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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI
Before: SHRI H. S. SIDHU
ORDER This appeal is filed by the Assessee against the impugned Order dated 23.01.2018 passed by the Ld. CIT(A)-14, New Delhi relating to Assessment Year 2009-10.
2. At the time of hearing Ld. Counsel for the assessee stated that originally assessee has filed 07 grounds of appeal
, but later assessee has also filed additional grounds of appeal vide its Application dated 10.08.2019. He further submitted that AO has completed the assessment u/s. 143(3) of the Income Tax Act, 1961 (in short “Act”) on 20.12.2016 and assessee has filed the objections on 26.8.2016 which were disposed by the AO on 01.12.2016, which is contrary to the judgment of the Hon’ble Bombay High Court in the case of Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax reported (2008) 296 ITR
90. (Bombay) and various other judgments which he has reproduced in the small paper book containing pages 1-27 by attaching the copy of the judgment in the case of Asian Paints Ltd; Bharat Jayantilal Patel; Meta Plast Engineering Ltd. And Hirachand Kanuga. He requested that the additional grounds may be admitted in view of the judgment of the Hon’ble Bombay High Court in the case of Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax (Supra) and addition in dispute may be deleted. No other ground has been argued by the Ld. Counsel for the assessee.
3. On the contrary, Ld. DR relied upon the orders of the authorities below and opposed the request for admission of additional grounds.
I have heard both the parties and perused the orders of the revenue authorities especially the contention raised by the Ld. Counsel for the assessee in the original grounds of appeal filed with the appeal and the additional grounds filed by the Assessee with the Application dated 10.08.2019. For the sake of convenience, the Assesee’s application dated 10.8.2019 for admission of additional grounds is reproduced as under:-
“10/8/2019 To The Hon'ble Income Tax Appellate Tribunal, 'SMC' Bench, New Delhi Sub: Indsao Construction Pvt Ltd- Assessment Year 2009-10 - Request for additional grounds of appeal- Respected Member, In this case assessment was originally completed u/s 143(1) and thereafter proceedings initiated u/s 147. Notice was u/s 148 was issued. The further details are as under:
1 Date of filing the return u/s 148 21/05/2016 2 Date of request for reasons 15/07/2016 3 Date of filing the objections 26/08/2016 4 Date of disposal of objections 01/12/2016 5 Date of completion of assessment 20/12/2016
2. Appeal against this order was filed by taking several grounds of appeal including the validity of action u/s 147. The assessee's appeal was dismissed both on legal and merits grounds. Thereafter appeal to the Hon'ble ITAT was filed in Feb 2018 taking several grounds including the ground relating to the invalidity of action 148.
3. Even though we have taken the legal ground challenging the validity of action u/s 147 but out of abundant precaution we are also requesting for the under mentioned two legal grounds which arises out of the assessment order and appeal order for which every details are on record and no verification or clarification is required. It is requested that these tow legal grounds may kindly be allowed to be raised in view of the judgment if Hon'ble Supreme Court in the case of NTPC reported in 229 ITR 383. Similar matter was involved in the coordinate bench decision in the case of Pioneer Town Planners Pvt Ltd and where the Hon'ble Members have allowed the additional grounds. Similar matter was also involved in the case of Smt Kamleash Goyal. Copies of the order are enclosed:-
Additional legal grounds of appeal:
1. The assessment completed u/s 143(3) was bad in law and merits quashing since mandatory period of 4 weeks for completion of assessment, after disposal of objection against the objections raised, have not been allowed which is mandatory as referred to tn the judgments of Hon'ble High Court in the case of Asian Paints reported in 296 ITR 90.
On the facts and in the circumstances of the case and in law action the assessment completed u/s 143(3) is invalid and void abintio since in view of the provisions of section 153C applicable in this case the assessing officer is not empowered to take action u/s 148 which is clearly prohibited by provision of section 153C
Both the above said grounds are legal grounds and it is submitted that these grounds allowed to be raise for which the assessee shall be highly grateful.
Yours faithfully Sd/- For Indsao Construction Pvt. Ltd.”
4.1 After going through the judgment passed by the Hon’ble Bombay High Court in the case of Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax (Supra) and the facts and circumstances of the present case, I am of the view that Assessee has raised the objections after receiving the notice u/s. 148 of the Act on 26.8.2016 which were disposed of by the AO on 01.12.2016 and AO completed the assessment on 20.12.2016. Keeping in view of the facts and circumstances of the present case and the Judgement of the Hon’ble Bombay High Court in the Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax (Supra), I am of the view that the additional grounds raised by the assessee are legal grounds and are very much connected with the facts and circumstances of the present case and deserve to be admitted. Therefore, I admit the aforesaid additional grounds raised by the Assessee.
4.2 As argued by the Ld. Counsel for the assessee, which I have verified from the records that the Assessee has field the objections on 26.8.2016 which were disposed of by the AO on 01.12.2016 and he completed the assessment on 20.12.2016 u/s. 143(3) of the Act. For the sake of convenience, the relevant portion of the judgement of the Hon’ble Bombay High Court in the case of Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax (Supra) is reproduced as under:-
“1. Heard learned counsel for the petitioner and the respondent. Rule, returnable forthwith. By consent all the petitions are taken up for final hearing.
2. In all the above petitions, it is a case regarding reopening of the assessment order under section 148 of the Income-tax Act. In all the above cases, the petitioners have filed their respective objections on January 15, 2007, with regard to reopening of the assessment.
The learned senior counsel for the petitioner pointed out that in some of the cases as soon a the objections were rejected by the concerned Income-tax Officer, even the assessment order has been passed within a very short time whereby the assessee is left without any remedy to challenge such an order of rejection.
4. Hence we make it clear that if the Assessing Officer does not accept the objections so filed, be shall not proceed further in the matter within a period of four weeks from the date of receipt of service of the said order on objections, on the assessee.
5. Accordingly, rule is made absolute.
We also direct that the Income-tax Officer concerned shall follow the above procedure strictly in all such cases of reopening of assessment.
All the petitions stand disposed of accordingly.“
4.3 Keeping in view of the facts and circumstances of the present case and the judgment passed by the Hon’ble Bombay High Court in the case of Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax (Supra), I am of the view that the AO has rejected the objections of the assessee on 01.12.2016 and completed the assessment on 20.12.2016 which was within a very short time whereby the Assessee was left without any remedy to challenge such an order of rejection. The Hon’ble Bombay High Court has taken a serious view on this issue and also direct that AO concerned shall follow the above procedure strictly in all such cases of reopening of assessment. Therefore, respectfully following the aforesaid precedent of the Hon’ble Bombay High Court in the case of Asian Paints Ltd. Vs. Deputy Commissioner of Income Tax (Supra) the addition in dispute is deleted by accepting the appeal of the assessee.
In the result, the appeal filed by the assessee stands allowed.