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Income Tax Appellate Tribunal, JAIPUR BENCH ‘B’ JAIPUR
Before: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 383/JP/2017
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH ‘B’ JAIPUR Jh lanhi xkslkbZ] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 383/JP/2017 fu/kZkj.k o"kZ@Assessment Year :2008-09 cuke Shri Babu Lal Agarwal, ITO Vs. 56, Govind Nagar, Amer Road, Ward-5(5), Jaipur Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABWPA6723D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Rajeev Sogani & Ms. Shiwangi Samdhani (CA) jktLo dh vksj ls@ Revenue by : Smt. Runi Pal (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 01/10/2019 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 03/10/2019 vkns'k@ ORDER PER: VIKRAM SINGH YADAV, A.M. This is an appeal filed by the assessee against the order of ld. CIT(A)-2, Jaipur dated 30.03.2017 wherein the assessee has taken the following grounds of appeal:-
“1. (a) In the facts and circumstances of the case and in law the ld. AO has erred in reopening the case of the assessee, under section 147 of the Income Tax Act 1961. The action of the ld. AO is legal, unjustified and arbitrary and against the facts of the case. Relief may please be granted by quashing such re-assessment proceedings.
(b) In the facts and circumstances of the case and in law the ld. AO has erred in re-opening the case of the assessee by issuing notice Shri Babu Lal Agarwal, Jaipur Vs. ITO Ward- 5(5), Jaipur under section 148 of the Income Tax Act 1961, being not in accordance with the provisions of Section 151 of Income Tax Act 1961. The action of the ld. AO is illegal, unjustified and arbitrary and against the facts of the case. Relief may please be granted by quashing such re-assessment proceedings. 2. (a) In the facts and circumstances of the case and in law ld. CIT(A) has erred in confirming the action of ld. AO in considering the enhanced value of the property, taken by stamp valuation authorities, when under Section 50C, only "assessed value" and not "re-assessed value" can be taken for the purpose of computing capital gains under Section 48. The action of the ld. CIT(A) is illegal, unjustified and arbitrary and against the facts of the case. Relief may please be granted by considering the value of the property, taken by stamp valuation authorities, at the time of transfer of such property. (c) In the facts and circumstances of the case and in law the ld. CIT(A) has erred in confirming the action of the ld. AO in computing the long tetra capital gain at Rs. 63,62,652 against the declared long term capital gain of Rs. NIL . The action of the ld. CIT (A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by considering the long term capital gain at Rs. NIL as declared by the assessee. (d) In the facts and circumstances of the case and in law the ld. CIT (A) has erred in confirming the action of the ld. AO in not allowing exemption under section 54 of the Income Tax Act, 1961 amounting to Rs. 35,20,000/. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by allowing exemption of Rs. 35,20,000/-.” Shri Babu Lal Agarwal, Jaipur Vs. ITO Ward- 5(5), Jaipur 2. At the outset, the ld AR submitted that the assessee has moved an application for seeking permission to file additional grounds of appeal under Rule 11 and the additional grounds so sought to be moved are as under:-
1. (a) In the facts and circumstances of the case and in law the ld. AO has erred in reopening the case of the assessee, under section 147 of the Income Tax Act 1961. The action of the ld. AO is illegal, unjustified and arbitrary and against the facts of the case. Relief may please be granted by quashing such re-assessment proceedings.
(b) In the facts and circumstances of the case and in law the ld. AO has erred in re-opening the case of the assessee by issuing notice under section 148 of the Income Tax Act 1961, being not in accordance with the provisions of Section 151 of Income Tax Act 1961. The action of the ld. AO is illegal, unjustified and arbitrary and against the facts of the case. Relief may please be granted by quashing such re-assessment proceedings."
(c) In the facts and circumstances of the case and in law the ld. AO has erred in re-opening the case of the assessee under section 147 of Income Tax Act 1961 whereas the correct jurisdiction lies under section 155(15) of the Income Tax Act 1961. The action of the ld. AO is illegal, unjustified and arbitrary and against the facts of the case. Relief may please be granted by quashing such re-assessment proceedings being without jurisdiction.”
It was submitted by the ld AR that the above grounds are legal grounds and all relevant facts are available on the record. No new facts are required to be evaluated nor is any further enquiry needed. The assessee while filing original Form 36 included Ground No. 1(a) and 1(b). However, as a matter of precaution, the prayer for admission of same is being moved. The Ground No. 1(c) is taken for the first time, however omissions of the same was inadvertent. 3 Shri Babu Lal Agarwal, Jaipur Vs. ITO Ward- 5(5), Jaipur The assessee further submitted that Ground No. 1(a) was taken before the ld. CIT(A), however, the same was not pressed before him and hence, the same was dismissed. It was submitted that the assessee wishes to take up the said ground before the Tribunal and in support, the reliance was placed on the Hon’ble Punjab and Haryana High Court in case of Vijay Kumar Jain vs. CIT [1975] 99 ITR 349 wherein it was held that the assessee is not precluded from urging a ground of appeal before the Tribunal which was taken before the ld. CIT(A) but was not pressed. The relevant findings of the Hon’ble High Court reads as under:-
"There was no material on the record to show that any decision was made by the ITO to issue a notice under section 148 on the basis that the assessee had failed to disclose fully and truly all material facts necessary for his assessment year. The notice was issued on the basis that there was omission or failure on the part of the assessee to make a return under section 139 for any assessment year. It was maintained that in view of the clear provision of section 139(4) there was a valid return before the ITO. That return could not be treated as invalid and no ground was made out for taking action under section 148, read with section 147. Once it was held that the return dated 28-3-1969, was a valid return, the mere fact that the assessee gave up grounds Nos. 2 to 5 before the AAC would be of no consequence.
It is aximomatic that what is void is non est. In this situation, the assessee was not precluded from urging the grounds Nos. 2 to 5 by giving them up the assessee could not confer jurisdiction on the ITO where he had none. Therefore, the Tribunal was bound to hear the assessee and could not reject the appeal on the ground that grounds Nos. 2 to 5 were not agitated before the AAC and thus could not be permitted to be agitated before it. Therefore, the Tribunal was not 4 Shri Babu Lal Agarwal, Jaipur Vs. ITO Ward- 5(5), Jaipur justified in refusing to consider the validity of notice under section 148 even though the ground challenging the same had not been pressed before the AAC."
Further, the reliance was placed on the Hon’ble Supreme Court decision in case of NTPC [1998] 229 ITR (SC) in support of taking up legal grounds before the Tribunal.
The ld. DR is heard who has submitted that the Ground No. 1 was taken by the assessee before the ld. CIT(A). However, the same was not pressed by the appellant. Hence, the same was dismissed and therefore, the assessee cannot be granted another opportunity to raise the said ground again when the matter has been decided against the assessee on merits.
We have heard the rival contentions and pursued the material available on record. It is noted that the assessee has challenged the issuance of notice u/s 148 and the consequent assessment proceedings before the ld. CIT(A). However, the same were not pressed by the appellant during the course of appellate proceedings before the ld CIT(A), hence, the same was dismissed. However, the assessee wishes to raise the said ground of appeal
again before us. In this regard, we refer to the decision of the Hon’ble Punjab and Haryana High Court in case of Vijay Kumar Jain vs. CIT (supra) wherein the Hon’ble High Court has held that the assessee could not be precluded from urging the grounds as giving them up, the assessee could not confer jurisdiction on the ITO where he had none at first place. Given that the ground so raised to be raised goes to the root of the matter challenging the jurisdictional of the Assessing officer and thus being a legal ground, the same is admitted for adjudication. Ground No. 1(b) again goes to the root of the matter in the sense that the assessee has challenged the issuance of notice u/s 148 not in accordance with the provisions of section 151. Similarly, in Ground No. 1(c),
5. Shri Babu Lal Agarwal, Jaipur Vs. ITO Ward- 5(5), Jaipur the assessee has challenged the assumption of jurisdiction u/s 147 stating that the correct jurisdiction lies u/s 155 (15) of the Act. We are therefore of the view all these 3 grounds of appeal relates to challenging the jurisdiction of the Assessing officer, goes to the root of the matter and being legal in nature, there are admitted for adjudication. We also note that since first ground was not pressed before the ld CIT(A), there is no finding of the ld CIT(A) and similarly, other two grounds have been taken up for the first time before us, the matter is set-aside to the file of the ld. CIT(A) to examine these grounds of appeal after providing reasonable opportunity to the assessee.
In the result, appeal of the assessee is allowed for statistical purposes.
Order pronounced in the open Court on 03/10/2019.