SHRI CHAITANYA KOCHAR,HINGANGHAT vs. I.T.O., WARDHA

IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI SANDEEP GOSAIN, JM & SHRI ARUN KHODPIA, AM

I.T.A. Nos. 568 to 574/N/2016 A.Ys. 2002-03, 2003-04,2004-05,2005-06,2006-07,2007-08 & 2008-09 Shri Chaitanya Kochar Vs. The ITO Chaitanya Bhavan, Main Road Wardha Mohta Chowk, at Post Hinghaghat Distt. Wardha – 442 001 PAN No.: AESPK 9767 L Appellant Respondent Assessee by: Shri R.S. Thakar (Adv.) and Shri S.C. Thakar, (Adv.) Revenue by : Shri Piyush Kolhe (CIT-DR) Date of Hearing: 20/04/2022 Date of Pronouncement: 28 /04/2022 ORDER PER: SANDEEP GOSAIN, J.M. The Above referred seven appeals for A.Y.2002-03 to A.Y.2008-09 are by the assessee against the consolidated order dt.20.10.2016 passed by Commissioner of Income Tax (Appeals)-2, Nagpur arising out of assessment orders u/s.153A r.w.s. 143(3) dt.30.12.2010 passed by Income Tax Officer, Wardha. 2] Assessee-Appellant has taken following grounds of appeal before us.

2 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA Grounds of Appeal 1) On the facts and circumstances of the case the reassessment made under section 153-A by order dt.30.12.2010 for A.Y. 2002-03 to A.Y.2008-09 in pursuance of search U/s.132(1) dt.07.09.2007 is barred by limitation as provided in section 153-B. The search having taken place in F.Y.2007-08 the assessment U/s.153-A was required to be completed within 21 months from end of F.Y.2007-08 i.e. on or before 31.12.2009 as provided in section 153-B. However the impugned order was passed on 30.12.2010 and hence the same was barred by limitation. C.I.T.(A) erred in holding the said assessment order as within time. 2) Learned C.I.T.(A) failed to see that the order U/s.153-A initially passed by Dy. C.I.T.-C.C.(2)3, Nagpur on 31.12.2009 was without jurisdiction and hence ab-inito void as held by Hon. High Court by its order dt.09.09.2010 and hence learned C.I.T.(A) erred in assuming that the order U/s.153-A when passed by Dy. C.I.T.-C.C.(2)3 on 31.12.2009 was valid as the writ petition was filed on dt.05.04.2010 i.e. after the passing of said order and the matter became subjudice from that date till the H.C. passed order on 09.09.2010 and hence the period of limitation of 21 months would commence from the date of passing of order of H.C. Such a reasoning to anyhow bring the order within time is not only illogical, untenable and contrary to provision of law but also it amounts to re-writing the law by C.I.T.(A).

3) Learned C.I.T.(A) erred in assuming that merely because the assessee had given purshish before the High Court that he will not object to the jurisdiction of I.T.O. Wardha, the time automatically got extended or A.O. need not follow law of limitation or that the assessee was estopped from taking objection to the limitation etc. Such assumptions drawn by C.I.T.(A) are untenable, contrary to facts and law. There is no estopel against the law of limitation or other provisions of law and the A.O. has to

3 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA act within the framework of law. Even the High Court or Supreme Court cannot direct the statutory authority to pass an order in violation of statutory provision or law of limitation. See (1994) 205 I.T.R. P.508 (S.C.) Hope Textile and another Vs. Union of India and others. 4) Learned C.I.T.(A) failed to appreciate various written submissions filed by the assessee before him in proper perspective and hence erred in drawing erroneous conclusions. 5) Learned C.I.T.(A) failed to see that the impugned assessment order U/s.153-A was seriously violative of section 153-D. Hearing of assessment proceedings went on till 29.12.2010 when the assessee filed reply to various querries and the Asstt. Order was passed on 30.12.2010 stating that order is passed with prior approval dt.30.12.2010. The so called approval was mechanical and without application of mind and without following the required procedure, rendering the impugned order to be a nullity. 6) Assessee filed the return U/s.153-A on 22.12.2010 in pursuance of notice issued by I.T.O. Wardha U/s.153-A dt.22.12.2010. After the filing of the return no notice U/s.143(2) was issued which was mandatorily required to be issued if the A.O. repudiates the return. He passed the asstt. order U/s.143(3) making huge additions on 30.12.2010 without issue of any notice U/s.143(2) and hence the said order U/s.143(3) was a nullity. Learned C.I.T.(A) should have held the said impugned order as a nullity. 7) Learned C.I.T.(A) failed to properly appreciate the written submission dt.26.09.2016 dealing with merits of the additions and erred in drawing conclusions which are contrary to evidence and material on record and are seriously violative of principles of natural justice and consequently erred in confirming various additions made by A.O. Assessee

4 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA craves leave to refer to the said written submission and other submissions filed before C.I.T.(A).

