MAHESH MEHTA,DELHI vs. ACIT, NEW DELHI

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ITA 3617/DEL/2017Status: DisposedITAT Delhi10 August 2020AY 2009-103 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 quashed the Section 263 proceedings initiated by the PCIT. Consequently, the assessment order passed under Section 263/143(3) and the addition made therein were rendered invalid and infructuous.

What were the facts?

The Assessing Officer (AO) made an addition of Rs. 2 crores under Section 69 of the Income Tax Act, 1961, in an order passed under Section 263/143(3). The CIT(A) sustained this addition. The assessee had previously appealed against the Section 263 order.

What were the issues?

The primary issue was the validity of the assessment order and the addition made therein, given that the underlying Section 263 proceedings were quashed by the Tribunal.

Which sections of the Income-tax Act were involved?

Section 69,Section 263,Section 143(3),Section 153A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH : E : NEW DELHI

Before: SHRI R.K. PANDA & SHRI SUDHANSHU SRIVASTAVA

For Appellant: Shri Suresh K. Gupta, CA
For Respondent: Ms Parimita Biswas, Sr. DR
Hearing: 30.07.2020Pronounced: 10.08.2020

BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER Assessment Year: 2009-10 Mahesh Mehta, Vs ACIT, 2042, Katra Tobacco, Central Circle-13, Khari Baoli, New Delhi. Delhi. PAN: AGBPM7320C (Appellant) (Respondent) Assessee by : Shri Suresh K. Gupta, CA Revenue by : Ms Parimita Biswas, Sr. DR Date of Hearing : 30.07.2020 Date of Pronouncement : 10.08.2020 ORDER

PER R.K. PANDA, AM:

1.

This appeal filed by the assessee is directed against the order dated 31st March, 2017 of the CIT(A)-28, New Delhi relating to assessment year 2009-10.

2.

Although a number of grounds have been raised by the assessee, these all relate to the addition made by the AO of Rs.2 crores u/s 69 of the Act in the order passed u/s 263/143(3) of the Act.

3.

The ld. counsel for the assessee, at the outset, submitted that the AO passed the order u/s 263/143(3) of the Act on 31st March, 2015 determining the total income of the assessee at Rs.6,28,15,410/- wherein he made addition of Rs.2 crore u/s 69 of the Act which the ld. CIT(A) has sustained. He submitted that against the order of the PCIT passed u/s 263 of the Act, the assessee preferred appeal before the Tribunal and the Tribunal, vide order dated 12th March, 2020, had quashed the section 263 proceedings and upheld the original assessment order passed u/s 153A/143(3) of the Act. He submitted that since the section 263 order passed by the PCIT has been quashed, the subsequent proceedings by the AO become infructuous and, therefore, the order passed by the AO and the CIT(A) have to be quashed.

4.

The ld. DR, on the other hand, fairly conceded that the order passed by the PCIT u/s 263 has been quashed by the Tribunal.

We find, the Tribunal, vide order dated 12th March, 5. 2020, copy of which is placed in the paper book, has quashed the section 263 proceedings initiated by the PCIT. Since the section 263 proceedings have been quashed and no longer exists, therefore, the consequent passing of assessment order u/s 263 becomes invalid and without jurisdiction and void ab initio and, therefore, the addition made by the AO in the proceedings u/s 263/143(3) which have been upheld by the CIT(A) become infructuous and is quashed. The grounds raised by the assessee are, therefore, allowed.

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