSMENT BY ISSUING NOTICE U/S. 143(2) OF THE ACT, AO IS NOT DEBARRED TO INITIATE REASSESSMENT PROCEEDINGS BY ISSUING NOTICE U/S. 148 OF THE ACT. 4. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF AUTHO RITIES BELOW AND THE SUBMISSIONS OF LD. REPRESENTATIVES OF THE PARTIES. WE OBSERVE THAT THIS ISSUE IS DIRECTLY COVERED BY DECISION OF HONBLE MADRAS H IGH COURT IN THE CASE OF CIT VS. K.M. PACHAYAPPAN WHICH HAS BEEN FOLLOWED SU BSEQUENTLY BY HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS QATALYS SOF TWARE TECHNOLOGIES LTD. 308 ITR 249. THEIR LORDSHIPS HAS HELD THAT WHEN TH E PERIOD FOR ISSUE OF NOTICE U/S. 143(2) HAS NOT EXPIRED, ACTION OF AO TO INITIATE REASSESSMENT PROCEEDINGS BY ISSUING NOTICE U/S. 148 OF THE ACT I S NOT VALID. IN THE PRESENT CASE, THERE IS NO DISPUTE TO THE FACT THAT ASSESSEE FILED RETURN OF INCOME ON 12.1.2007 AND THE TIME WAS AVAILABLE WITH AO TO ISS UE NOTICE U/S. 143(2) OF THE ACT TO MAKE REGULAR ASSESSMENT, THEN THE AO ISS UED NOTICE U/S. 148 OF THE ACT DT. 17 TH OCTOBER, 2007. IN VIEW OF THE ABOVE DECISION OF HO NBLE MADRAS HIGH COURT IN THE CASE OF CIT VS. K.M. PACH AYAPPAN (SUPRA), WE HOLD THAT NOTICE ISSUED BY AO U/S. 148 DT. 17 TH OCTOBER 2007 IS NOT VALID. ITA NO. 5192/M/09 3 THEREFORE REASSESSMENT MADE BY AO IS NOT SUSTAINABL E IN LAW HENCE WE QUASH THE ASSESSMENT BY ALLOWING GROUND TAKEN BY AS SESSEE. 5. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED ON THIS 14 TH DAY OF OCTOBER, 2011 SD/- SD/- ( R.K. PANDA) (B.R. MITTAL ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 14 TH OCTOBER, 2011 RJ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT-CONCERNED 4. THE CIT(A)-CONCERNED 5. THE DR B BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, I.T.A.T, MUMBAI ITA NO. 5192/M/09 4 DATE INITIALS 1. DRAFT DICTATED ON: 11.10.2011 SR. PS/PS 2. DRAFT PLACED BEFORE AUTHOR: 11.10.2011 SR. PS/PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER: JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER: JM/AM 5. APPROVED DRAFT COMES TO THE SR. PS/PS: SR. PS/PS 6. ORDER PRONOUNCED ON: SR. PS/PS 7. FILE SENT TO THE BENCH CLERK: 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK: SR. PS/PS 9. DATE ON WHICH FILE GOES TO AR 10. DATE OF DISPATCH OF ORDER: