Asstt. Commissioner of Income Tax, Kanpur V. M/s Alliance Builders & Contractors Ltd., Kanpur

ITA 668/LKW/2013

• Counselvise Citation: 66823714 RSA 2013
• Duration Of Justice: 1 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 11-02-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 09-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K DEY
• Keywords: Reopening of assessment; Competent authority
• Section: 143(3); 80IB; 147; 148; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI. A. K. GARODIA, ACCOUNTANT MEMBER ITA NOS. 668 & 669/LKW/2013 ASSESSMENT YEAR:2004-05 & 2005-06 ACIT CENTRAL CIRCLE II KANPUR V. M/S ALLIANCE BUILDERS & CONTRACTORS LTD., 24/4, THE MALL, KANPUR TAN/PAN:AAECA8217A (APPELLANT) (RESPONDENT) C.O. NOS. 43 & 44/LKW/2013) [ARISING OUT OF ITA NO.668 & 669/LKW/2013] ASSESSMENT YEAR:2004-05 & 2005-06 M/S ALLIANCE BUILDERS & CONTRACTORS LTD., 24/4, THE MALL, KANPUR V. ACIT CENTRAL CIRCLE II KANPUR TAN/PAN:AAECA8217A CROSS-OBJECTOR) (RESPONDENT) DEPARTMENT BY: SHRI. P. K. DEY, D.R. ASSESSEE BY: NONE DATE OF HEARING: 11 02 2015 DATE OF PRONOUNCEMENT: 03 2015 O R D E R PER SUNIL KUMAR YADAV: THESE APPEALS ARE PREFERRED BY THE REVENUE AGAINST THE RESPECTIVE ORDER OF THE LD. CIT(A) ON COMMON GROUNDS. 2. THE ASSESSEE HAS ALSO FILED CROSS OBJECTIONS IN SUPPORT OF THE ORDERS OF THE LD. CIT(A). :- 2 -: 3. IN THE REVENUES APPEALS, COMMON GROUNDS ARE RAISED BY THE REVENUE ASSAILING THE ORDERS OF THE LD. CIT(A) PERTAINING TO ASSESSMENT YEARS 2004-05 & 2005-06. THE COMMON GROUNDS RAISED BY THE REVENUE ARE AS UNDER:- 1. THAT LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE VERY REOPENING IS HELD TO BE INVALID AND ILLEGAL WITHOUT APPRECIATING THE FACT THAT PROCEEDING U/S 147 WAS INITIATED AFTER ISSUING LEGAL NOTICE U/S 148 ON THE BASIS OF REASONS RECORDED AND AFTER HAVING TAKEN APPROVAL FROM LD. CIT(C), KANPUR. 2. THAT LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN OBSERVING THAT ANY ASSESSMENT ORDER MADE PURSUANT TO AN INVALID/ILLEGAL REOPENING CANNOT BE SUSTAINED AND IS, THEREFORE, ANNULLED IGNORING THE FACT THAT AO, AFTER HAVING NOTICED DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR A.Y. 2008-09 THE ASSESSEE'S FAILURE TO DISCLOSE FULLY AND TRULY ALL THE MATERIAL FACTS NECESSARY FOR ASSESSMENT WITH REGARD TO OBTAINING AND FILING THE COMPLETION CERTIFICATE AS STIPULATED IN EXPLANATION APPENDED TO SUB-SEC (10) OF SEC. 80IB, RE-OPENED THE CASE. 3. THAT LD. CIT (A) IS NOT JUSTIFIED IN ALLOWING THE APPEAL OF THE ASSESSEE ON RELYING THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN AERONAUTICS LTD. VS CIT (243ITR 