DATTAPRASAD RADHAKISAN REVGADE,HIVARGAON vs. ITO WARD 2, AHMEDNAGAR

3. On the facts and in the circumstances of the case and in law, Ld. NFAC has erred in upholding the illegal order passed by the Ld. NaFAC since the Notice u/s 148 dated 04-04-2022 was issued by Jurisdictional Assessing Officer (ITO Ward 2 Ahmednagar) and not by the NaFAC and hence, the assumption of jurisdiction by Ld. JAO u/s 148 is in violation of mandatory jurisdictional conditions as stipulated in Notification No 18/2022 dated 29th March 2022, which has been upheld by Jurisdictional Hon'ble Bombay High Court in case of Hexaware Technologies Ltd. 464 ITR 430 (Bombay) as mandatory jurisdictional condition and therefore, the impugned reassessment proceedings and the consequential reassessment order may please be quashed.

4. On the facts and in the circumstances of the case and in law, Ld. NFAC has erred in upholding the reassessment order passed u/s 147 r.ws 144 read with section 1448 of the Act by the National Faceless Assessment Centre (NaFAC) is invalid and without jurisdiction since the income of the appellant is admittedly below the monetary limit as specified u/s 149(1)(b) of the Act viz. Rs 50 lakhs and which has been duly accepted by Ld. NaFAC hence, the very assumption of the jurisdiction u/s 148 of the Act for reopening the appellant's case is bad 2

5. On the facts and in the circumstances of the case and in law and without prejudice to other grounds the assessment order passed u/s 147 r.w.s. 144 of the Act is bad in law inasmuch as there was no valid and proper sanction by the prescribed authority under section 151 of the Act as sanction is accorded by Principal Commissioner of Income Tax 1, Pune whereas since three years were elapsed, as held by Hon'ble Supreme Court in the case of Rajeev Bansal -469 ITR 46, the sanction ought have been obtained from Principal Chief Commissioner of Income Tax, Pune which admittedly not obtained and hence, the said notice as well as consequential assessment order deserves to be quashed.

6. On the facts and in the circumstances of the case and without prejudice to any other grounds, the order passed under section 148A(d) and the consequential notice issued u/s 148 are bad in law and liable to be quashed, as they were issued without valid approval from the competent authority under section 151 of the Act.

7. On the facts and in the circumstances of the case and without prejudice to any other grounds, the order passed under section 148A(d) and the consequential notice issued u/s 148 are bad in law and liable to be quashed, as they were issued mechanically and without proper application of mind and hence, the impugned reassessment order deserves to be quashed and set aside.

8. On the facts and in the circumstances of the case and without prejudice to any other grounds, the learned Assessing Officer has erred in issuing notice under section 148 of the Act in a standard format without striking off the inapplicable reasons or specifying the exact basis for reopening, thereby the use of a generic, unmodified template without application of mind renders the notice vague. nonspeaking, and invalid in law, as held in various judicial precedents and consequently, the reassessment proceedings initiated pursuant to such defective notice are liable to be quashed.

9. On the facts and in the circumstances of the case and in law and without prejudice to other grounds, the assessment order passed under section 147 r.ws 144 of the Income-tax Act, 1961 is bad in law and void 3 143(2) was issued pursuant to the return of income filed by the appellant. which was erroneously treated as invalid by the Assessing Officer, and in the absence of a valid and mandatory notice under section 143(2), the entire assessment proceedings stand vitiated and are liable to be quashed

10. On the facts and in the circumstances of the case and in law and without prejudice to other grounds, Ld. NFAC has erred in upholding the addition of Rs 12,92,967/-made by Ld. NaFAC u/s 69 of the Act and hence, the same is bad in law and thus. the impugned addition may please be deleted

11. On the facts and in the circumstances of the case and in law and without prejudice to any other ground, Ld. NFAC has erred in upholding the addition of Rs 2,73,180/-on account of Business Income which is incorrect both on facts and in law and which amounts to double taxation and hence, the said addition deserves to be quashed.

12. On the facts and in the circumstances of the case and in law and without prejudice to any other ground, Ld. NaFAC has erred in not giving the credit of prepaid taxes of Rs 6,700 paid by the appellant while computing the tax demand.

13. On the facts and in the circumstances of the case and without prejudice to any other grounds, the Ld. NaFAC erred in initiating penalty proceedings under section 270A, 271AAC(1) and 272A(1)(d) of the Act.

14. On the facts and in the circumstances of the case and without prejudice to any other grounds, the Ld. NaFAC erred in charging interest under sections 234A and 2348, and fees u/s 234F of the Act.

