M/s. BILPOWER LTD., MUMBAI V. ITO 9(1)(2), MUMBAI

ITA 7370/MUM/2005

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48472 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 27-10-2010
• Assessment Year: 2000-2001
• Appeal Filed On: 16-12-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Assessee Lawyers: R S JAIN
• Keywords: Reopening of assessment; Question of law; Reassessment proceedings

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI I BENCH BEFORE SHRI R.V.EASWAR (PRESIDENT) & SHRI T.R.SOOD, ACCOUNTANT MEMBER I.T.A.NO.7370/MUM/2005 A.Y 2000-01 BILPOWER LIMITED, VIKAS CHAMBERS, 2 ND FLOOR, MARVE ROAD, MALAD (WEST), MUMBAI 400 065. PAN: AABCB 1857 G VS. THE INCOME TAX OFFICER 9 (1)(2), MUMBAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.S.JAIN. RESPONDENT BY : SHRI S.K.SINGH. O R D E R PER T.R.SOOD, AM: IN THIS APPEAL VARIOUS GROUNDS HAVE BEEN RAISED. TH E LD.COUNSEL OF THE ASSESSEE SUBMITTED THAT THROUGH GROUND NO.3 THE ISSUE OF REOPENING HAS BEEN TAKEN BY THE ASSESSEE AND IF THI S GROUND IS ACCEPTED THEN THERE MAY NOT BE ANY NEED TO ADJUDICA TE THE OTHER GROUNDS. GROUND NO.3 READS AS UNDER: THE LEARNED ASSESSING OFFICER HAS ERRED IN NOT SUP PLYING REASONS FOR REOPENING OF ASSESSMENT TO THE APPELLANT AND THEREA FTER COMPLETING THE ASSESSMENT WHICH WAS VOID AB-INITIO. THE LEARNED CO MMISSIONER OF INCOME TAX [APPEALS] HAS ERRED IN NOT HOLDING THE A SSESSMENT AS VALID. 2. THE LD.COUNSEL OF THE ASSESSEE SUBMITTED THAT RE ASONS FOR REOPENING WERE NOT SUPPLIED TO THE ASSESSEE DESPITE SPECIFIC REQUEST IN THIS REGARD AND IN THIS REGARD HE REFERRED TO THE L ETTER DATED 27-6- 2004, A COPY OF WHICH HAS BEEN FILED ON RECORD. HE STRONGLY RELIED ON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN T HE CASE OF ALLANA 2 COLD STORAGE LTD. VS. ITO [287 ITR 1], WHEREIN IT W AS HELD THAT IF ASSESSMENT ORDER DID NOT DISCLOSE ANY REASONS, THEN SAME IS REQUIRED TO BE QUASHED. HE FURTHER ARGUED THAT NO REASON FOR REOPENING OF THE ASSESSMENT WAS INCORPORATED EVEN IN THE ASSESSMENT ORDER. 3. ON THE OTHER HAND, LD.DR INVITED OUR ATTENTION T O THE LETTER DATED 29 TH SEPTEMBER, 2008 BY DCIT 9(1), MUMBAI ADDRESSED TO SENIOR AUTHORISED REPRESENTATIVE IN WHICH IT WAS ST ATED THAT REASONS HAVE ALREADY BEEN RECORDED IN THE ORDER SHEET AND T HIS LETTER ALONG WITH THE ORDER SHEET HAS ALREADY BEEN FILED ON RECO RDS OF THE TRIBUNAL. HE ALSO FILED ANOTHER LETTER DATED 28/3/11 AND IN T HIS LETTER IT HAS BEEN AGAIN STATED THAT REASONS HAVE BEEN RECORDED. HE TH EN REFERRED TO THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CA SE OF FISHER-XMOX SANMAR LTD. VS. ACIT [271 ITR 393] WHEREIN WHEN REA SONS WERE NOT SUPPLIED, THE MATTER WAS SET ASIDE TO THE FILE OF T HE ASSESSING OFFICER FOR CONSIDERING THE OBJECTIONS OF THE ASSESSEE IN T HE LIGHT OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F GKN DRIVESHAFT INDIA LTD. VS. CIT [259 ITR 19]. SIMILAR VIEW HAS B EEN TAKEN BY THE HONBLE DELHI HIGH COURT IN THE CASE OF REACH CABLE NETWORKS LTD. VS. DCIT [167 TAXMAN 161]. HE ALSO POINTED THAT EVEN IN THE CASE OF ALLANA COLD STORAGE LTD. VS. ITO [SUPRA], THE MATTE R WAS ULTIMATELY RESTORED TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO PASS A SEPARATE SPEAKING ORDER AGAINST THE OBJECTIONS RAIS ED BY THE ASSESSEE AGAINST THE REASONS FOR REOPENING THE ASSESSMENT. 