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Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI
Before: S/SHRI CHANDRA MOHAN GARG & LAXMI PRASAD SAHU
Per Bench
These are appeals filed by the assessee against the separate orders
of the Commissioner of Income Tax(Appeals)- dated 14.12.2018 for the
assessment years 2009-2010 and 2010-11.
The assessee has raised the common grounds in both the assessment years, which read as under:
“1. That the Assessment order passed u/s.147/143(3) is liable to be quashed in limine since the approval required u/s.151 was not taken from the competent authority i,.e. from CIT, Jamshedpur.
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ITA Nos.117 & 118/R an/2019 Ass essment Years : 2009- 2010 & 2010-2011
That the assessment order passed u/s.147/143(3) is liable to be quashed in limine on the ground also that no notice u/s.143(2) was issued prior to passing of the assessment order. 3. For that notice issued u/s.148 is liable to be quashed since reasons recorded by the AO are no reasons for which notice u/s.148 could not have been issued. 4. For that the order passed is liable to be quashed since no addition has been on the grounds for which notice u/s.148 was issued. 5. For that the rejection of books of account is unjustified, arbitrary and without any basis. The appellant maintained completely verifiable books of account. All purchases were made through banking channel and even in the assessment made, no escapement of turnover has been found out. 6. That the AO as well as CIT(A) were not justified in passing the order in an exparte manner without appreciating the facts and giving reasonable opportunity of hearing. 7. For that the CIT(A) was not justified in confirming the estimate of net profit @ 5% of the gross receipts added by AO as against net profit @ 1.96% declared by the appellant in his audited books of account. The estimate made is unjustified and excessive. 8. For that charging of interest u/s. 234A and 234B, on the tax payable on the returned income, instead of tax payable on the returned income is unjustified. 9. For that, order grounds if any, would be urged at the time of hearing.’ 3. At the time of hearing, ld A.R. argued the legal issue that
the assessment years involved in this case are 209-10 & 2010-
2011. Ld A.R. referred to order sheet of the department and
submitted that notice u/s.148 of the Act was issued on 4.11.2016,
which is beyond the period of four years from the date of the
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ITA Nos.117 & 118/R an/2019 Ass essment Years : 2009- 2010 & 2010-2011
relevant assessment years. Ld Authorised Representative by
referring to page 1 of the assessment order passed under section
147 r.w.s 143(3) of the Act dated 31.3.2016 in both the years
under appeal submitted that the Assessing officer before issuing
notice for reopening of assessment has taken approval of Addl.
Commissioner of Income Tax, Range-3, Jamshedpur vide his letter
F.No.Addl.CIT/R-3/JSR/U/S/147/2014-15/1276 dated 30.10.2015.
He pointed out that provisions of section 151 of the Act were
amended by the Finance Act, 2015 w.e.f. 1.6.2015 and the
amended provisions of Section 151(1) read as under:
“No notice shall be issued under section 148 by the Assessing Officer after the expiry of four years from the end of the relevant assessment years, unless the Principal Chief Commissioner or Chief Commissioner, or Principal Commissioner or Commissioner is satisfied on the reasons recorded by the Assessing Officer that it is a fit case for issue of such notice.” 7. He further relied on the decision of Hon’ble Jharkhand High
Court in the case of Navketan Enterprises vs CIT, (2001) 250 ITR
508 (Jharkhand) and submitted that the Hon’ble High Court has
held that the manner of issue of notice under section 148 and the
requirements to be complied with, are contained in section 151. If
therefore, the Assessing Officer contemplates initiating
proceedings under section 147 and before he does so since he has
to issue a notice under section 148, the requirements as contained
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ITA Nos.117 & 118/R an/2019 Ass essment Years : 2009- 2010 & 2010-2011
in section 151 have to be complied with. For issuance of notice
under section 148 of the Act, the Assessing officer is supposed to
look at the law as it presently stands and apply the same. He has
not to go back to a law which stood at a point of time when the
original assessment order was passed. Obtaining the approval of
a superior officer is procedural in nature. Therefore, for the
purpose of obtaining the approval, the Assessing Officer has to
apply the law as it stands on the date when he decides, by
recording his reasons, to invoke section 147 and, thus decides to
issue notice under section 148. He submitted that the Assessing
officer was required to seek approval from Principal Chief
Commissioner or Chief Commissioner, or Principal Commissioner
or Commissioner as reopening of assessment was made after four
years from the end of the relevant assessment years. As the
approval was obtained from the Addl. Commissioner of Income
Tax, Range-3, Jamshedpur, therefore, the reopening of
assessment was bad in law and consequently, the assessment
order passed in pursuance to the said notice is also bad in law and
is required to be cancelled.
