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Income Tax Appellate Tribunal, MUMBAI BENCH “H” MUMBAI
Before: SHRI KULDIP SINGH & SHRI OM PRAKASH KANT
PER OM PRAKASH KANT, AM This appeal by the Revenue is directed against the order dated 15.09.2021 passed by the Ld. Commissioner of Income-Tax (Appeals)-50, Mumbai [in short ‘the Ld. CIT(A)] for assessment year 2014-15, raising following grounds:
On the facts and circumstances of the case and in law, the learned Commissioner of Income-tax(Appeals)-50, Mumbai,
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was erred in holding that the assessment proceeding was erred in holding that the assessment proceeding was erred in holding that the assessment proceedings should have been framed u/s 153C r.w.s. 153A without appreciating have been framed u/s 153C r.w.s. 153A without appreciating have been framed u/s 153C r.w.s. 153A without appreciating that in absence of a satisfaction by AO u/s 153A that seized that in absence of a satisfaction by AO u/s 153A that seized that in absence of a satisfaction by AO u/s 153A that seized material belonged to assessee, no proceedings u/s 153C could material belonged to assessee, no proceedings u/s 153C could material belonged to assessee, no proceedings u/s 153C could have been legally initiated. have been legally initiated. 2. 2. On the facts and circumstances of the case and in law, the 2. On the facts and circumstances of the case and in law, the 2. On the facts and circumstances of the case and in law, the learned Commissioner of Income learned Commissioner of Income-tax(Appeals)-50, Mumbai, 50, Mumbai, was erred in alluding to the fact that once the conditions of was erred in alluding to the fact that once the conditions of was erred in alluding to the fact that once the conditions of issue of notice u/s 153C were not satisfied, the proceedings u/s issue of notice u/s 153C were not satisfied, the proceedings u/s issue of notice u/s 153C were not satisfied, the proceedings u/s 147 could n 147 could not be repelled for making assessment of ot be repelled for making assessment of undisclosed income based on a seized document. undisclosed income based on a seized document. 3. On the facts and circumstances of the case and in law, the On the facts and circumstances of the case and in law, the On the facts and circumstances of the case and in law, the learned Commissioner of Income learned Commissioner of Income-tax(Appeals)-50, Mumbai, 50, Mumbai, was not correct in ignoring the decision of Hon'ble was not correct in ignoring the decision of Hon'ble was not correct in ignoring the decision of Hon'ble Bombay High Court in the case of Shirish Madhukar Dalvi 287 ITR High Court in the case of Shirish Madhukar Dalvi 287 ITR High Court in the case of Shirish Madhukar Dalvi 287 ITR 242(Bom.) section 48 is a substantive provision whereas 242(Bom.) section 48 is a substantive provision whereas 242(Bom.) section 48 is a substantive provision whereas section 153C is procedural section. Both sections definitely section 153C is procedural section. Both sections definitely section 153C is procedural section. Both sections definitely stand on different footings. stand on different footings. 4. On the facts and circumstances of the case an On the facts and circumstances of the case and in law, the d in law, the learned Commissioner of Income learned Commissioner of Income-tax(Appeals)-50 has not 50 has not considered the decision of the Income Tax Appellate Tribunal considered the decision of the Income Tax Appellate Tribunal considered the decision of the Income Tax Appellate Tribunal - Ahmedabad in the case of Shri Shailesh S. Patel, ITA Ahmedabad in the case of Shri Shailesh S. Patel, ITA Ahmedabad in the case of Shri Shailesh S. Patel, ITA No.3063/Ahd/2016, Palanpur Vs The Income Tax Officer, No.3063/Ahd/2016, Palanpur Vs The Income Tax Officer, No.3063/Ahd/2016, Palanpur Vs The Income Tax Officer, Ward-5 on 31 Augu 5 on 31 August, 2018 in this regard. 5. The appellant craves leave to amend or alter any ground and/ The appellant craves leave to amend or alter any ground and/ The appellant craves leave to amend or alter any ground and/ or add new grounds which may be necessary. or add new grounds which may be necessary.
