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Income Tax Appellate Tribunal, “C” BENCH : KOLKATA
Before: Hon’ble Sri N.V.Vasudevan, JM & Shri M.Balaganesh, AM]
Gold View Financial Services Ltd. -vs.- A.C.I.T.., Central Circle-2(1), Kolkata Kolkata [PAN : AABCG 9762 D] (Respondent) (Appellant) For the Appellant : Shri S.M.Surana, Advocate For the Respondent : Shri Nicolas Murmu, Addl. CIT,Sr.DR Date of Hearing : 30.01.2018. Date of Pronouncement : 02.02.2018. ORDER Per N.V.Vasudevan, JM This is an appeal by the Assessee against the order dated 18.01.2016 of C.I.T.(A)-23, Kolkata relating to A.Y.2010-11.
The Assessee is a company. It carries on the business of finance and investment. For A.Y.2010-11 the assessee filed return of income on 04.10.2010 declaring total income of Rs.2,62,26,270/-. An order of assessment dated 20.06.2012 was passed by the AO u/s 143(3) of the Income Tax Act, 1961 (Act). In the said order the AO determined the total income of the assessee at Rs.2,73,92,410/- after making the following additions :-
2 Gold View Finance Services Ltd. A.Yr.2010-11 3. Aggrieved by the aforesaid order of the AO the assessee preferred appeal before CIT(A). In the appeal before CIT(A) the assessee primarily challenged the disallowance of expenditure u/s 14A of the Act.
Pending disposal of the appeal before CIT(A) (appeal before CIT(A) was filed on 06.08.2012) there was a search and seizure operation conducted in the case of the assessee us/ 132 of the Act on 11.10.2012. Consequent to the search an order of assessment u/s 153A of the Act was passed for A.Yrs. beginning from A.Y.2007-08 to 2013-14. Such orders of assessment were passed on 30.03.2015. Against the aforesaid orders of assessment and the additions made in such orders the assessee filed appeal before CIT(A) on 27.04.2015. The appeal for A.Y.2010-11 was also filed by the assessee.
The appeal filed by the assessee against the order of AO u/s 143(3) of the Act dated 20.06.2012 came up for hearing before CIT(A) on 11.01.2016. On that day the authorised representative of the assessee brought to the notice of CIT(A) the subsequent events viz. search and seizure operation and consequent framing of assessment u/s 153 A of the Act and filing of the appeal by the assessee against such orders including the order of assessment for A.Y.2010-11 passed u/s 153A of the Act. The assessee made the following prayer before CIT(A) :- “In view of above the current status of the Assessment year 2010-11 now Is that the Original Order u/s 143(3) dt. 20.06.2012. has no validity after fresh assessment order Passed U/s 153A dt. 30.03.2015 and consequently, any appeal effect arising out of 143(3) order should not also have any bearing on the fresh order U/s 153A and /or appeal files against that.
It is therefore, our request to your good self to kindly decide whether the appeal In reference should further be pursued or It Is should be withdrawn.
If the order of appeal in reference cannot be given effect in the fresh order U/s 153A and /or appeal U/s 246A(1)(ba) at. 21.04.2015 then we would like to withdraw the appeal pending before you.”
This is without prejudice to our right to protect our Interest In the matter.”
3 Gold View Finance Services Ltd. A.Yr.2010-11 6. The CIT(A) was of the view that once the appeal is filed by an assessee the appellate authority has no power to allow withdrawal of the appeal. The AO also found that the issues that arose for consideration in the appeal against the order dated 20.06.2012 u/s 143(3) of the Act and the order dated 30.03.2015 passed u/s 153A of the Act were different. The CIT(A) was therefore of the view that the appeal of the assessee has to be dismissed for non prosecution. The CIT(A) accordingly dismissed the appeal of the assessee for non prosecution with the following observations : “06. As regards the power to allow withdrawal of appeal, Hon'ble Courts have held that an assessee having once filed an appeal, cannot withdraw it. Even If the assessee refuses to appear at the hearing, CIT(A) can proceed with the enquiry and if he finds that there has been under-assessment, he can enhance the assessment.This is emanating From the following judgments: 1. CIT Vs Rai Bahadur Hardutroy Motilal Chamaria(SC )66 ITR 443 2. CIT Vs B.N. Bhattachargee (Se) 118 ITR461
In view of above judicial findings and the submission of the appellant/Ld.A.R. I find that the grounds raised by the appellant no longer subsist, do not require adjudication.
The appeal therefore stands ‘dismissed’. “
Aggrieved by the aforesaid order of CIT(A) the assessee has preferred the present appeal before the Tribunal.
The ld. Counsel for the assessee submitted that since the CIT(A) has not decided the appeal on merits, the said order should be set aside and the CIT(A) should be directed to decide the appeal of the assessee on merits. In this regard the ld. Counsel for the assessee also pointed out that since the order of assessment u/s 143(3) was passed prior to the search action u/s 132 of the Act against the assessee the said order of assessment u/s 143(3) of the Act does not abate The ld. Counsel for the assessee also pointed out that the issues arising for consideration in the appeal filed by the assessee against the order u/s 143(3) of the Act ad the appeal filed against the order u/s 153(A) of the Act for the relevant assessment year 2010-11 are different. The ld. DR relied on the order of CIT(A). 3 4 Gold View Finance Services Ltd. A.Yr.2010-11 9. After considering the rival submissions, we are of the view that the appeal against the order dated 20.06.2012 and passed u/s 143(3) of the Act does not become infructuous, consequent to the search action u/s 132 of the Act in the case of the assessee on 11.10.2012 as per the second proviso to section 153A of the Act the assessment completed prior to the search action will not abate. Therefore the CIT(A) should be directed to decide the appeal of the assessee filed against the order dated 20.06.2012 passed u/s 143(3) of the Act on merits. The order of CIT(A) is accordingly set aside and the CIT(A) is directed to consider the appeal of the assesee on merits after affording opportunity of being heard to the assessee.
In the result the appeal of the assessee is treated as allowed for statistical purpose. Order pronounced in the Court on 02.02.2018.