ANISH GARG,PATIALA vs. ACIT/ DCIT CEN CIR, PATIALA

Before me the learned AR, placed reliance on the order of the Tribunal in the case of Anish Garg v. ITO in ITA No. 739/Chd/2024. In that case, on identical facts, the Tribunal had decided the legal ground of validity of reassessment proceedings in favour of the assessee. The relevant finding of the Tribunal in Anish Garg (supra), as relied upon by the assessee, reads as under:

The learned AR contended that the above finding squarely applies to the assessee’s case, and therefore, the action of the Assessing Officer in reopening the assessment is unsustainable in law.

The learned DR, on the other hand, relied upon the assessment order and supported the reopening, contending that sufficient reasons existed for the formation of a belief of escapement of income and the additions made were justified. It was submitted that the assessee had not appeared before the lower authorities and had also failed to demonstrate how the facts of the present case were identical to those decided by the Tribunal in the case relied upon. The DR argued that for search proceedings, the existence of incriminating material is a requirement; however, where additions are made based on material gathered during survey or regular proceedings, there is no such condition that incriminating material must be with the Assessing Officer. It was further submitted that the learned CIT(A) had already taken a liberal view in setting aside the matter to the file of the Assessing Officer, despite the assessee not cooperating during the proceedings, and therefore, no further relief is called for.

I have considered the rival submissions. It is evident that the learned CIT(A) has examined the matter in detail and found that the assessment was framed without proper opportunity and in violation of principles of natural justice. Moreover, the legal ground as decided by the Tribunal in Anish Garg v. ITO (ITA No. 739/Chd/2024) was admittedly not raised before the lower authority, as the assessee had failed to appear during the course of proceedings. In my considered view, it was necessary for the assessee to demonstrate before the CIT(A) that the facts of the present case were identical to those decided by the Tribunal in Anish Garg (supra). Such a finding can only be recorded by the lower authorities on the basis of specific submissions and supporting documents, if any, filed by the assessee in the course of appellate proceedings. Since the assessee did not discharge this obligation, I find no infirmity in the approach adopted by the learned CIT(A) in remanding the matter back to the file of the Faceless Assessing Officer for affording a fresh opportunity of hearing. Further it is pertinent to note that the proceedings, if any initiated by the Assessing Officer, will be transferred to the Faceless Assessing Officer. The Faceless Assessing Officer to whom the proceeding have been assigned, would hear the matter afresh without being influenced by any observation or conclusion drawn by the earlier AO and the Faceless Assessing Officer will start the assessment de novo.

Thus, the learned CIT(A) was justified in setting aside the assessment for fresh adjudication, and I find no infirmity in the well-reasoned order. However, the directions of the learned CIT(A) are modified to the limited extent that the Faceless Assessing Officer, while framing the assessment afresh, shall specifically consider the binding decision of the Coordinate Bench in the case of Anish Garg v. ITO (supra). The Assessing Officer shall also adjudicate the legal ground raised by the assessee with respect to the validity of reopening, and record a clear finding as to whether the alleged escapement of income had a direct nexus or live link with the material relied upon by him. Subject to this modification, the order of the learned CIT(A) is upheld.

In the result, appeal of the Assessee stands allowed for statistical purposes. to 284/Chd/2024:- 11. Since the grounds involved in all the appeals for the assessment years 2014-15 to and 2017-18 are similar and even the facts and circumstances involved and submissions of the ld. Representatives too are similar, therefore, the findings arrived at by us, in the former part of our order, shall apply mutatis mutandis to these appeals also. Accordingly, these appeals also stand allowed for statistical purposes.

In the result, all the appeals filed by the assessee are allowed for statistical purposes.