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Facts
Three different assessees filed twelve appeals for various assessment years from 2006-07 to 2010-11, involving both reopened and regular assessments. The assessees contended that they were not provided with the 'reasons recorded' for reopening, certified copies of ordersheets, or Section 151 approval, despite repeated requests since 2016. The CIT-DR sought an adjournment, citing the non-availability of case records.
Held
The Tribunal denied the CIT-DR's adjournment request and found that the assessees had not been provided the necessary documents for a long time. Following the G.K.N. Driveshafts (India) Ltd. decision, the Tribunal restored all appeals, including those challenging reopening and those related to protective/substantive additions, to the Assessing Officer (AO) for fresh adjudication. The AO is directed to provide the 'reasons recorded,' certified copies of ordersheets, and Section 151 approval, allow the assessee to file objections, and then proceed with re-assessment, keeping legal grounds open.
Key Issues
Whether assessments were validly reopened without providing the 'reasons recorded' and other essential documents to the assessee; the treatment of unexplained investments/income and protective vs. substantive additions.
Sections Cited
Section 143(3), Section 147, Section 148, Section 151
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Income Tax Appellate Tribunal, RANCHI BENCH, RANCHI
Before: SHRI GEORGE MATHAN, JM & SHRI RATNESH NANDAN SAHAY, AM
O R D E R Per Bench : These twelve appeals are filed by the three different assessees against the separate orders passed by the ld. CIT(A), Ranchi, both dated 01.09.2016 for the assessment year 2006-2007, 2007-2008, 2008-2009, 2009-2010 & 2010-2011, respectively.
2. As all the appeals are interconnected, therefore, they are being disposed off by this common order. 3. Ld. CIT-DR has filed an adjournment letter in the cases of Shri Anosh Ekka and Smt. Menon Ujjana Ekka, on the grounds which reads as follows:-
It was submitted by the ld. CIT-DR that the records in all the cases were required to be called for and the ld CIT-DR has called for the records only on 03.10.2025 and till date the records have not come.
5. Here it is pertinent to note that these appeals are relating to the year 2016 and they have been pending for so many years. We are now in 2025. These appeals had been posted on multiple occasions being six times before the Tribunal went into the online mode and nine times after the Tribunal has gone into the online mode. Till now, nobody has thought of calling for the records. Only now the records have been sought for. The reasons given by the ld. CIT-DR for the purpose of seeking adjournment is not found to be substantiated and consequently the adjournment request, as made by the ld. CIT-DR, is denied and the appeals are being heard on merits.
It was the submission of the ld. AR on behalf of the assessee that the assessments in the case of Shri Anosh Ekka for the assessment years 2006-2007 to 2009-2010 are reopened assessment and in the case of Smt. Menon Ujjana Ekka for the assessment years 2006-2007 to 2008-2009 the assessments are reopened assessments. It was the submission that in the case of M/s Ekka Constructions Pvt. Ltd. for the assessment years 2007- 2008 to 20102011 and in the case of Shri Anosh Ekka for the assessment year 2010-2011, these are regular assessments u/s.143(3) of the Act.
Ld. AR drew our attention to the reasons recorded in the case of Shri Anosh Ekka for the assessment year 2006-2007 and Smt. Menon Ujjana Ekka for the assessment year 2006-2007, which reads as follows :-
7. It was the submission that in the other years also the assessee has sought the reasons recorded along with the certified copy of the ordersheet as also approval u/s.151 of the Act.
On this point, it was pointed out by the ld. CIT-DR that the counsel on behalf of the assessee has misled the court. He drew our attention to para 3 of the assessment order for the assessment year 2006-2007 in the case of Shri Anosh Ekka where the AO has recorded that after filing of the return the AO has provided a certified copy of the ordersheet to Shri Anosh Ekka containing the reasons recorded.
