SAMARTH LIFETERS P.LTD, THANE V. ASST CIT CIR 3, THANE

ITA 7285/MUM/2016

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3077 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Assessment Year: 2007-2008
• Appeal Filed On: 13-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAUDHARY ARUN KUMAR SINGH
• Assessee Lawyers: SUBOPDH RATNAPARIKHI
• Keywords: Reopening of assessment; Depreciation; Reasonable cause; Set aside
• Section: 143(3); 147; 148

Judgement Text

AAYAK AAYAK AAYAK AAYAKR APILAIYA AIQ R APILAIYA AIQ R APILAIYA AIQ R APILAIYA AIQAKRNA N AKRNA N AKRNA N AKRNA NYAAYAPIZ YAAYAPIZ YAAYAPIZ YAAYAPIZ MAMUBA[ MAMUBA[ MAMUBA[ MAMUBA[- -- - MAO MAOMAO MAO. .. . IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUM BAI BEFORE SRI MAHAVIR SINGH, JM AND SRI M BALAGENSH, AM AAYAKR APILA SA AAYAKR APILA SA AAYAKR APILA SA AAYAKR APILA SAM MM M . / ITA NOS.7285 TO 7287/MUM/2016 ( INAQA-ARNA BAYA- / ASSESSMENT YEARS: 2007-08, 2008-09 & 2012-13) SAMARTH LIFETERS PVT LTD., OPP. ANAND NAGAR OCTROI NAKE NAAN BUILDING, NEXT TO MAA NIKETAN SCHOOL, EASTERN EXPRESS HIGH WAY, KOPARI, THANE (W). VS. ACIT, CIRCLE-3, 6TH FLOOR, ASHAR IT PARK ROAD NO.16Z, WAGLE INDL.ESTATE, THANE ( APILAAQA APILAAQA APILAAQA APILAAQAI II I - -- - / APPELLANT) .. ( P` P`P` P`%YAQAA %YAQAA %YAQAA %YAQAAI II I- -- - / RESPONDENT) PAN NO. AACCS 6646 K REVENUE BY : SHRI CHAUDHARY ARUN KUMAR SINGH, DR ASSESSEE BY : SHRI SUBOPDH RATNAPARIKHI, CA DATE OF HEARING: 6.3.2019 DATE OF PRONOUNCEMENT : 6-03- 2019 AADOSA AADOSA AADOSA AADOSA / O R D E R PER MAHAVIR SINGH, JM: THESE APPEALS BY THE ASSESSEE ARE ARISING OUT OF T HE CONSOLIDATED ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-2, [I N SHORT CIT(A)], IN APPEAL NOS.507,705 & 508/15-16 DATED 30.9.2016. TH E ASSESSMENT WAS FRAMED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE3, THANE 2 ITA NO.7285 TO 7287/MUM/2016 ASSESSMENT YEAR 2007-08, 200809 & 2012-13 FOR THE A.YS 2007-08 & 2012-13 VIDE ORDER DATED 20 .3.2015 UNDER SECTION 143(3) READ WITH SECTION 147 OF THE INCOME TAX ACT, 1961 AND FOR THE ASSESSMENT YEAR 2008-09 DATED 12.2.2015 UNDER S ECTION 143(3) OF THE ACT, 1961 (HEREINAFTER THE ACT). 2. FIRST, WE TAKE UP THE APPEALS FOR THE ASSESSMENT YEARS 2007- 08 & 2012-13 IN ITA NOS.7285 & 7287/MUM/2016. 3. AT THE OUTSET, LD COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE COMMON GROUND RAISED IN GROUND NO.1 WHICH IS IDENTICAL FACTS AND CIRCUMSTANCES THAT THE CIT(A) ERRED IN NO T ADMITTING THESE APPEALS HOLDING THE SAME HAVE BEEN FILED BEYOND LI MITATION. 4. GROUND NO.1 RAISED IN BOTH THE ASSESSMENT YEARS IS IDENTICAL AND HENCE, GROUND RAISED IN ASSESSMENT YEAR 2007-08 IN ITA NO.7285./MUM/2016 READS AS UNDER: THE CIT(A) ERRED IN NOT ADMITTING THE APPEAL HOLDI NG THE SAME TO HAVE BEEN FILED BEYOND THE PERIOD PRESCRIBE D BY SECTION 249(2) OF THE I.T.ACT, 1961 NOT APPRECIATIN G THAT THE DELAY IN FILING OF APPEAL BY 33 DAYS WAS DUE TO SUF FICIENT CAUSE AND THAT THE APPELLANT WAS PREVENTED FROM ADD RESSING THE ISSUE IN APPEAL PROCEEDINGS AND HENCE THE APPEA L SHOULD HAVE BEEN ADMITTED AS PER SECTION 249(3) OF THE I.T .ACT, 1961. 5. LD COUNSEL FOR THE ASSESSEE TOOK US THROUGH THE RELEVANT FINDINGS OF THE CIT(A) THAT THE APPEALS FOR ASSESSM ENT YEAR 2007- 08 AND 2012-13 WERE FILED LATE BY 35 DAYS AND 53 DA YS RESPECTIVELY FOR WHICH THE ASSESSEE COULD NOT OFFER ANY EXPLANAT ION. THE RELEVANT FINDINGS OF THE CIT(A) READS AS UNDER: 3 ITA NO.7285 TO 7287/MUM/2016 ASSESSMENT YEAR 2007-08, 200809 & 2012-13 AS PER DECLARATION IN FORM NO. 35, FILED WITH THE DEPARTMENT, THE DATE OF SERVICE OF THE ASSESSMENT ORDERS ALONG WITH DEMAND NOTICE IS STATED TO BE 25.3.2015, 05.03. 2015 & 3,2.2016, RESPECTIVELY. THE APPEAL FOR A. Y. O8-09 WAS FILED IN TIME, HENCE ADMITTED THE APPEALS FOR A. Y 07-08 & 12- 13, WERE FILED LATE BY 33 DU\B & 53 DAYS, RESPECTI VELY, FOR WHICH THE APPELLANT COULD NO! OFFER ANY VALID EXPLANATION. AS PER THE PROVISIONS OF THE SECTION OF THE ACT , THE APPELLANT SHOULD HAVE FILED APPEALS IN THESE YEARS, WITHIN 30 DAYS FROM RECEIPT OF APPEAL ORDERS /NOTICES OF DEMAND, IN THIS OFFICE. THE APPELLANT HOWEVER, FILED THESE APP EALS AFTER 33 DAYS AND 53 DAYS OF DUE DATES, WITHOUT GIVING ANY VALID REASONS /EXPLANATION, HENCE THE SAME ARE NOT ADMISSIBLE. AFTER GOING THROUGH TH E CONTENTS OF THE FINDING OF THE AO, IN THE ASSESSMENT ORDER, PAST HI STORY AND SUBMISSION OF THE APPELLANT, IT IS NOTICED THAT ON MERIT ALSO, THE CLAIM OF THE APPELLANT IS NOT ADMISSIBLE, IN VIEW OF THE FACTS DISCUSSED H ERE, AS UNDER. 6. IN VIEW OF ABOVE, LD COUNSEL FOR THE ASSESSEE ST ATED THAT AFTER NOT ADMITTING THE APPEALS, EVEN THE CIT(A) DECIDED THE ISSUE ON MERITS. ACCORDING TO LD COUNSEL FOR THE ASSESSEE, THERE IS NO CLEAR F INDINGS IN THE ORDER OF THE CIT(A) WHETHER HE IS CONDONING THE APPEAL OR NOT. WHEN A QUERY PUT TO LD COUNSEL, HE STATED THAT THE ASSESSEE WAS NOT AWARE ABOUT THE LIMITATION IN FILING OF THESE APPEALS BEFORE THE CIT(A) AND HENCE, HE CO ULD NOT FILE THE CONDONATION PETITION OR ANY REASONABLE CAUSE BEFORE THE CIT(A). ON A FURTHER QUERY FROM THE BENCH, LD SR DEPARTMENTAL REPRESENTATIVE AGREED THA T THE MATTER CAN BE SENT BACK TO THE FILE OF THE CIT(A) AND THE ASSESSEE CAN BE DIRECTED TO FILE CONDONATION PETITION BEFORE THE CIT(A) AND FIRST G ET THE CONDONATION PETITION ADJUDICATED AND ACCORDINGLY THE APPEALS BE DECIDED. