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Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE
Before: SHRI D. KARUNAKARA RAO, AM
आदेश / ORDER
PER D. KARUNAKARA RAO, AM
This core appeal filed by Revenue is directed against the order of
Commissioner of Income Tax (Appeal)-2, Nashik dated 22.06.2016 for
assessment year 2008-09. The assessee has filed cross objection in the appeal
filed by the Department.
ITA No.1972/PUN/2016 ( By Revenue) A.Y. 2008-09
In ITA No. 1972/PUN/2016, the Revenue has raised following grounds
in appeal:
“1. Whether on the facts & circumstances of the case and in law, the Ld. CIT(A) was justified in quashing the reassessment order u/s 147 passed by the AO. relying on the decision of the Hon'ble Supreme court in the case of GKN Drive Shaft (India) Ltd. Vs. ITO 259 ITR 19 without appreciating the fact that the A.O had disposed off the objection filed by the assessee by way of making a noting in the order sheet and signed by the A.R of the assessee? 2. Whether on the facts & circumstances of the case and in law, the CIT(A) was justified in quashing the reassessment order u/s 147 passed by the AO. by not considering section 292B of the Income-tax Act-1961? 3. The appellant prays leave to add, alter, clarify, amend or to withdraw any grounds of appeal as and when the occasion demands.”
ITA No.1972/PUN/2016 CO No. 01/PUN/2017 A.Y.2008-09
Briefly stated relevant facts include that the assessee has filed return of
income on 06.03.2009 declaring total income at Rs.2,09,130/-. The case of
the assessee was re-opened on 02.08.2012 by issuing notice u/s. 148 of the
Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). The Assessing
Officer noted that the assessee entered into development agreement with
M/s.Vascon Dewlling Pvt. Ltd. for developing the property bearing survey No.
82/1/1/1+2+3 at Wadala, Nashik. The sale value of the said property was
credited by M/s. Sanklecha Constructions in its profit and loss account. The
Assessing Officer held that as the per the provision of the Income Tax Act,
1961, the sale should have been recorded in the books of purchaser and not in
the books of M/s. Sanklecha Construction and the short term/ long term
capital gain/loss should be taxed in the hands of assessee. In re-assessment
proceedings, the Assessing Officer assessed the total income of assessee at
Rs.43,75,800/- (rounded off) and completed the assessment u/s. 143(3) r.w.s.
147 by making addition of Rs. 41,66,666/- on account of short term capital
gain.
Aggrieved by the assessment order, the assessee filed appeal before the
CIT(A) challenging the re-assessment proceedings on the ground that
Assessing Officer disposed off the objection filed by assessee by way of making
a noting in the order sheet and not followed the proper procedure laid down
by the Hon'ble Supreme Court of India. The CIT(A) in the case of assessee
held that the Assessing Officer has not adhered to the procedure laid down by
the Hon'ble Supreme Court of India in the case of GKN Driveshafts (India)
Ltd. Vs. Income Tax Officer & Ors reported as 259 ITR 19 and thus,
assessment order is declared invalid by CIT(A). Against the said findings of the
CIT(A), the Department is in appeal before us raising grounds extracted above.
ITA No.1972/PUN/2016 CO No. 01/PUN/2017 A.Y.2008-09
The Ld. DR for the Revenue relied heavily on the order of Assessing
Officer/ CIT(A).
The Ld. Counsel for the assessee vehemently supporting the findings of
CIT(A) submitted that the assessee sought the reasons for re-opening of the
assessment and thereafter, filed objections against re-opening of the
assessment. The Assessing Officer without disposing of the objections as has
been laid down by the Hon'ble Supreme Court of India in the case of GKN
Drive shaft (India) Ltd. ITO & Ors (supra) proceeded on to make assessment.
The Ld. Counsel further, submitted that similar issue involved in this case
was adjudicated by Pune Bench of Tribunal in the case of ITO Vs. Smt.
Nirmala Vijay Sanklecha, ITA No. 1937/PUN/2016 and CO No.
35/PUN/2016 for A.Y. 2008-09 decided on 23.02.2018. The contents of Para
15 of the order of Tribunal are relevant in this regard and same is extracted as
under:
“15. It is apparent from record that the Assessing Officer committed error in not following the proper procedure for deciding the objections of assessee against re-opening of assessment. The Assessing Officer is a quasi judicial authority and is therefore, duty bound to follow the law laid down by the Hon'ble Supreme Court of India, the Hon'ble High Courts and the Appellate Authorities. The assessment orders have been passed by the Assessing Officer in both the cases without following the principles as set out by the Hon'ble Apex Court and Hon'ble Jurisdictional High Court. Thus, considering the facts of the case and in the light of various judgments the impugned orders are set aside and appeals of the Revenue are dismissed.”
Thus, considering the above referred decision of Pune Bench of
Tribunal, the fact that the Assessing Officer had not disposed of objections of
the assessee against issuance of notice for re-opening assessment by a
ITA No.1972/PUN/2016 CO No. 01/PUN/2017 A.Y.2008-09
speaking order, the impugned order is set aside and appeal of the Revenue is
dismissed.
In the result, appeal of the Revenue is dismissed.
CO No. 01/PUN/2017 ( By assessee) A.Y. 2008-09
Condonation of Delay of 57 days: An affidavit was filed with regard to
delay in filing cross objection in late by 57 days due to miscommunication
among their staff. Since the delay in filing cross objection is unintentional,
the cross objection filed by assessee is admitted and taken up for
adjudication.
In cross objections, the assessee has assailed the order of CIT(A) on the
addition made on merit. Since, I uphold the findings of CIT(A) in quashing the
assessment order as mentioned by the Ld. AR, the cross objection filed by the
assessee has become infructuous and is dismissed.
In the result, appeal of the Revenue is dismissed and cross objection filed by assessee is also dismissed.
Order pronounced on 16th day of May, 2018.
Sd/- (डी.क�णाकरा राव/D. Karunakara Rao) लेखा सद�य / ACCOUNTANT MEMBER
पुणे / Pune; �दनांक / Dated : 16th May, 2018. SB
6 ITA No.1972/PUN/2016 CO No. 01/PUN/2017 A.Y.2008-09
आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT(Appeal)-2, Nashik. 4. The Pr. CIT-2, Nashik. 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “एक-सद�य” ब�च, पुणे / DR, ITAT, “SMC” Bench, Pune. गाड� फ़ाइल / Guard File. 6.
// True Copy // आदेशानुसार / BY ORDER,
�नजी स�चव /Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.