SUBHASHCHAND CHANDAK (HUF),NAGPUR vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, NAGPUR

Date of Hearing – 11/07/2024 Date of Order – 16/07/2024

O R D E R PER K.M. ROY, A.M.

The instant appeal has been filed by the assessee challenging the impugned order dated 20/03/2020, passed by the learned Commissioner of Income Tax (Appeals)–1, Nagpur, [“learned CIT(A)”], for the assessment year 2006–07.

“1. That, the CIT(A), Nagpur has erred on facts and in law in dismissing the rectification application filed u/s 154 against the appeal order passed u/s 250. 2. That, the learned CIT(A) has erred in not deciding the Ground No. 5 raised in Grounds of appeal.

Shri Subhashchand Chandak (HUF) ITA no.85/Nag./2021 3. That, whether additions made on other grounds would sustained, when the primary ground on the basis of which reassessment u/s 147 is initiated, ceased to exist.

4. That, the Assessing Officer has erred, while giving effect to order of CIT (A), Nagpur, in not deducting the other additions made in the assessment order, when the addition made on primary ground, on the basis of which reassessment u/s 147 was initiated, ceased to exist.

7. That, the order passed by the A.O. and upheld by the CIT (A) as regards to additions made on the grounds other than the primary ground on which case was reopened is against the facts of case and the law applicable thereto.

2. The present appeal is directed against the rectification application dated 20/03/2020, passed by the learned CIT(A), which is emanating from the appeal order dated 29/07/2015, against assessment order passed by the ACIT, Circle–1, Nagpur, under section 143(3) r/w section 147 of the Income Tax Act, 1961 ("the Act") dated 07/11/2013.

“5.0 The appellant has filed a rectification petition in respect of Ground no.5, stating that the same remains undecided. Ground no.5, of the grounds of appeal reads as follows:–

Shri Subhashchand Chandak (HUF) ITA no.85/Nag./2021 “5. The other addition made by the Assessing Officer is against the facts of the case and the law thereto and the same needs to be modified.” 5.1 Further, in the assessment order dated 07/11/2013, Para no.5, pertaining to computation of income, read as follows:– 5. Subject to above remarks, the total income of the assessee is computed as under:– Returned income : ` 85,470 Add: As discussed in Para–3 above Long term capital gain : ` 97,036 Short term capital gain : ` 2,00,000 Total Income Assessed : ` 4,20,006 Rounded off u/s 288A : ` 4,20,010 Tax calculation: As per tax calculation sheet enclosed” 5.2 On perusal of the ground no.5, of grounds of appeal and the computation of income as per para 5 of the assessment order, it is observed that there is no specific mention of quantum or head of income under which any addition as other addition as mentioned by the appellant in his rectification petition has been made by the AO. It is also observed on verification of the written submission made by the appellant during the appeal proceedings (Point no.III discussed at preceding para 3.0 that the reference to the only other addition in the assessment order was through objection taken by the appellant at the initial stage to initiation of proceedings u/s. 148 of the Act. This fact is further highlighted from a submissions being made by the appellant on 21.08.2015 and 18.02.2020, where again the issue is seen to be directly connected to adjudication of proceeding u/s. 148 of the Act. While the appellant has been trying to make case that ground no.5, has not been adjudicated upon by the CIT(A)-1, in the order u/s. 250 dated 29/07/2015 the fact remains that, once the AR for the appellant had agreed to not pressing of grounds u/s. 148 as apparent from the order sheet noting, Ground no.5, does not remain to the adjudicated separately as it is directly linked to the grounds related to section 148 not pressed by the appellant. / 5.3 It has been held at several judicial fora that in garb of rectification, no review of an appellate order can be sought. Thus, prima-facie there appears to be no error apparent from the appellate order and the records Therefore, the rectification application made by the appellant is dismissed. 6.0 In the result, the application petition u/s 154 is dismissed.”

“3.1 It is also observed from the order sheet dated 27/07/2015 that Shri K.M. Gupta, C.A. appeared on behalf of the appellant, filed written submission and facts and issues discussed with him. It is on record that ground on section 148 was not pressed.”

Shri Subhashchand Chandak (HUF) ITA no.85/Nag./2021 5. During the course of hearing, the learned Authorised Representative vehemently submitted that the learned CIT(A) has erred in not deciding the ground no.5, raised in the grounds of appeal. The learned A.R., Shri K.M. Gupta, himself filed written submissions, discussed the issue and the ground on section 148 of the Act which was not pressed. The grounds no.2 to 5, in the grounds of appeal has been reproduced by the learned CIT(A) at Page–2, below Para–2.0 of the order passed under section 154 of the Act, which is reproduced below:–

“2.0 The appellate order in this case was passed on 29/07/2015 after giving an adequate opportunity of being heard to the appellant. The appellant had raised as many as 7 grounds of appeal

, which are listed as follows:

1. The Assessing Officer has committed error in taking deemed (so called) Fair Market Value of shares as consideration value u/s. 48 for computation of Long Term Capital Gain, which is against the provision of law.

2. The Assessing Officer has not assumed proper jurisdiction u/s.148 to assess the assessee u/s.147 read with section 143(3). Hence, the order passed by the Assessing Officer is bad in law.

3. The order passed by Assessing Officer is against the principle laid down by the Supreme Court, Bombay High Court and Delhi High Court in the case reported in 66 ITR 622, 87 ITR 407, 215 Taxman 153, 81 DTR 33 and 309 ITR 233 respectively.

4. The Assessing Officer has not followed guideline prescribed by Supreme Court and Bombay High Court in the cases reported in 259 ITR 19 and 296 ITR 96 respectively. The assessing Officer has immediately passed the order within a day from supply of objection instead of 4 week time as prescribed by the Hon'ble Courts in the 259 ITR 19 (Hemal Raju Sheter). Hence, the order passed by the Assessing Officer violates the principle of natural justice and is bad in law.

5. The order addition made by the Assessing Officer is against the fact of the case and the provisions of law.

6. That the order passed by the Assistant Commissioner of Income Tax, Circle- 1, Nagpur is contrary to the facts of case and the law applicable thereto and the same needs to be modified.

7. That the assessee reserves his right to take any other ground or additional grounds at the time of hearing of the appeal." [emphasis supplied]

6. It is apparent on record that once he had himself not pressed the grounds of appeal, there is no scope of again submitting that the learned Page | 4

Shri Subhashchand Chandak (HUF) ITA no.85/Nag./2021 CIT(A) has failed to deal with the issues while passing the order. The wild allegation made by the learned A.R. is unjustified and contrary to the facts on record. The learned CIT(A), therefore, rightly dismissed the rectification petition under section 154 of the Act. Even before us also, the learned A.R. failed to point out any mistake apparent in the appeal order which requires rectification. The order of the learned CIT(A) needs no interference as it is cogent, incisive and directly hits the nail on the head. Therefore, we find no merits to disturb the findings of the learned CIT(A). Accordingly, the grounds of appeal raised by the assessee are dismissed.