STERLITE OPPORTUNITIES & VENTURES LTD, MUMBAI V. DCIT RG 8(3), MUMBAI

ITA 656/MUM/2009

• Counselvise Citation: 65619914 RSA 2009
• Duration Of Justice: 2 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 30-03-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 02-02-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: HEMANT LAL
• Assessee Lawyers: B V JHAVERI
• Keywords: Wrong claim; Revised return
• Section: 143(3); 142(1); 139(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E, MUMBAI BEFORE SHRI P.M.JAGTAP, ACCOUNTANT MEMBER & SMT. ASHA VIJAYRAGHAVAN, JUDICIAL MEMBER. I.T.A. NO. 656/MUM/2009. ASSESS MENT YEAR : 2005-06. STERLITE OPPORTUNITIES & DY. COMMISSIONER OF INCOME-TAX, VENTURES LTD., VS. RANGE-8(3), MUMBAI. VEDANTA, 75, NEHRU ROAD, VILE PARLE (EAST), MUMBAI 400 099. PAN AAGCS9427A APPELLANT. RESPONDENT. APPELLANT BY : SHR I B.V. JHAVERI. RESPONDENT BY : SHRI HEMANT LAL. O R D E R PER P.M. JAGTAP, A.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE LEARNED CIT(APPEALS)-XXIX, MUMBAI DATED 26-11-2008. 2. THE ASSESSEE IN THE PRESENT CASE IS A NON BANKIN G FINANCIAL COMPANY WHICH FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSI DERATION ORIGINALLY ON 29 TH OCT., 2005 DECLARING A TOTAL LOSS OF RS.20,64,18,320/-. T HE SAID RETURN WAS INITIALLY PROCESSED AND ACCEPTED BY THE AO U/S 143(1) ON 12-7 -2006. SUBSEQUENTLY THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND A NOT ICE U/S 143(2) WAS ISSUED BY THE AO ON 23-10-2006. AFTER RECEIPT OF THE SAID NOTICE, THE ASSESSEE FILED A REVISED RETURN OF INCOME ON 13-02-2007 WITHDRAWING ITS CLAI M FOR LOSS OF 2 ITA NO. 656/MUM/2009 ASSTT. YEAR : 2005-06. RS.20,64,18,320/- AND DECLARING ITS TOTAL INCOME AT NIL. IN THE ASSESSMENT COMPLETED U/S 143(3) VIDE AN ORDER DATED 15-11-2007 , TOTAL INCOME OF THE ASSESSEE WAS COMPUTED BY THE AO AT NIL AS DECLARED IN THE RE VISED RETURN. HE, HOWEVER, HELD IN THE SAID ASSESSMENT THAT THE DISCLOSURE MAD E BY THE ASSESSEE BY WITHDRAWING ITS CLAIM OF LOSS IN THE REVISED RETURN COULD NOT BE TREATED AS VOLUNTARY. 3. AGAINST THE ORDER PASSED BY THE AO U/S 143(3), A N APPEAL WAS PREFERRED BY THE ASSESSEE BEFORE THE LEARNED CIT(APPEALS) CHALLE NGING THE VALIDITY OF THE SAID ASSESSMENT ON THE GROUND THAT IT WAS MADE WITHOUT I SSUING A FRESH NOTICE U/S 143(2) AFTER FILING OF REVISED RETURN BY THE ASSESSEE. THE LEARNED CIT(APPEALS) DID NOT FIND MERIT IN THIS STAND TAKEN BY THE ASSESSEE OBSERVING THAT THERE WAS NO REQUIREMENT IN LAW TO ISSUE A FRESH NOTICE U/S 143(2) AFTER FILING OF THE REVISED RETURN BY THE ASSESSEE. THE LEARNED CIT(APPEALS) ALSO DID NOT FIN D MERIT IN THE SUBMISSIONS MADE ON BEHALF OF THE ASSESSEE ON THE OTHER ISSUE C HALLENGING THE ORDER OF THE AO HOLDING THAT THE REVISED RETURN FILED BY IT WAS NOT VOLUNTARY. HE HELD THAT THE REVISED RETURN HAVING BEEN FILED BY THE ASSESSEE ON LY AFTER RECEIPT OF NOTICE U/S 143(2), THE AO WAS CORRECT IN HOLDING THAT THE SAID RETURN WAS FILED AS AN AFTER THOUGHT AND IT WAS NOT VOLUNTARY. AGGRIEVED BY THE ORDER OF THE LEARNED CIT(APPEALS), THE ASSESSEE HAS PREFERRED THIS APPEA L BEFORE THE TRIBUNAL ON THE FOLLOWING GROUNDS : 1. FOR THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN HOLDING THAT THERE WAS NO REQUIREMENT TO ISSUE A FRESH NOTICE U/S 143(2) OF THE ACT, IN PURSUANCE TO A REVISED RETURN AND SUCH FINDING OF LD. CIT(A) IS ARBITRARY, UNJUSTIFIED, UNWARRANTED AND ILLEGAL. 2. FOR THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT(A) ERRED IN HOLDING THE REVISED RETURN FILED BY THE APPELLANT W AS NOT VOLUNTARY AND SUCH FINDING IS ARBITRARY, UNJUSTIFIED, UNWARRANTED AND ILLEGAL. 3 ITA NO. 656/MUM/2009 ASSTT. YEAR : 2005-06. 