808) IGNORING THAT THE FACTS AND CIRCUMSTANCES OF THE INSTANT CASE WHICH ARE TOTALLY DIFFERENT WITH THAT OF RELIED CASE. 4. THAT LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN RELYING ON THE DECISION OF THE CASE OF HINDUSTAN AERONAUTICS LTD. VS CIT (243ITR 808), WHICH RELATES TO ASSESSMENT YEAR 1970-71 WHEREAS THE I.T. ACT HAS BEEN AMENDED (W.R.T. SECTION 263, 264 OF THE ACT) BY FINANCE ACT 1988 W.E.F. 01/06/1988 PROVIDING FOR PARTIAL MERGERS ONLY OF SUCH ORDERS. 5. THAT THE ORDER OF THE LD. CIT (A) BEING ERRONEOUS IN LAW AND ON FACTS WHICH NEEDS TO BE VACATED AND THE ORDER OF THE A.O. :- 3 -: BE RESTORED. 4. THE FACTS IN BRIEF ARE THAT THE ORIGINAL ASSESSMENT WAS FRAMED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER CALLED IN SHORT THE ACT') ALLOWING THE CLAIM OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT. LATER ON, THE ASSESSING OFFICER HAS REOPENED THE ASSESSMENT BY ISSUING NOTICE UNDER SECTION 148 OF THE ACT ON THE GROUND THAT THE ASSESSEE DID NOT FULFILL THE REQUISITE CONDITIONS FOR CLAIMING DEDUCTION UNDER SECTION 80- IB(10) OF THE ACT. 5. THE REOPENING OF ASSESSMENT WAS CHALLENGED BEFORE THE LD. CIT(A) IN BOTH THE ASSESSMENT YEARS AND THE LD. CIT(A) HAS HELD THE REOPENING TO BE INVALID AND ILLEGAL IN BOTH THE ASSESSMENT YEARS. THE DETAILED ORDER OF THE LD. CIT(A) WAS PASSED IN ASSESSMENT YEAR 2005-06, WHICH WAS FOLLOWED BY THE LD. CIT(A) WHILE DISPOSING OF THE APPEAL FOR ASSESSMENT YEAR 2004-05. WE, THEREFORE, PREFER TO ADJUDICATE THE APPEAL FOR ASSESSMENT YEAR 2005-06 FIRST. I.T.A. NO. 669/LKW/2013: A.Y. 2005-06: 6. THIS APPEAL CAME UP FOR HEARING ON 11.2.2015, BUT NONE APPEARED ON BEHALF OF THE ASSESSEE. AN APPLICATION FOR ADJOURNMENT WAS, HOWEVER, MOVED ON THE GROUND THAT DUE TO CERTAIN UNAVOIDABLE PERSONAL REASONS, THE COUNSEL OF THE ASSESSEE WAS UNABLE TO APPEAR. ON PERUSAL OF RECORD, IT IS NOTICED THAT THIS APPEAL WAS FILED ON 10.9.2013. THEREAFTER, IT WAS LISTED FOR HEARING FOR ABOUT FIVE TIMES. INITIALLY, THE LD. COUNSEL FOR THE ASSESSEE APPEARED AND SOUGHT ADJOURNMENT, BUT LATER ON HE STOPPED APPEARING AND ADJOURNMENT WAS SOUGHT BY SENDING LETTERS EITHER BY POST OR THROUGH SOME CLERK. EVERY TIME HEARING WAS ADJOURNED FOR THE REASON THAT ON ACCOUNT OF UNAVOIDABLE CIRCUMSTANCES THE COUNSEL FOR THE ASSESSEE COULD NOT APPEAR. DESPITE AFFORDING SUFFICIENT OPPORTUNITY TO THE ASSESSEE, NO EFFORT WAS MADE ON BEHALF OF THE ASSESSEE TO PROSECUTE ITS APPEAL. MOREOVER, IN THE :- 4 -: ADJOURNMENT APPLICATION DATED 5.2.2015, WE FIND NO VALID GROUND FOR NON- APPEARANCE OF THE COUNSEL FOR THE ASSESSEE. WE, THEREFORE, REJECT THE REQUEST FOR ADJOURNMENT AND HEARD THE APPEAL EX-PARTE QUA THE ASSESSEE. ACCORDINGLY, THE REVENUE WAS HEARD. 