Assistant Commissioner of Income-tax, Ahmednagar Circle , , Ahmednagar V. M/s. Akshar Udyog, Ahmednagar

MA 325/PUN/2022

• Counselvise Citation: [2024] 130 COUNSELVISE.COM (IT) 0669 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 6 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 03-09-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 22-08-2024
• Assessment Year: 2011-2012
• Appeal Filed On: 28-02-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDEEP P SATHE
• Assessee Lawyers: AKASH PARIKH
• Section: 234B; 73

Judgement Text

।आयकर अपीलीय अिधकरण ”ए” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A” :: PUNE BEFORE DR.DIPAK P. RIPOTE, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER Miscellaneous Application No.325/PUN/2022 (Arising out of ITA No.2007/PUN/2017) िनधाᭅरण वषᭅ / Assessment Year:2011-12 The Assistant Commissioner of Income Tax, Ahmednagar Circle, Ahmednagar. V s M/s.Akshar Udyog, Ashtavinayak Colony, Pipeline Road, Ahmednagar – 414003. PAN: AAKFA8960B Appellant / Revenue Respondent / Assessee Assessee by Shri Akash Parikh – AR Revenue by Shri Sandeep P Sathe – JCIT(DR) Date of hearing 23/08/2024 Date of pronouncement 04/09/2024 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This is a Miscellaneous Application filed by Revenue against the Tribunal’s Order in ITA No.2007/PUN/2017 for A.Y.2011-12 order dated 04.11.2019. 1.1 The Revenue has raised the following issues in the Miscellaneous Application : “3.1 Hon'ble IT AT, in para No.5 of its order, has treated AO's action u/s MA No.325/PUN/2022 M/s.Akshar Udyog [R] 2 154 as va. In contrast to this decision in para 5, Hon'ble ITAT has allowed assessee's app which appears to be a mistake warranting rectification. Further, on merit, in order i 154 AO has correctly given directions regarding charging of interest u/s 234A. In ITAT's order Hon'ble ITAT has stated that there is no mention regarding charging interest in assessment order ( Para 11 to para 13). As such facts quoted by Hon' ITAT are not correct as Hon'ble ITAT is referring to order u/s 143(3) and not ore u/s 154 which is the order appealed against. 4. In view of the above facts, this miscellaneous application is filed u/s.254 of the Income Tax Act, requesting the Hon'ble I.T.A.T. to rectify the mista occurred in the order ITA No. 2007/PUN/2017 dated 04.11.2019.” Findings & Analysis : 2. We have heard both the parties and perused the records. In this case, an assessment order u/sec.144 r.w.s 147 for A.Y.2011-12 was passed on 27.03.2015. In the said assessment order, the Assessing Officer had not mentioned about levying interest u/sec.234A of the Act. In the impugned assessment order, the AO has only levied interest u/sec.234B, 234C and 234D of the Act. The Assessing Officer then issued notice u/sec.154 of the Act. After considering the reply of the assessee, filed in response to notice u/sec.154, the AO held vide order u/sec.154 of the Act dated 24.11.2015 that there was an apparent mistake of not levying MA No.325/PUN/2022 M/s.Akshar Udyog [R] 3 interest u/sec.234A of the Act of Rs.79,45,106/-. The assessee filed appeal before ld.CIT(A). Ld.CIT(A) upheld the order u/sec.154 dated 24.11.2015 vide his order dated 01.06.2017(paper book, page 73 to 79 of Revenue). Then, assessee filed appeal before this ITAT. ITAT in assessee’s appeal no.2007/PUN/2017 vide order dated 04.11.2019 has held as under : “4. We heard both the sides on this limited issue and perused the said order of the Tribunal in the case of M/s. Heritage Project (supra). Further, we also examined the assessment order, in general and the contents of para 11 to 13, in particular for want of direction, if any, in favour of charging of interest u/s 234A of the Act. We find that there is no whisper about the proposal to levy of interest u/s 234A of the Act in the assessment orders. Considering the same, we are of the opinion that the order of the Tribunal in the case of M/s. Heritage Project (supra) is applicable directly to the facts of the present case. For the sake of completeness, the relevant para 5 of the said order of the Tribunal (supra) is extracted hereunder “5. We have heard the rival parties and have gone though the material placed on record. We find that assessee filed a return of income declaring a loss of Rs.2,84,909/- The return of income was filed on 31.03.2010 which was required to be filed on 30.09.2009. The Assessing Officer vide assessment order dated 23.12.2012 completed the assessment after making certain additions and in the body of assessment order charged interest u/s 234B. However, he did not make any direction to charge any interest u/s 234A of the Act later on