ROHINI GREEN ENERGY PRIVATE LIMITED,HYDERABAD vs. DCIT., CENTRAL CIRCLE-7, HYDERABAD, HYDERABAD

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ITA 113/HYD/2015Status: DisposedITAT Hyderabad28 March 2018AY 2011-123 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal admitted the additional ground and held that the assessment under Section 143(3) read with Section 153C was void ab initio because the AO had not recorded satisfaction for initiating proceedings under Section 153C. Consequently, the additions made were invalid.

What were the facts?

The assessee appealed against an addition made by the Assessing Officer (AO) and confirmed by the CIT(A). An additional ground was raised regarding the validity of proceedings under Section 153C due to lack of recorded reasons.

What were the issues?

Whether the assessment proceedings initiated under Section 153C were valid without the AO recording reasons for such initiation.

Which sections of the Income-tax Act were involved?

Section 153C,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD BENCH “B”, HYDERABAD

Before: SMT P. MADHAVI DEVI & SHRI B. RAMAKOTAIAH

For Appellant: Shri S. Rama Rao
For Respondent: Shri K. Srinivas Reddy
Hearing: 28/03/2018Pronounced: 28/03/2018

PER P. MADHAVI DEVI, J.M.:

The assessee is in appeal against the order of CIT(A) – 12, Hyderabad dated 28/11/2014 for AY 2011-12. 2. The assessee has raised the following grounds of appeal:

“1. The order of learned Commissioner of Income-Tax (Appeals) is erroneous both on facts and law.

2.

The learned Commissioner of Income-Tax(Appeals) erred in conforming addition of Rs.1,48,00,000/- made by the Assessing officer on the plea that cash payment was made from unexplained sources without considering the explanation and documentary evidences produced.

3.

Any other ground that may be urged at the time of hearing.”

2.

1 Further, the assessee has filed the following additional ground of appeal and requested for admission and adjudication of the same: “The AO erred in initiating proceedings u/s 153C of the IT Act without recording the reasons for such initiation and the learned CIT(A) ought to have held that the assessment is not valid as the reasons are not recorded.”

3.

Since the additional ground raised by the assessee is a legal ground, the same is admitted and the ld. DR was directed to get a report from the AO as to whether the satisfaction for initiating proceedings u/s 153C have been recorded by the AO.

4.

Ld. DR has filed the report of the AO dated 30/11/2017 enclosing a letter dated 29/03/2016 of the ITO, Ward – 3(2), Hyderabad, reporting that there is no satisfaction note on file of the assessee. Taking the same into consideration, we allow the additional ground raised by the assessee and hold that the assessment completed u/s 143(3) read with section 153C of the Act is void ab- initio. Since the very assessment has been held to be void, the additions made in such assessment have no legs to stand. Therefore, original grounds of appeal raised by the assessee against the additions confirmed by the CIT(A), need no adjudication.

4.

In the result, appeal of the assessee is allowed.

Pronounced in the open Court on 28th March, 2018. (B. RAMAKOTAIAH) JUDICIAL MEMBER

Hyderabad, Dated: 28th March, 2018 kv Copy to:-

1) Rohini Green Energy Pvt. Ltd., 2-1-88/1, Anand Nagar X Roads, Bandlaguda X Roads, Hyderabad. 2) DCIT, Central Circle – 7, Posnett Bhavan, Ram Koti, Hyd. 3) CIT(A) – 12, Hyd. 4) CIT (Central), Hyd. 5) The Departmental Representative, I.T.A.T., Hyderabad. 6) Guard file

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