7. THE LD. D.R. HAS PLACED HEAVY RELIANCE UPON THE ORDER OF THE ASSESSING OFFICER WITH THE SUBMISSION THAT THE ASSESSMENT WAS REOPENED BY THE ASSESSING OFFICER HAVING FORMED A BELIEF THAT THE ASSESSEE DID NOT FULFILL THE REQUISITE CONDITIONS FOR CLAIMING DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT. THE MAIN DEFECT POINTED OUT BY THE ASSESSING OFFICER, BEFORE REOPENING THE ASSESSMENT, WAS WITH REGARD TO THE NON-OBTAINING THE APPROVAL OF THE HOUSING PROJECT FROM THE COMPETENT AUTHORITY, SIZE OF THE HOUSING PROJECT & SIZE OF THE PLOT ON WHICH HOUSING PROJECT WAS RAISED AND ALSO COMPLETION CERTIFICATE ISSUED BY THE COMPETENT AUTHORITY. IT WAS FURTHER CONTENDED BY THE LD. D.R. THAT SINCE THIS ASPECT WAS NOT EXAMINED DURING THE COURSE OF ORIGINAL ASSESSMENT WHILE ALLOWING DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT, THE REOPENING IS VALID. 8. HAVING GIVEN A THOUGHTFUL CONSIDERATION TO THE SUBMISSIONS OF THE LD. D.R. AND FROM A CAREFUL PERUSAL OF THE ORDER OF THE LD. CIT(A), WE FIND THAT THE LD. CIT(A) HAS OBSERVED IN HIS ORDER THAT THE ORIGINAL ASSESSMENT WAS FRAMED UNDER SECTION 143(3) READ WITH SECTION 147 OF THE ACT WHEREIN THE ASSESSING OFFICER DID NOT FULLY ALLOW THE CLAIM OF THE ASSESSEE UNDER SECTION 80-IB(10) OF THE ACT AND THE ASSESSEE TOOK THE MATTER WITH THE LD. CIT(A) AND THE LD. CIT(A) VIDE HIS ORDER DATED 30.3.2010 ALLOWED THE CLAIM OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT. AGAINST THIS ORDER, THE DEPARTMENT TOOK THE MATTER TO THE TRIBUNAL AND THE TRIBUNAL VIDE ITS ORDER DATED 9.9.2010 DISMISSED THE APPEAL OF THE DEPARTMENT. THEREAFTER, THE DEPARTMENT HAS FILED AN APPEAL BEFORE THE HON'BLE HIGH COURT AND THE MATTER IS STILL PENDING BEFORE THE HON'BLE HIGH COURT. THE LD. CIT(A) HAS ALSO MADE A REFERENCE TO THE PROVISO TO SECTION 147 OF THE ACT, ACCORDING TO :- 5 -: WHICH THE ASSESSING OFFICER MAY ASSESS OR REASSESS SUCH INCOME, OTHER THAN THE INCOME INVOLVING MATTERS WHICH ARE THE SUBJECT-MATTERS OF ANY APPEAL, REFERENCE OR REVISION. THEREFORE, UNDISPUTEDLY THIS IS THE SECOND TIME OF REOPENING OF ASSESSMENT ON THE ISSUE OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT. IN THE INITIAL ASSESSMENT WHEN THE MATTER HAS GONE UPTO THE TRIBUNAL ON THE ISSUE OF CLAIM OF DEDUCTION UNDER SECTION 80- IB(10) OF THE ACT, IT CANNOT BE ASSUMED THAT THE ISSUE OF REQUISITE CONDITIONS FOR CLAIMING DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT WAS NOT EXAMINED BY THE APPELLATE AUTHORITIES INCLUDING THE TRIBUNAL. THEREFORE, ONCE