KESHAORAO BISRAM KATRE,NAGPUR vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1), NAGPUR

272 IN THE INCOME TAX APPELLATE TRIBUNAL Nagpur Bench, Nagpur Before Shri P K Bansal; Vice President A.d Ghri Pawan Singh, Judicial Member ITA Nog.351 to 357/NAG/2017 (Assessment Years: 2003-04 to 2009-10) ACIT, Central Circle 2(1) Shri Keshavarao Bisram Katre Shikshak Colony Vs, Nagpur 22 Nagpur 440008 PAN AIGPK8626C Respondent Appellant Appellant by: Shri Manoj G. Moryani Respondent by: Shri Gitesh Kumar Date of Hearing: 22.11.2017 Date Of Pronouncement: 23.11.2017 QRDER Per Bench under Section 253 of the Income Tax Act This group of seven appeals the order of the CIT(AI-4 Nagpur the assessee are directed against by 31,01.2017 for assessment years 2003-04 to 2009-10. dated has raised identical grounds of appeal except variation The asbesse2 heard together and are all appcals were clubbed, [igures Thereiore WE are referring order For appreciation of facts decided by this common The a8sessee has raised the for A.Y_ 2003-04. the grounds of appeal following grounds of appeai: Coimissioner of Incomte Ta order passed byy leated } The 14303) is illegal, invrlid Nagpur U/ s. 153A KWS {Appeals}-4, and bad in law Tar (Appeals)-4 erred irt The leamed Commnissioner %f Incore 2 the assessing officer and not confinmning the addition made by of accounts prepared OFL the bosis of accepling regulor books the same ard duta prepared by the departmen: and rejerted is 7,607/ the same unjustified, tnade addition of Rs. untuurrfinted and excessive. 2 J TYe lecied Cowmissi;;er 0j Icume Tau' {Appeals}-4 Qutgh1i tU have (ccepted {he profi: shr)iun as per audiied bonks of CoULs cf tnr' nsessce theor (' oner possed [5 ujiiStied wvathtu!lect {Itlf] &C:xive Tlif' OSeYSC 18 nC1[ {cutiig regulor books of cXcr Ounts ciaa} Scne were oudited [/ $ A4AB 0f !he Income Tc Ac aci ihicll Were prodliced by the (SSessee durivg the course 0f assessment proceedings rejecting Ilze sorne without any rrnsons ctct adopting profit (, 8% Of total receipts 08 net profit Cls per cush systet of accounting, therefore order passed is unjustified, unlwuarralted and excessive The leamed Commissioner of Income Tax (Appeals}-^ errerl in confirming the addition made by the assessing officer cnd not accepting regular books of accounts, therefore order passed is unjustified, uriwvartunted and excessive. The learned Commissioner of Income Tax (Appeals)-4 erred Tr confirming addition made by the assessing officer, adopling 84 of total receipls aS net profii Gs per cash systemn of accounting by rejecting books 0f accounts {J} $ 145/2) and deternined income '4 8" ard made the additior , therefore order passed is unjustified unwaranted ad excessive; The assessee is under bonafide impression that the department will not initiate any penalty praceedings 263 proceedings against the (ssessee_ but jurisdictional comntissioner initicted proceed ings U/s, 263 and set aside the assessmient and order passed U/ $. 153 T.W,s, 263 though the same ZVas quashed by the Ilon "ble Income Tax Appellate Tribunal Ihe depa" rtment has preferred appeal before the Hon ?ble High Court and the said iS pending hefore the Hon 'ble High Court; therefore order passed is unjustified, tnwarranted und excessive. JW The assessee is under bonafide impression that the deparlment withdrawal the proceeding before the Hon 'ble Iligh Court since the Scte is pending, therefore order passed i5 unjustified. tlnwcirronted and excessive: 3 The persal of the Tecord reveals that the learned CIT(A) passed the order On 31s January, 2017 and the appeals were [iled On 40k October; 2017 . The appeal S ae barred by 185 days of period 0f liritation The assessee/ appellant has filed an application for condonation of the dclay. 4 We have perused the application for condonation of delay and heard the leatned representatives of the parties The ld AR for the asbessee argued that the order passed by the CIT(A)-4, Nagpur dated 31st January, 2017 was received On 1st February, 2017. It was argued that 2 surVCv conducted Qn 3rd September, 2007, Further , 2 search Was conducted at the business prcmises of the aSS8SSCE 017 27.05,2008. During the search and seizure action complete Tecords of the assessee Wete seized, Thc assessee gought permission [or inspcction of the records and prepared the return of income a8 per audited books of account a8 per law. The as8esse1 wa8 following mercantile sysrem ol accounting Subsequcnt to the search action notice under Section 1534 Was issued, The as3essp0 furnished return of income a5 per mercantile system of accounting The AO while thc assessment order adopted 85 of the total receipt of lhe passing and changed the accounting system of the as3essc8 The AO as8es8ee adopted cash system of accounting: To buy peace and to avoid litigation the as853e8 agreed for 8% of the sales On estimate basis, The @8se35e0 for adoption of cash system of accounting by the AQ s the objected liability of the assessee was increased. For A.Y. 2008-0g by adopting cash tem ol accounting the income of the assessee was reduced and in rest dEite years the income was increased. The CIT initiated proceedings under Section 263 on 28.03.2013. Against the action of the CIT the asscssee fled appeal before the Tribunal vide ITA No. 162/Nag/2013 The appeal of the Was allowed and the order under Section 263 for A.Y 2008-09 a8gesspe ias quashed, The assessee was Under the bonafide belief that the revenue would not challenge the order of Tribunal in High Court The Revenue filed appeal belore the Nagpur Bench of the Hon'ble Bombay High Court The aSsessce was under the bona fide impression that once the order under Section 263 has been quashed by the Tribunal in ITA No_ 162/Nag/2013 the as8e8se0 filed an application before the CITIA) for withdrawal of the appeal on 27.12,2016. On the application of the assessee the learned CITIA} passed an order dismissing the appeal of the assessce on 31s January, 2017 . 53 It was submitted that the appeal preferred by Revenue against the order of the Tribunal was admitted by the Hon"ble High Court On 16.06.2017. On admitting the appeal of the Revenue the assessee realised that in case the Hon'ble High Court pass order against the assessee the as86s506 #ill suffcr heavy Monetary loss_ The assessee has wrongly withdrawn his &ppeal and it wds 4 bona fide and mistaken advice ol the counsel. In support of his submission the learned A,R. for the a8scisee relied upon the decisions ol the Hon"ble Supreme Court in the case ol Ramnath Sa0 and Other VS_ Gobardhan Sa0 and Others reported in AIR 2002 (SC) 1201, State of Haryana vS Chandra Mani in AIR 1996 (SC) [623 and N, Balakrishnan FS M. Krishnamurthy in AIR 1998 (SCI 3222. 6 On the other hand, the learned DR: opposed the condonation of delay , It was submilted by the learned D.R that he leave the decision of delay on the discrepancy of the Bench: We have considered the rival submissions of the parties and have gone through the order of the CITLAJ: The leamed CITQA) passerl the following order: 45. The AO has completed the assessment by adopting ppellant's tumover on cash basis Thereafter the A.O, has rejected hppellant's books %f accounts u/ 5. 14502] %f the Incometax Act and Jetemmnined the appellant's income at &% of the total turnover: The A.O has adopted a rate %f 8% on the basis of appellant's offer where the appellant himself has agreed for adoption of net income of 8% subject to the condition that no penalty proceedings are initiated against the appellant, Consequent to passing the order by the 4.0, w/ 5.1534 rw S, 143/3} of the Incometax Act; for A.K2008-09, proceedings wvere initiated by jurisdictional Commissioner against the appellunt u/ s.263 of the Incometax Act and the assessment Was set aside. The 4. 0. Su bsequently took up Teossessmtent proceedings and another order u/s. 153A TWS 263 wuas passed by the A.O. for A.Y.2008-0g on 03.03.2014. 5.1_ In the meantime, the appellant uent before the ITAT against jurisdictional Commissioners order Wf 5.263, Hon %le ITAT; Nagpur Bench Vide order No_ ITA.161/ Nag/ 2013, dated 17,7.2015 has quashed Commissioner's order dated 28.03.2013 passed u/ s.263 of the Incometax Act. However; the department for #.Y.2008-09 has challenged the order of ITAT before jurisdictional High Court. Further, the appellant has filed an application dated 27.12,2016 exressing his desire to accept the assessment order passed by the A.O and to withdraw pending appeals in the group where orders were passed by the 4. 