CIT, Kottayam V. Sri. Tomin J. Thachankary, Ernakulam

MA 82/COCH/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 1071 (ITAT-COCHIN)
• Duration Of Justice: 3 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 18-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 11-10-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 18-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K K JOHN
• Assessee Lawyers: R KRISHNAN
• Keywords: Revision of order
• Section: 147; 263

Judgement Text

1 MA NO. 82/COCH/2013 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKA RAN(AM) M.P. NO.82/COCH/2013 (ARISING OUT OF I.T.A NO. 125/COCH/2012) (ASSESSMENT YEAR 2007-08) CIT, KOTTAYAM VS SHRI TOMIN J THACHANKARY THACHANKARY HOUSE THAMMANAM P.O. ERNAKULAM PAN : ABHPT5844P (APPLICANT) (RESPONDENT) APPLICANT BY : SHRI K.K. JOHN RESPONDENT BY : SHRI R KRISHNAN DATE OF HEARING : 11-10-2013 DATE OF PRONOUNCEMENT : 18-10-2013 O R D E R PER N.R.S. GANESAN (JM) THE REVENUE HAS FILED THE PRESENT MISCELLANEOUS PE TITION ON THE GROUND THAT THERE IS AN ERROR IN THE ORDER OF THIS TRIBUNAL DATED 28-02-2013. 2. SHRI K.K. JOHN, THE LD.DR SUBMITTED THAT THIS TR IBUNAL HAS ALLOWED THE APPEAL OF THE ASSESSEE ON THE GROUND THAT THE A DMINISTRATIVE COMMISSIONER HAS NOT APPLIED HER MIND AT THE TIME O F INITIATION OF PROCEEDINGS U/S 263 OF THE ACT. ACCORDING TO THE L D.DR, THERE WAS NO 2 MA NO. 82/COCH/2013 REGULAR COMMISSIONER OF INCOME-TAX AT KOTTAYAM; THE REFORE, DURING THE PERIOD OF ISSUE OF NOTICE, THE COMMISSIONER OF INCO ME-TAX AT TRIVANDRUM WAS HOLDING THE ADDITIONAL CHARGE. AFTER EXAMINING THE RECORDS, THE COMMISSIONER OF INCOME-TAX, TRIVANDRUM INSTRUCTED T HE ITO (H.QRS) ORALLY TO ISSUE NOTICE TO THE ASSESSEE. THE REASON FOR IS SUING THE NOTICE WAS ALREADY RECORDED IN THE ORDER SHEET. THEREFORE, TH E LD.DR SUBMITTED THAT THE PROCEEDINGS WERE VALIDLY INITIATED AND THE ASSE SSEE WAS GIVEN AN OPPORTUNITY TO REBUT HIS CASE. IN FACT, THERE IS N O NEED FOR ANY SHOW CAUSE NOTICE. THE LD.DR PLACED HIS RELIANCE ON THE DECIS ION OF THE DELHI BENCH OF THIS TRIBUNAL IN CAMA AUTOMOBILES (P) LTD VS ITO 31 2 ITR (TRIB) 315 (DEL). THE LD.DR HAS ALSO PLACED HIS RELIANCE ON THE JUDGM ENT OF THE APEX COURT IN THE CASE OF CIT VS ELECTRO HOUSE (1971) 82 ITR 8 24 (SC). 3. ON A QUERY FROM THE BENCH AS TO HOW THE COMMISSI ONER OF INCOME- TAX SITTING AT TRIVANDRUM WAS ABLE TO VERIFY THE RE CORDS AND ISSUE INSTRUCTION WHEN THE FILE WAS IN FACT LYING IN KOTT AYAM, THE LD.DR SUBMITTED THAT HE DOES NOT KNOW HOW THE FILE WAS VERIFIED BY THE COMMISSIONER OF INCOME-TAX AND HOW PRODUCED THE ORIGINAL FILE WAS P RODUCED FOR VERIFICATION. IN THE ORIGINAL FILE PRODUCED, THERE WAS NO REFERENCE ABOUT THE ORAL INSTRUCTION CONVEYED BY THE COMMISSIONER OF IN COME-TAX TO THE INCOME-TAX OFFICER TO ISSUE NOTICE. IN