THE APPELLATE AUTHORITIES HAVE APPLIED THEIR MIND TO A PARTICULAR ISSUE, THE ORDER OF THE ASSESSING OFFICER WILL MERGE WITH THE ORDERS OF THE APPELLATE AUTHORITIES. WE HAVE ALSO CAREFULLY EXAMINED THE SECOND PROVISO TO SECTION 147 OF THE ACT, ACCORDING TO WHICH THE ASSESSING OFFICER CANNOT ASSESS OR RE-ASSESS SUCH INCOME WHICH IS SUBJECT MATTER OF APPEAL, REFERENCE OR REVISION. SINCE THE CLAIM OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT IS SUB-JUDICE BEFORE THE HON'BLE HIGH COURT IN THE REVENUES APPEAL, THE REOPENING OF THE SAME ISSUE IS NOT POSSIBLE. THE LD. CIT(A) HAS DISCUSSED THIS ISSUE IN DETAIL IN HIS ORDER AND FOR THE SAKE OF REFERENCE, WE EXTRACT THE RELEVANT PORTION OF THE ORDER OF THE LD. CIT(A) AS UNDER:- ACTION U/S.147 OF THE ACT HAD BEEN UNDERTAKEN BY THE AO ON THE GROUND THAT THE DEDUCTION U/S.80IB (10) HAD BEEN WRONGLY CLAIMED BY THE ASSESSEE AS THE ASSESSEE HAD FAILED TO OBTAIN AND FILE THE 'COMPLETION CERTIFICATE' AS STIPULATED IN EXPLANATION APPENDED TO SUB-SECTION (10) OF SECTION 80IB OF THE IT. ACT. AS THE FACTS OF THE CASE GO, THE INITIAL ASSESSMENT IN THIS CASE WAS FRAMED U/S.143(3)/147 OF THE ACT, WHEREIN THE AO DID NOT FULLY ALLOW THE CLAIM MADE BY THE ASSESSEE UNDER SECTION 80IB(10) OF THE ACT. THE ASSESSEE TOOK THE MATTER TO THE CIT(A). THE ID. CIT(A) PASSED AN ORDER VIDE HIS ORDER NO. CIT(A)-L/85/CC-II-KNP/09-10/201 DATED :- 6 -: 30.03.2010 WHEREIN THE CLAIM OF THE ASSESSEE UNDER SECTION 80IB(10) WAS ALLOWED. THE RELEVANT PORTION OF THE APPEAL ORDER IS AS UNDER: '6. DURING THE COURSE OF APPEAL PROCEEDING AR APPEARED AND FURNISHED COPY OF ASSESSMENT ORDER FOR A. Y. 2001-02 AS WELL AS COPY OF APPEAL ORDER FOR A. Y. 2005-06 PASSED BY THE CIT(A)-I, KANPUR VIDE ORDER DATED 11-03-2008 FROM THESE ORDER, IT IS OBSERVED THAT THE ISSUE IN QUESTION AS WELL AS THE APPELLANT PLEA FOR ALLOWANCE OF DEDUCTION U/S.80IB IN RESPECT OF ADDITION OF DISALLOWANCE MADE IN ASSESSMENT ORDER AS ALREADY BEEN DECIDED IN CIT(A) ORDER NO. CIT(A)-I/292/CC- III/KNP/07-08 VIDE PARA 10, WHICH IS AS UNDER: '10. IN THE LIGHT OF THE ABOVE, THE LEGAL POSITION WHICH EMERGES IS THAT ANY DEDUCTION UNDER CHAPTER-VIA IS TO BE MADE WITH REFERENCE TO THE INCOME INCLUDED IN THE GROSS TOTAL INCOME. THE PROVISION OF SECTION 40AB ARE VERY CLEAR, WHEREIN IT HAS BEEN LAID DOWN THAT WHERE ANY DEDUCTION IS REQUIRED TO BE MADE OR ALLOWED UNDER ANY SECTION (EXCEPT SECTION 8M) INCLUDED IN CHAPTER-VIA UNDER THE HEADING 'C-DEDUCTION IN RESPECT CERTAIN INCOMES' IN RESPECT OF ANY INCOME OF THE NATURE SPECIFIED IN THAT SECTION, WHICH IS INCLUDED IN THE GROSS TOTAL INCOME OF THE