ACIT, UDAIPUR V. M/s. Ramesh Chand Rajesh Kumar and Party, UDAIPUR

ITA 78/JODH/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9640 (ITAT-JODHPUR)
• Duration Of Justice: 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 02-03-2017
• Assessment Year: 2013-2014
• Appeal Filed On: 10-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MEENA J
• Keywords: Reopening of assessment; Difference of opinion; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 143(3); 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH JODHPUR BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER ITA NO.75 /JODH/2017 ASSESSMENT YEARS: 2008-09 ACIT, CIRCLE-2, UDAIPUR. VS M/S. OM PRAKASH MAHESH KUMAR AND PARTY, SIROHI JALORE GROUP, HO-UDAIPUR 401 PLOT NO.4, UJJAWAL APARTMENT, BHATT JI KI BARI, UDAIPUR. PAN: AAAO1179P (APPELLANT) (RESPONDENT) ITA NO.77/JODH/2017 ASSESSMENT YEARS: 2008-09 ACIT, CIRCLE-2, UDAIPUR. VS M/S. JITENDRA SHARMA AND PARTY JAISALMER GROUP, HO-UDAIPUR, VARDHMAN COMPLEX BHOPALPURA, UDAIPUR. PAN: AAAAJ 4862A (APPELLANT) (RESPONDENT) ITA NO.73/JODH/2017 ASSESSMENT YEARS: 2008-09 ACIT, CIRCLE-2, UDAIPUR. VS M/S. OM PRAKASH SAURABH TAK AND PARTY, SIROHI GROUP, HO- UDAIPUR 103 UJJAWAL APARTMENT PLOT NO.4, , BHATT JI KI BARI, UDAIPUR. PAN: AAAO1538J (APPELLANT) (RESPONDENT) ITA NOS.73, 75, 77 & 78-JODH-2017 2 ITA NO.73/JODH/2017 ASSESSMENT YEARS: 2008-09 ACIT, CIRCLE-2, UDAIPUR. VS M/S. RAMESH CHAND RAJESH KUMAR AND PARTY RAJSAMAND GROUP, UDAIPUR PAN: AABAR1274R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.K. MEENA, JCIT-DR RESPONDENT BY : NONE / DATE OF HEARING : 02/03/2017 / DATE OF PRONOUNCEMENT: 03/03/2017 ORDER THESE FOUR APPEALS OF DIFFERENT ASSESSEES ARE FILE D BY THE REVENUE ON IDENTICAL ISSUES. THOUGH THE ASSESSMENT YEARS ARE D IFFERENT HOWEVER THEY HAVE BEEN IDENTICALLY DECIDED BY SEPARATE ORDERS OF THE CIT(A)-I, UDAIPUR DATED 25.11.2016. ACCORDINGLY FOR THE SAKE OF CONVE NIENCE THEY ARE BIENG DECIDED BY A COMMON ORDER. IN VIEW OF THE FACT THAT THE ARGUMENTS AND FACTS QUA THE GROUND RAISED ARE IDENTICAL IN EACH OF THE APPEALS FOR READY REFERENCE THE FACTS FROM ITA NO.77/JODH/2017 ARE BEING REFERR ED TO WHEREIN THE REVENUE HAS RAISED THE FOLLOWING GROUNDS ASSAILING THE CORRECTNESS OF THE ORDER DATED 25.11.2016 OF CIT(A)-I, UDAIPUR PERTAIN ING TO 2008-09 ASSESSMENT YEAR. ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF T HE CASE AND IN LAW THE LEARNED CIT(A) HAS ERRED IN:- WHETHER ON FACTS AND THE CIRCUMSTANCE OF THE CASE AND IN LAW, THE LD. CIT(A) WAS JUSTIFIED IN QUASHING THE REOPENING OF PROCEEDINGS DESPITE THE FACTS THAT THE ASSESSING OFFICER HAS REASON TO BELIEVE THAT THE A OP HAS INCORRECTLY CLAIMED THE CREDIT OF TCS/TDS CERTIFICATES ISSUED IN THE NAME OF INDIVIDUAL MEMBERS OF THE AOP. ITA NOS.73, 75, 77 & 78-JODH-2017 3 2. NO ONE WAS PRESENT ON BEHALF OF THE