On the other hand, ld D.R. relied on the orders of lower
authorities.
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ITA Nos.117 & 118/R an/2019 Ass essment Years : 2009- 2010 & 2010-2011
We have heard the rival submissions and perused the
relevant materials placed on the record of the Tribunal. It is an
admitted fact that before issuing notice u/s.148 of the Act, the
Assessing Officer was required to obtain approval from the Pr.
CCIT or PCIT, as the case may be. However, the Assessing Officer
has initiated the reassessment proceedings after taking approval
from the Addl. CIT, Range-3, Jamshedpur. Before us, ld A.R. of
the assessee produced a copy of decision of co-ordinate Bench of
this Tribunal in the case of Kamendra Mishra vs ITO in ITA
Nos.201 & 202/Ran/2017 for the assessment years 2009-10 &
2010-2011 order dated 30.11.2018 and submitted that the issue
at hand is covered in favour of the assessee. We have perused
the order of the Tribunal, wherein, on similar facts, it has been
observed as under:
‘ 9. In the above facts and circumstances of the case, we are of the considered opinion that as the Assessing Officer had not taken approval from the Principal Chief Commissioner or Chief Commissioner, or Principal Commissioner or Commissioner, for reopening of assessment, which was beyond the period of four years from the end of the relevant assessment years by issuance of notice under section 148 on 3.2.2016, which was not in accordance with the provisions of section 151(1) of the Act applicable at the relevant point of time, the issuance of notice u/s.148 of the Act is bad in law and consequently, the assessment order passed under section 147 r.w.s 143(3) is also bad in law and hence, same is cancelled. Therefore, this ground of appeal is allowed.’
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ITA Nos.117 & 118/R an/2019 Ass essment Years : 2009- 2010 & 2010-2011
The facts under consideration are identical to the facts in the
case of Kamendra Mishra (supra). We find that the Assessing
Officer has not taken approval from the Pr. CCIT or PCIT for
initiating reassessment proceedings and issuing notice u/s.148 of
the Act. Therefore, respectfully following the decision of the
Tribunal in the case of Kamendra Mishra (supra), we quash the
reassessment order passed on 31.3.2016 and allow the grounds of
appeal of the assessee for both the assessment years under
appeal.
Since we have quashed the reassessment orders on legal
ground, other grounds taken by the assessee have become
infructuous.
In the result, appeals filed by the assessee are allowed.
Order pronounced on 27/08/2019.
Sd/- sd/- (Laxmi Prasad Sahu) (Chandra Mohan Garg) ACCOUNTANT MEMBER JUDICIALMEMBER
Ranchi; Dated 27 /08/209 B.K.Parida, SPS
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Copy of the Order forwarded to : 1. The Appellant : Roshan Maheshwari, Prop. M/a. Maheshwari Minerals, H.No.35, Aastha Krishna Tower, S.N.P. Area, Sakchi, Jamshedpur
The Respondent. ITO 3(5), Chaibasa 3. The CIT(A)- Jamshedpur 4. Pr.CIT-Jamshedpur 5. DR, ITAT, Ranchi 6. Guard file. //True Copy// By order
Sr. Pvt. Secretary, ITAT, Cuttack camp at Ranchi
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