2.1 Appellant has taken additional ground by his application for additional grounds filed on 09.06.2021 which is as under :- Additional Ground 1) Assessments orders passed by I.T.O. Wardha dt.30.12.2010 U/s.153-A over again for A.Y.2002-03 to A.Y.2008-09 after they were annulled by High Court are totally illegal and also contrary to the provisions of section 153A(2). 3. Facts of the case are that the appellant is resident of Hinganghat and is assessed to Income Tax by Income Tax Officer, Wardha. There was a search action u/s.132(1) I.T.Act,1961 in “Sancheti group” and “Raisoni group” premises on 07.09.2007. Assessee being connected with Raisoni group he was also roped into the said search u/s.132(1) dt.07.09.2007. Raisoni group is in the business of running various colleges including engineering colleges and professional Institution at various places in the State of Maharashtra and Madhya Pradesh in a big way. Assessee was associated with Raisoni group in their educational Trust at Raipur during the relevant time and he was also roped into the search. Assessee and his family members being resident of Hinganghat, Dist. : Wardha are being regularly assessed by Income Tax Officer, Wardha since last several years. After the search dt.07.09.2007 nothing

5 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA happened for about nine months. Then the assessee received notices u/s.153-A for A.Y.2002-03 to A.Y.2007-08 on 30.05.2008 from Asst. Commissioner of Income Tax Central Circle-2(1), Nagpur calling upon him to file returns for those years. Assessee by his objection dt.08.07.2008 objected to the jurisdiction of ACIT Nagpur as the assessee was regularly assessed by I.T.O. Wardha and that he had neither received any notice u/s.127 or order transferring his case from I.T.O. Wardha to said A.O. at Nagpur. Thereafter he received seven notices u/s.142(1) from yet another officer viz. ACIT Circle-2(2), Nagpur calling upon him to file returns for said years. Assessee objected to his jurisdiction, however he filed returns under protest. Thereafter the assessee received another notice u/s.142(1) dt.11.09.2009 from another officer viz. Dy. Comm. of Income Tax Central Circle-2(3), Nagpur calling upon him to file the return for A.Y.2008-09 which the assessee filed under protest objecting to his jurisdiction. Then in pursuance of queries raised by Dy. Comm. of I.T. C.C.-2(3), Nagpur for those years viz. .AY.2002-03 to A.Y.2008-09 assessee filed replies with a view to cooperate with the Dept. The said Dy. Comm. of I.T. CC-2(3), Nagpur passed assessment order u/s.153-A r.w.s. 143(3) against the assessee by asst. order dt.23.12.2009 making huge additions.

6 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA 4. Assessee filed Writ Petition before the Hon’ble High Court of Judicature of Mumbai, Bench at Nagpur on 05.04.2010 (W.P. No. 2743 of 2010) against Commissioner of Income Tax ,Central Circle Nagpur and all concerned officer Nagpur challenging the impugned transfer order dt.07.03.2008 whereby the case of the assessee was transferred from I.T.O. Wardha to Assessing Officer at Nagpur and challenging the consequent assessment orders u/s.153-A dt.23.12.2009 passed by Dy. Comm. of I.T. CC-2(3) Nagpur as without jurisdiction. 5. Hon’ble High Court by its judgment and order dt.09.09.2010 relying on the decision of Apex Court in the case of Ajantha Industries and others Vs. Central Board of Direct Taxes & others reported in (1976) 102 ITR P.281 (S.C.) quashed the notice of transfer dt.07.03.2008 and consequent assessment orders dt.23.12.2009 in absolute terms. Assessee also filed purshish stating that he will not have objection against I.T.O. Wardha making assessments. 6. After the said assessments u/s.153-A were annulled by the High Court by order dt.09.09.2010 the Dy. Comm. of I.T. CC-2(3), Nagpur cancelled the assessment orders passed by him on 23.12.2009 u/s.153- A by his order dt.26.10.2010.