ASSESSEE-RES PONDENT. THE RECORD SHOWS THAT THE APPEAL WAS LISTED FOR HEARING ON 1 ST MARCH, 2017 ON WHICH DATE ALSO NO ONE WAS PRESENT ON BEHALF OF THE ASSES SEE-RESPONDENT. IN VIEW OF THE FACT THAT THE ASSESSMENT HAS BEEN QUASHED BY THE CIT(A) RELYING UPON PLETHORA OF DECISIONS OF THE CO-ORDINATE BENCH OR O F ITAT JODHPUR TIME WAS GIVEN TO THE LEARNED SR.D.R. TO VERIFY WHETHER ANY OF THE DECISIONS QUOTED AT PAGE 10 OF THE IMPUGNED ORDER HAD BEEN UPSET BY A H IGHER FORUM. ON THE NEXT DATE THE LEARNED SR.D.R. STATED THAT HE IS NOT IN A POSITION TO ADDRESS THE QUERY. ACCORDINGLY CONSIDERING THE PECULIAR FACTS A ND CIRCUMSTANCES OF THE CASE I FIND NO GOOD REASON TO DEVIATE FROM THE VIEW TAKEN FROM THE CO- ORDINATE BENCH AS HAS BEEN TAKEN NOTED OF BY THE CI T(A) AT PAGE 10 OF HIS ORDER. THE RELEVANT EXTRACT OF THE ORDER FROM PAGES 9 TO 12 IS REPRODUCED HEREUNDER FOR READY REFERENCE. 11. THAT, AFTER REOPENING PROCEEDINGS, THE ASSESSE D INCOME OF THE APPELLANT AOP AS IT IS AS THE INCOME ASSESSED U/S.143(3) OF THE IT ACT, 1961 IN THE ORIGINAL ASSESSMENT PROCEEDINGS. THEREFORE, THE ASS ESSMENT ORDER PASSED U/S. 147 OF THE IT ACT, 1961 IS ERRONEOUS AND BAD IN LAW IN VIEW OF THAT THERE IS NO CHANGE IN THE ASSESSED AND REASSESSED INCOME OF THE RELEVANT ASSESSMENT YEAR. IN THIS CONNECTION, WE RELIED UPON THE BELOW MENTIO NED JURISDICTIONAL ITAT, JODHPUR BENCH DECISIONS IN THE SIMILAR AOP CASES ON THE IDENTICAL ISSUES, WHEREIN THE HON'BLE ITAT, JODHPUR BENCH QUASHED THE REASSESSMENT PROCEEDINGS. THE DETAILS OF CASES, WHEREIN THE FIND INGS AND DECISIONS GIVEN BY THE HON'BLE ITAT, JODHPUR BENCH, JODHPUR ARE AS UND ER: SR. NO. NAME OF AOP PAN A.Y. APPEAL NO. DATE OF ORDER 1. M/S. KRISHAN LAL MEEL & PARTY ALWAR GROUP, HO- UDAIPUR, 319 BHUPALPUR, UDAIPUR AAAAK7971K 2009-10 ITA NO.370/JODH/2015 & ITA NO.401/JODH/2015 04.09.2015 2. M/S. HANUMAN SINGH HITENDRA TAK RITESH SUWALAK & PARTY UDAIPUR GROUP, HO- UDAIPUR 20, SAHELI NAGAR, UDAIPUR AAAAH 2811F 2009-10 ITA NO.379/JODH/2015 & ITA NO.400/JODH/2015 04.09.2015 3. M/S. PRABHU LAL AAAAP7637F 2009-10 ITA 04.09.20 15 ITA NOS.73, 75, 77 & 78-JODH-2017 4 KAILASH CHAND & PARTY RAJSAMAND GROUP, HO- UDAIPUR 302, VARDHMAN COMPLEX, BHUPALPURA, UDAIPUR. NO.380/JODH/2015 & ITA NO.399/JODH/2015 4. M/S. OM PRAKASH MAHESH KUMAR & PARTY SIROHI-JALORE GROYUP, HO- UDAIPUR, 401, UJJAWAL APARTMENT, PLOT NO.-4, BHATT JI KI BARI, UDAIPUR. AAAAO1179P 2009-10 ITA NO.388/JODH/2015 & ITA NO.398/JODH/2015 04.09.2015 5. M/S. LEKHRAJ MEWARA & PARTY JODHPUR GROUP, HO-UDAIPUR 103, UJJAWAL APARTMENT, PLOT NO.