DCIT 3(3)(1), MUMBAI V. RALLIS INDIA LTD, MUMBAI

ITA 6447/MUM/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3230 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2011-2012
• Appeal Filed On: 02-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D G PANSARI
• Assessee Lawyers: H J AMSHEDJ I
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI AMARJIT SINGH, JM ITA NO. 6447 /MUM/ 2017 (ASSESSMENT YEAR: 2011 - 12 ) DY. CIT - 3(3)(1) ROOM NO. 609, 6 TH FLOOR, AAYAKAR BHAVAN, M. K. ROAD, MUMBAI - 400 020 VS. M/S. RALLIS INDIA LTD. 156/157, 15 TH FLOOR, NARIMAN BHAVAN, NARIMAN POINT, MUMBAI - 400 021 PAN/GIR NO. AABCR 2657 N ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : SHRI D. G. PANSARI RESPONDENT BY : SHRI H. JAMSHEDJI DATE OF HEARING : 06.02.2019 DATE OF PRONOUNCEMENT : 27.02 .2019 O R D E R PER SHAMIM YAHYA, A. M.: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX - 8, MUMBAI (LD.CIT FOR SHORT) DATED 21.08.2017 AND PERTAINS TO THE ASSESSMENT YEAR (A.Y.) 2011 - 12. 2. THE GROUND OF APPEAL READ AS UNDER: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ORDER U/S. 143(3) R.W.S. 263 OF THE ACT STATING THAT THE REVISION ORDER U/S. 263 W HICH IS A BASIS FOR ORDER U/S. 143(3) R.W.S. 263 O THE ACT HAS BEEN CANCELLED BY THE HONBLE ITAT VIDE ITS ORDER DATED 13.04.2017 AND THAT THE ORDER HAS NO LEGS TO STAND AND THEREFORE, THE ADJUDICATION OF THE GROUNDS RAISED BY THE ASSESSEE BECOMES ACADEMIC EXERCISE? 3. IN THE PRESENT CASE, THE ASSESSMENT WAS FRAMED PURSUANT TO THE ORDER U/S. 263 OF THE ACT. THE SAID ORDER OF THE LD. CIT U/S. 263 HAS BEEN QUASHED BY THE ITAT. HENCE, IN THE PRESENT CASE, THE LD. CIT HAS SET ASIDE THE ASSESSMENT ORDER ON THE BASIS THAT SINCE THE 2 ITA NO. 6447/MUM/2017 ORDER U/S. 263 OF THE ACT HAS BEEN QUASHED, THIS ASSESSMENT HAS NO BEEN BASIS TO STAND. THE ORDER OF THE LD. CIT IS AS UNDER: THE ORIGINAL ASSESSMENT WAS COMPLETED U/S 143(3) VIDE ORDER DATED 31 ST JANUARY, 2014 (PG. NO. 6 - 11 OF THE CO MPILATION) IN WHICH CERTAIN DISALLOWANCES WERE MADE BY THE ASSESSING OFFICER. AN ORDER U/S 263 WAS THEREAFTER PASSED ON 29 TH MARCH, 2016, WHEREIN THE PRINCIPAL COMMISSIONER OF INCOME TAX HAD DIRECTED THE ASSESSING OFFICER TO MAKE A FRESH ASSESSMENT AFTER E XAMINING THE TAXABILITY AND TREATMENT TO BE GIVEN TO THE AMOUNT RECEIVED BY THE ASSESSEE FROM KUREHA CORPORATION. THE CURRENT APPEAL IS AGAINST THE ORDER U/S 143(3) R.W.S. 263 PASSED ON 30 TH DECEMBER, 2016, WHEREIN THE ASSESSING OFFICER HAD TAXED THE ENTIR E AMOUNT RECEIVED BY THE ASSESSEE COMPANY FROM KUREHA CORPORATION. THE ASSESSEE COMPANY HAD FILED AN APPEAL AGAINST THE ORDER PASSED U/S 263 TO THE TRIBUNAL (I.T.A. NO. 3564/MUM/2016). THE HON. TRIBUNAL HAS ALLOWED THE APPEAL OF THE ASSESSEE COMPANY CANCEL LING THE REVISION ORDER U/S 263 AND HELD IN PARAGRAPH 11 OF ITS ORDER DATED 13 TH APRIL, 2017 (PG. NO. 60 - 79 OF THE COMPILATION), AS