On this point, the ld. AR on behalf of the assessee submitted that it is not in dispute for the assessment year 2006-2007 the reasons have not been provided, in fact it was the submission that the reasons placed before the Tribunal were the reasons provided by the AO for the assessment year 2006-2007. It was the submission that there is no intention for misleading the court as has been stated by the ld. CIT-DR. It was further submitted by the ld. AR that the assessment in the case of M/s Ekka Constructions Pvt. Ltd. as also the assessments in the case of Shri Anosh Ekka and Smt. Menon Ujjana Ekka had been completed by the AO by making substantiate and protective assessments. Certain additions had been made on protective basis in the hands of M/s Ekka Construction Pvt. Ltd. and Smt. Menon Ujjana Ekka and the substantial addition has been made in the case of Shri Anosh Ekka. It was the submission that the ld. CIT(A) gave relief in regard to certain additions and in respect of other additions, the substantial addition has been directed to be made in the hands of Shri Anosh Ekka. It was the submission that the nature of additions were one unexplained investments in the nature of share capital and secured loans in the case of M/s Ekka Constructions Pvt. Ltd. has been treated as the unexplained investment and unexplained income of Shri Anosh Ekka. The business income of Smt. Menon Ujjana Ekka has been treated as the income from other sources of Shri Anosh Ekka. The unexplained expenditure allegedly of both Anosh Ekka and Smt. Menon Ujjana Ekka was treated as the income from other sources in the case of Shri Anosh Ekka. It was the submission that this whole assessment was on the foundation of tax evasion petition received against Shri Anosh Ekka. It was the submission that the assessee has been asking for the certified copies of the ordersheets and the reasons recorded as also the approval u/s.151 of the Act and the same has not been provided to the assessee. It was the submission that the assessee has asked for the details as early as from the time of filing of the appeals itself in 2016 as it is also one of the grounds before the Tribunal. It was the submission that till date the reasons nor the approval nor the certified copies of the ordersheets have been provided to the assessee.
At this point it was informed to the ld.CIT-DR that in view of the decision of the Hon’ble Supreme Court in the case of G.K.N.Driveshafts (India) Ltd., reported in (2003) 259n ITR 19 (SC), the Bench is of the view that the issues in these appeals must be restored to the file of AO in respect of such appeals where the appeals are against reopening of the assessments, so as to provided the assessee with the reasons recorded and such other details as requested for by the assessee and take the objections of the assessee to readjudicate the issues on the basis of evidence as are available. To this, ld. CIT-DR raised serious objections stating that restoring the issues to the file of ld. AO would nullify the demands and it would cause prejudice to the revenue. It was also submitted by the ld. AR that if the issues are being restored to the file of AO then the legal issues which the assessee proposed to raise should be left open. It is also submitted by the ld.AR that certain additions had been deleted by the ld. CIT(A) and the revenue has filed against the said deletion of additions, those appeals have also been dismissed by the Tribunal on account of tax effect. It was the submission that those additions which have already been deleted by the ld. CIT(A), should not be the subject matter of the set aside assessments. To this, it was informed to the ld. AR that such a prayer cannot be acceded to that the issues which have been deleted by the ld. CIT(A) would not be examined by the AO, insofar as if there is a link between the issues which have been deleted by the ld. CIT(A) and which has been sustained by the ld. CIT(A) on account of the deletion, the other balance portion would also get affected. However, his prayer that legal grounds should be left open and live, is acceded to.
Having considered the submissions of both the sides and perused the records, at the outset, we are of the view that the assessee does have shown a case for providing of the reasons recorded and other connected documents, which have not been provided to the assessee right from 2016. This being so, appeals in the case of Shri Anosh Ekka for the assessment years 2006-2007, 2007-2008, 2008-2009 & 2009-2010 as also the appeals in the case of Smt. Menon Ujjana Ekka for the assessment years 2006- 2007, 2007-2008 & 2008-2009, being the appeals in which the issue of reopening has been challenged, are restored to the file of AO for readjudication after granting the assessee copies of reasons recorded as also the certified copy of the ordersheets and the approval u/s.151 of the Act and after granting the assessee adequate opportunity of being heard to represent its case. Should the assessee file its objections against the reopening, then the AO shall also consider and consider the same before proceeding with the assessments in the light of the decision of the Hon’ble Supreme Court in the case of GKN Driveshafts (India) Ltd., referred to supra.
In regard to the appeals of the assessee M/s Ekka Construction Pvt. Ltd. for the assessment year 2007-2008, 2008-2009, 2009-2010 & 2010- 2011 and appeals of Shri Anosh Ekka for the assessment year 2010-2011, it is noticed that certain additions in the form of share capital and secured loans in the case of M/s Ekka Construction has been treated as unexplained investment and income from other sources as also investments in the case of Shri Anosh Ekka on substantive basis. A perusal of the assessment order shows that in respect of share capital, the issue is mentioned that the share applicant details have not been provided. Similarly in respect of issue of secured loan. The AO shall do the necessary examination and take the stand as to whether the said investments are that of Shri Anosh Ekka and give justifiable reasoning, insofar as there is no reasons mentioned in the assessment orders which are impugned before us along with the orders of the ld. CIT(A). For these reasons, the issues in these appeals are required to be restored to the file of ld.AO for readjudication afresh after granting assessee adequate opportunity of being heard. Thus, the orders of the ld. CIT(A) in all these appeals are set aside in their entirety and the issues in these appeals are restored to the file of ld. AO for readjudication as per the directions given above and after granting the assessee adequate opportunity of being heard.
In the result, all the appeals of the three assesses are partly allowed for statistical purposes. Order dictated and pronounced in the open court on 08/10/2025.