-4 BHATT JI KI BARI, UDAIPUR. AAAAL2221M 2009-10 ITA NO.363/JODH/2015 & ITA NO.394/JODH/2015 17.03.2016 6. M/S. ASHOK KUMAR DEVENDRA MEEL & PARTY JAIPUR GROUP, HO- UDAIPUR 318, BHUPALPURA, UDAIPUR AAAAA9393H 2009-10 ITA NO.372/JODH/2015 & ITA NO.397/JODH/2015 17.03.2016 7. M/S. OM PRAKASH MAHESH KUMAR & PARTY, PALI GROUP, HO-UDAIPUR, 101, VARDHMAN COMPLEX, BHUPALPUR, UDAIPUR AAAAO1116E 2009-10 ITA NO.390/JODH/2015 & ITA NO.395/JODH/2015 17.03.2016 8. M/S. DILIP KUMAR & PARTY AJMER GROUP, HO- UDAIPUR 401, UJJAWAL APARTMENT PLOT NO.4 BHATT JI KI BARI, UDAIPUR. AAAAD4764H 2009-10 ITA NO.369/JODH/2015 & ITA NO.396/JODH/2015 17.03.2016 UNDER THE FACT AND CIRCUMSTANCES OF THE APPELLANT C ASE AND IN VIEW OF THE LEGAL POSITION IN VARIOUS JUDICIAL PRONOUNCEMENTS, WHERE ALL MATERIAL FACTS WERE AVAILABLE BEFORE THE ASSESSING OFFICER DURING ORIGI NAL ASSESSMENT AND THE ASSESSING OFFICER HAD EXAMINED THE SAME, REASSESSME NT PROCEEDINGS CANNOT BE TAKEN UP BY CHANGING THE OPINION BASED ON AUDIT NOT E. FURTHER, FROM THE PLAIN READING OF REASON RECORDED FOR REOPENING OF ASSESSE ES CASE, ITS APPEAR THAT THE DEPARTMENT TREATED THE TCS/TDS CREDIT AMOUNT AS INC OME ESCAPEMENT FROM ASSESSMENT IN TERMS OF SECTION 147 OF THE IT ACT, 1 961. HOWEVER, SECTION 147 PERTAINS TO THE ESCAPEMENT OF INCOME ONLY NOT THE C REDIT OF TDS/TCS. THEREFORE, ITA NOS.73, 75, 77 & 78-JODH-2017 5 THE ACTION TAKEN U/S.147 OF THE IT ACT, 1961 FOR RE OPENING OF ASSESSMENT PROCEEDINGS INTEREST EH ASSESSEES CASE HAS NO WARR ANT IN LAW IN THE ABSENCE OF ANY MATERIAL EVIDENCE TO COVER ANY TRANSACTION IN T HE FOUR CORNERS OF THE INCOME ESCAPING ASSESSMENT AND THE REASON RECORDED FOR REO PENING THE APPELLANT CASE ITSELF DOES NOT REPRESENT THE OBJECTIVE OR BONA FID E ONE AND THE SAID REASON TO BELIEVE CANNOT BE REASON TO SUSPECT. IT IS A SETTLE D LAW THAT REASONS TO BELIEVE CAN NEVER BE THE OUTCOME OF A CHANGE OF OPINION. IT IS ESSENTIAL THAT BEFORE ANY ACTION IS TAKEN BY THE OFFICER, THE OFFICER SHOULD SUBSTANTIATE HIS SATISFACTION. WHEN ENTIRE FACTS RELATING TO THE INCOME WERE MADE KNOWN TO THE OFFICER AND NO OBJECTIVE REASON HAS BEEN GIVEN FOR ISSUING A NOTIC E, THE ASSESSMENT SO COMPLETED IS AGAINST THE PRINCIPAL OF NATURAL JUSTI CE AND BAD IN LAW AND LIABLE TO BE QUASHED. 2.1 CONSIDERING THE SAME, THE CIT(A) CAME TO THE CO NCLUSION AS UNDER: 3.3. THE SUBMISSIONS OF THE ASSESSEE AND THE RELEVA NT FINDINGS OF THE AO HAVE BEEN CONSIDERED. ON PERUSAL OF THE ORDER OF THE ITAT, JODHPUR DT. 04 .09.2015 IN CASES OF SIMILAR AOPS (TABLE ON PAGE 10 REFERS) RELIED UPON BY THE ASSESS EE, IT IS SEEN THAT THE PRECISE QUESTION WHETHER ASSESSMENT COULD BE REOPENED ON GROUNDS OF EXCESS ALLOWANCE OF TCS CREDIT WAS CONSIDERED BY THE HON. TRIBUNAL AND IT WAS HELD AS UNDER- NOW COMING TO THE APPEALS OF THE ASSESSEE WHEREIN REASSESSMENT HAS BEEN CHALLENGED ON THE GROUND THAT THERE WAS NO ESCAPEMENT OF INCOM E. FROM A PLAIN READING OF THE SECTION 147 OF THE IT ACT, 1961, IT IS CLEAR THAT P ROVISIONS OF SECTION 147 ARE APPLICABLE WHEREIN ANY INCOME CHARGEABLE TO TAX HAS ESCAPED AS SESSMENT NOT THE EXCESS CREDIT OF TAX OR TCS I TDS. THE ASSESSEES