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Facts
The assessee appealed against a CIT(A) order that confirmed an assessment order passed under Section 144 read with Section 263 and 144B of the Income Tax Act for AY 2017-18. The underlying revisional order under Section 263, which formed the basis for the assessment, had previously been challenged by the assessee before the Tribunal.
Held
The Tribunal noted that its Co-ordinate Bench had already quashed the revisional order under Section 263. As a result, the assessment order, being a consequence of the quashed revisional order, and all subsequent appellate proceedings, including the current appeal, were rendered infructuous and non-est by operation of law.
Key Issues
Whether an assessment order and subsequent appellate proceedings are valid if the foundational revisional order under Section 263, upon which the assessment was based, has been quashed by the Tribunal.
Sections Cited
Section 144, Section 263, Section 144B
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘E’, NEW DELHI
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’, NEW DELHI BEFORE PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI YOGESH KUMAR US, JUDICIAL MEMBER (Assessment Year : 2017-18) Vs. Assessment Unit Nivesh Group Block-F, Sector – 12, Dwarka, National Faceless Assessment Delhi-110 075 Centre, Delhi-110 001 PAN No. AAMFN 1544 J (APPELLANT) (RESPONDENT) Assessee by Shri Pranshu Singhal, C.A. Revenue by Shri Govind Singhal, Sr. D.R. Date of hearing: 25.07.2024 Date of Pronouncement: 25.07.2024 ORDER PER PRADIP KUMAR KEDIA, AM :
The captioned appeal has been filed by the assessee against the first appellate order of the Ld. Commissioner of Income Tax (Appeals) – National Faceless Appeal Centre (NFAC), Delhi dated 14.12.2023 arising from the assessment order dated 28.03.2023 passed by the National Faceless Assessment Centre, Delhi (hereinafter referred to as ‘AO’) under Section 144 read with section 263 read with section 144B of the Income Tax Act, 1961 (the Act) concerning Assessment Year 2017-18.
The grounds of appeal
raised by the assessee reads as under:
1. On the facts and circumstances of the case, the order passed by Ld. Commissioner of Income Tax (Appeals) [CIT(A)] is bad both in the eyes of law as well as on the facts of the case.
Nivesh Group vs. Assessment Unit. A.Y. 2017-18 -2- 2. 2.(i) On the facts and circumstances of the case, the Ld. CIT(A) has erred both on facts and in law in passing the order without giving assessee an opportunity of being heard in violation of the principle of natural justice. (ii) That the non- appearance before the Ld. CIT(A) was due to reasons beyond the control of the assessee. 3.
On the facts and circumstances of the case, the Ld. CIT(A) has erred both in the eyes of law and on the facts in confirming the order u/s 144 r.w.s 263 of the Act despite the fact that the appeal against the order u/s 263 of the Act is decided in favour of the appellant by the Hon'ble Income Tax Appellate Tribunal. 4.
4. On the facts and circumstances of the case, the Ld. CIT(A) has erred both on the facts and in law, in confirming the income of the appellant at Rs. 2,60,52,201/- as against the returned income of Rs. 12,97,350/-. 5. 5.(1) On the facts and circumstances of the case, the Ld. CIT(A) has erred both on facts and in law, in confirming the addition of Rs. 1,61,53,068/- (being 80% of the total commission expenses of Rs. 2,01,91,335/-) treating it to be unexplained expenses of the assessee. (ii) That the addition has been confirmed ignoring the material and evidences brought on record by the appellant in support of its contention without bringing any adverse material on record. 6. 6.(1) On the facts and circumstances of the case, the Ld. CIT(A) has erred both on facts and in law, in confirming the addition of Rs. 81,16,070/- (being 60% of the total advertising and marketing expenses of Rs.1,36,01,783/-) treating it to be unexplained expenses of the assessee. (ii) That the addition has been confirmed ignoring the material and evidences brought on record by the appellant in support of its contention without bringing any adverse material on record. (iii) That the Ld. AO has wrongly mentioned the addition to be Rs. 86,01,783/-instead of Rs. 81,16,070/- while computing the total income of the assessee. 7.
That the appellant craves leave to add, amend or alter any of the grounds of appeal.”
3. When the matter was called for hearing, the learned Counsel referred to submissions placed on record and submitted that the present appeal is against the order of the CIT(A) passed ex parte in an assessee appeal against the assessment order
Nivesh Group vs. Assessment Unit. A.Y. 2017-18 -3- dated 28.03.2023 which was passed as a sequel to the revisional order under Section 263 of the Act by Pr. CIT, Delhi – 15. However, the revisional order passed by the Pr. CIT under section 263 of the Act was challenged before the Tribunal by the assessee and the Co-ordinate Bench of Tribunal vide order dated 08.12.2023 has decided the appeal in favour of the assessee and quashed the revisional order. This being so, the present appeal arising from assessment order based on a quashed revisional order passed under Section 263 of the Act is rendered infructuous by operation of law. As a consequence, the subsequent appellate proceedings arising from non-est assessment order are automatically rendered infructuous including the present appellate proceedings before the Tribunal.
In the light of submissions made on behalf of the assessee where the revisional 263 stands quashed, the consequential assessment order based on revisional order giving rise to present appellate proceedings is rendered non-est and without sanction of law, the dispute arising in the present appeal are rendered infructuous.
In the result, appeal of the assessee is dismissed in limine as infructuous.
Order was pronounced in the open court on 25.07.2024