ITO 16(1)(3), MUMBAI V. SURENDRA R. SHAH, MUMBAI

ITA 5192/MUM/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2910 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 1998-1999
• Appeal Filed On: 22-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard
• Section: 143(3); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI E BENCH, MUMBAI BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER. ITA. NO. 5192/MUM/2013 (ASSESSMENT YEAR:1998-99) INCOME TAX OFFICER - 16(1)(3), MATRU MANDIR, TARDEO ROAD, MUMBAI 400 007 APPELLANT VS. SHRI SURENDRA R. SHAH 307, SHREEPAL NAGAR, 12, JAMNADAS MEHTA MARG, MUMBAI 400 007 RESPONDENT PAN: AAIPS4711J /BY APPELLANT : SHRI VINOD KUMAR, D.R. /BY RESPONDENT : SHRI RAJKUMAR SINGH, A.R. /DATE OF HEARING : 16.06.2016 /DATE OF PRONOUNCEMENT : 24.06.2016 ORDER ITA NO.5192/MUM/13 A.Y. 98-99 [ITO VS. SHRI SURENDRA R. SHAH] PAGE 2 PER SHAILENDRA KUMAR YADAV, J.M: THIS APPEAL HAS BEEN FILED BY REVENUE AGAINST THE O RDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-5, MUMBAI, DATED 29.04.2013 FOR A.Y. 1998-99 ON FOLLOWING GROUNDS: 1. ON THE FACTS AND CIRCUMSTANCES AND IN LAW, THE LD. CIT(A) HAS ERRED IN QUASHING THE RE-ASSESSMENT PROCEEDINGS U/S.143(3) R.W.S. OF THE I.T.ACT 1961. (A) WHILE DOING SO THE LD. CIT(A) HAS FAILED TO APPRECIATE THE FACTS THAT ASSESSEES REPRESENTATIVE HAS BEEN REGULARLY ATTENDING AND MAKING SUBMISSIONS BEFORE THE A.O. IN THE RE-ASSESSMENT PROCEEDINGS WITHOUT CHALLENGING THE VALIDITY OF THE NOTICE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN RECALLING THE RE- ASSESSMENT PROCEEDINGS FOR DECIDING THE MATTER FRESH ON MERIT THOUGH THE A.O. HAS PASSED THE RE- ASSESSMENT PROCEEDINGS AFTER GIVING PROPER OPPORTUNITY OF BEING HEARD. 2. ASSESSING OFFICER COMPLETED ASSESSMENT U/S.143(3 ) R.W.S. 147 OF THE ACT ON 21.03.2003 WITH LONG TERM CAPITAL GAIN AT RS.1,73,07,417/- AND INCOME OTHER THAN CAPI TAL GAIN AT RS.57,621/-. 2.1 MATTER WAS CARRIED BEFORE THE FIRST APPELLATE A UTHORITY, WHEREIN VARIOUS CONTENTIONS WERE RAISED ON BEHALF O F ASSESSEE AND HAVING CONSIDERED THE SAME, CIT(A) GRA NTED RELIEF TO ASSESSEE. ITA NO.5192/MUM/13 A.Y. 98-99 [ITO VS. SHRI SURENDRA R. SHAH] PAGE 3 2.2 SAME HAS BEEN OPPOSED ON BEHALF OF REVENUE BEFO RE US INTER ALIA SUBMITTING THAT IN FACTS AND CIRCUMSTANC ES, CIT(A) ERRED IN QUASHING RE-ASSESSMENT U/S.143(3) R.W.S. O F THE ACT. WHILE DOING SO CIT(A) HAS FAILED TO APPRECIATE THE FACTS THAT ASSESSEES REPRESENTATIVE HAS BEEN REGULARLY ATTEND ING AND MAKING SUBMISSIONS BEFORE THE ASSESSING OFFICER IN RE- ASSESSMENT PROCEEDINGS WITHOUT CHALLENGING THE VALI DITY OF THE NOTICE. ON THE OTHER HAND, LD. AUTHORIZED REPR ESENTATIVE SUPPORTED THE ORDER OF CIT(A). 