ACIT, NEW DELHI vs. M/S. SARVODAYA REALTORS (P) LTD., NEW DELHI

PDF · subscribers
ITA 3508/DEL/2016Status: DisposedITAT Delhi09 November 2017AY 2000-013 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(Appeals)'s decision, finding that if the original assessment order was annulled, any subsequent rectification order based on it would also lack validity. Therefore, the AO's rectification order was rightly annulled.

What were the facts?

The Assessing Officer (AO) passed an assessment order under Section 144/147 and later a rectification order under Section 154 to modify interest calculations. The CIT(Appeals) annulled the rectification order, stating that since the original assessment order was invalid, the subsequent rectification was also invalid.

What were the issues?

The primary issue was whether a rectification order under Section 154 could be valid if the original assessment order it sought to rectify was itself invalid or annulled.

Which sections of the Income-tax Act were involved?

Section 154,Section 144,Section 147,Section 234A,Section 234B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES: ‘G’, NEW DELHI

For Appellant: Shri Kaushlendra Tiwari, Sr.D.R
For Respondent: Adv. Sh. Nirmal Singh, C.A

PER NK SAINI, ACCOUNTANT MEMBER

1.

This is an appeal filed by the Department against the Order dt. 21.3.2016 of Ld.CIT(Appeals), New Delhi. The only effective ground raised in this appeal reads as under.

1. The Ld.CIT(A) erred in annulling the order passed by the A.O. u/s 154 of the Income Tax Act, 1961. The Ld.CIT(A) erred in holding that since the original order passed u/s 144/147 of the Income Tax Act, 1961 by the A.O. had no legal validity, the subsequent rectification order passed by the A.O. u/s 154 of the Act also has no validity in the eye of law. The Dept. has filed appeal against the order of the CIT(A) annulling the original assessment order.

2.

Facts of the case in brief are that the assessment in this case was completed on 20.12.2007 at an income of Rs.64,43,940/- by passing the order u/s 144/147 of the Income Tax Act, 1961 (hereinafter referred to as the Act). Later on the A.O. passed the rectification order u/s 154 of the Act on 24.8.2009 and modified the calculation of interest u/s 234A and 234B of the Act. Being aggrieved the assessee carried the matter to the Ld.CIT(A) who annulled the order by observing in para 3.1 of the impugned order as under. “3.1. Considering above and since the original order passed u/s 144/147 of the Income Tax Act 1961 had no legal validity, the subsequent rectification passed by the Assessing Officer u/s 154 of the Act also has no validity in the eye of law. Accordingly the order dated 20.12.2007 passed by the ACIT, Circle 7(1) New Delhi u/s 154/144/147 of the Act is annulled.”

3.

Now the department is in appeal. We have considered submissions of both the parties and perused material available on record. In the present case, the observations of the Ld.CIT(A) that the assessment order dt. 20.12.2007 was annulled vide order dt. 18.3.2016 has not been rebutted. Therefore when the original assessment order which has been rectified by the A.O. was not in existence, the subsequent order passed by the A.O. by making the rectification u/s 154 of the Act in the assessment order was rightly annulled by the Ld.CIT(A). We do not see any infirmity in the impugned order, and, therefore, do not see merit in this appeal of the department. 4. In the result the appeal of the department is dismissed. Pronounced in the Open Court on 09th November, 2017.

More judgments on Section 154

All 8,676 judgments and leading authorities on Section 154 →

Recent GST High Court judgments

Search GST case law →