Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, RAIPUR BENCH, RAIPUR
Before: SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM
आदेश / O R D E R Per Arun Khodpia, AM :
The assessee has filed this appeal against the order passed by the CIT(A)-3, Bhopal, dated 12.07.2021 for the assessment year 2012-13, on the following grounds :- “
1. That the assessment order passed by the ACIT, [Cirde-21(1), New Delhi] U/s. 147/144/142(1) of the I.T. Act, 1961 (Act) as well as the appellate order passed by the Learned CIT(Appeals), to the extent prejudicial to the appellant, is unjustified, arbitrary, excessive, contrary to evidences, unlawful and bad in law.
2. That the ACIT, [Circle-21(1), New Delhi] as well as Learned CIT (Appeals) have erred both in law and facts of the case by not providing sufficient opportunity to the appellant to present its case with all evidences.
3. That the Learned authorities below have erred both in law and facts in passing the assessment order u/s.147/144/142(1) of the Act, wherein the notice u/s.148 was not validly served and the appellate order u/s.250 of the Act was also passed dismissing the appeal.
4. That the ACIT, [Circle-21(1), New Delhi] has committed gross judicial impropriety in continuing with the reassessment proceedings and passing
ACIT Central Circle-1, Raipur.
That considering the initiation of search and seizure operation u/s.132 of the Act, the pending reassessment proceedings for the AY 2012-13 U/s.147, abates as per the provisions U/s.153A of the Act, 1961 as such the assessment order passed is void and not tenable in law.
6. That the Learned CIT(A) has erred both in law and facts of the case in dismissing the submission of the appellant and sustaining the void and illegal assessment order which is unjustified, unlawful and against the principles of natural justice.
7. That the Learned CIT(A) has erred both in law and facts of the case in sustaining the addition of Rs.8,21,00,000/- on account of accommodation entries by assuming that the addition was made u/s.68 of the Act and without any detailed independent enquiry.
8. That the Learned CIT(A) has erred both in law and facts of the case in confirming the addition of Rs.5,77,000/- towards registration charges of Land made purely on presumption and assumption irrespective of the fact that the purchase of landed properties for Rs.76,00,000/- was accepted and an amount of Rs.3,06,15,180/- is also shown in the Audited Financial Statements as investment in landed properties.
That the Learned CIT(A) has erred both in law and facts of the case in confirming the addition of Rs.2,30,15,180/- towards unexplained investment in landed property made by illegal application of section 69 of the Act, as the relevant investment is duly recorded in the books of account at an amount much more than the landed documents as referred by the ACIT, [Circle-21(1), New Delhi].
That the Learned CIT(A) has erred both in law and facts of the case in confirming the addition of Rs.32,00,000/- towards unexplained investment for purchase of crusher plant made by illegal application of section 69 of the Act, as it is confirmed in the Assessment Order itself that the relevant investment is duly recorded in the books of account.
That the Learned CIT(A) has erred both in law and facts of the case in confirming the addition of Rs.12,75,00,000/- towards share application money pending allotment remaining outstanding after allotment of shares out of total amount of Rs.20,69,00,000/- received in preceding previous year of the year under consideration and more so by illegal application of section 69A of the Act irrespective of the fact that the transaction is duly recorded in the books of account and section 69A mandates addition only
in case the assessee is found to be owner of money, bullion etc. not recorded in the books of account.
That the Learned CIT(A) has erred both in law and facts of the case in confirming the addition of Rs.85,00,000/- in the hands of the appellant due to misinterpretation of section 2(22)(e) of the Act.
That the ACIT, [Circle-21(1), New Delhi] has erred both in law and facts of the case in initiating penalty proceedings u/s.271(1) (c) and u/s.271(1)(b) of the Act.
14.That the Learned Authorities below would have provided sufficient opportunity to the assessee to explain its case with proper evidences.
15.The ACIT, [Circle-21(1), New Delhi] would not have continued the reassessment proceedings and passed the assessment order without jurisdiction and the Learned CIT(A) would not have sustained the void and illegal assessment order..
16.The ACIT, [Circle-21(1), New Delhi] would not have continued the reassessment proceedings and passed the assessment order as the proceedings were abated in terms of section 153A after initiation of search u/s.132 of the Act. Further, the Learned CIT(A) would not have sustained the void and illegal assessment order.
17.That the Learned authorities below would not have made addition/disallowances on different heads of accounts as mentioned above and would have allowed all the claims.
That the ACIT, [Circle-21(1), New Delhi] would not have initiated penalty proceedings U/s. 271(1)(c) and 271(1)(b) of the I.T.Act, 1961.
19.That the appellant craves leave to add alter, delete, modify or withdraw any of the above grounds of appeal as may be required for adjudication of the case.”
2. The brief facts of the case are that the appellant is a company filed its return of income of Assessment Year 2012-13 on 24.09.2012 declaring total income of Rs. Nil. The return was processed u/s 143(1) of the Income Tax Act, 1961. Subsequently, information has been received from office of Assistant Director of Income Tax (Investigation) (OSD)-III, vide letter F. No.