FACT, THERE WAS A REFERENCE ABOUT THE REPORT OF THE ADDITIONAL COMMISSIONER OF INCOME-TAX FOR INITIATING 3 MA NO. 82/COCH/2013 PROCEEDINGS U/S 263 OF THE ACT. THE COMMISSIONER O F INCOME-TAX APPARENTLY MADE A NOTE SAYING THAT THE ISSUES RAISE D BY THE ADDITIONAL COMMISSIONER OF INCOME-TAX WERE BEYOND THE PURVIEW OF SECTION 263 OF THE ACT. THEREFORE, APPARENTLY, THE PROCEEDINGS WE RE NOT INITIATED BY THE COMMISSIONER OF INCOME-TAX. THIS REPORT FILED BY T HE ADDITIONAL COMMISSIONER OF INCOME-TAX AND THE NOTE MADE BY THE COMMISSIONER OF INCOME-TAX WAS BROUGHT TO THE NOTICE OF THE LD.DR. HOWEVER, HE COULD NOT EXPLAIN HOW PROCEEDINGS U/S 263 COULD BE RE-INITIAT ED BY AN INCOME-TAX OFFICER WHEN THE ADDITIONAL COMMISSIONER OF INCOME- TAXS REPORT ITSELF WAS REJECTED BY THE COMMISSIONER OF INCOME-TAX ON THE G ROUND THAT IT IS BEYOND THE PURVIEW OF SECTION 263 OF THE ACT. 4. WE HEARD SHRI R KRISHNAN, THE LD.REPRQESENTATIVE FOR THE ASSESSEE ALSO. 4. HAVING HEARD THE LD.DR AND THE LD.REPRESENTATIVE FOR THE ASSESSEE, WE HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, THE ADDITIONAL COMMISSIONER OF INCOME-TAX BY HIS LETTER DATED 15-01-2010 SOUGHT DIRECTIONS FROM THE COMMISSIONER OF INCOME-T AX TO INITIATE PROCEEDINGS U/S 263 OF THE ACT. IT APPEARS THAT TH IS WAS PUT UP BEFORE THE COMMISSIONER OF INCOME-TAX AND THE COMMISSIONER OF INCOME-TAX IN TURN MADE AN ENDORSEMENT IN THE NOTE ITSELF, WHICH READS AS FOLLOWS: 4 MA NO. 82/COCH/2013 ASK THE ADDL.CIT TO EXAMINE AS TO WHETHER ACTION U /S 147 OF THE IT ACT CAN BE TAKEN AS A REMEDIAL ACTION FOR VA RIOUS ISSUES RAISED BY HIM IN HIS LETTER. MOST OF THE ISSUES RA ISED BY HIM IN HIS REVIEW ARE HIS OBSERVATIONS WHICH HAVE NOT BEEN ADJUDICATED BY THE ASSESSING OFFICER HENCE THE SAME ARE BEYOND THE PURVIEW OF SECTION 263 OF THE I.T. ACT. 5. IN VIEW OF THE ABOVE NOTE OF THE COMMISSIONER OF INCOME-TAX ON THE REPORT OF THE ADDL. COMMISSIONER OF INCOME-TAX, APP ARENTLY, IT WAS FOUND BY THE COMMISSIONER OF INCOME-TAX THAT THE ISSUE RA ISED IN THE REPORT WAS BEYOND THE PURVIEW OF SECTION 263 OF THE ACT. THER EFORE, THE COMMISSIONER OF INCOME-TAX HAS NOT INITIATED ANY PR OCEEDINGS U/S 263 OF THE ACT. IN THE SUBSEQUENT NOTE, THE ITO (H.QRS) I SSUED THE NOTICE WITHOUT ANYBODYS APPROVAL. THERE IS NO REFERENCE ABOUT TH E INSTRUCTION SAID TO BE GIVEN BY THE COMMISSIONER OF INCOME-TAX FOR ISSUING THE NOTICE. THE FILE SHOWS THAT EVEN THE DRAFT ORDER WAS PREPARED BY THE ITO (H.,QRS) AND IT WAS PUT UP FOR SIGNATURE OF THE COMMISSIONER OF INC OME-TAX. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE PROCEEDINGS U /S 263 OF THE ACT IS JUDICIAL PROCEEDINGS. THEREFORE, THE ORDER U/S 263 OF THE ACT HAS TO BE DICTATED AND DRAFTED ONLY BY THE COMMISSIONER OF IN COME-TAX AND NOT BY ANYBODY ELSE. IN THIS CASE, APPARENTLY, THE INCOME -TAX OFFICER DRAFTED THE ORDER AND PUT UP THE SAME BEFORE THE COMMISSIONER O F INCOME-TAX FOR 5 MA NO. 82/COCH/2013 SIGNATURE. THIS KIND OF PRACTICE CANNOT BE ALLOWED IN JUDICIAL PROCEEDINGS. THE JUDICIAL POWER HAS TO BE EXERCISED ONLY BY THE CONCERNED OFFICER TO WHOM IT WAS ASSIGNED UNDER THE INCOME-TAX ACT. OF COURSE, THE CONCERNED OFFICER MAY TAKE THE ASSISTANCE OF OTHERS IN THE PROCESS OF DICTATING AND DRAFTING THE ORDER. HOWEVER, THE POW ER OF DICTATING AND DRAFTING THE ORDER CANNOT BE DELEGATED TO ANYONE EL SE. OTHERWISE, THE VERY PURPOSE OF CONFERRING THE JUDICIAL POWER ON A RESPO NSIBLE OFFICER WILL BE DEFEATED. IT IS TO BE REMEMBERED THAT THE POWER OF AN AUTHORITY IN A JUDICIAL PROCEEDINGS FLOWS NOT ONLY FROM THE STATORY PROVISI ON BUT ALSO FROM THE CONFIDENCE AND TRUST OF THE PEOPLE. THAT IS THE RE ASON WHY A SPECIFIC POWER IS CONFERRED ON A PARTICULAR OFFICER WHO IS E MPOWERED TO DISCHARGE THE JUDICIAL FUNCTION. THIS TRIBUNAL IS OF THE CON SIDERED OPINION THAT THE CONFIDENCE AND TRUST OF THE PEOPLE COULD BE MAINTAI NED ONLY WHEN THE OFFICER WHO IS ENTRUSTED WITH THE POWER OF JUDICIAL AUTHORITY EXERCISES THE POWER BY HIMSELF. THE VERY FACT THAT THE ORDER WAS PUT UP BEFORE THE COMMISSIONER OF INCOME-TAX SHOWS THAT THE COMMISSIO NER OF INCOME-TAX HAS NOT APPLIED HIS MIND AT ALL. IN VIEW OF THE AB OVE, WE DO NOT FIND ANY ERROR, MUCH LESS A PRIMA FACIE ERROR, WITHIN THE ME ANING OF SECTION 254(2) OF THE ACT IN THE ORDER OF THIS TRIBUNAL. 6. WE HAVE ALSO CAREFULLY GONE THROUGH THE DECISION OF THE DELHI BENCH OF THIS TRIBUNAL IN CAMA AUTOMOBILES (P) LTD (SUPRA ) AND THE JUDGMENT OF 6 MA NO. 82/COCH/2013 THE SUPREME COURT IN THE CASE OF ELECTRO HOUSE (SUP RA). NO DOUBT, THE APEX COURT IN CATEGORICAL TERMS SAYS THAT SHOW CAUS E NOTICE IS NOT REQUIRED; WHAT IS REQUIRED IS AN OPPORTUNITY TO THE ASSESSEE. THE QUESTION IS WHO HAS TO GIVE THE OPPORTUNITY? THE OPPORTUN ITY GIVEN BY THE INCOME-TAX OFFICER CANNOT BE EQUATED TO AN OPPORTUN ITY TO REPRESENT THE CASE BEFORE THE COMMISSIONER OF INCOME-TAX. THE OP PORTUNITY SHOULD BE GIVEN TO THE ASSESSEE BY THE COMMISSIONER OF INCOME -TAX TO REPRESENT THE CASE BEFORE THE COMMISSIONER OF INCOME-TAX IN THE C OURSE OF THE PROCEEDINGS INITIATED U/S 263 OF THE ACT. UNFORTUN ATELY, SUCH AN OPPORTUNITY WAS NOT GIVEN TO THE ASSESSEE. THEREFO RE, THIS TRIBUNAL FIND NO MERIT IN THE MISCELLANEOUS PETITION FILED BY THE RE VENUE. ACCORDINGLY, THE SAME IS DISMISSED AS DEVOID OF MERIT. 7. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 18 TH OCTOBER, 2013. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 18 TH OCTOBER, 2013 PK/- COPY TO: 1. THE CIT, PUBLIC LIBRARY BLDG, SHASTRI ROAD, KOTT AYAM 686 001 2. SHRI TOMIN J THACHANKARRY, THACHANKARRY HOUSE, T HAMMANAM PO, ERNAKULAM 3. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH