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Income Tax Appellate Tribunal, DELHI BENCH: ‘G’: NEW DELHI
Before: SHRI H.S. SIDHU & SHRI ANADEE NATH MISSHRA
This appeal by Revenue has been directed against the order of Learned Commissioner of Income Tax (Appeals)-36, [‘Ld. CIT(A)’, for short] New Delhi, dated 31.08.2016 for Assessment Year 2007-08, on the following grounds:
“1. The Commissioner of Income Tax is empowered to call for and examine the record of any proceedings under this Act, and if considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue he may ater giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary
ITA No.-5651/Del/2016. M/s Tarun Bal Shiksha Samiti. pass such order thereon as the circumstances of the case justify including an order enhancing or modifying the assessment or cancelling the assessment and directing a fresh assessment. 2. The appellant craves leave to add, to alter or amend any ground of appeal raised above at the time of hearing.”
(2) The assessee has filed its return of income for Assessment Year 2007-08 on 11.12.2007 and assessment in this case was completed by accepting NIL income on 29.12.2009. Subsequently, vide order dated 09.03.2012 of the Ld. Director of Income Tax (Exemption) [“Ld. DIT(E)”, for short] U/s 263 of the Income Tax Act, 1961 (“IT Act, for short), the Assessment Order was set aside with the direction to the Assessing Officer (“AO”, for short) to pass fresh Assessment Order. The relevant portion of the aforesaid order dated 09.03.2012 of the Ld. DIT passed U/s 263 of I.T. Act, as reproduced as under:
“A notice u/s 263 was issued to the assessee on 3.2.2012 requiring him to show cause as to why the assessment order should not be set aside to be made de novo. In response, a letter was received seeking adjournment. On request, hearing was adjourned to 17.2.2012. On 17.2.2012, on request, hearing was again adjourned to 21.2.2012. On 22.2.2012, hearing was again adjourned to 27.2.2012. On 27.2.2012, neither anybody appeared nor any submissions filed. Therefore, this proceedings is decided on the basis of material available on record. It is noted that during the year, the assessee has claimed to have received corpus donation of Rs. 1,35,00,000/-. On a perusal of the details, it was seen that some of the alleged donors are existing /operating their office from the same address. The names of donors who are operating from same address are as under:-
I M/s Diana Builders & Contractors Pvt. Ltd. II M/s Laajree Spinning & Wearing Mills Pvt. Ltd. III M/s Well Set Pharaceuticals & Drugs Pvt. Ltd. IV M/s Aapki Marketing Pvt. Ltd. V M/s Noble Mercantile Pvt. Ltd. VI M/s Vaare Exime Pvt. Ltd. VII M/s Mona Advertising & Marketing Pvt. Ltd. VIII M/s Onflow Agro Pvt. Ltd.
ITA No.-5651/Del/2016. M/s Tarun Bal Shiksha Samiti.
It is noted that AO has not made any effort to examine the creditworthiness and capacity of these corpus donors, which are operating mostly from the same address 3805 /5 Kanhiya Nagar, Tri Nagar, Delhi. The letters sent u/s 133(6) for verification have been either received back or not replied to. Only confirmations from the assessee has been obtained. Mere filing of confirmation does not establish the creditworthiness and the genuineness of the transaction. The AO should have made independent enquiries to know the capacity, identity and creditworthiness of the parties. It is noted that even the purpose for which the donation is made is not specified in the confirmations filed. Further, the AO has not investigated the transaction of purchase of land for hostal claimed to be for Rs. 17282074/-. The above facts clearly show that the assessment order for the assessment year 2007 - 08 dated 29.: 12.2009 was framed in a hurried and casual manner without any application of mind, without making proper inquiries and with scant regard to the provisions of the Income Tax Act, 1961. The assessment order for assessment year 2007-08 dated 29.12.2009 is, therefore, held to be erroneous and prejudicial to the interest of-revenue. The assessment order for the Asstt, Year 2007-08 passed u/s 143(3) of the Income Tax Act, 1961 on 29.12.2009, is, therefore, set aside u/s 263 of the Act, with the direction to the Assessing Officer, Trust Circle - IV, New Delhi to examine the issues discussed in this order and pass as fresh assessment order in accordance with law after affording due opportunity of hearing to the assessee.”
(3) In pursuance of the aforesaid order dated 09.03.2012 of the Ld. DIT(E), the AO passed fresh Assessment Order dated 22.03.2013, wherein income was determined of Rs. 1,89,52,910/-. In the meantime, the Assessee filed appeal in Income Tax Appellate Tribunal (“ITAT”, for short) against the aforesaid order dated 09/03/2012 of the Ld. DIT(E) passed u/s 263 of IT Act, which was adjudicated by Co-ordinate Bench of ITAT, Delhi, vide order dated 27.11.2015 in for Assessment Year 2007- 08 in the aforesaid order dated 27.11.2015. The assessee’s appeal was allowed by Co- ordinate Bench of ITAT, Delhi by setting aside the aforesaid order dated 27.11.2015 u/s 263 of IT Act and by restoring the original Assessment Order dated 29.12.2009.
Assessee’s appeal against the fresh Assessment Order dated 22.03.2013 was decided by the Ld. Commissioner of Income Tax (Appeals) [“Ld. CIT(A)”, for short] vide order dated
ITA No.-5651/Del/2016. M/s Tarun Bal Shiksha Samiti. 31.08.2016. Taking note of the aforesaid order dated 27.11.2015 of ITAT, Delhi, the Ld.
CIT(A) held that the order under appeal (i.e. Assessment Order dated 22.03.2013 ) had become null and void and did not survive. She deleted the addition in the fresh Assessment Order dated 22.03.2015 by holding the fresh Assessment Order to be null and void. The present appeal before us has been filed by Revenue against the aforesaid impugned order dated 31.08.2016 of the Ld. CIT(A). During the appellate proceedings in ITAT, a copy of the aforesaid order dated 27.11.2015 of Co-ordinate Bench of ITAT, Delhi was filed from assessee’s side. Moreover, a copy of the order dated 03.08.2016 of the Hon’ble High Court of Delhi was also filed from assessee’s side wherein Revenue’s appeal U/s 260A against the aforesaid order dated 27.11.2016 of Co-ordinate Bench of ITAT, Delhi was dismissed.
(4) At the time of hearing before us, at the outset, the Ld. Authorized Representative (“AR”, for short) of the Assessee contented that the present appeal filed by Revenue has no merits. In view of the aforesaid order dated 27.11.2015 of Co-ordinate Bench of ITAT, Delhi, wherein the order of the Ld. DIT(E) passed u/s 263 of IT Act, was set aside and original Assessment Order dated 29.12.2009 was restored; and further, as the Revenue’s appeal against the aforesaid order dated 27.11.2015 of Co-ordinate Bench of ITAT, Delhi, has also been dismissed by Hon’ble High Court of Delhi, vide aforesaid order dated 03.08.2016 in ITA 517/2016. The Ld. Departmental Representative (“Ld. DR”, for short) relied on the order of the AO.
(5) We have heard both sides. We have perused the materials available on record.
We have also considered the judicial precedents brought to our attention, during the Page 4 of 7
ITA No.-5651/Del/2016. M/s Tarun Bal Shiksha Samiti. appellate proceedings. We find that the Co-ordinate Bench of ITAT, Delhi has already set aside the aforesaid order dated 09.03.2012 of the Ld. DIT(E) passed u/s 263 of I.T. Act and has restored the original Assessment Order dated 29.12.2009 wherein assessee’s income was assessed at NIL. Thus, the fresh Assessment Order dated 22.03.2013, passed in pursuance of the aforesaid order dated 09.03.2012 of Ld. DIT(E) passed u/s 263 of IT Act does not survive at present. We also find that Revenue’s appeal against the aforesaid order dated 27.11.2015 of Co-ordinate Bench of ITAT, Delhi, has already been dismissed by Hon’ble High court of Delhi, in ITA 517/2016 vide order dated 03/08/2016 in the following words “
This appeal by the Revenue is directed against the order dated 27th November, “4. 2015 passed in the Income Tax Appellate Tribunal (‘ITAT’) in relating to the assessment year 2007-08.
The only question urged is whether the ITAT was in error in setting aside the order passed by the CIT(A) under section 263 of the Income Tax Act, 1961 on 12th March, 2012 holding that the assessment order dated 29th December, 2009 passed by the Assessing Officer (‘A.O.’) was prejudicial to the interest of the Revenue.
As rightly pointed out by the ITAT, the CIT(A) should have had some materials to enable him to form a prima facie view. It appears that the view of the CIT(A) was merely a different one on the same materials. There was no justification for the CIT(A) to have concluded on the existing materials that the order of the AO was erroneous or prejudicial to the interest of the Revenue. No substantial question of law arises for consideration.”
(6) In view of the foregoing, we are of the view that the Revenue’s appeal has no merits. We find no reason to interfere with the order of the Ld. CIT(A), who held the fresh Assessment Order dated 22.03.2015 to be null and void and deleted the addition.
What survives at present, is the original Assessment Order dated 29.12.2009, in which the assessee’s income was to determined at NIL; and the fresh Assessment Order dated Page 5 of 7
ITA No.-5651/Del/2016. M/s Tarun Bal Shiksha Samiti. 29.12.2009 has no legal force or sanctity at present. Therefore, Revenue’s appeal is dismissed.
(7) In the result, appeal filed by Revenue is dismissed.
Order pronounced in the open court on 29/7/2019