, in the interest of justice, if necessary, at the time of hearing of the appeal.” Submission of ld.AR :

2. The ld.Authorised Representative(ld.AR) for the Assessee submitted that assessee’s appeal was dismissed by the ld.CIT(A) 4 [A] without discussing each and every ground and merits of the case and merely dismissed for non-compliance. Ld.AR also submitted that legal grounds were raised before ld.CIT(A), but ld.CIT(A) has not adjudicated the legal grounds raised. Hence, ld.AR requested for one more opportunity of being heard to the assessee.

Submission of ld.Departmental Representative(ld.DR) : 3. The ld.DR for the Revenue relied on the order of Assessing Officer(AO) and ld.CIT(A)[NFAC].

Findings & Analysis : 4. We have heard both the parties and perused the records.

4.1 Aggrieved by the assessment order, assessee filed appeal before the ld.CIT(A). The grounds of appeal raised before the ld.CIT(A) are as under : “On the facts and in the prevailing circumstances of the case and in law the learned assessing officer has erred in re-opening the assessment by issue of notice u/s 147 of the I.T. Act, 1961. On the facts and in the prevailing circumstances of the case and in law the learned assessing officer has erred in passing the assessment order without any proper jurisdiction. On the facts and in the prevailing circumstances of the case and in law the learned assessing officer has erred in making addition of Rs.12,92,167/-as unexplained deposit u/s 69 of the IT Act 1961, without considering the nature of land and cost of acquisition and improvement expenses etc thereof. Therefore, addition made by the A.O. may please 5 be deleted.

It is humbly prayed that the reliefs as prayed and such other and further reliefs as maybe justified by the facts and circumstances of the case and as may meet the ends of justice, may please be granted. The Appellate craves the right to add, amend, modify, alter, revise, substitute, delete any or all grounds of the appeal, if deemed necessary at the time of hearing of the appeal.” 4.2 It is observed from the order of the ld.CIT(A) that the ld.CIT(A) during the appellate proceedings issued notices. Assessee failed to comply these notices. Assessee has challenged validity of Reopening. This is a Legal Ground. It has not been adjudicated giving reasons. The ld.CIT(A) did not decide the grounds of appeal on merit but merely dismissed the appeal of the assessee for non- compliance. The ld.CIT(A) has not adjudicated grounds raised by the assessee on merits.

5. The Hon’ble Bombay High Court has held in the case of Pr.CIT(Central) Vs. Premkumar Arjundas Luthra (HUF) (Bombay)/[2017] 297 CTR 614 (Bombay) as under : Quote, “8.From the aforesaid provisions, it is very clear once an appeal is preferred before the CIT(A), then in disposing of the appeal, he is obliged to make such further inquiry that he thinks fit or direct the Assessing Officer to make further inquiry and report the result of the same to him as found in Section 250(4) of the Act.

Further Section 250(6) of the Act obliges the CIT(A) to dispose of an appeal in writing after stating the points for determination and then 6 [A] render a decision on each of the points which arise for consideration with reasons in support. Section 251(1)(a) and (b) of the Act provide that while disposing of appeal the CIT(A) would have the power to confirm, reduce, enhance or annul an assessment and/or penalty. Besides Explanation to sub-section (2) of Section 251 of the Act also makes it clear that while considering the appeal, the CIT(A) would be entitled to consider and decide any issue arising in the proceedings before him in appeal filed for its consideration, even if the issue is not raised by the appellant in its appeal before the CIT(A). Thus once an assessee files an appeal under Section 246A of the Act, it is not open to him as of right to withdraw or not press the appeal. In fact the CIT(A) is obliged to dispose of the appeal on merits. In fact with effect from 1st June, 2001 the power of the CIT(A) to set aside the order of the Assessing Officer and restore it to the Assessing Officer for passing a fresh order stands withdrawn.

Therefore, it would be noticed that the powers of the CIT(A) is coterminous with that of the Assessing Officer i.e. he can do all that Assessing Officer could do. Therefore just as it is not open to the Assessing Officer to not complete the assessment by allowing the assessee to withdraw its return of income, it is not open to the assessee in appeal to withdraw and/or the CIT(A) to dismiss the appeal on account of non-prosecution of the appeal by the assessee. This is amply clear from the Section 251(1)(a) and (b) and Explanation to Section 251(2) of the Act which requires the CIT(A) to apply his mind to all the issues which arise from the impugned order before him whether or not the same has been raised by the appellant before him. Accordingly, the law does not empower the CIT(A) to dismiss the appeal for non- prosecution as is evident from the provisions of the Act.” Unquote.

5.1 Thus, the Hon’ble Bombay High Court has categorically held that ld.CIT(A) has to decide the appeal on merit and ld.CIT(A) does not have any power to dismiss appeal for non-prosecution.