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THROUG H THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTED THAT THERE IS DELAY IN FILING OF THESE 4 ITA NO.7285 TO 7287/MUM/2016 ASSESSMENT YEAR 2007-08, 200809 & 2012-13 TWO APPEALS BEFORE THE CIT(A) FOR THE ASSESSMENT YE AR 2007-08 AND 2012-13 BY 33 & 53 DAYS. ADMITTED FACTS ARE THAT T HE ASSESSEE HAS NOT FILED ANY CONDONATION PETITIONS BEFORE THE CIT(A). NOW LD COUNSEL FOR THE ASSESSEE UNDERTOOK TO FILE THE CONDONATION PETITION S BEFORE THE CIT(A) AT THE FIRST INSTANCE. IN VIEW OF ABOVE UNDERTAKING, WE SET ASIDE THESE TWO ORDERS OF THE CIT(A) TO HIS FILE. THE ASSESSEE WI LL FILE CONDONATION PETITIONS FOR DELAY CAUSES AND THE CIT(A) WILL ADJU DICATE THE SAME ALSO AND ON MERITS. 7. AS WE HAVE REMITTED THE MATTER BACK TO THE FILE OF THE CIT(A), GROUNDS TAKEN ON MERITS OF THE ADDITIONS HAVE BECOM E INFRUCTUOUS AND SAME ARE NOT ADJUDICATED UPON. 8. IN TERMS OF ABOVE DIRECTION, THE APPEALS ARE ALL OWED FOR STATISTICAL PURPOSES. ITA NO.7286/M/2016 9. THE FIRST JURISDICTION ISSUE IN THIS APPEAL OF T HE ASSESSEE IS AS REGARDS TO THE ORDER OF THE CIT(A) UPHOLDING THE RE OPENING OF ASSESSMENT DESPITE THE FACT THAT THE REOPENING IS DONE AFTER T HE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR AND TH E ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT AND T HERE WAS NO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE MATERIAL FA CTS FULLY AND TRULY AS PER THE REASONS RECORDED. FOR THIS, THE ASSESSEE HAS R AISED FOLLOWING GROUNDS: 5 ITA NO.7285 TO 7287/MUM/2016 ASSESSMENT YEAR 2007-08, 200809 & 2012-13 1. THE CIT(A) ERRED IN UPHOLDING THE REOPENING OF ASSESSMENT ORIGINALLY COMPLETED UNDER SECTION.143(3) OF THE I. ,T.ACT, 1961 BY ISSUE OF THE NOTICE UNDER SECTION.148 ON 27.3.2015 I.E. AFTER THE EXPIRY OF 4 YEARS FROM THE END OF THE RELEVANT A.Y. NOT APPRECIATING THAT THE REOPENING WAS BAD IN LAW. (I) AS THERE WAS NO FAILURE ON THE PART OF THE ASSE SSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS,. (II) THAT, NO FAILURE TO DISCLOSE ALL MATERIAL FACT S HAS BEEN ATTRIBUTED TO THE ASSESSEE IN THE REASONS RECORDED PRIOR TO IS SUE OF NOTICE UNDER SECTION.148 AND (III) THAT THE REOPENING WAS ON ACCOUNT OF CHANGE O F OPINION IN RESPECT OF FACTS EXAMINED DURING ORIGINAL ASSESSMEN T PROCEEDINGS. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE TH ROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND FROM THE FACTS OF THE CASE THAT THE ORIGINAL ASSESSMENT FOR THE ASSESSMENT YEAR 2008-09 WAS COMPLETED UNDER SECTION.143(3) VIDE ORDER DATED 23.12.2010. DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS F ILED COMPLETE DETAILS IN RESPECT OF CLAIM OF DEPRECIATION OF CRANES @ 30% AND THE ASSESSING OFFICER HAS FRAMED ASSESSMENT AFTER CONSIDERING THE SE FACTS AND GOING THROUGH THE ACCOUNTS OF THE ASSESSEE, WHEREIN, CLAI M WAS MADE. SUBSEQUENTLY, THE ASSESSING OFFICER ISSUED NOTICE U NDER SECTION.148 OF THE ACT ON 