CASE WAS REOPENED FOR THE REASON THAT THE INCOME OF THE APPELLANT TO THE EXTENT OF RS. 26,68,331/- ON ACCOU NT OF EXCESS CREDIT OF TCS/TDS ALLOWED TO THE ASSESSEE AOP HAS ESCAPED THE ASSESSMENT IN T ERMS OF SECTION 147 OF THE IT ACT, 1961, WHICH WAS NOT COME WITHIN THE PURVIEW OF SECT ION 147 OF THE IT ACT, 1961, AS THE EXCESS CREDIT OF TCS/TDS IS NOT THE PART OF INCOME OF THE ASSESSEE. HENCE, THE ESSENTIAL PRECONDITION OF SECTION 147 OF THE IT ACT, 1961 HAS NOT BEEN FULFILLED ON THE ASSESSEES CASE. IT IS CLEAR FROM THE FACTS ON RECORD THAT THERE IS NO VARIATION IN THE INCOME EVEN AFTER PASSING OF ORDER U/S 143/147 OF THE ACT. SINCE THER E IS NO ESCAPEMENT OF INCOME WHICH HAS BEEN BROUGHT WITHIN THE TAX NET AFTER REOPENING , THERE IS NO JUSTIFICATION FOR REOPENING OF ASSESSMENT. IN THE INSTANT CASE ALSO THE ONLY GROUND FOR REOPEN ING OF ASSESSMENT IS ALLOWANCE OF EXCESS CREDIT OF TCS AND ASSESSMENT U/S 147 HAS BEE N COMPLETED AT THE SAME FIGURE AT WHICH EARLIER ASSESSMENT U/S 143(3) WAS COMPLETED. IN THESE FACTS THE ABOVEMENTIONED DECISION OF THE HON. TRIBUNAL IS SQUARELY APPLICABL E. RESPECTFULLY FOLLOWING THE ABOVE MENTIONED DECISION OF THE HON. TRIBUNAL IT IS HELD THAT IN THE INSTANT CASE THE REASSESSMENT PROCEEDINGS WERE NOT VALIDLY INITIATED AND THEREFORE THE IMPUGNED ORDER U/S 148 IS HEREBY QUASHED. THE GROUND OF APPEAL IS THU S ALLOWED. ITA NOS.73, 75, 77 & 78-JODH-2017 6 SINCE IT HAS BEEN HELD ABOVE THAT THE REASSESSMENT PROCEEDINGS WERE NOT VALIDLY INITIATED AND THEREFORE THE IMPUGNED ORDER U/S 147 ITSELF HAS BEEN QUASHED IT IS NOT FOUND NECESSARY TO ADJUDICATE THE OTHER GROUNDS RAISED IN APPEAL. 3. BY WAY OF ABUNDANT CAUTION LIBERTY IS GIVEN TO T HE REVENUE THAT IN THE EVENTUALITY IT IS BROUGHT TO THE NOTICE OF THE ITAT THAT THE AFORESAID VIEW TAKEN BY THE ITAT HAS BEEN UPSET BY A HIGHER FORUM, THE REVENUE WOULD BE AT LIBERTY TO PRAY FOR A RECALL OF THIS ORDER. IN V IEW OF THE FACT THAT THE ASSESSEE-RESPONDENT IN EACH OF THESE CASES DESPITE NOTICE HAS REMAINED UNREPRESENTED IT IS MADE CLEAR THAT NO VESTED RIGHT SHALL OPERATE IN FAVOUR OF THE ASSESSEE QUA THE REQUEST FOR RECALL OF THE REVE NUE IF SO MADE IN ACCORDANCE WITH LAW ON THE ABOVE MENTIONED GROUND B Y THE REVENUE. 4. SINCE THE FACTS AND CIRCUMSTANCES AND THE ARGUME NTS IN ITA NOS.73, 75 AND 78/JODH/2017 REMAIN THE SAME AND QUA THE IDE NTICAL REASONING OF THE CIT(A) ACCORDINGLY ON ACCOUNT OF IDENTICAL REASONIN G WITH IDENTICAL OBSERVATIONS THE DEPARTMENTAL APPEALS ARE DISMISSED AS PER THE PRONOUNCEMENT MADE IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 5. IN THE RESULT, THE APPEALS OF THE REVENUE ARE DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 03/03/2017 SD/- (SMT. DIVA SINGH) JUDICIAL MEMBER PRABHAT KUMAR KESARWANI, SR.P.S. COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT AS SISTANT REGISTRAR