3 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFUL LY. THE LD.DR HAS ALREADY SUPPLIED THE COPY OF THE LETTER DATED 2 8-3-11 ALONG WITH THE COPY OF THE ORDER SHEET OF THE ASSESSMENT PROCE EDINGS WHEREIN THE REASONS FOR REOPENING OF THE ASSESSMENT HAVE BEEN R ECORDED AND SUPPLIED TO THE OTHER PARTY. THIS MEANS SOME REASON S HAVE BEEN RECORDED. HOWEVER, AT THE SAME TIME THE HONBLE SUP REME COURT IN THE CASE OF HAS CLEARLY HELD IN THE CASE OF GKN DRIVESH AFT (INDIA) LTD. VS. ITO [SUPRA] THAT IF AN ASSESSMENT IS REOPENED THEN ON RECEIPT OF REASONS FOR REOPENING AN ASSESSEE IS DUTY BOUND TO FILE A RETURN, BUT AT THE SAME TIME ASSESSEE WOULD HAVE RIGHT TO OBJECT T O SUCH REOPENING AND ASSESSING OFFICER IS REQUIRED TO DEAL WITH SUCH OBJECTIONS SEPARATELY. WE FURTHER FIND THAT HONBLE MADRAS HIG H COURT IN THE CASE OF FISHER-XMOX SANMAR LTD. VS. ACIT [SUPRA] HAS OBS ERVED HAS UNDER: THE AO IS BOUND TO FURNISH REASONS TO THE ASSESSEE WITHIN A REASONABLE TIME, ENTITLING THE ASSESSEE TO FILE THE OBJECTIONS AND AS A NECESSARY COROLLARY, THE AO HAS TO CONSIDER THOSE O BJECTIONS AND PASS A SPEAKING ORDER. IN THE ABSENCE OF ABOVE COMPLIANCE, THE PETITIONER IS ENTITLED TO THE RELIEF SOUGHT FOR IN THIS WRIT PETI TION. THE AO IS GIVEN TWO WEEKS FROM THE DATE OF RECEIPT OF A COPY OF THI S ORDER OR PRODUCTION OF A COPY OF THIS ORDER BY THE PETITIONE R FOR PETITIONER IS ENTITLED TO FILE ALL OBJECTIONS AVAILABLE, INCLUDIN G THE QUESTION OF LAW THAT MAY BE RAISED, WITHIN A PERIOD OF TWO WEEKS TH EREAFTER. THE AO SHALL CONSIDER SUCH OBJECTIONS ON MERITS AND PASS A SPEAKING ORDER WITHIN A PERIOD OF FOUR WEEKS FROM THE DATE OF RECE IPT OF THE OBJECTIONS FROM THE PETITIONER. SIMILARLY, HONBLE DELHI HIGH COURT IN THE CASE OF REACH CABLE NETWORKS LTD. VS. DY.CIT [SUPRA] HAS HELD AS UNDER: PETITIONER ASSESSEE HAVING REPEATEDLY REQUESTED FO R SUPPLY OF COPIES OF THE DOCUMENTS ON THE BASIS OF WHICH REASSESSMENT PROCEEDINGS HAD BEEN INITIATED, REASSESSMENT FRAMED WITHOUT FURNISH ING COPIES OF THESE DOCUMENTS IS INITIATED; REASSESSMENT IS SET ASIDE A ND THE RESPONDENT IS 4 DIRECTED TO PROVIDE COPIES OF ALL DOCUMENTS AND MAT ERIAL TO THE PETITIONER ON WHICH THE REVENUE SEEKS TO RELY. EVEN HONBLE BOMBAY HIGH COURT IN THE CASE OF ALLAN A COLD STORAGE VS. ITO [SUPRA] HAS HELD VIDE PLACITUM 9 AS UNDER: NOW THAT THE IMPUGNED ORDERS ARE SET ASIDE, THE FI RST RESPONDENT, AFTER HEARING THE PETITIONERS, WILL PASS SEPARATE SPEAKIN G ORDERS ON THE OBJECTIONS WHICH THE PETITIONERS HAVE FILED. WE FUR THER ADD THAT IN THE EVENT THE OBJECTIONS ARE REJECTED, THE ASSESSMENT O RDER WILL NOT BE PASSED FOR A PERIOD OF FOUR WEEKS THEREAFTER. RESPECTFULLY FOLLOWING THE ABOVE DECISIONS, WE SET ASIDE THE ISSUE RAISED BEFORE US TO THE FILE OF THE AO WITH A DIREC TION TO PASS A SPEAKING ORDER AGAINST THE OBJECTIONS WHICH MAY BE RAISED BY THE ASSESSEE BEFORE HIM. NEED LESS TO SAY THAT ASSESSEE SHALL BE GIVEN AN ADEQUATE OPPORTUNITY TO RAISE ANY OBJECTION AGAINST THE REOPENING OF THE ASSESSMENT. 5. IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 8 /4/2011. SD/- SD/- (R.V.EASWAR) (T.R.SOOD) PRESIDENT ACCOUNTANT MEMBER MUMBAI:8/4/2011. P/-* 5