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At the outset, the Ld. Departmental Representative (DR) At the outset, the Ld. Departmental Representative (DR) At the outset, the Ld. Departmental Representative (DR) submitted that this appeal has been filed with a delay of 14 days. submitted that this appeal has been filed with a delay of 14 days. submitted that this appeal has been filed with a delay of 14 days. He submitted that the period of the delay is covered he period of the delay is covered by the decision of by the decision of Hon’ble Supreme Court in Miscellaneous Application No. 665 of Hon’ble Supreme Court in Miscellaneous Application No. 665 of Hon’ble Supreme Court in Miscellaneous Application No. 665 of 2021 in SMW(C) No. 3 of 2020 SMW(C) No. 3 of 2020, wherein Hon’ble Supreme Court wherein Hon’ble Supreme Court has extended the limitation for instituting extended the limitation for instituting suit or proceeding proceedings including appeal before the Tribunal till 3 appeal before the Tribunal till 3rd October 2021 and therefore there October 2021 and therefore there is no delay in filing the present appeal. The Ld. Authorized is no delay in filing the present appeal. The Ld. Authorized is no delay in filing the present appeal. The Ld. Authorized Representative (AR) of the assessee did not object for condoning the Representative (AR) of the assessee did not object for condoning the Representative (AR) of the assessee did not object for condoning the delay in filing the appeals. delay in filing the appeals.
We have heard the rival submissions of the parties on the issue d the rival submissions of the parties on the issue d the rival submissions of the parties on the issue of condonation of the delay in filing the appeal of condonation of the delay in filing the appeal. In view of the decision of the Hon’ble Supreme Court dated 23.09.2021 (supra), decision of the Hon’ble Supreme Court dated 23.09.2021 (supra), decision of the Hon’ble Supreme Court dated 23.09.2021 (supra), wherein the Hon’ble Supreme Court has extended period of ble Supreme Court has extended period of ble Supreme Court has extended period of limitation for any suit, application or proceedings wherever application or proceedings wherever limitation was due was due between the period from 15.03.2020 to
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03.10.2021. Since, the delay in the present appeal is during the said 03.10.2021. Since, the delay in the present appeal is during the said 03.10.2021. Since, the delay in the present appeal is during the said period where the Hon’ble Supreme Court has extended the period where the Hon’ble Supreme Court has extended the period where the Hon’ble Supreme Court has extended the limitation, therefore, t , therefore, the delay in filing the appeal is condoned. y in filing the appeal is condoned.
Briefly stated, the facts of the case are that the assessee filed its Briefly stated, the facts of the case are that the assessee filed its Briefly stated, the facts of the case are that the assessee filed its return of income for the year under consideration on 04.11.2014 return of income for the year under consideration on 04.11.2014 return of income for the year under consideration on 04.11.2014 declaring total income of declaring total income of ₹5,650/-. Subsequently, on the basis of . Subsequently, on the basis of certain documents seized during the search action at the premises s seized during the search action at the premises s seized during the search action at the premises of Mr. Pankaj Goshar on 10. of Mr. Pankaj Goshar on 10.09.2015, the case of the assessee was he case of the assessee was reopened by way of issue of notice u/s 148 of the Income Tax Act, reopened by way of issue of notice u/s 148 of the Income Tax Act, reopened by way of issue of notice u/s 148 of the Income Tax Act, 1961 (in short ‘the Act’) dated 27.11.2018. The assessment was 1961 (in short ‘the Act’) dated 27.11.2018. The assessment was 1961 (in short ‘the Act’) dated 27.11.2018. The assessment was completed after making certain additions as discussed in the ter making certain additions as discussed in the ter making certain additions as discussed in the assessment order dated 31.12.2019 passed u/s 143(3) r.w.s. 147 of assessment order dated 31.12.2019 passed u/s 143(3) r.w.s. 147 of assessment order dated 31.12.2019 passed u/s 143(3) r.w.s. 147 of the Act. On further appeal, the assessee challenged legality of the the Act. On further appeal, the assessee challenged legality of the the Act. On further appeal, the assessee challenged legality of the assessment completed u/s 147 of the Act. According to the assessee, assessment completed u/s 147 of the Act. According to the assessee, assessment completed u/s 147 of the Act. According to the assessee, the addition has been made based on the documents seized during ddition has been made based on the documents seized during ddition has been made based on the documents seized during the search proceedings in the case of another person and therefore, the search proceedings in the case of another person and therefore, the search proceedings in the case of another person and therefore,
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in view of amended provisions of section 153C of the Act, the in view of amended provisions of section 153C of the Act, the in view of amended provisions of section 153C of the Act, the reassessment should have been completed u/s 153C of the Act reassessment should have been completed u/s 153C of the Act reassessment should have been completed u/s 153C of the Act rather than section 148 of the Act than section 148 of the Act, thus, the reassessment , the reassessment proceedings completed u/s 148 of the Act are invalid. The Ld. CIT(A) proceedings completed u/s 148 of the Act are invalid. The Ld. CIT(A) proceedings completed u/s 148 of the Act are invalid. The Ld. CIT(A) following the finding of the Tribunal in the case of assessee’s own following the finding of the Tribunal in the case of assessee’s own following the finding of the Tribunal in the case of assessee’s own case for assessment years 2010 case for assessment years 2010-11 to 2013-14 14, annulled the reassessment made by the Assessing Officer. reassessment made by the Assessing Officer. Aggrieved Aggrieved, the Revenue is in appeal before the Tribunal. is in appeal before the Tribunal.