ASSESSEE, THEN, NOTWITHSTANDING ANYTHING CONTAINED IN THAT SECTION FOR THE PURPOSE OF COMPUTING ANY DEDUCTION UNDER THAT SECTION, THE AMOUNT OF INCOME OF THAT NATURE AS COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT (BEFORE MAKING ANY DEDUCTION UNDER THIS CHAPTER) SHALL ALONE BE DEEMED TO BE THE AMOUNT OF INCOME FOR THAT NATURE WHICH IS DERIVED OR RECEIVED BY THE ASSESSEE AND WHICH IS INCLUDED IN HIS GROSS TOTAL INCOME. FURTHER, THE GROSS TOTAL INCOME HAS BEEN DEFINED IN SECTION 80B(5) OF-THE I. T. ACT, AS MEANS 'THE TOTAL INCOME COMPUTED IN ACCORDANCE WITH THE- :- 7 -: PROVISIONS OF THIS ACT, BEFORE MAKING ANY DEDUCTION UNDER THIS CHAPTER'. HENCE, IN VIEW OF. PROVISIONS CONTAINED IN SECTION 40AB AND 80B(5) OF THE IT. ACT COUPLED WITH THE JUDICIAL RULINGS ON THIS POINT, I HAVE NO HESITATION IN HOLDING THAT APPELLANT IS ENTITLED FOR DEDUCTION U/S.80IB(10) OF THE I.T. ACT ON THE PROFITS OF ELIGIBLE DWELLING UNITS, WHICH IS INCLUDED IN THE GROSS TOTAL INCOME. IN OTHER WORDS, THE ADDITION/DISALLOWANCES MADE IN THE ASSESSMENT AND WHICH ARE DIRECTLY RELATED TO THE 'ELIGIBLE DWELLING UNITS' HAVE TO BE CONSIDERED AS 'PROFIT DERIVED FROM SUCH NITS, WHILE ALLOWING THE DEDUCTION U/S.80IB(10) OF THE I. T. ACT.' 7. I HAVE CONSIDERED THIS ISSUE AND FACTS AND CIRCUMSTANCES OF THE CASE. MY PREDECESSOR HAS ELABORATELY DISCUSSED THE ISSUE AND FACTS AND CIRCUMSTANCES OF THE CASE OF APPELLANT WHICH ARE SIMILAR IN. THIS YEAR, THERE IS NO REASON FOR DISAGREEING WITH THE CONCLUSION AND ORDER OF MY PREDECESSOR ON THIS ISSUE. ACCORDINGLY, GROUND NO. 2 OF APPEAL IS ALLOWED. 8. IN VIEW OF THE ABOVE, I DIRECT THE AO TO REWORK OUT THE DEDUCTION U/S.80IB(10) OF THE IT. ACT ON THE BASIS OF CIT(A) ORDER FOR A. Y. 2005-06 AND ASSESSMENT ORDER FOR A, Y. 2001- 02. 4.2 AGAINST THE ORDER OF THE LD. CIT(A), THE DEPARTMENT TOOK THE MATTER TO THE HON'BLE ITAT, WHO VIDE ORDER DATED 09.09.2010 PASSED AN ORDER DISMISSING THE DEPARTMENTAL APPEAL. THE DEPARTMENT HAS FILED AN APPEAL BEFORE HON'BLE HIGH COURT AND THE MATTER IS STILL PENDING. 4.3 DURING THE COURSE OF ORAL HEARING, THE LD. A.R. HAS INVITED MY ATTENTION TO 2ND PROVISO TO THE SECTION 147, WHICH READS AS UNDER: 'PROVIDED FURTHER THAT THE ASSESSING OFFICER MAY ASSESS OR REASSESS SUCH INCOME, OTHER THAN THE INCOME INVOLVING MATTERS WHICH ARE THE SUBJECT MATTERS OF ANY APPEAL, :- 8 -: REFERENCE OR REVISION, WHICH IS CHARGEABLE TO TAX AND HAS ESCAPED ASSESSMENT.' 