4. WE HAVE HEARD ARGUMENTS OF BOTH THE SIDES AND AL SO PERUSED THE RELEVANT MATERIAL ON RECORD. AS REGARDS THE ISSUE RAISED IN GROUND NO. 1, WE FIND OURSELVES IN AGREEMENT WITH THE LEARNED CIT(APPEALS) THAT THE RE IS NO REQUIREMENT IN LAW FOR ISSUANCE OF A FRESH NOTICE U/S 143(2) AFTER THE FIL ING OF REVISED RETURN BY THE ASSESSEE U/S 139(5). EVEN THE LEARNED COUNSEL FOR T HE ASSESSEE HAS NOT BEEN ABLE TO RELY ON ANY SUCH SPECIFIC PROVISION CONTAINED IN TH E INCOME-TAX ACT, 1961 WHICH REQUIRES THE AO TO ISSUE A FRESH NOTICE U/S 143(2) AFTER THE FILING OF REVISED RETURN BY THE ASSESSEE. ONCE THE REGULAR ASSESSMENT PROCEE DINGS ARE ALREADY INITIATED BY THE AO BY ISSUING NOTICE U/S 143(2), THE COGNIZANCE OF THE REVISED RETURN, IF ANY, FILED BY THE ASSESSEE U/S 139(5) CAN BE TAKEN BY TH E AO WHILE COMPLETING THE SAID PROCEEDINGS AND IN OUR OPINION, THERE IS NO PROVISI ON CONTAINED IN THE INCOME-TAX ACT, 1961 WHICH REQUIRES THE AO TO ISSUE A FRESH NO TICE U/S 143(2) AFTER THE FILING OF REVISED RETURN BY THE ASSESSEE. WE, THEREFORE, F IND NO MERIT IN GROUND NO.1 RAISED BY THE ASSESSEE IN THIS APPEAL AND DISMISS T HE SAME. 5. AS REGARDS THE ISSUE RAISED IN GROUND NO.2, WE A RE OF THE OPINION THAT WHAT IS RELEVANT FOR THE PURPOSE OF MAKING ASSESSMENT U/S 1 43(3) IS TO ASCERTAIN WHETHER THE REVISED RETURN FILED BY THE ASSESSEE U/S 139(5) IS VALID OR NOT AND IT IS NOT RELEVANT FOR THE PURPOSE OF ASSESSMENT TO DECIDE WH ETHER THE SAID REVISED RETURN IS VOLUNTARY OR NOT. WE, THEREFORE, FIND THE DECISION RENDERED BY THE AO AND AFFIRMED BY THE LEARNED CIT(APPEALS) HOLDING THE REVISED RET URN FILED BY THE ASSESSEE TO BE NOT VOLUNTARY OUT OF CONTEXT FOR THE PURPOSE OF ASS ESSMENT. THE RELEVANT OBSERVATIONS RECORDED BY THEM IN THIS CONTEXT ARE, THEREFORE, DELETED. 6. AS REGARDS THE VALIDITY OF THE REVISED RETURN FI LED BY THE ASSESSEE, WE ARE OF THE VIEW THAT AS PER THE PROVISIONS OF SECTION 139( 5), THE FOLLOWING CONDITIONS ARE REQUIRED TO BE SATISFIED IN ORDER TO ENABLE AN ASSE SSEE TO FURNISH A VALID REVISED RETURN : 4 ITA NO. 656/MUM/2009 ASSTT. YEAR : 2005-06. I) THE ORIGINAL RETURN MUST HAVE BEEN FURNISHED U/S 139(1) OR IN PURSUANCE OF A NOTICE ISSUED U/S 142(1) AND II) THE ASSESSEE DISCOVERS ANY OMISSION OR ANY WRON G STATEMENT MADE THEREIN. 7. IN THE PRESENT CASE, BOTH THE CONDITIONS WERE SA TISFIED INASMUCH AS THE ORIGINAL RETURN WAS FILED BY THE ASSESSEE U/S 139(1 ) AND THE WRONG STATEMENT MADE THEREIN BY CLAIMING THE LOSS WAS STATED TO BE DISCO VERED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS WITHOUT THERE BEIN G ANY POSITIVE DETECTION OF SUCH A WRONG CLAIM BY THE AO. AS RIGHTLY SUBMITTED BY THE LEARNED COUNSEL FOR THE ASSESSEE IN THIS REGARD, THERE IS NOTHING EITHER IN THE ORDER OF THE AO OR EVEN IN THE ORDER OF THE LEARNED CIT(APPEALS) TO SHOW THAT THE WRONG CLAIM OF LOSS MADE BY THE ASSESSEE WAS DETECTED BY THE AO AND ONLY AFTER SUCH DETECTION, REVISED RETURN WAS FILED BY THE ASSESSEE WITHDRAWING ITS CLAIM. AT THE TIME OF HEARING BEFORE US, THE LEARNED DR HAS NOT BEEN ABLE TO SHOW THAT THERE WAS ANY SUCH DETECTION BY THE AO. AS SUCH, CONSIDERING ALL THE FACTS OF THE CASE AS WELL AS THE MATERIAL AVAILABLE ON RECORD, WE HOLD THAT THE REVISED RETURN FILED BY THE ASSESSEE WAS IN ACCORDANCE WITH THE PROVISIONS OF SECTION 139(5). GROUND NO.2 OF THE ASSESSEES APPEAL IS ACCORDINGLY ALLOWED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. ORDER PRONOUNCED ON THIS 27 TH DAY OF MAY, 2011. SD/- SD/- (ASHA VIJAYRAGHAVAN) (P.M. JAG TAP) JUDICIAL MEMBER ACCO UNTANT MEMBER MUMBAI, DATED: 27 TH MAY, 2011. WAKODE 5 ITA NO. 656/MUM/2009 ASSTT. YEAR : 2005-06. COPY TO : 1. APPELLANT 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR, E-BENCH. (TRUE COPY) BY ORD ER ASSTT. R EGISTRAR, ITAT, MUMBAI BEN CHES, MUMBA I.