he passed an order u/s 154 on 10.05.2013 and created an additional demand of Rs.2,14,9,438/- being interest for six months which the assessee was liable to be charged u/s 234A of the Act. The Ld. CIT(A) has deleted the demand for interest by following the decision of Hon'ble Supreme Court in the case of CIT Vs. Ranchi Club MA No.325/PUN/2022 M/s.Akshar Udyog [R] 4 Ltd. in 247 ITR 0209. The Hon'ble Supreme Court order in the case of Ranchi Club Ltd. has dismissed the appeal of revenue against the Patna High Court. The conclusion of Hon'ble Supreme Court in the case of CIT Vs. Ranchi Club Ltd. is that in the absence of any specific mention of the Assessment Year: 2009-10 Assessing Officer in the assessment order for charging of interest u/s 234A and 234B, no interest would be recovered from the assessee merely by way of a demand notice. We further find that Hon'ble Delhi High Court in the case of CIT Vs. Kishan Lai (HUF) has again followed the order of Hon'ble Supreme Court and has held that in the absence of any direction in the assessment order for charging interest u/s 234A and 234B interest cannot be recovered. For the sake of completeness, the findings of the Ld. CIT(A) are reproduced below: The Hon'ble Court has held that if there is no direction in the original assessment order, no rectification can be made as there is no mistake apparent from record. The case law relied on by Ld. DR is on a different aspect where the Hon'ble Court has said that omission of application of statutory provision is a mistake rectifiable u/s 154 of the Act whereas in the present case the issue is as to whether interest not charged in the original assessment can be rectified or not and the case law of Hon'ble Supreme Court and other case laws are directly on the issue.” 5. Considering the above settled legal position on the matter in the said precedent and considering the commonality of the facts of all the three cases, we are of the opinion that the Assessing Officer assumed jurisdiction u/s 154 of the Act is validly. Consequential common ground nos. 2 and 3 raised by the assessee in all the three appeals are allowed.” 3. Thus, ITAT has relied on the decision in the case of Heritage Projects, in ITA No.170/ASR/2016 dated 12.10.2017 while deciding the assessee’s appeal in ITA No.2007/PUN/2017. The MA No.325/PUN/2022 M/s.Akshar Udyog [R] 5 proposition of law followed by the ITAT is that “if there is no direction in the original assessment order to levy interest u/sec.234A, no rectification can be made as it is not an apparent mistake from record.” Accordingly, ITAT in para 5 of the order, allowed the assessee’s appeal. However, in para 5, ITAT has mentioned that “Assessing Officer assumed jurisdiction u/sec.154 of the Act validly.” Therefore, Revenue has pleaded before us in this Miscellaneous Application that since ITAT in para 5 mentioned that jurisdiction u/sec.154 was validly assumed means, the AO had power to rectify the mistake of not levying interest u/sec.234A of the Act. Therefore, Revenue pleaded that the meaning of para 5 is that order u/sec.154 needs to be upheld. However, when we read the entire order in ITA No.2007/PUN/2017, which we have already reproduced above, it is absolutely clear that ITAT in ITA No.2007/PUN/2017 had followed the proposition of law that once no direction is given for levying 234A interest in the original assessment order, no rectification order can be passed as it is not a mistake apparent from record. Ld.DR has not disputed this fact that in the assessment order dated 27.03.2015, these are no directions to levy MA No.325/PUN/2022 M/s.Akshar Udyog [R] 6 interest u/sec.234A of the Act, copy of the assessment order is filed by Revenue at page 4 to 74 of the appeal memo. In these facts and circumstances of the case, we are of the opinion that the words “Assessing Officer assumed jurisdiction u/sec.154 of the Act is validly”, shall be read as “Assessing Officer assumed jurisdiction u/sec.154 of the Act is invalid”. Therefore, once we read the word “validly” as “invalid”, it sinks with the proposition of law discussed by ITAT in earlier paragraphs. Accordingly, the words “validly” shall be read as “invalid”. Thus, the Miscellaneous Application filed by the Revenue is rejected. 4. In the result, Miscellaneous Application filed by the Revenue is dismissed. Order pronounced in the open Court on 4 th September, 2024. Sd/- Sd/- (VINAY BHAMORE) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 4 th Sep, 2024/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “ए” बᱶच, MA No.325/PUN/2022 M/s.Akshar Udyog [R] 7 पुणे / DR, ITAT, “A” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.