Akshaya Kumar Samant, Angul V. Principal CIT-1, Bhubaneswar

ITA 71/CTK/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 9643 (ITAT-CUTTACK)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2016-2017
• Appeal Filed On: 23-06-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Bogus
• Section: 263; 13

Judgement Text

आयकर अपीऱीय अधिकरण, कटक न्यायपीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK श्री जाजज माथन, न्याययक सदस्य एवं श्री अरुण खोड़पऩया ऱेखा सदस्य के समक्ष । BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER ITA No.71/CTK/2021 (नििाारण वषा / Asses s m ent Year :2016-2017) Aksha ya Kum ar Sa m ant, 6 th Lane, Am alapada, Angul-759122 P AN No. AG L PS 36 36 H ... ... ... ... .... . As s e s s e e Versus Pr.CIT , Bhubanes w ar-1 ..................Re ve n u e Shri P.R.Mohanty, Advocate for the assessee Shri M.K.Gautam, CIT-DR for the Revenue Date of Hearing : 07/07/2022 Date of Pronouncement : 07/07/2022 आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the order passed u/s.263 of the Act by the ld. Pr.CIT, Bhubaneswar-1, in DIN & Order No.ITBA/REV/F/REV5/2020-21/1031492621(1), dated 15.03.2021 for the assessment year 2016-2017. 2. At the outset, we found that appeal of the assessee is barred by 13 days. In this regard, the assessee has filed an application stating therein to condone the delay which is not deliberate. Ld. CIT-DR also agreed to the contention of the ld. AR and he did not have any objection to condone ITA No.71/CTK/2021 2 the delay occurred in filing the instant appeal. Accordingly, we condone the delay of 13 days in filing the appeal and the appeal is heard finally. 3. It was submitted by the ld. AR that the original assessment came to be completed u/s.143(3) of the Act on 24.12.2018, wherein certain additions in respect of sundry creditors have been made. It was the submission that the said assessment order was the subject matter of an appeal before the ld. CIT(A), who had rejected the appeal of the assessee. It was further submission that the Tribunal had on further appeal granted relief to the assessee in ITA No.284/CTK/2019 vide dated 10.06.2020. It was the submission that the notice u/s.263 of the Act came to be issued on the assessee on 01.03.2021 after the order of the Tribunal. It was the submission that the assessee had replied to the Pr.CIT and has also submitted the confirmation letters of the other creditors, which the ld. Pr.CIT had proposed in a show cause notice to be disallowed. The assessee had filed his reply on 09.03.2021. The ld. Pr.CIT without considering the response of the assessee nor having the confirmation letters verified proceeded to direct the AO to examine two credits being the credits in respect of SP Construction and Mr. Purandhar Pradhan. It was submitted by the ld. AR that the consequential order in respect of the order passed u/s.263 of the Act had also been passed on 30.03.2022 and two creditors are accepted as genuine and no addition was made. It was the submission that the confirmation letters and the ITRs of the creditors having been produced before the Pr.CIT, if at all had done verification as available in his powers u/s.263 of the Act, the ITA No.71/CTK/2021 3 requirement of the order u/s.263 of the Act itself was not there. It was the submission that the order passed u/s.263 of the Act was liable to be quashed insofar as the same did not consider the evidence and response filed by the assessee. 4. In reply, ld. CIT-DR submitted that just because the consequential order passed did not result into addition, it cannot be said that the revision order passed by the Pr.CIT was infructuous. It was the submission that there was possibility that the creditors were bogus and to examine this the ld. Pr.CIT had invoked his powers u/s.263 of the Act. It was the further submission that as a consequential order itself has been passed and no addition has been made, the arguments in respect of the order passed u/s.263 of the Act would only be academic and appeal of the assessee should be dismissed as infructuous. 5. We have considered rival submissions. 6. An order passed validly remains valid till such time it is challenged and quashed by an appellate authority. It is true that the consequential order passed by the AO in respect of the order passed by the ld. Pr.CIT has not resulted into any addition. It is also an accepted fact that the assessee has filed his response to the show cause notice before the Pr.CIT. The ld. Pr.CIT also accepts that the ITR-V in respect of both the creditors were submitted before the Pr.CIT. The provisions of Section 263 of the Act specifically provide that the Pr.CIT “after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, shall pass order thereon as the ITA No.71/CTK/2021 4 circumstances of the case may justify”. The requirement of making or causing to be made such enquiry as he deems necessary is before passing the order u/s.263 of the Act. Here ld. Pr.CIT has failed to do so. If at all he has done verification as per the provisions available to the Pr.CIT under u/s.263 of the Act, he himself would have dropped the proceedings in any case. As there has been violation on the part of the ld. Pr.CIT to cause or do the necessary enquiry before passing the order u/s.263 of the Act, therefore, the order passed u/s.263 of the Act by the Pr.CIT is nullity and is hereby quashed. 7. In the result, appeal of the assessee is allowed. Order dictated and pronounced in the open court on 07/07/2022. Sd/- (अरुण खोड़पऩया) (ARUN KHODPIA) Sd/- (जाजज माथन) (GEORGE MATHAN) ऱेखा सदस्य/ ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनाांक Dated 07/07/2022 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनिलऱपप अग्रेपषि/Copy of the Order forwarded to : आदेशाि ु सार/ BY ORDER, (Assistant Registrar) आयकर अपीऱीय अधिकरण, कटक/ITAT, Cuttack 1. अऩीऱाथी / The Appellant- 2. प्रत्यथी / The Respondent- 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. पिभागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 6. गार्ज पाईऱ / Guard file. सत्यापऩत प्रयत //True Copy//