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Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI SUNIL KUMAR YADAV & SHRI A.K. GARODIA
Per Sunil Kumar Yadav, Judicial Member
This appeal is preferred by the assessee against the order of the CIT(Appeals), Mysore dated 03.12.2012 for the assessment year 2007-08 inter alia on the following grounds:-
“1. The order of the authorities below in so far as it is against the Appellant, is opposed to law, weight of evidence, natural justice, probabilities, facts and circumstances of the Appellant's case.
2. The appellant denies itself to be assessed on a sum of Rs. 5,66,90,094/- as against a sum of Rs. 1,05,35,680/- as declared by the appellant under the facts and circumstances of the case.
3. The action of the CIT-A in dismissing the appeal on the ground of non-payment of admitted taxes when the appellant had paid the taxes as per the return filed on 09.04.2008 is against the facts of the case and against all known canons of reasonableness and natural justice and patently illegal. 4. The order of the authorities below is bad in law as the mandatory conditions to invoke the jurisdiction under section 153C of the Act did not exist, or having not been complied with and consequently the orders of the authorities below is bad in law for want of requisite jurisdiction. 5. The order of the learned Commissioner is bad in law as the appellant was denied reasonable opportunity of being heard which is against the principles of natural justice. 6. The learned commissioner of income tax (appeals) ought to have finding on the validity of the search. Reliance is placed on the decision of the Jurisdictional High Court in the case of C Ramaiah Reddy vs ACIT reported in 339 ITR 210 and of the Jurisdictional Tribunal in the case of DCIT, Central Circle Mangalore vs M/s HML Agencies in MP No. 103/Bangalore/ 2010 in ITA No. 1209/Bang/2009. 7. The order of the CIT-A is further bad in law as the appellant was not provided the copy of the letter relied upon by the CIT-A for-rebuttal by the appellant and thus the order needs to be set aside in the interest of equity and justice. 8. The appellant denies itself liable to be levied to interest under section 234 B of the Act and further the computation of interest under section 234 B was not provided to the appellant as regard to the rate, period and method of calculation of interest under the facts and circumstances of the case. The appellant expressly urges that the period of levy of interest is not in accordance with section 234B of the Act.
PRAYER FOR ADMITTING ADDITIONAL GROUNDS OF APPEAL
WHICH WERE NOT ORIGINALLY URGED BEFORE THE CIT-A The assessee appellant begs to submit the under mentioned additional grounds of appeal which were not urged specifically in the original grounds of appeal filed before the learned CIT(A). These grounds do not involve any investigation of any facts otherwise on the record of the department and are also pure questions of law, which goes into the very root of the matter of jurisdiction and validity of the assessment and therefore, it is prayed that the additional grounds may kindly be admitted and disposed off on merits for the advancement of substantial cause of justice. Reliance is placed on the decision of the Hon'ble Apex Court in the case of National Thermal Power Co. Ltd. Vs. CIT reported in 229 ITR 383.
9. The assessment order passed is not valid in law on account of the fact that the same has not been passed by a joint commissioner as mandated under section 153D of the Act.
10. The appellant craves leave to add, alter, delete, modify any of the grounds which are urged above.
11. For the above and such other grounds as may be urged at the time of hearing the appellant prays your Honour to consider the facts and circumstances of the case and justice be rendered.”
During the course of hearing, the ld. counsel for the assessee has invited our attention that the assessee has filed a return of income declaring capital gains at Rs.48,15,354. Later on, a search was conducted and in response to notice, assessee has filed a letter dated 8.9.2010 to treat its return filed u/s. 139 as a return u/s. 153C of the Income-tax Act, 1961 [“the Act”]. Accordingly, the said return was accepted as a return u/s. 153C of the Act. The assessee filed another return on 28.10.2010 disclosing capital gains at Rs.2,75,64,615 and marking the return as a revised return u/s. 153C of the Act. In view of the fact that the original return has already been acted upon as a return u/s. 153C, the return filed on 28.10.2010 was not treated to be a valid return by the AO. However, the information available in the return was considered for the purpose of assessment of the case by the AO. Accordingly the assessment was framed.
Against the assessment order, the assessee filed an appeal before the CIT(Appeals) and the CIT(Appeals) has raised the objection that the assessee had not paid the tax on the admitted return of income; whereas according to the assessee, it has already paid the tax on the admitted return of income and since revised return filed by the assessee was not accepted by the AO, there was no question of payment of tax on the income declared in the revised return. The CIT(Appeals) was not convinced with this argument and the CIT(Appeals) has dismissed the appeal of the assessee, without dealing with the issues on merit. Now the assessee is before the Tribunal and reiterated its contentions.
Having carefully examined the relevant provisions of the Act, we are of the view that while filing an appeal before the CIT(Appeals), the assessee is required to pay the tax on the admitted return of income. But in the instant case, on the admitted return of income, the assessee has already paid the taxes. The assessee has not paid the taxes on the revised return which was not treated to be valid by the AO and was non est in law. Since the revised return was treated to be non est in law, there was no question of making payment of tax on the income declared therein. Therefore, we are of the view that the assessee has already paid the tax on the admitted income declared in the original return filed which was acted upon by the AO for framing the assessment u/s. 153C of the Act. In the light of these facts, we are of the view that the CIT(Appeals) was wrong in dismissing the appeal of the assessee. Therefore, we set aside his order and restore the matter to his file with a direction to readjudicate the appeal on merits by passing a reasoned order.
In the result, the appeal of the assessee is allowed for statistical purposes.
Pronounced in the open court on this 5th day of August, 2016.