UNDER: '11. MOREOVER, A PERUSAL OF THE IMPUGNED ORDER OF THE PCIT WOULD DEMONSTRATE THAT, THOUGH, HE HAS HELD THE ASSESSMENT ORDER TO BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVENUE, IN THE ABSENCE OF PROPER ENQUIRY REGARDING THE NATURE AND CHARACTER OF SUBSIDY RECEIVED, HOWEVER, ULTIMATELY HE HIMSELF HAS NOT GIVEN ANY FINDING WITH REGARD TO THE NATURE AND CH ARACTER OF SUBSIDY RECEIVED BY THE ASSESSEE AND LEFT THE ISSUE OPEN FOR DECISION OF THE ASSESSING OFFICER. IN OUR VIEW, THE DIRECTION OF THE REVISIONAL AUTHORITY TO START A FRESH ENQUIRY IS IN THE NATURE OF ROVING AND FISHING ENQUIRY WITHOUT HAVING ANY SPE CIFIC MATERIAL BEFORE HIM. THOUGH, THE REVISIONAL AUTHORITY HAS ALLEGED THAT THE ASSESSING OFFICER FAILED TO MAKE ANY ENQUIRY, NEITHER HE HIMSELF HAS MADE ANY ENQUIRY ON THE BASIS OF MATERIAL ON RECORD TO POINT OUT THE SPECIFIC ERROR COMMITTED BY THE ASSES SING OFFICER NOR HAS MENTIONED THE NATURE OF ENQUIRY TO BE CONDUCTED BY THE ASSESSING OFFICER AND WHAT MORE DOCUMENTS AND DETAILS ARE REQUIRED TO BE CALLED FOR CONSIDERING THE FACT THAT ALL DOCUMENTS AND DETAILS RELATING TO SUBSIDY ARE ALREADY AVAILABLE ON RECORD. THEREFORE, ON OVER ALL CONSIDERATION OF FACTS AND CIRCUMSTANCES OF THIS CASE AND PREJUDICIAL TO THE INTERESTS OF REVENUE HENCE, PCIT WAS UNJUSTIFIED IN EXERCISING POWER UNDER SECT/ON 263 FOR REVISING THE ASSESSMENT ORDER. ACCORDINGLY, WE SET ASI DE THE IMPUGNED ORDER PASSED BY THE PCIT UNDER SECTION 263 OF THE ACT AND RESTORE THE ASSESSMENT ORDER.' AS REGARDS THE ABOVE MENTIONED GROUNDS, WHICH PERTAIN TO THE ERRONEOUS ADDITION OF THE AMOUNT RECEIVED FROM KUREHA CORPORATION, THE APPELLANT RESPECT FULLY SUBMITS THAT SINCE, THE TRIBUNAL VIDE ITS ORDER DATED 13 TH APRIL, HAS QUASHED THE REVISION ORDER OF THE PRINCIPAL COMMISSIONER U/S 263. DATED 29 TH MARCH, 2016 (PG. NOS. 60 - 79 OF THE COMPILATION), THE ORDER OF THE ASSESSING OFFICER PASSED U/S 143(3) R .W.S. 263 HAS NO BASIS TO SURVIVE AND MUST BE CANCELLED . 4. AGAINST THE ABOVE ORDER, THE REVENUE IS IN APPEAL BEFORE US. 5. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. AS ADMITTED ABOVE, THE ASSESSMENT ORDER HAS BEEN PASSED PURSUANT TO THE ORDER U/S. 263 BY THE LD. C IT. THIS ORDER 3 ITA NO. 6447/MUM/2017 U/S. 263 HAS BEEN QUASHED BY THE ITAT. IT IS NOT THE CASE THAT THE HON'BLE JURISDICTIONAL HIGH COURT HAS REVERSED THE ORDER OF THE ITAT. IN THESE CIRCUMSTANCES, WE DO NOT FIN D ANY INFIRMITY IN THE ORDER OF THE LD. C IT HOLDING THAT THE ASSESSMENT ORDER PASSED PURSUANT TO AN ORDER U/S. 263 OF THE ACT WHICH ITSELF HAS BEEN QUASHED HAS NO BASIS TO STAND. 6. IN THE RESULT, THIS APPEAL BY THE REVENUE STANDS DISMISSED. O RDER PRONOUNCED IN THE OPEN COURT ON 2 7 . 0 2 . 2 0 1 9 S D / - S D / - ( AMARJIT SINGH ) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 2 7 . 0 2 . 2 0 1 9 ROSHANI , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI