ACIT(OSD), Ward-22(1), New Delhi V. S.S. Gas Lab Asia P. Ltd., Delhi

MA 3/DEL/2020

AI Insights

The case involves the Revenue's appeal against the dismissal of its earlier appeal by the Income Tax Appellate Tribunal, which was based on the CBDT Circular No.03/2018. The Revenue argued that the dismissal was erroneous as the case involved an audit objection from the Comptroller and Auditor General (C&AG), which had been accepted by the Department. The assessee countered that there was no evidence of the Department's acceptance of the audit objection. The Tribunal found that the audit objection had indeed been accepted by the Department, as evidenced by the actions taken under sections 148 and 151 of the Income Tax Act, leading to the recall of the previous order.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 115813 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 4 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-05-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 29-12-2022
• Assessment Year: 2008-2009
• Appeal Filed On: 02-01-2020
• Laws Referred To: CBDT Circular No.03/2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Audit objection; Competent authority

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : G : NEW DELHI BEFORE SHRI C.M. GARG, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER Miscellaneous Application No.03/Del/2020 (ITA No.3246/Del/2019) Assessment Year: 2008-09 ACIT (OSD), Ward-22(1), New Delhi. Vs S.S. Gas Lab Asia P. Ltd., A-6/3, Jhilmil Industrial Area, Shahdara, Delhi. PAN: AAKCS1928C (Applicant) (Respondent) Assessee by : Shri Sanjeev Kumar Bindal, CA & Shri Vidur Krishna Bindal, CA Revenue by : Shri Mirnal Kumar Das, Sr. DR Date of Hearing : 21.04.2023 Date of Pronouncement : 03.05.2023 ORDER PER M. BALAGANESH, AM: By virtue of this Miscellaneous Application, the Revenue seeks the recall of the order passed by this Tribunal, vide order dated 28.08.2019, on the ground that this Tribunal had erred in dismissing the appeal of the Revenue by applying the CBDT Circular No.03/2018 dated 11.07.2018 which prescribes the monetary limit for preferring the appeals by the Revenue before this Tribunal. The ld. DR vehemently MA No.03/Del/2020 2 argued that this was a case of audit objection of Comptroller and Auditor General (C&AG) which has been accepted by the Department and, hence, the same falls in exceptions provided in the Circular No.03/2018 dated 11.07.2018. The ld. AR vehemently argued that in the instant case, though the assessment was reopened based on audit objection, there is no evidence that has been brought on record by the Revenue to prove whether the audit objection has been accepted by the Department. In support of this argument, the ld. AR placed on record a reply filed by the assessee before the ld. AO after completion of the assessment proceedings, which is purportedly during the audit proceedings, dated 24.02.2012. The ld. AR also placed on record a letter dated 23.09.2014 issued by the ld. AO addressed to the Sr. Audit Officer, Office of the Director General of Audit, Central Receipt, New Delhi, wherein the ld. AO had enclosed the reply of the assessee’s letter dated 24.02.2012 and had pleaded before the audit party for dropping the audit para/audit objection. This goes to prove that the ld. AO was convinced that the order originally passed by him was correct and was not convinced with the audit objection of the C&AG party. 2. We have heard the rival submissions and perused the material available on record. None of the aforesaid facts stated by both the parties are in dispute. But, the crucial fact that needs to be understood in the instant case is that though the ld. AO initially had supported his own earlier assessment order and had also drawn strength from the reply filed by the assessee, vide letter dated 24.02.2012, and the said letter was also enclosed by the ld. AO while giving a reply to the C&AG party on MA No.03/Del/2020 3 23.09.2014, still it is a fact on record that the ld. AO had resorted to take remedial action against the said audit objection raised by the C&AG party by issuing notice u/s 148 of the Act after obtaining the approval of the competent authority u/s 151 of the Act. This goes to prove that the triggering point for reopening of assessment itself is the audit objection which has been accepted by the Department by taking remedial action. In our considered opinion, the case squarely falls in the exception clause of the CBDT Circular No.03/2018. Accordingly, the contentions raised by the Revenue in its Miscellaneous Application are found to be correct and we are recalling the order passed by this Tribunal dated 28.08.2019 to adjudicate the grounds raised thereon afresh. The Registry is directed to fix the main appeal for fresh hearing for 13 th of July, 2023 after issuing notice to both the parties. 3. In the result, the Miscellaneous Application filed by the Revenue is allowed. Order pronounced in the open court on 03.05.2023. Sd/- Sd/- (C.M. GARG) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 03 rd May, 2023. dk Copy forwarded to : 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi