SHRICHAND SHAMDAS ASWANI,,PUNE vs. INCOME-TAX OFFICER,, PUNE

This assessee’s appeal for A.Y. 2006-07 is directed against the CIT(A)-6, Pune’s order dated 22/03/2017 passed in case No. PN/CIT(A)-V/ITO Wd.8(1)/96/2014-15 involving proceeding u/s. 143(3) r.w.s. 147 of the Income Tax Act, 1961; in short "the Act”.

We notice at the outset that the assessee has moved a petition dated 22.11.2019 seeking to raise an additional ground that the impugned section 148/147 proceedings taken recourse to by the learned lower authorities is not sustainable in law. The Revenue has vehemently opposed the foregoing petition on the grounds of inordinate delay, estoppel as well as approbate and reprobate; as the case may be.

We find no merit in the Revenue’s foregoing technical objections in light of the tribunal’s decision in All Cargo Global Logistics Ltd. V/s DCIT (2012) 137 ITD 217 (Mumbai)(SB); after considering NTPC Ltd. V/s CIT 229 ITR 383 (SC) thereby holding that such an additional ground could very well be entertained in second appellate proceedings before us which goes to root of the matter; so as to determine correct tax liability of an assessee, provided all the relevant facts form part of records. There is hardly any dispute the assessee has already filed the clinching seized documents annexure R-3/ Bundle No.1 at page 17 of the paperbook. We therefore accept the assessee’s above stated petition dated 22.11.2019 raising its additional substantial ground challenging validity of section 148/147 proceedings.

We now advert to foregoing legal issue. There is hardly any dispute that the department had found/seized the impugned document in search action carried out in case of M/s. Nanasaheb S. Gaikwad group, indicating cash payment of Rs. 1,22,30,000/- accepted at the assessee’s behest. Suffice to say, it is the said seized documents R-3 (supra) that stands treated as the tangible material for recording reasons to belief that the assessee’s taxable income had escaped assessment.

We make it clear first of all that the foregoing annexure R-3 forms part of record before us at page 17 (vernacular) and page 19 (translated version ). The Revenue could hardly dispute that the same is in the nature of cash receipt issued and signed by the assessee Shrichand Shamdas Aswani which “belongs” to him only. And it is at this stage that section 153C of the Act comes into play containing the non obstante clause “Notwithstanding anything contained in ………section 147……” having overriding effect over the general clause and therefore, we conclude that the learned lower authorities have erred in law and on facts in initiating the impugned reopening. The same stands quashed for this precise reason alone. Ordered accordingly. All other pleadings on merits are rendered academic.

This assessee’s appeal is allowed in above terms.