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Income Tax Appellate Tribunal, “D”
Before: HON’BLE SHRI R. C. SHARMA, AM, & HON’BLE SHRI SANDEEP GOSAIN, JM
आदेश / O R D E R
Per Sandeep Gosain, Judicial Member:
The present Appeal filed by the assesseeis against the order of Commissioner of Income Tax (Appeals)-40,
Rajendra M. Gadhecha Mumbaidated 01.12.16 for AY 2009-10 on the grounds mentioned herein below:- 1. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in upholding the reassessment proceedings initiated u/s 147 by the learned Assessing Officer without independent application of mind on the information received from DGIT(Investigation).
In facts and in the circumstances of the case and in law, the learned CIT(A)-40 has erred in confirming the action of the Assessing Officer of completing the assessment u/s 143(3) without providing any opportunity of cross examination of the witnesses relied upon by the Assessing Officer and thus violating the law laid down by Honorable Supreme Court in the case of KishanchandChellaram v. CIT (1980) 125 ITR 713 and Andaman Timber Industries v. Commissioner of Central Excise (Civil Appeal No. 4228 of 2006.)
In facts and in the circumstances of the case and in law, the learned CIT(A)-40, Mumbai has erred in upholding the ad hoc addition of Rs. 51,86,620/- being 12.5% of alleged bogus purchases of Rs. 4,14,92,962/-, merely on surmises and conjectures.
Rajendra M. Gadhecha 2. The brief facts of the case are that the return of income for the year under consider was filed by the assessee on 27.09.09 declaring total income at Rs. 2,32,620/-. The return was processed and subsequently the case was selected for scrutiny after recording due reasons for re-opening the assessment u/s 147 of the Act. Assessment order u/s 143(3) r.w.s. 147 of the I.T. Act was passed by the AO assessing the total income at Rs. 58,65,460/- thereby making additions.
Aggrieved by the order of AO, assessee preferred appeal before Ld. CIT(A) and Ld. CIT(A) after considering the case of both the parties partly allowed the appeal of the assessee.
Now before us, the assessee has preferred the present appeal by raising the above grounds.
Ground No. 1 3. This ground raised by the assessee relates to challenging the order of Ld. CIT(A)in upholding the reassessment proceedings initiated u/s 147 by the AO without independent application of mind on the information received from DGIT(Investigation).
Rajendra M. Gadhecha 4. From the records, we noticed that this ground was never raised before Ld. CIT(A), therefore Ld. CIT(A) had no occasion to adjudicate the same. Though, it is a settled law that a legal issue can always be raised by the parties at any stage of proceeding, hence the assessee is well within his rights to challenge the re-assessment proceedings initiated u/s 147 of the I.T. Act at this stage.
Since the assessee has categorically raised specific ground No. 1 of appeal to the effect that Ld. CIT(A) has erred in upholding the re-assessment proceedings initiated u/s 147 by the AO, however on perusal of the impugned order passed by Ld. CIT(A), there are no findings as such as no such ground was ever raised by the assessee before Ld. CIT(A).
Be that as it may, considering the facts and circumstances of the case and keeping in view the interest of justice, we are of the view that decision on initiation or legality of re- assessment proceedings goes to the roots of the case and touches the very foundations of the impugned order.
Therefore, we remit the matter back to Ld. CIT(A) to adjudicate this ground on merits and thereafter pass afresh order. It is Rajendra M. Gadhecha needless here to mention that before passing the order, the Ld.
CIT(A) shall provide sufficient opportunity of hearing to the assessee.
Before parting, we may make it clear that our decision to restore the matter back to the file of Ld. CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by Ld. CIT(A) independently in accordance with law.
Ground No. 2 & 3 5. Since we have already remitted back ground no. 1 of appeal to Ld. CIT(A) for adjudication, therefore these grounds at this stage become infructuous.
In the net result, the appeal filed by the assessee stands partly allowed with no orders as to cost.
Order pronounced in the open court on 30th August, 2018.