Guru Proteins Ltd, Ludhiana V. ACIT, Patiala

ITA 642/CHANDI/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8424 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Next Hearing Date: 10-02-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 15-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: RAKESH JAIN
• Keywords: Competent authority; Assessment record
• Section: 143(3); 147; 148; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT & MS. RANO JAIN, ACCOUNTANT MEMBER ITA NOS. 641 & 642/CHD/2015 ASSESSMENT YEARS: 2005-06 & 2006-07 M/S GURU PROTEINS LTD., VS. THE ACIT, CIRCLE, LUDHIANA PATIALA PAN NO. AAACG5320Q (APPELLANT) (RESPONDENT) APPELLANT BY : SH. RAKESH JAIN RESPONDENT BY : SH. MANJIT SINGH DATE OF HEARING : 10.02.2016 DATE OF PRONOUNCEMENT : 10.03.2016 ORDER PER H.L.KARWA, VP BOTH THESE APPEALS CONCERN TO THE SAME ASSESSEE AND THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. FIRSTLY, WE WILL TAKE UP ITA NO. 641/CHD/2015 RELATING TO AS SESSMENT YEAR 2005-06. IN THIS APPEAL, THE ASSESSEE HAS RAISED T HE FOLLOWING GROUNDS:- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) IS NOT JUSTIFIED IN UPHOLDING THE VALIDITY O F NOTICE U/S 148 AND ASSESSMENT MADE. 2. THAT THE FINDING GIVEN BY THE LD. CIT(A) THAT TRANSACTIONS ALLEGED TO HAVE BEEN MADE WITH SAGAR T RADERS, ROORKIE HAVE NOT BEEN DENIED BY THE ASSESSEE IS INC ORRECT. 2 3. THAT THE LD. CIT(A) IS NOT JUSTIFIED IN UPHOLDIN G THE ADDITION OF RS. 10,53,432/- IN VIEW OF THE DENIAL O F THE ASSESSEE REGARDING DEALING WITH THE CONCERNED PARTI ES . 4. THAT WITHOUT PREJUDICE TO ABOVE THE ASSESSEE HA VING DENIED ANY DEALING WITH THE PARTIES THE ADDITION HA S BEEN MADE WITHOUT BRINGING ANY MATERIAL ON RECORD OR CAL LING FOR THE CONCERNED PARTIES FOR EXAMINATION. 3. IN THIS CASE, THE ASSESSING OFFICER FRAMED THE A SSESSMENT U/S 144/147 OF THE ITA VIDE HIS ORDER DATED 25.3.2013. VIDE GROUND NO.1 OF THE APPEAL, THE ASSESSEE HAS CHALLENGED THE VALIDITY OF ISSUANCE OF NOTICE U/S 148 OF THE ACT AND REOPENING OF THE ASSESSMENT ORDER. THE ASSESSMENT I N THIS CASE WAS ORIGINALLY FRAMED U/S 143(3) OF THE ACT VIDE ORDER DATED 19.1 1.2007 AT NIL INCOME. THE ASSESSING OFFICER NOTED THAT AS PER INFORMATION AVA ILABLE WITH HIS OFFICE, IT CAME TO THE NOTICE THAT THE ASSESSEE HAD RECEIVED AN AMO UNT OF S 10,53,432/- ON 28.3.2005 VIDE TWO CHEQUES, THE DETAILS OF WHICH AR E GIVEN IN THE ASSESSMENT ORDER. ON VERIFICATION OF THE ASSESSMENT RECORDS OF THE ASSESSEE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAD NOT DISCLOSED THE AMOUNT OF RS. 10,53,432/- FOR TAXATION PURPOSE. ACCORDINGLY, THE ASSESSING OFFICER FORMED A BELIEF THAT THE ABOVE INCOME OF THE ASSESSEE CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT F OR THE FINANCIAL YEAR 2004-05 WITHIN THE MEANING OF SECTION 147 OF THE ACT. AFTER OBTAINING OF THE APPROVAL OF THE COMPETENT AUTHORITY I.E. THE CIT CONCERN, THE A SSESSING OFFICER ISSUED NOTICE U/S 148 OF THE ACT ON 6.6.2011. IN RESPONSE TO TH E NOTICE U/S 148 OF THE ACT, THE ASSESSEE SUBMITTED ITS REPLY ON 12.6.2011, WHICH RE ADS AS UNDER:- KINDLY REFER TO YOUR NOTICE DATED 6.6.2011 ON THE ABOVE SUBJECT. IN THIS CONNECTION IT MAY BE SUBMITTED THA T THE ASSESSMENT IN THIS CASE WAS MADE U/S 143(3) OF THE I.T. ACT, 1961 IN WHICH THE MATERIAL NECESSARY FOR THE ASSESS MENT WAS DISCLOSED. AS PER THE PROVISO TO SECTION 147, THE PROCEEDINGS IN THIS CASE COULD BE REOPENED ONLY WITHIN FOUR YEA RS FROM THE 3 END OF THE ASSESSMENT YEAR IN WHICH THE INCOME WAS ASSESSABLE. A VALID NOTICE COULD, THERE BE ISSUED U PON 31.10.2010. THE ABOVE NOTICE IS, THEREFORE, BARRED BY LIMITATION. IT IS THEREFORE, REQUESTED THAT THE PRO CEEDINGS MAY KINDLY BE FILED. WITHOUT PREJUDICE TO ABOVE SINCE THE ENTIRE MATERIA L NECESSARY FOR THE ASSESSMENT WAS PLACED ON RECORD T HERE CANNOT BE A CASE OF REASSESSMENT. HOWEVER, TO FILE FURTHER LEGAL OBJECTIONS, A COPY OF THE REASONS RECORDED FO R REOPENING OF THE ASSESSMENT MAY KINDLY BE SUPPLIED, THE RETURN OF INCOME IN RESPONSE TO NOTICE U/S 148, IS BEING FILED UNDER PROTEST. 4. THEREAFTER, THE ASSESSING OFFICER ISSUED NOTICE U/S 143(2) DATED 11.2.2013 OF THE ACT. THERE WAS NO COMPLIANCE TO THE SAID NOT ICE AND NOTICE U/S 143(2) DATED 21.03.2013 WAS AFFIXED AT THE BUSINESS PREMIS ES OF THE ASSESSEE. IN RESPONSE TO THE SAID NOTICE, THE ASSESSEE SUBMITTED ITS REPLY DATED 20.3.2013 TO THE ASSESSING OFFICER. IN THE SAID LETTER THE ASSES SEE HAS CATEGORICALLY STATED THAT THE REASONS RECORDED FOR REOPENING OF THE CASE WERE NOT SUPPLIED TO IT. IN THIS REGARD, THE ASSESSING OFFICER NOTED THAT THE REASON S RECORDED U/S 147 OF THE ACT FOR REOPENING THE CASE WAS SENT BY REGISTERED POST TO THE ASSESSEE ON 28.2.2013 BUT THE SAME WAS RECEIVED BACK UNDELIVERED. THE ASS ESSING OFFICER COMPLETED THE ASSESSMENT EX-PARTE QUA THE ASSESSEE AND MADE THE ADDITION OF RS. 10,53,432/- U/S 68 OF THE ACT. 5. ON APPEAL, THE CIT(A) UPHELD THE ORDER OF THE AS SESSING OFFICER AND, HENCE, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNA L. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS. SHRI RAKES H JAIN, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN THE INSTANT CASE, TH E ASSESSEE REQUESTED THE 4 ASSESSING OFFICER FOR SUPPLY OF REASONS RECORDED FOR REOPENING OF THE ASSESSMENT VIDE ITS LETTER DATED 12.6.20011, BUT TH E ASSESSING OFFICER DID NOT SUPPLY THE SAME. HE FURTHER POINTED OUT THAT THE A SSESSING OFFICER HAS NOTED AT PAGE 4 OF THE ASSESSMENT ORDER THAT THE REASONS RE CORDED U/S 147 OF THE ACT FOR REOPENING OF CASE HAS BEEN SUPPLIED AND THE SAME WA S SENT BY REGISTERED POST TO THE ASSESSEE ON 28.2.2013, BUT THE SAME WAS REVIVED BACK UNDELIVERED. SHRI RAKESH JAIN LD. COUNSEL FOR THE ASSESSEE FURTHER SU BMITTED THAT THE LD. CIT(A) HAS ADMITTED THIS FACT THAT THE REASONS RECORDED BY THE ASSESSING OFFICER FOR REOPENING OF CASE WAS NEVER RECEIVED BY THE ASSESS EE. SHRI RAKESH JAINL, LD. COUNSEL FOR THE ASSESSEE RELIED ON THE JUDGEMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF G.K.N. DRIVESHAFTS VS ITO & ORS. (20 03) 259 ITR 19 (SC) AND SUBMITTED THAT IN THIS CASE THE ASSESSING OFFICER H AS ISSUED A NOTICE U/S 148 OF THE ACT TO THE ASSESSEE AND IN RESPONSE TO THE SAID NOTICE, THE ASSESSEE REQUESTED THE ASSESSING OFFICER THAT THE RETURN ALREADY FILED U/S 139 OF THE ACT MAY BE TREATED AS HAVING BEEN FILED IN RESPONSE TO THE NOT ICE DATED 6.6.2011 ISSUED U/S 148 OF THE ACT. THE ASSESSEE VIDE LETTER DATED 12.6 .2011 AND 20/25-3-2013 REQUESTED THE ASSESSING OFFICER FOR SUPPLY OF THE R EASONS RECORDED IN ORDER TO FILE OBJECTIONS TO REOPENING. IT APPEARS THAT THE REQUEST MADE TO THE ASSESSING OFFICER FOR SUPPLY OF THE REASONS RECORDED HAS NOT BEEN EXCEEDED TO. HOWEVER, THE ASSESSING OFFICER NOTED THAT THE REASONS RECORD ED WERE SUPPLIED BY REGISTERED POST TO THE ASSESSEE ON 28.2.2013, BUT T HE SAME WAS RECEIVED BACK UNDELIVERED. THUS, IT IS CLEAR THAT REASONS RECORDE D FOR REOPENING OF THE ASSESSMENT WAS NEVER RECEIVED BY THE ASSESSEE. IN V IEW OF THE ABOVE JUDGEMENT OF THE HON'BLE SUPREME COURT, WE DIRECT THE ASSESSI NG OFFICER TO SUPPLY THE COPY OF REASONS RECORDED FOR RE-OPENING OF THE ASSE SSMENT WITHIN REASONABLE TIME. ON RECEIPT OF THE REASONS, THE ASSESSEE IS EN TITLED TO FILE OBJECTIONS TO ISSUANCE OF NOTICE AND, THEREAFTER THE ASSESSING O FFICER IS BOUND TO DISPOSE OFF THE SAME BY PASSING A SPEAKING ORDER. IN VIEW OF TH E DECISION OF THE HON'BLE SUPREME COURT IN THE G.K.N. DRIVESHAFTS VS ITO & O RS. (SUPRA) REFERRED TO 5 ABOVE, WE SET ASIDE THE IMPUGNED ORDER IN TOTO AND REMAND THE MATTER TO THE ASSESSING OFFICER WITH A DIRECTION TO COMPLY WITH A BOVE OBSERVATIONS. IT IS MADE CLEAR THAT ON RECEIPT OF REASONS, THE NOTICEE / ASSESSEE WILL BE ENTITLED TO FILE OBJECTIONS TO ISSUANCE OF NOTICE AND THE ASSES SING OFFICER IS DIRECTED TO DISPOSE OF THE SAME BY PASSING A SPEAKING ORDER. WE MAY ALSO DIRECT THE ASSESSING OFFICER TO PASS A FRESH ASSESSMENT ORDER IN ACCORDANCE WITH LAW AFTER HEARING THE ASSESSEE. 7. FOR STATISTICAL PURPOSES, THE APPEAL IS ALLOWED. ITA NO. 642/CHD/2015 8. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOLL OWING GROUNDS:- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) IS NOT JUSTIFIED IN UPHOLDING THE VALIDITY O F NOTICE U/S 148 AND ASSESSMENT MADE. 2. THAT THE FINDING GIVEN BY THE LD. CIT(A) THAT TRANSACTIONS ALLEGED TO HAVE BEEN MADE WITH SAGAR T RADERS, ROORKIE HAVE NOT BEEN DENIED BY THE ASSESSEE IS INC ORRECT. 3. THAT THE LD. CIT(A) IS NOT JUSTIFIED IN UPHOLDIN G THE ADDITION OF RS. 48,68,042/- IN VIEW OF THE DENIAL O F THE ASSESSEE REGARDING DEALING WITH THE CONCERNED PARTI ES . 4. THAT WITHOUT PREJUDICE TO ABOVE THE ASSESSEE HA VING DENIED ANY DEALING WITH THE PARTIES THE ADDITION HA S BEEN MADE WITHOUT BRINGING ANY MATERIAL ON RECORD OR CAL LING FOR THE CONCERNED PARTIES FOR EXAMINATION. 9. THE ISSUE INVOLVED IN THIS APPEAL IS ALSO SIMILA R TO THAT IN ITA NO. 641/CHD/2015. THE DECISION GIVEN IN ITA NO. 641/CH D/2015 SHALL ALSO APPLY TO THIS APPEAL WITH EQUAL FORCE. FOR THE DETAILED REA SONS GIVEN THEREIN, WE ALLOW THIS APPEAL FOR STATISTICAL PURPOSES. 6 10. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIS TICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10.03.2016 SD/- SD/- (RANO JAIN) (H.L.KARWA) ACCOUNTANT MEMBER VICE PRESIDENT DATED : 10 TH MARCH, 2016 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 7