4.3.1 BASED ON THIS PROVISO, THE APPELLANT HAS CHALLENGED THE SAID REOPENING BY STATING THAT THE AO COULD NOT HAVE INITIATED ACTION U/S. 147/148 AS THE INCOME SOUGHT TO BE REASSESSED HAD ALREADY BEEN THE SUBJECT MATTER OF APPEAL. IN THIS REGARD, I HAVE GONE THROUGH THE MEMORANDUM TO THE FINANCE ACT 2008 EXPLAINING THE INTRODUCTION OF THE 2ND PROVISO TO SEC.147 WHEREIN IT HAS BEEN STATED 'THAT IT HAS BEEN HELD IN A CASE WHERE AN ASSESSMENT IS MADE THE SUBJECT MATTER OF THE APPEAL, ONLY THAT PART OF THE AO'S ORDER MERGES WITH THE APPELLATE AUTHORITIES ORDER IN RESPECT OF WHICH THE APPELLATE AUTHORITY HAS EXERCISED THE APPELLATE JURISDICTION-[( CIT VS SAKSERIA COTTON MILLS LTD. 124 ITR 570 (BOMBAY)]. HENCE, THE LEGISLATURE INTENT IS CLEAR THAT IF AN INCOME HAS ESCAPED ASSESSMENT AND WHICH HAS NOT BEEN SUBJECT MATTER OF AN APPEAL, REFERENCE OR REVISION, NOTICE U/S.148 CAN BE ISSUED FOR ASSESSMENT OR REASSESSMENT OF THAT INCOME.' 4.3.2 IN THIS CASE, INCOME ON ACCOUNT OF SALE OF HOUSING UNITS [(WHICH WAS SUBJECTED TO DEDUCTION U/S 80IB (10)] WAS ALREADY DISCLOSED IN THE PROFIT & LOSS ACCOUNT OF THE ASSESSES AND IT IS NOT THE CASE OF AO THAT THERE WAS SOME MORE INCOME WHICH HAD NOT BEEN H DISPOSED BY THE ASSESSEE IN HIS BOOKS. THUS, THERE WAS NO ESCAPEMENT OF INCOME ON THE' GROSS LEVEL'. AS REGARDS THE 'NET INCOME' ESCAPING ASSESSMENT, I.E. INCOME AFTER DEDUCTION U/S 80IB (10) OF THE ACT THE MATTER OF SUCH DEDUCTION U/S. 80IB(10) HAS ALREADY BEEN A SUBJECT MATTER OF APPEAL AND CONTINUES TO BE A SUBJECT MATTER OF APPEAL BEFORE THE HON'BLE HIGH COURT. THUS, THE REOPENING IN THIS CASE IS DIRECTLY HIT BY THE 2ND PROVISO TO SECTION 147, WHICH STATES THAT PROCEEDINGS U/S 147 COULD NOT BE UNDERTAKEN IF THE INCOME SOUGHT TO BE ASSESSED/REASSESSED IS SUBJECT MATTER OF ANY APPEAL, REFERENCE OR REVISION. ACCORDINGLY, THE EARLIER ORDER OF THE A.O. ON THE ISSUE OF ALLOWABLE DEDUCTION U/S 80IB(10) HAS MERGED WITH THE ORDER OF THE APPELLATE AUTHORITIES AND THEREFORE, :- 9 -: THE A.O. WAS PRECLUDED FROM INITIATING PROCEEDINGS U/S 147 OF THE ACT ON THE IMPUGNED SUBJECT OF DEDUCTION U/S 80IB(10). IN THIS REGARD, IT WILL BE RELEVANT TO QUOTE FROM THE DECISION THE HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN AERONAUTICS LTD VS CIT (243 ITR 808) WHEREIN IT WAS OBSERVED BY THEIR LORDSHIP AS UNDER: 'THE ORDER WHICH IS THE SUBJECT MATTER OF AN APPEAL CANNOT BE DIVIDED INTO TWO PARTS ONE WHICH IS THE SUBJECT MATTER OF THE APPEAL AND THE OTHER WHICH WAS NOT IN ISSUE IN THE APPEAL BEFORE THE TRIBUNAL. WHAT BECOMES MERGED IN THE ORDER OF THE TRIBUNAL IS THE ORDER MADE BY THE APPELLATE ASSISTANT COMMISSIONER IN ITS ENTIRETY AND NOT IN PART. INDEED WHERE THE LEGISLATURE INTENDED TO MAKE A DISTINCTION IN SUCH CIRCUMSTANCES WHERE THERE WILL BE NO MERGER IN SUCH CASES IT IS