THE BEEKEEPERS CO-OPERATIVE SOCIETY LIMTIED ,SAKALESHAPURA vs. INCOME TAX OFFICER, WARD-1 & TPS, , HASSAN
In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal held that the AO's order was passed when the matter was sub-judice before the ITAT, making all consequential proceedings void. Therefore, the appeals arising from this void order were dismissed.
What were the facts?
The assessee, a Co-operative Society, claimed deduction under Section 10(23B). This claim was disallowed by the CPC. The CIT(A) initially set aside the matter to the AO, but the ITAT restored it to the CIT(A). Subsequently, the AO passed an order disallowing the deduction, which was upheld by the CIT(A).
What were the issues?
Whether proceedings initiated subsequent to an order that was set aside by a higher appellate authority are valid. The validity of an AO's order passed while the matter was pending before the ITAT.
Which sections of the Income-tax Act were involved?
Section 10(23B),Section 143(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B’’ BENCH: BANGALORE
Before: SHRI LAXMI PRASAD SAHU & SHRI PRAKASH CHAND YADAV
PER PRAKASH CHAND YADAV, JUDICIAL MEMBER:
Present appeal of the assessee is arising from the order of ld. CIT(A)/NFAC dated 23.8.2024 having DIN & Order No.ITBA/NFAC/S/250/2024-25/1067905148(1) for the assessment year 2016-17.
There is a delay of 6 days in filing of this present appeal. Ld. Counsel for the assessee appearing on behalf of the assessee has pointed out that because of the communication gap between the assessee and the professional who was handling the matter earlier, the inadvertent delay has occured.
Ld. D.R. could not seriously objected to the prayer of the assessee vis- à-vis condonation of delay.
Considering the smallness of the delay of 6 days, we hereby condone the same and proceed to decide the matter.
Brief facts of the case leading to the filing of present appeal are that the assessee is a Co-operative Society filed its return of income for the impugned year on 30.3.2018. The return of income filed by the assessee was processed u/s 143(1) of the Income Tax Act, 1961 (in short “The Act”), wherein the claim of deduction u/s 10(23B) of the Act, claimed by the assessee has been disallowed by the CPC.
Aggrieved with the order of CPC, assessee preferred an appeal before the ld. CIT(A), who vide its order dated 6.12.2021 allowed the appeal of the assessee by observing that the matter requires fresh consideration by the AO and hence, the ld. CIT(A) restored the matter to the file of AO.
Aggrieved with the order of ld. CIT(A) dated 6.12.2021, the assessee preferred appeal before the Hon’ble ITAT and the Hon’ble ITAT vide its order dated 7.12.2023 in held that the ld. CIT(A) has exceeded his jurisdiction by restoring the matter to the file of the AO for deciding afresh. Lastly the ITAT restored the matter to the file of CIT(A).
7.1. When the proceedings were pending before the ld. CIT(A), after the order of ITAT dated 7.2.2023, the ld. AO following the directions of the ld. CIT(A) dated 6.12.2021 has passed the impugned order dated 27.4.2022 and held that the assessee is not entitled for the deduction u/s 10(23B) of the Act. 7.2 Aggrieved of the order of the ld. AO, the assessee preferred appeal before the ld. CIT(A) who vide its order dated 23.8.2024, dismissed the appeal of the assessee upholding the disallowance of deduction made u/s 10(23B) of the Act to the assessee.
7.3 Now the assessee has come up in appeal before us and contended that the directions given by the Hon’ble ITAT vide its order dated 7.2.2023 are still pending and hence, the present proceedings are non-est proceedings, as the The Beekeepers Co-operative Society Ltd., Hassan Page 3 of 4 same are initiated in response to an order of ld CIT(A), which order has already been set aside by the Hon’ble ITAT vide its order dated 7.2.2023.
Ld. D.R. relied upon the order of the authorities below and sequence of events as narrated by the counsel for the assessee.
After considering the rival submissions, we deem it appropriate to incorporate certain sequence of events, which goes to the root of the matter are as under: Date Nature of proceedings Remarks 29.03.2019 Return filed by the assessee was Deduction u/s processed u/s 143(1) of the Act 10(23B) of the Act was disallowed. 11.07.2019 Assessee preferred appeal before No remarks. ld. CIT(A) against the order of CPC Admitted fact. 06.12.2021 Ld. CIT(A) set aside the matter to Admitted fact. the file of AO
07.02.2023 Coordinate bench of the ITAT in Fresh proceedings set side before ld. CIT(A) are the order of ld. CIT(A) and still pending. restored the matter to the file of ld. CIT(A).
27.04.2022 The AO passed the impugned Admitted fact order 07.09.2022 Assessee filed appeal before the Admitted fact ld. CIT(A) against the order of AO
23.08.2024 Impugned order of ld. CIT(A) has Against this order been passed. now the assessee has comeup in appeal.
9.1 After bare perusal of the above sequence of events would show that the impugned order of the AO has been passed when the matter was sub-judice before the coordinate bench in ITA No.841/Bang/2022. We are of the view that the moment the order of CIT(A) in first round has been set aside all consequential proceedings in pursuance to such order become non-est/ void ab initio, since the directions of ITAT are yet to be complied by the first appellate authority. Therefore, we dismiss these present appeals which are emanating from non-est order. However, we make it clear that assessee would have full liberty to contest its appeal before the first appellate authority, which
In the result, appeal of the assessee is dismissed as indicated above.
Order pronounced in the open court on 5th Dec, 2024
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