ADIT (Inv)-III/RPR/PMO reference/2018-19 dated 25.02.2019. Further one more information has been received from ITO (Tech. & TPS-2) O/o Pr. CIT, Bilaspur C. G. vide letter dF. No. Pr. CIT/Tech./Verification/2018-19/2211 dated 07.03.2019.
In view of the information received, the case of the assessee was reopened u/s 148 of I.T. Act by issuing notice dated 29.03.2019. The assessee was required to file necessary return in compliance of notice u/s 148, but the assessee remains non-compliant. Later, based on information received from office of Assistant Director of Income Tax (Inv.), the ld. AO proceeded with the reopening assessment proceedings, passed the order u/s 147 of the Act on 16.12.2019 and have made certain disallowances aggregating to Rs.24,48,92,180/-.
Aggrieved by the order of AO u/s 147, the assessee preferred an appeal before the ld. CIT(A)-3, Bhopal, but with no success the grounds of appeal of the assessee were rejected and the appeal has been dismissed.
5. Now the assessee is before the ITAT, challenging the order of ld. CIT(A) with the grounds as mentioned hereinabove.
At the outset, the ld. AR of the assessee has furnished written submission before us along with an affidavit dated 01.06.2023 sworn by Mr. Shiv Garg, S/o Sh. Ashok Garg, Director of M/s Rashi Steel and Power Ltd.
(the assessee company). The written submission and the affidavit submitted are reproduced here under for better understanding of this case:
Based on aforesaid submissions wherein, it was the plea of the assessee that during the assessment proceedings and also while matter was under adjudication before the ld. CIT(A), the assessee was unable to make necessary compliance so as to represent its case with all the necessary facts required to appreciate the issue raised in the matter and to appropriately adjudication the same. It was the submission that the non- compliance by the assessee was due to reasons beyond control. The affidavit submitted by the Director of the company has the mention about reasons for non-compliance by the assessee due to unintended causes,
before ld. AO as well as before ld. CIT(A). The main reason declared in the affidavit was that the management of the assessee company was changed, the loan account of the assessee had turned up as NPA and loans of Rs. 175.67 Crore were called back, accordingly, the bank had published various notices of e-auction of properties of the assessee under provisions of SARFAESI Act, 2002 from 11.04.2018 to 08.01.2020, while the management of the company was going through negotiations and discussions with the banks FOR One time Settlement (OTS) to resolve the loan issues, the assessment proceedings were also commenced and culminated, the reopening of assessment was during the tenure of old management, however, the old management did not make any compliance, the new management could never come to know about the non-compliance and had come to know only after the passing of assessment order. Thus, non-compliance before the AO was due to reasons beyond control of the assessee/present management. Before ld. CIT(A) also the assessee was non-compliant because of the reason that certain documents which were given to the earlier counsel could not be obtained because of non- cooperation of the earlier management /earlier counsel. A search was also conducted in the case of assessee u/s 132 on 20.01.2019 and the assessment u/s 153A for A.Y 2012-13 was passed on 14th July, 2021. Since, the appeal was fixed for hearing on 08.07.2020, at the same time, assessment proceedings u/s 153A were also in process. This also resulted in the unintended non-compliance. Further, as per affidavit the assessee has submitted that during the month of June, 2021, the portal of the income tax department had undergone a total change and thus no data was available on the portal, the new portal become fully functional only in the month of October, 2021, this was also one of the reason for non- compliance.
Ld AR of the assessee, in view of aforesaid compelling reasons, has requested that since the matter at the stage of assessment as well as before the Ld CIT(A) could not be represented by the assessee, in the interest of justice, one more opportunity may be granted by way of restoring the matter back to files of Ld AO, where the assessee will be duty bound to make all the necessary compliances, without fail.
We have heard the contentions of the ld. AR and have gone through the affidavit of the assessee very carefully, the reasons assigned by the assessee towards the non-compliance are considered as genuine and since the assessee was stopped by reasonable, un-intended, circumstances and reasons beyond its control, we are of the considered view that in all fairness matters as requested by the ld. AR needs to be restored back to the files of ld. AO for de novo assessment. The ld. CIT-DR was confronted, who in response has fairly agreed that in the given circumstances the matter may be set aside to the files of ld. AO for conducting assessment de novo.
In terms of aforesaid observations, in the interest of natural justice, without going into the merits of the case, we find it appropriate to set aside the orders of authorities below in the present case and restore the matter back to the files of ld. AO for de novo assessment. Needless to say, that the assessee should be more vigilant and fully compliant during de novo assessment proceedings, the ld. AO is also directed to provide reasonable liberty / opportunity to the assessee to furnish necessary information evidences and documents in support of their contentions. In the result, appeal of the assessee is partly allowed for statistical purposes.