0. Il} s.1534 rWs 143031 of the Incometax Act; 1961. The appellant made the following request; "The assessee has filed aforesqid appeals on 28.01.2014 against the order Qf Assistant; Commissioner &f Incometax; 13 Central Circle-2(l}, Nagpur dated 30.12.2010 for the AY.2003- 2004 to 2009-2010. The assessee wants to Withdraw all the aforesaid appeals Hence this Withdrawal application that the appellant hcs filed opplication for 5,2, Cansidering withdrawal of appeal, the grounds %f appeal filed by the appellant are hereby Dismissed, From the order of the CIT(A) Te noted that the appeals of thc asscssee Were dismissed a8 the assesgee filed an application for withdrawal of appeala We have further notedl that the applica tion for withdrawal of appeals was baged on thc belief that the Tribunal has quashed the Commissioner'$ order undcr Section 263 daled 28.03.2013 for A.Y. 2008-09_ The assesgee has realised its mistake after admission of the appeal against the order of the Tribunal Considering the fact the assessee has withdrawn the appeal on a mistaken belicf and realised that the assessee will suffer heavy monetary loss, we find force in the submission of the learned A.R and condone lhe delay in filing We are of the view that under the Income Tax Act the Revenue if appeal. itled to assess the real income and to recover the legitimate tax thereon: under the mistaken belief withdrew his appeals There is no The assebsee adjudication of the issue involve in the appeal at the stage of first appellate that there i5 no estoppel against the law If the stage. It i8 settled law assessee ig entitled for any relief on merit, the relief available under the law be denierl to lhc usses3ee_ We, instead of going in the merit of the cannot that the matter/ appeal of the asgessee be case We are of the opinion instead of technicalities; Considering the explanation decided on merit offered by the assessee the delay in fling the present appeal is condoned: In the result; the delay of 185 days in fling the present appeals is condoned: 8, We have heard the Id representatives of the parties and perused the The perusal of the order of the CIT(A}reveals that the order of ld CIT(A): learned CITIA} has not decided the appeal on merits_ The appeal of the assessee was dismissed a8 withdrawn Considering the factual matrix ol the case a8 discussed in the proceedings paras, we deem it appropriate to restore the appeal to the file of the CIT(A) to decide the same on merits, Needless to say that the learned CIT(A) shall grant sufficient and adequate opportunity to the assessee before deciding the appeal on merits We may 132 further order that while hearing the appeal the application for withdrawa] of appeal madc by lhe assessce Will not come in the way ol bypassing the order On mcrits- 9 In the result; the appeal of the a88eS3c6 is allowed for statistical Purposes_ ITA No. 353 to 357/Nag/ 2017 10_ In all the appeals the a55es8ee ha8 raised identical grounds of appeal. All appeals are accompanied by application for condonation of delay on similar [acts 18 taken in ITA No_ 365 Nag/2017_ As TC have: alrcady condoned the delay in that appeal, the delay in filing the other appeals is also condoned 11_ Considering the fact that we have already restored the appeal in ITA No, 351/Nag} 2017 to the file of the CIT(A); &ll the other appeals in the Up are restored to the file of the CITI(A} (or deciding the issue on merits In the result, TTA No_ 351 to 357 /Nag/2017 are allowed for tatistical purposes Order pronounced in the open court On 231d November, 2017 , - (P,K, Bansal) (Pawan Singh) Vice President Judicial Member Nagpur; Dated: 23rd November, 2017 CoputQ; I_ The Appellant 2 The Respondent 3 The CIT(A) -4, Nagpur 4. The Pr CIT (Central} , Nagpur 5, The DR; Bench ITAT, Nagpur Guay_d Hle pOrdeb ~ E37 Euirg@ ar ITAT, Noparigerc78 NEEr 7mal 5t [/ / n.p. 9