4.1 Despite notifying none appeared on behalf of the assessee and Despite notifying none appeared on behalf of the assessee and Despite notifying none appeared on behalf of the assessee and therefore, the appeal is adjudicated therefore, the appeal is adjudicated ex-parte qua the assessee after qua the assessee after hearing arguments of the Ld. DR. nts of the Ld. DR.
We find that the only We find that the only issue-in-dispute in the case is whether dispute in the case is whether the re-assessment proceedings should have been initiated in the assessment proceedings should have been initiated in the assessment proceedings should have been initiated in the case u/s 147 of the Act or u/s 153C of the Act case u/s 147 of the Act or u/s 153C of the Act. Before the Ld. CIT(A), . Before the Ld. CIT(A), the assessee contended that the assessee contended that w.e.f. 01.06.2015 provisions of section .06.2015 provisions of section 153C have been amended and according to which if any document 153C have been amended and according to which if any document 153C have been amended and according to which if any document
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seized pertains to or any information contained therein relates to a seized pertains to or any information contained therein relates to a seized pertains to or any information contained therein relates to a person other than the person searched person other than the person searched, then reassessment in the then reassessment in the case of the other person has t case of the other person has to be completed in accordance with o be completed in accordance with provisions of section 153A r.w.s. 153C of the Act. Whereas the provisions of section 153A r.w.s. 153C of the Act. Whereas the provisions of section 153A r.w.s. 153C of the Act. Whereas the contention of the Revenue contention of the Revenue before us is that for invoking section that for invoking section 153C(1)(b), the first condition of the first condition of the document seized must pertains the document seized must pertains to the other person, shou , should be satisfied. According to the Ld. DR, the According to the Ld. DR, the document in the form of printout of the mobile phone seized from document in the form of printout of the mobile phone seized from document in the form of printout of the mobile phone seized from Mr. Pankaj Goshar did not pertains to the assessee and therefore, Mr. Pankaj Goshar did not pertains to the assessee and therefore, Mr. Pankaj Goshar did not pertains to the assessee and therefore, requisite of section 153C are not satisfied and hence the Assessing requisite of section 153C are not satisfied and hence the Assessing requisite of section 153C are not satisfied and hence the Assessing Officer has rightly initiated proceedings u/s 147 of the Act. We find rightly initiated proceedings u/s 147 of the Act. We find rightly initiated proceedings u/s 147 of the Act. We find that identical issue was in existence in the assessment years 2010 that identical issue was in existence in the assessment years 2010 that identical issue was in existence in the assessment years 2010- 11 to 2013-14 in the case of the assessee. The Ld. CIT(A) has 14 in the case of the assessee. The Ld. CIT(A) has 14 in the case of the assessee. The Ld. CIT(A) has followed the finding of the Tribunal wherein it is held that followed the finding of the Tribunal wherein it is held that followed the finding of the Tribunal wherein it is held that appropriate action in the case of the assessee should have been iate action in the case of the assessee should have been iate action in the case of the assessee should have been
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taken u/s 153C of the Act. The relevant finding of the Ld. CIT(A) is taken u/s 153C of the Act. The relevant finding of the Ld. CIT(A) is taken u/s 153C of the Act. The relevant finding of the Ld. CIT(A) is reproduced as under: reproduced as under:
“7.3.12 In view of above discussions, and respectfully following 7.3.12 In view of above discussions, and respectfully following 7.3.12 In view of above discussions, and respectfully following the above referred decision of the Hon'ble I the above referred decision of the Hon'ble ITAT, Mumbai in TAT, Mumbai in appellant's own case for AYS 2010 appellant's own case for AYS 2010-11 to 2013-14, wherein it has 14, wherein it has been held that the Ld. AO was not justified in taking action u/s been held that the Ld. AO was not justified in taking action u/s been held that the Ld. AO was not justified in taking action u/s 147 of the Act as in the present case, the provisions of sec 153C of 147 of the Act as in the present case, the provisions of sec 153C of 147 of the Act as in the present case, the provisions of sec 153C of the Act were applicable and the Ld. AO ough the Act were applicable and the Ld. AO ought to have taken t to have taken action therein and the fact that the present assessment year action therein and the fact that the present assessment year action therein and the fact that the present assessment year 2014-15 falls within said period of six assessment years 15 falls within said period of six assessment years 15 falls within said period of six assessment years immediately preceding the assessment year relevant to the immediately preceding the assessment year relevant to the immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is previous year in which search is conducted or requisition is previous year in which search is conducted or requisition is made, as the search in case of Goshar Group was conducted on e, as the search in case of Goshar Group was conducted on e, as the search in case of Goshar Group was conducted on 10.09.2015, I am of the considered opinion that in the present 10.09.2015, I am of the considered opinion that in the present 10.09.2015, I am of the considered opinion that in the present case, the provisions of sec 153C of the Act were applicable and case, the provisions of sec 153C of the Act were applicable and case, the provisions of sec 153C of the Act were applicable and the Ld. AO was not justified in assuming jurisdiction u/s 147 of the Ld. AO was not justified in assuming jurisdiction u/s 147 of the Ld. AO was not justified in assuming jurisdiction u/s 147 of the Act and consequently framing assessment order u/s 143(3) t and consequently framing assessment order u/s 143(3) t and consequently framing assessment order u/s 143(3) rws 147 of the Act is bad in law and liable to be annulled. rws 147 of the Act is bad in law and liable to be annulled. rws 147 of the Act is bad in law and liable to be annulled. Therefore, the impugned assessment order u/s 143(3) rws 147 of Therefore, the impugned assessment order u/s 143(3) rws 147 of Therefore, the impugned assessment order u/s 143(3) rws 147 of the Act is annulled and accordingly, the impugned additions the Act is annulled and accordingly, the impugned additions the Act is annulled and accordingly, the impugned additions would not survive. would not survive. The Ground No.3 raised in appeal is The Ground No.3 raised in appeal is ALLOWED.” 5.1 Since, we find that the Ld. CIT(A) has followed the binding Since, we find that the Ld. CIT(A) has followed the binding Since, we find that the Ld. CIT(A) has followed the binding precedent in the case of the assessee itself. precedent in the case of the assessee itself. Therefore, w Therefore, we do not find
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any error in the order of the Ld. CIT(A) any error in the order of the Ld. CIT(A) on the issue on the issue-in-dispute and accordingly, we uphold the same. The grounds of appeal of the we uphold the same. The grounds of appeal of the we uphold the same. The grounds of appeal of the Revenue are accordingly dismissed. Revenue are accordingly dismissed.
In the result, the appeal filed by the Revenue is dismissed. In the result, the appeal filed by the Revenue is dismissed. In the result, the appeal filed by the Revenue is dismissed.
Order pronounced in the open Court in ounced in the open Court in 26/08/2022. /08/2022. Sd/- Sd/- Sd/ (KULDIP SINGH KULDIP SINGH) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 26/08/2022 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. BY ORDER, //True Copy// (Sr. Private Secretary Sr. Private Secretary) ITAT, Mumbai ITAT, Mumbai