ITO Ward-7(1), Hyderabad V. Banda Reddy Pingali, Hyderabad

ITA 963/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61821 (ITAT-HYDERABAD)
• Duration Of Justice: 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-04-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 19-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V SRINIVAS
• Assessee Lawyers: GVSS MURTHY
• Section: 143(3); 147; 263

Judgement Text

ITA NOS. 962 & 963/HYD/2011 BANDA REDDY PINGALI, HYDERABAD IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER I.T.A. NO. 962 & 963/HYD/2011 ASSESSMENT YEAR : 2004-05 & 2005-06 INCOME TAX OFFICER, WARD- 7(1), HYDERABAD VS. M/S BANDA REDDY PINGALI, HYDERABAD. PAN: ALIPP7187J APPELLANT RESPONDENT REVENUE BY: SHRI V SRINIVAS ASSESSEE BY: SHRI G.V.S.S MURTHY DATE OF HEARING: 02.04.2012 DATE OF PRONOUNCEMENT: 02.04.2012 O R D E R PER CHANDRA POOJARI, AM : THESE ARE THE APPEALS BY THE DEPARTMENT AGAINST ORD ERS OF CIT(A) FOR TWO DIFFERENT ASSESSMENT YEARS 2004-05 & 2005-06. ASSESSMENT YEAR 2004-05 : 2. BRIEF FACTS OF THE CASE RELATING TO AY: 2004-05 ARE THAT THE ASSESSEE FILED A RETURN ADMITTING AN INCOME OF RS.1,75,830/- FOR THE SAID AY. THE ORIGINAL ASSESSMENT U/S 143(3 ) OF THE ACT WAS COMPLETED ON 29.09.2006 ACCEPTING THE INCOME RETURN ED. PROCEEDINGS U/S 263 WERE INITIATED AND VIDE ORDER U /S 263 DATED 24.03.2009, THE ASSESSMENT WAS SET ASIDE AND THE AS SESSING OFFICER WAS DIRECTED TO REDO THE ASSESSMENT IN THE LIGHT OF THE DIRECTION GIVEN THEREIN. PURSUANT TO THE DIRECTION S, THE APPELLANT WAS ASSESSEED ON AN INCOME OF RS.85,95,830/- IN THE ORDER PASSED U/S 143(3) R.W.S. 263 OF THE INCOME TAX ACT BY CONS IDERING THE INVESTMENT OF RS.84,20,000/- MADE IN REC BONDS AS U NEXPLAINED CREDIT IN THE ACCOUNTS OF THE APPELLANT. AGGRIEVED BY THIS ORDER, THE ASSESSEE WENT IN APPEAL BEFORE CIT(A) AND SUBMI TTED THAT ITA NOS. 962 & 963/HYD/2011 BANDA REDDY PINGALI, HYDERABAD ============================ 2 ORDER PASSED U/S 263 OF THE ACT WAS CHALLENGED BY T HE ASSESSEE BEFORE THE TRIBUNAL AND THE TRIBUNAL VIDE ORDER DAT ED 21.01.2011 IN ITA NO. 587/HYD/2009 HAD CANCELLED THE ORDER PAS SED U/S 263 OF THE ACT BY CIT AND RESTORED THE ORDER OF THE ASS ESSING OFFICER. IT WAS SUBMITTED THAT AN ORDER U/S 263 WAS NO LONGER V ALID, THE ORDER PASSED U/S 143(3) R.W.S. 263 DATED 31.12.2009 HAVE NO LEGAL SANCTION. ON THE ISSUE IT WAS DECIDED BY CIT(A) BY PLACING RELIANCE ON THE JUDGMENT OF MADHYA PRADESH HIGH COU RT IN THE CASE OF CIT VS. BHANDARI CAPACITORS PVT. LTD. (178 ITR 275 ) WHEREIN HELD THAT ANY ORDER MADE PURSUANT TO A REVI SIONAL ORDER WHICH WAS SET ASIDE SUBSEQUENTLY WAS ALSO LIABLE TO BE SET ASIDE. IN VIEW OF THIS, HE ALLOWED THE APPEAL OF THE ASSES SEE. AGAINST THIS, REVENUE IS IN APPEAL BEFORE US AND RAISED FOLLOWING GROUNDS. 1. THE ORDER OF THE HONBLE CIT(A) IS ERRONEOUS BOTH ON FACTS OF THE CASE AND IN LAW. 2. THE LEARNED CIT(A) ERRED IN HOLDING THAT THERE WAS NEI THER CONCEALMENT OF PARTICULARS NOT INACCURATE PARTICULARS FOR T HE AY 2004-05. 3. THE LEARNED CIT(A) FAILED TO CONSIDER THAT THE INCOME FOR THE AY: 2004-05 WAS NEGATIVE BEFORE ADMITTANCE. 4. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT TH E ASSESSEE FIRM CAME FORWARD WITH DISCLOSURE OF ADDITIONAL INCOMES. FOR ASSESSMENT YEAR 2005-06: 3. FOR THIS ASSESSMENT YEAR BRIEF FACTS ARE THAT T HE ASSESSEE FILED A RETURN OF INCOME ADMITTING AN INCO ME OF RS.4,33,630/- AND THE SAME WAS PROCESSED U/S 143(1) . THE CASE WAS REOPENED U/S 147 AND THE ASSESSMENT U/S 14 3(3) R.W.S. 147 WAS COMPLETED DETERMINING THE TOTAL INCO ME RS.86,58,130/- WHICH INCLUDES LONG TERM CAPITAL GAI NS ON SALE OF LAND OF RS.82,24,497/-. AGGRIEVED BY THIS ORDER, THE APPELLANT PREFERRED AN APPEAL BEFORE THE CIT(A). B EFORE THE CIT(A) THE ASSESSEE SUBMITTED THAT THE ASSESSEE OWN CASE WAS SUBJECT MATTER OF APPEAL BEFORE THE TRIBUNAL ON THE SAME ITA NOS. 962 & 963/HYD/2011 BANDA REDDY PINGALI, HYDERABAD ============================ 3 ISSUE AND THE TRIBUNAL VIDE ITS ORDER DATED 21.01.2 011 IN ITA NO. 587/HYD/2009 HAD CANCELLED THE ORDER PASSED U/S 263 OF THE ACT BY CIT AND RESTORED THE ORDER OF THE ASSESSING OFFICER BY HOLDING THAT LONG TERM CAPITAL GAINS ON SALE OF LAN DS AND EXEMPTION CLAIMED U/S 54EC WERE TO BE CONSIDERED FO R THE ASSESSMENT YEAR 2004-05 AND NOT FOR AY 2005-06. AC CORDINGLY, HE DELETED THE ADDITION MADE BY THE ASSESSING OFFIC ER BY TREATING THE LONG TERM CAPITAL GAINS AS INCOME FOR AY 2005-0 6. AGAINST THIS, THE REVENUE IS IN APPEAL BEFORE US AND RAISED THE FOLLOWING GROUNDS. 1. THE ORDER OF THE HONBLE CIT(A) IS ERRONEOUS BOTH O N FACTS OF THE CASE AND IN LAW. 2. THE LEARNED CIT(A) ERRED IN HOLDING THAT THERE WAS NEITHER CONCEALMENT OF PARTICULARS NOT INACCURATE PARTICULA RS FOR THE AY 2005-06. 3. THE LEARNED CIT(A) FAILED TO CONSIDER THAT THE INCO ME FOR THE AY: 2004-05 WAS NEGATIVE BEFORE ADMITTANCE. 4. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT TH AT THE ASSESSEE FIRM CAME FORWARD WITH DISCLOSURE OF ADDITIONAL INC OMES. 4. AFTER GOING THROUGH THE ABOVE G ROUNDS IN BOTH THE ASSESSMENT YEARS, WE ARE OF THE OPINION THAT THESE GROUNDS ARE INFRUCTUOUS, IN VIEW OF ORDER OF THE TRIBUNAL DATED 21.01.2011 IN ITAT NO.587/HYD/2009 FOR THE AY: 2004-05 IN ASSESSE ES OWN CASE, WHEREIN TRIBUNAL HELD THAT THE LONG TERM CAPI TAL GAINS ON SALE OF LANDS AND EXEMPTION CLAIMED U/S 54EC WERE T O BE CONSIDERED FOR AY 2004-05 ONLY AND NOT FOR AY 2005- 06. BEING SO, THERE CANNOT BE ANY RE-OPENING OF ASSESSMENT FOR TH E AY 2005-06 OR PASSING ANY CONSEQUENTIAL ORDER GIVING EFFECT TO ORDER PASSED U/S 263 FOR AY 2004-05 AS THERE IS NO SURVIVAL OF O RDERS PASSED U/S 263 OF I.T. ACT BY CIT. ACCORDINGLY, WE INCLIN E TO DISMISS THE APPEALS FILED BY THE REVENUE. ITA NOS. 962 & 963/HYD/2011 BANDA REDDY PINGALI, HYDERABAD ============================ 4 5. IN THE RESULT, BOTH THE REVENUE APPEALS ARE DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 2 ND APRIL, 2012. SD/- SD/- SD/- ( SAKTIJIT DEY) JUDICIAL MEMBER SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED THE 2ND APRIL, 2012 COPY FORWARDED TO: 1. THE INCOME TAX OFFICER, WARD-7(1), HYDERABAD. 2. SHRI BANDA REDDY PINGALI, # 10-2-289/73, SHANTI NAGAR, HYDERABAD. 3. THE CIT(A), VIJAYAWADA. 4. THE DR A BENCH, ITAT, HYDERABAD 5. CIT-VI, HYDERABAD. B.V.S.