SHRI SEENIVASAN,GANDHIDHAM-KUTCH V. THE PR. CIT-1, RAJKOT, RAJKOT

ITA 161/RJT/2022

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The case revolves around the challenge by the assessee, Seenivasan Kalpesh S. Doshi & Co. Chartered Accountants, against the order of the Ld PCIT passed under section 263 of the Income-tax Act, 1961, for the assessment year 2017-18. The Tribunal had earlier remitted the matter back to the Assessing Officer to frame a fresh assessment order, considering all issues, as per its order in ITA No. 51/Rjt/2024 dated 30.08.2024. However, the Ld PCIT also issued an order on the same issues, leading to a conflict of having two assessment orders for the same assessment year and issues. The Tribunal found this duplication untenable and quashed the PCIT's order, allowing the assessee's appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 28857 (ITAT-RAJKOT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2017-2018
• Other Referred Cases: Gandhidham v. PCIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY PUNGLIA; LD
• Assessee Lawyers: KALPESH DOSHI; LD
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice
• Section: 263

Judgement Text

" आयकर अपीलȣय अͬधकरण,राजकोट Ûयायपीठ, राजकोट। IN THE INCOMETAXAPPELLATE TRIBUNAL, RAJKOT BENCH: RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER And SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकर अपील सं./ITA No.161 /RJT/2022 (Ǔनधा[रण वष[/Assessment Year: (2017-18) Ǔनधा[ǐरती कȧ ओर से/Appellant by : Shri Kalpesh Doshi, Ld. AR व कȧ Ĥ×यथȸ ओर से/Respondent by : Shri Sanjay Punglia, Ld. CIT(DR) सुनवाईकȧतारȣख/ Date of Hearing : 19 /02 /2025 घोषणाकȧतारȣख/Date of Pronouncement : 18 /03 /2025 आदेश / O R D E R PER DR. A. L. SAINI, AM: By way of this appeal, the assessee has challenged the correctness of the order dated 07.03.2022, passed by the Learned Principal Commissioner of Income- Shri Seenivasan Kalpesh S. Doshi & Co. Chartered Accountants 1006-09, The Spire-2, Near Sheetal Park BRTS stop, 150ft Ring Road Rajkot – 360005 Vs. The Principle Commissioner of Income Tax, Aayakar Bhavan, Race Course Ring Road, Rajkot – 360001 èथायीलेखासं./जीआइआरसं./PAN/GIR No.: BSTPS6049D (अपीलाथȸ/Appellant) (Ĥ×यथȸ/Respondent) Seenivasan Gandhidham v. PCIT tax (in short “Ld PCIT”) under section 263 of the Income-tax Act, 1961 (hereinafter referred to as 'the Act'), for the assessment year 2017-18. 2. At the outset, Learned Counsel for the assessee, begins by pointing out that this Tribunal has passed the order in the assessee’s case, and remitted the matter back to the file of the Assessing Officer to frame the fresh assessment order, vide ITA No. 51/Rjt/2024, for assessment year 2017-18, order dated 30.08.2024, wherein the Tribunal has given the direction to the assessing officer to pass the fresh assessment order, considering all the issues. 3. The ld. Counsel further stated that later on, theLearned Principal Commissioner of Income-tax (in short “Ld PCIT”), has exercised his jurisdiction under section 263 of the Income-tax Act, 1961, for the same assessment year 2017-18 and on the same issues, which the ITAT Rajkot, vide ITA No. 51/Rjt/2024, for assessment year 2017-18, vide order of Tribunal dated 30.08.2024,has given the direction to the assessing officer to pass the fresh assessment order, considering all the issues. The ldCounsel stated that assessing officer cannot frame two assessment order, Viz: (i) one, as directed by the Tribunal in ITA No. 51/Rjt/2024, for assessment year 2017-18, and (ii) second, as directed by the ld. PCIT, vide his order dated 07.03.2022, for assessment year 2017-18, on the same issues. Therefore, order of the ld. PCIT may quashed. 4.On the other hand, Ld. CIT(DR) for the revenue has submitted that the appeal effect order of the Ld. PCIT, (vide order of PCIT dated 07.03.2022) passed u/s. 263 of the Act, has already been given by the Assessing Officer on 27.03.2023. Further, the assessee did not inform the Bench about passing such order. Therefore, an affidavit should be obtained from the assessee to the effect that no order giving appeal effect has been passed by the Assessing Officer, in respect of Tribunal order in ITA No. 51/Rjt/2024, for assessment year 2017-18, this is necessary to avoid the duplication. The Ld. CIT(DR) did not have any Seenivasan Gandhidham v. PCIT objection to quash the order of ld. PCIT, however, he wants to make sure that while giving appeal effect order of the Tribunal`s order in ITA No. 51/Rjt/2024, all the issues raised by the ld. PCIT may be taken care of by the assessing officer. 5.We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. We note that there should not be two assessment orders for the same issues and for the same assessment year, on one person.We note that the Tribunal in ITA No. 51/Rjt/2024, vide its order dated 30.08.2024,hasremitted the issue back to the file of the assessing officer, to frame a fresh assessment order, considering all the issues. The relevant Para of the order of the Tribunal in ITA No. 51/Rjt/2024 is reproduced below, for ready reference: “We have heard both the sides and gone through the relevant material on record. It is seen that during the appellate proceedings, the assessee did not submit details and documents before the Ld. CIT(A), as no notices were served on the assessee therefore, the Ld. CIT(A) passed an ex parte order. We note that assessee could not plead his case successfully before the Ld. CIT(A) as notices for hearing were not served on the assessee. We also note that Ld. CIT(A) has not passed the order as per the mandate of provisions of section 250(6) of the Act as the order was passed by Ld.CIT(A) without hearing the assessee. That is, Ld. CIT(A) did not pass order on merit based on the material available on record. Hence, we are of the view that one more opportunity should be given to the assessee to plead his case before the Assessing Officer. We note that it is settled law that principles of natural justice and fair play require that the affected party is granted sufficient opportunity of being heard to contest his case. Therefore, without delving much deeper into the merits of the case, in the interest of justice, we restore the matter back to the file of Assessing Officer for de novo adjudication and pass a speaking order after affording sufficient opportunity of being heard to the assessee, who in turn, is also directed to contest his stand forthwith. Therefore, we deem it fit and proper to set aside the order of the Ld. CIT(A) and remit the matter back to the file of Assessing Officer to adjudicate the issue afresh on merits. For statistical purposes, the appeal of the assessee is treated as allowed. Seenivasan Gandhidham v. PCIT 6. Therefore, from the above order,we find that Tribunal has already directed the assessing officer to make the fresh assessment order, where the assessing officer is free to examine each and every issue. 7. The ld DR for the revenue, informed the Bench that the Assessing Officer has already passed the appeal effect order,on 27.03.2023, in pursuance of order of the Ld. PCIT u/s. 263 of the Act, dated 07.03.2022, which may be cancelled. After hearing, ld. DR for the revenue, we find that Assessing Officer will also pass the assessment order, as per the directions of Tribunal in ITA No. 51/Rjt/2024, vide, order dated 30.08.2024. Hence, there will be two assessment orders, on one person, for same issues and for same assessment year, which is not tenable in the eye of law. Therefore, in these circumstances, the order passed by the ld. PCIT should be quashed, so that assessing officer can pass the fresh assessment order,as per the directions of Tribunal in ITA No. 51/Rjt/2024, vide order dated 30.08.2024. 8. The ld Counsel for the assessee also submitted before us an affidavit, as demanded by the ld. DR for the revenue, stating that appeal effect order has not been passed by the assessing officer in respect of the order of the ITAT in ITA No. 51/Rjt/2024, vide order dated 30.08.2024. The contents of the affidavit are reproduced below: “1.That I am regularly assessed to income tax, ACIT Circle Gandhi Dham having PAN number BSTPS6049D. 2. That for assessment year 2017–18, the honourable ITAT,vide ITA no. 51/RJT/ 2024, order dated 30.08.2024 has been set- aside to the file of the learned assessing officer with the direction for de- novo adjudication. 3.That I have gone through the income tax portal and as on date, no notice under section 142(1) or any other notice for assessment has been issued after the order of the Hon`ble, ITAT dated 30th August 2024 for assessment year 2017-18. Seenivasan Gandhidham v. PCIT 4.That the order of assessment after the direction of the honourable ITAT dated 30.08.2024 is pending before the AO. 5. That it is also assured that he will comply with the notice as and when the details are called upon, by the ld.AO. It is further stated that whatever is stated above is true to the best of my knowledge and believe.” 9. Considering these facts and circumstances, we quash the order passed by the ld PCIT, dated 07.03.2022 and allow the appeal of the assessee. 10.Before parting, we make it clear that the Assessing Officer should examine all the issues raised by the Ld. PCIT, while giving appeal effect order of the Tribunal in ITA No. 51/Rjt/2024, vide order dated 30.08.2024. 11. In the combined result, the appeal filed by the assessee is allowed. Order is pronounced on 18 / 03 /2025 in the open court. Sd/- Sd/- (DINESH MOHAN SINHA) (Dr. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER Rajkot Ǒदनांक/ Date: 18 / 03 /2025 Copy of the Order forwarded to: 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Rajkot 6. Guard File By Order Assistant Registrar/Sr. PS/PS ITAT, Rajkot Seenivasan Gandhidham v. PCIT "