Late Sri Dhulipala Ramachandra Koteswara Rao, Vijayawada V. THE DCIT, CIRCLE - 2(1), Vijayawada

ITA 725/VIZ/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1105 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 5 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 20-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revision of order; Opportunity of being heard; Assessment record
• Section: 143(3); 263

Judgement Text

ITA NO.725/VIZAG/2013 LATE SRI DHULIPALA RAMCHANDRA KOTESWARA RAO, VIJAYA WADA 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.725/VIZAG/2013 ( / ASSESSMENT YEAR: 2007-08) LATE SRI DHULIPALA RAMACHANDRA KOTESWARA RAO, LEGAL REPRESENTED BY SRI D. SRIKANTH VIJAYAWADA VS. DCIT, CIRCLE - 2(1), VIJAYAWADA [PAN: AAB HD1457M ] ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHRI G.V.N. HARI, AR / RESPONDENT BY : SHRI M.N. MURTHY NAI K,DR / DATE OF HEARING : 01.06.2016 / DATE OF PRONOUNCEMENT : 10.06.2016 / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF CIT(A), VIJAYAWADA DATED 4.9.2013 AND IT PERTAINS T O THE ASSESSMENT YEAR 2007-08. ITA NO.725/VIZAG/2013 LATE SRI DHULIPALA RAMCHANDRA KOTESWARA RAO, VIJAYA WADA 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HUF IS ENGAGED IN THE BUSINESS OF MONEY LENDING AND TRADING IN FEATUR ES, HAS FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2007-08 ON 31.10.2007 DECLARING TOTAL INCOME OF RS.28,78,15,050/-. SUBSEQ UENTLY, THE ASSESSMENT HAS BEEN COMPLETED U/S 143(3) OF THE INC OME TAX ACT, 1961 (HEREINAFTER CALLED AS THE ACT) BY THE ADDL. COMM ISSIONER OF INCOME TAX, RANGE-2, VIJAYAWADA ON 22.12.2009 BY ACCEPTING THE INCOME RETURNED. THEREAFTER, THE CIT HAS SET ASIDE THE ORD ER PASSED BY THE A.O. U/S 263 OF THE ACT AND DIRECTED THE A.O. TO REDO TH E ASSESSMENT AFRESH AFTER DULY EXAMINING ISSUES POINTED OUT BY THE CIT, AFTER GIVING ASSESSEE REASONABLE OPPORTUNITY OF BEING HEARD. CONSEQUENT TO CIT ORDER U/S 263, THE A.O. PASSED ASSESSMENT ORDER U/S 143(3) DA TED 11.9.2012 AND DETERMINED TOTAL INCOME OF RS.29,72,34,900/-. 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). THE CIT(A) AFTER CONSIDER ING THE EXPLANATION FURNISHED BY THE ASSESSEE, HELD THAT ON VERIFICATIO N OF THE ASSESSMENT ORDER, IT WAS FOUND THAT THE ASSESSING OFFICER HAS MADE ADDITIONS BASED ON THE DIRECTIONS OF THE CIT. SINCE THE CIT(A) AND CIT ARE EQUAL AUTHORITIES, AN APPEAL AGAINST THE ASSESSMENT COMPL ETED AS PER THE DIRECTIONS OF THE CIT U/S 263 OF THE ACT COULD NOT BE DECIDED BY THE ITA NO.725/VIZAG/2013 LATE SRI DHULIPALA RAMCHANDRA KOTESWARA RAO, VIJAYA WADA 3 CIT(A), ACCORDINGLY, DISMISSED THE APPEAL FILED BY THE ASSESSEE. AGGRIEVED BY THE CIT(A) ORDER, THE ASSESSEE IS IN A PPEAL BEFORE US. 4. THE LD. A.R. FOR THE ASSESSEE SUBMITTED THAT THE CIT(A) IS NOT CORRECT IN DISMISSING THE APPEAL SUMMARILY WITHOUT DISCUSSING THE ISSUES ON MERIT. THE A.R. FURTHER SUBMITTED THAT THE CIT, SET ASIDE THE ASSESSMENT ORDER WITH A OBSERVATION AT PARA 4 OF HI S ORDER TO THE EFFECT THAT THE ASSESSING OFFICER IS DIRECTED TO MAKE THE ASSESSMENT AFRESH AFTER DULY EXAMINING THE ISSUES THOROUGHLY AND TO H IS SATISFACTION AS PER THE PROVISIONS OF THE ACT, AFTER GIVING THE ASSESSE E A REASONABLE OPPORTUNITY OF BEING HEARD. THE DIRECTIONS GIVEN B Y THE CIT U/S 263 OF THE ACT IS AN OPEN DIRECTION AND THERE IS NO SPECIF IC DIRECTION TO THE A.O. TO COMPLETE THE ASSESSMENT. THEREFORE, ANY ASSESSM ENT ORDER PASSED CONSEQUENT TO DIRECTIONS GIVEN BY THE CIT U/S 263 O F THE ACT, THE FIRST APPEAL IS ALWAYS LIE WITH THE CIT(A). HENCE, THE CI T(A) WAS NOT CORRECT IN DISMISSING THE APPEAL WITHOUT ADJUDICATING THE I SSUES ON MERITS. ON THE OTHER HAND, THE LD. D.R. SUPPORTED THE ORDER OF THE CIT(A). 5. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE A GAINST THE ORDER PASSED BY THE A.O. U/S 143(3) R.W.S. 263 OF THE ACT , FOR THE REASON THAT ITA NO.725/VIZAG/2013 LATE SRI DHULIPALA RAMCHANDRA KOTESWARA RAO, VIJAYA WADA 4 THE A.O. HAS PASSED THE CONSEQUENTIAL ORDER AS PER THE DIRECTIONS OF THE CIT U/S 263 OF THE ACT. THE CIT AND CIT(A) ARE EQUA L RANK AUTHORITIES, THEREFORE, ANY ORDER PASSED BY THE A.O. AS PER THE DIRECTIONS OF THE CIT U/S 263 OF THE ACT, THE CIT(A) CANNOT ENTERTAIN THE APPEAL FILED BY THE ASSESSEE. WE DO NOT SEE ANY MERIT IN THE FINDINGS OF THE CIT(A) FOR THE REASON THAT AS PER THE PROVISIONS OF SECTION 246A O F THE ACT, ANY ORDER PASSED U/S 143(3) OF THE ACT, WHETHER OR NOT SAID O RDER WAS PASSED AS PER THE DIRECTIONS OF CIT U/S 263 OF THE ACT, THE F IRST APPEAL ALWAYS SHALL LIE WITH THE CIT(A). IN THE PRESENT CASE ON HAND, O N PERUSAL OF THE ASSESSMENT RECORDS, WE FIND THAT THE CIT HAS GIVEN AN OPEN DIRECTIONS TO THE A.O U/S 263 OF THE ACT TO DO THE ASSESSMENT AFRESH AFTER DULY EXAMINING THE ISSUES POINTED OUT BY THE CIT TO HIS SATISFACTION AS PER THE PROVISIONS OF THE ACT. THEREFORE, IN OUR OPINI ON, THE DIRECTIONS GIVEN BY THE CIT IS AN OPEN DIRECTION AND IT IS LEFT OPEN TO THE ASSESSING OFFICER TO EXAMINE THE ISSUES AS PER THE PROVISIONS OF THE ACT. THE A.O. HAS PASSED FRESH ASSESSMENT ORDER U/S 143(3) R.W.S. 263 OF THE ACT. THE ORDER PASSED BY THE CIT, U/S 263 OF THE ACT, ENABLE S THE ASSESSING OFFICER TO PASS FRESH ASSESSMENT ORDER U/S 143(3) O F THE ACT. ANY ASSESSMENT ORDER PASSED U/S 143(3) IS A APPEALABLE ORDER UNDER SECTION 246A OF THE ACT,. THEREFORE, WE ARE OF THE VIEW THA T THE CIT (A) WAS ERRED IN NOT ADJUDICATING THE APPEAL ON MERITS. HEN CE, WE SET ASIDE THE ITA NO.725/VIZAG/2013 LATE SRI DHULIPALA RAMCHANDRA KOTESWARA RAO, VIJAYA WADA 5 ORDER PASSED BY THE CIT(A) AND RESTORE THE ISSUE TO THE FILE OF THE CIT(A) FOR FRESH ADJUDICATION OF THE ISSUES ON MERI TS. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 10 TH JUN16. SD/- SD/- ( . ) ( . ) (V. DURGA RAO) (G. MANJUNATHA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 10.06.2016 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT LATE SRI DHULIPALA RAMACHANDRA K OTESWARA RAO, KARTA OF D. SRIKANTH, D.NO.32-16-3, NEAR RAVI CHETTY, MOG ALRAJAPURAM, VIJAYAWADA-520 010. 2. / THE RESPONDENT THE DCIT, CIRCLE-2(1), VIJAYAWA DA 3. + / THE CIT, VIJAYAWADA 4. + ( ) / THE CIT (A), VIJAYAWADA 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // 12 . (SR.PRIVATE SECRETARY) . , # / ITAT, VISAKHAPATNAM