26.3.2014. LD COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE REASONS RECORDED WHICH ARE FILED IN ASSESSEES PAPER BOOK AT PAGES 228 TO 230. LD COUNSEL FOR THE ASSESSEE DREW OUR A TTENTION TO FORM FOR RECORDING THE REASONS FOR INITIATING PROCEEDINGS UN DER SECTION 148 AND THE REASONS RECORDED IS GIVEN IN PARA 11 OF THE FORM, W HICH READS AS UNDER: 6 ITA NO.7285 TO 7287/MUM/2016 ASSESSMENT YEAR 2007-08, 200809 & 2012-13 THE ASSESSEE HAS WRONGLY CLAIMED DEPRECIATION @30 % ON CRAWLER CRANE INSTEAD OF 15%. I AM SATISFIED THAT IN THIS CASE INCOME OF 2,24,51,670/- IS ESCAPED FROM ASSESSMENT. 11. THIS FACT IS MENTIONED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER IN PARA 2 THAT ON GOING THROUGH THE ASSESSMEN T RECORDS, IT WAS NOTICED THAT THE ASSESSEE HAS WRONGLY CLAIMED, WHIC H WAS ALLOWED DEPRECIATION @ 30% ON CRAWLER CRANE IN STEAD OF DEP RECIATION ADMISSIBLE @ 15%. LD COUNSEL FOR THE ASSESSEE STATED THAT THE RE IS NO WHISPER ABOUT ANY FAILURE ON THE PART OF THE ASSESSEE IN TH E REASONS RECORDED TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS RELATIN G TO CLAIM OF DEPRECIATION. ON THE OTHER HAND, LD COUNSEL STATED THAT THE ENTIR E FACTS RELATING TO CLAIM OF DEPRECIATION WAS FILED IN THE DEPRECIATION CHART ENCLOSED WITH THE RETURN OF INCOME, WHICH WAS AVAILABLE TO THE ASSESSING OFF ICER DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS UNDER SECTION.14 3(3) OF THE ACT. ADMITTEDLY, THE ASSESSEES CASE FALLS UNDER THE PRO VISO TO SECTION 147 AND ABSOLUTELY THERE IS NO ALLEGATION IN THE REASONS RE CORDED THAT THERE IS ANY FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FUL LY AND TRULY ALL MATERIAL FACTS RELATING TO THE CLAIM OF DEPRECIATION. ONCE THIS IS A FACT, ON THE FIRST PRINCIPLE, THE REOPENING DONE BY THE ASSESSING OFFI CER IS BAD IN LAW AND HENCE, SAME IS QUASHED. 12. AS WE HAVE QUASHED THE REASSESSMENT PROCEEDING WHILE ADJUDICATING GROUND NO.1 OF THE APPEAL OF THE ASSES SEE, THERE IS NO NEED TO ADJUDICATE GROUND NO.2. 7 ITA NO.7285 TO 7287/MUM/2016 ASSESSMENT YEAR 2007-08, 200809 & 2012-13 13. IN THE RESULT, APPEALS FOR THE ASSESSMENT YEARS 2007-08 & 2012-13 ARE ALLOWED FOR STATISTICAL PURPOSES AND APPEAL FOR THE ASSESSMENT YEAR 2008-09 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 06-03- 2019. AADOSA KI AADOSA KI AADOSA KI AADOSA KI GAAO GAAOGAAO GAAOYANAA KULAO MAO IDNAMK YANAA KULAO MAO IDNAMK YANAA KULAO MAO IDNAMK YANAA KULAO MAO IDNAMK 15. 03.2019 KAO KI KAO KI KAO KI KAO KI GA GAGA GA SD/- SD/- (M BALAGANESH) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 06- - 03- 2019 BKP/SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ASSISTANT REGISTRAR ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT (A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//