2.3 IN APPELLATE PROCEEDINGS, AFFIDAVIT WAS FILED A LONG WITH LETTER DATED 10.03.2011 INTER ALIA STATING THAT NO NOTICE DATED 20.04.2001 ISSUED U/S. 148 OF THE ACT AS ALLEGED IN THE ASSESSMENT ORDER PASSED U/S. 143(3) R.W.S. 147 OF T HE ACT FOR A.Y. 1998-99 HAS EVER BEEN SERVED UPON DEPONENT, SH RI SURENDRA R. SHAH. FOR THE SAID REASON, THE ASSESSME NT ORDER PASSED U/S. 143(3) R.W.S. 147 OF THE ACT FOR A.Y.19 98-99 WAS ALLEGED TO BE WITHOUT JURISDICTION, INVALID AND VOI D AB INITIO. THE COPY OF THE SAID LETTER DATED 10.03.2011 WITH T HE COPY OF AFFIDAVIT WAS MARKED BY ASSESSEE TO CONCERNED ITO. IN SPITE OF SPECIFIC ORDER OF CIT(A), NO CASE RECORDS WERE S ENT. SUBSEQUENTLY, VIDE LETTER DATED 29.01.2013 ADDRESSE D TO ITO WITH A COPY TO ADDL. CIT DULY RECEIVED IN THEIR OFF ICES ON 18.02.2013. ASSESSING OFFICER WAS REQUIRED TO SEND THE REPORT REGARDING SERVICE OF NOTICE U/S. 148 OF THE ACT ALONGWITH EVIDENCE THEREOF BY RETURN OF POST. IT WA S ALSO DESIRED THAT THE REPORT BE SENT THROUGH ADDL. CIT 1 6(1), ITA NO.5192/MUM/13 A.Y. 98-99 [ITO VS. SHRI SURENDRA R. SHAH] PAGE 4 MUMBAI. HOWEVER, NO REPORT HAS BEEN RECEIVED IN THI S REGARD TILL RELEVANT POINT OF TIME. THE STAND OF ASSESSEE HAS BEEN TAKEN A SPECIFIC GROUND BEFORE THE ITAT THAT NOTICE U/S. 148 OF THE ACT FOR RE-OPENING THE ASSESSMENT WAS NEVER SERVED ON THE ASSESSEE. WHILE RESTORING THE ISSUE TO CIT(A) R EQUIRED TO FIND OUT WHETHER ANY NOTICE U/S. 148 OF THE ACT WAS SERVED OR NOT. CIT(A) REQUIRED THE CONCERNED ASSESSING OFFIC ER TO SEND THE CASE RECORDS FOR PERUSAL. HOWEVER, NO CASE RECO RDS WERE SENT. SUBSEQUENTLY, LETTER WAS WRITTEN TO THE CONCE RNED ASSESSING OFFICER, WHICH WAS ALSO NOT RESPONDED AS DISCUSSED ABOVE. UNDER THESE FACTS AND CIRCUMSTANC ES, SPECIALLY KEEPING IN MIND THE AFFIDAVIT FILED BY AS SESSEE THAT NO NOTICE HAS BEEN SERVED UPON ASSESSEE IN THE ABSE NCE OF ANY EVIDENCE PRODUCED IT CAN ONLY BE CONCLUDED THAT NOTICE U/S. 148 OF THE ACT HAS NOT BEEN SERVED. UNDER THES E CIRCUMSTANCES, WITHOUT ANY EVIDENCE THAT NOTICE U/S . 148 OF THE ACT WAS SERVED, PROCEEDINGS U/S 143(3) R.WS. 14 7 OF THE ACT WERE NOT JUSTIFIED. SINCE THE PROCEEDINGS U/S 147 OF THE ACT ARE QUASHED, CIT(A) DID NOT GO INTO THE MERITS OF THE ISSUES. FURTHER, CIT(A) OBSERVED THAT IN CASE ASSE SSING OFFICER AT ANY STAGE CAN COME THROUGH NECESSARY EVI DENCE SHOW THAT THE NOTICE U/S. 148 OF THE ACT WAS SENT T HROUGH ORDINARY POST/UPC/REGISTERED POST/THROUGH NOTICE SERVER/BY ANY OTHER MODE/MEANS ETC. THE SAME SHALL BE TREATED AS PROPER SERVICE OF THE NOTICE U/S. 148 OF THE ACT AND THE PROCEEDINGS SHALL BE RE-CALLED AND THE MATT ER DECIDED AFRESH ON MERITS AND THE ASSESSEE SHALL BE LIABLE FOR ITA NO.5192/MUM/13 A.Y. 98-99 [ITO VS. SHRI SURENDRA R. SHAH] PAGE 5 CONSEQUENCES. NOTHING NEW FACTS HAVE BEEN BROUGHT ON RECORD ON BEHALF OF REVENUE, UNDER THESE CIRCUMSTAN CES, WE ARE NOT INCLINED TO INTERFERE WITH THE FINDING OF C IT(A). SAME IS UPHELD. 3. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSE D. PRONOUNCED IN THE OPEN COURT ON THIS THE 24 TH DAY OF JUNE, 2016. SD/- SD/- ( RAJESH KUMAR ) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBE R MUMBAI: DATED 24/06/2016 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- 1. / REVENUE 2. / ASSESSEE 3. %&%'( ) / CONCERNED CIT 4. )- / CIT (A) 5.-./00'(, '( , %& / DR, ITAT, MUMBAI 6./4567 / GUARD FILE. BY ORDER / , / % , '( , %&