EXPRESSLY PROVIDED. WE MAY NOTICE THAT SECTION 263 OF THE ACT WHERE A REVISION IS PERMISSIBLE IN CASES OF ORDERS WHICH ARE PREJUDICIAL TO THE INTERESTS OF THE REVENUE, IN EXPLANATION (C) THERETO IT HAS BEEN PROVIDED THAT WHERE ANY ORDER REFERRED TO IN THIS SUB-SECTION AND PASSED BY THE ASSESSING OFFICER HAD BEEN THE SUBJECT-MATTER OF ANY APPEAL, THE POWERS OF THE COMMISSIONER UNDER THIS SUB-SECTION SHALL EXTEND TO SUCH MATTERS AS HAD NOT BEEN CONSIDERED AND DECIDED IN SUCH APPEAL. WHERE THE LEGISLATURE INTENDED THAT THE SCOPE OF REVISION SHOULD EXTEND TO A PART OF THE ORDER WHICH HAD NOT BEEN CONSIDERED AND DECIDED IN AN APPEAL AND THEREBY DOES NOT MERGE IT IS EXPLICITLY PROVIDED. WHEN THE LEGISLATURE DOES NOT MAKE SUCH A DISTINCTION IN THE SCHEME OF SECTION 264 OF THE ACT THE VIEW TAKEN BY THE HIGH COURT APPEARS TO US TO BE CORRECT.' 4.3.3 IN THIS VIEW OF THE MATTER, THE VERY REOPENING IS HELD TO BE INVALID AND ILLEGAL. ANY ASSESSMENT ORDER MADE PURSUANT TO AN INVALID/ILLEGAL REOPENING CANNOT BE SUSTAINED AND IS, THEREFORE, :- 10 -: ANNULLED. SINCE I HAVE ALREADY DECIDED THE APPEAL ON THE LEGAL ISSUE OF REOPENING, ANY DISCUSSION ON OTHER GROUNDS WOULD ONLY HAVE AN ACADEMIC VALUE & THUS NOT ADJUDICATED UPON. 9. SINCE THE ISSUE OF CLAIM OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT WAS THOROUGHLY EXAMINED DURING THE COURSE OF INITIAL ASSESSMENT, THE REOPENING OF ASSESSMENT ON THE SAME ISSUE ON A PLEA THAT CERTAIN REQUISITE CONDITIONS FOR CLAIMING DEDUCTION UNDER SECTION 80-IB (10) OF THE ACT WAS NOT EXAMINED BY THE ASSESSING OFFICER, CANNOT BE CALLED TO BE A VALID REOPENING, AS THE CLAIM OF DEDUCTION UNDER SECTION 80-IB(10) OF THE ACT HAVE BEEN THOROUGHLY EXAMINED BY THE ASSESSING OFFICER AS WELL AS THE APPELLATE AUTHORITIES. WE, THEREFORE, FIND OURSELVES IN AGREEMENT WITH THE ORDER OF THE LD. CIT(A) AND WE CONFIRM THE SAME. WE ACCORDINGLY CONFIRM THE ORDERS OF THE LD. CIT(A) IN BOTH THE ASSESSMENT YEARS I.E. 2005-06 AND 2004-05 AND DISMISS THE APPEALS OF THE REVENUE. 10. SINCE THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE IN SUPPORT OF THE ORDER OF THE LD. CIT(A), THE SAME HAVE BECOME INFRUCTUOUS, AS THE APPEALS OF THE REVENUE ARE DISMISSED AND ACCORDINGLY THE CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED BEING INFRUCTUOUS. 11. IN THE RESULT, APPEALS OF THE REVENUE AND CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTIONED PAGE. SD/- SD/- [A. K. GARODIA] [SUNIL KUMAR YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 11 TH MARCH, 2015 JJ:2502 :- 11 -: COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR ASSISTANT REGISTRAR