7 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA 7. Thereafter the I.T.O. Wardha again issued three notices u/s.153- A, 142(1) and 143(2) for all the years simultaneously on 13.12.2010 communicated to assessee on 20.12.2010 calling upon the assessee to file return for all those years and give reply to the querries raised by him. Assessee accordingly filed returns for all those years on 22.12.2010 and also filed replies to queries on 23.12.2010 but protested that the assessments had already become barred by time and he cannot make the assessment over again u/s.153-A which were annulled by Hon’ble High Court. Thereafter I.T.O. Wardha issued show cause notice dt.24.12.2010 proposing various additions for A.Y.2002-03 to A.Y.2008- 09. Assessee filed reply to the same on 29.12.2010. Thereafter the I.T.O. Wardha passed orders u/s.153-A r.w.s. 143(3) for A.Ys. 2002-03 to A.Y.2008-09 on the next day on 30.12.2010 after allegedly taking prior approval of Additional C.I.T. W.R. vide letter dt.30.12.2010 making huge additions. 8. Against the said orders of I.T.O. Wardha the assessee filed appeals for all those years before Comm. of I.T. (Appeals)-2, Nagpur on 27.01.2011 and raised various legal grounds and grounds on merits and also filed detailed written submissions. Ld. C.I.T.(A) by his consolidated order for all those years dismissed assessee’s appeal by his order

8 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA dt.20.10.2016. Against the said order the assessee is in appeal before us taking grounds of appeal as stated above. 9. Referring to the grounds of appeal referred to above broadly the following issues arise for our consideration :- (i) Whether the assessment made u/s.153-A by orders dt.30.12.2010 passed by I.T.O. Wardha are barred by limitation? (ground nos. 1,2,3 and 4). (ii) Whether passing of the same assessments order over again u/s.153-A after they were annulled by the High Court are contrary to the provisions of section 153-A(2) and are also otherwise illegal? (additional ground). (iii) Whether in absence of notice u/s.143(2) after filing of returns on 22.12.2010 are the assessments in question illegal? (ground no.6). (iv) Whether the orders passed by A.O. on 30.12.2010 are without proper approval of Jt. Commissioner and without application of mind as required under section 153-D and hence illegal? (ground no.5). (v) On merits whether the additions made by A.O. are totally unjustified and illegal being without application of mind, in serious violation of principles of natural justice, contrary to facts and material on record and merely based on surmises suspicion, conjuctures and assumption? (ground no.7). 10. Learned A.R. appearing for the assessee has filed a detailed written submission along with paper book on 17.06.2021 and copy

9 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA whereof was delivered to Departmental Representative on 17.06.2021 and in reply D.R. has filed his Reply-Submission on 09.07.2021 copy whereof is delivered to the A.R. Learned A.R. submitted that the reasons given by ld. C.I.T.(A) for holding that the impugned assessments are not barred by limitation are untenable. Reasoning of ld C.I.T.(A) is that the assessment u/s.153-A when made originally on 23.12.2009 was in time and was valid order. However it became sub-judice when the assessee filed writ petition on 05.04.2010 and remained sub-judice till the matter was decided by High Court on 09.09.2010 and hence this time is to be excluded in computing limitation; however in very next breath he says fresh limitation will begin from 09.09.2010 and hence the assessment orders being passed on 30.10.2010 i.e. within 21 months from the date of High Court’s order the same is in time. Learned A.R. pointed out that such an argument is wholly fallacious. When the earlier order dt.23.12.2009 is held to be without jurisdiction and null and void the same is null and void from beginning and non-est. It can’t be valid for part of the time and invalid for part of the time. Further even assuming that the time taken in Hon’ble High Court proceedings i.e. from 05.04.2010 to 09.09.2010 is to be excluded then also the assessment made on 30.12.2010 is barred by time. Search took place on

10 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA 07.09.2007. Hence limitation of 21 months will begin from 01.04.2008 and 21 months will end on 31.12.2009 while the impugned assessments are made on 30.12.2010 i.e. after 33 months. Time taken in Hon’ble High Court proceeding is five months and four days. If this time is excluded from 33 months then also it comes to 28 months. Thus the assessment made on 30.12.2010 as per ld C.I.T.(A)’s argument is also beyond the period of limitation of 21 months. That apart there is no question of exclusion of time in concluded matters. Ld C.I.T.(A)’s second argument that the fresh limitation of 21 months will begin from the date of Hon’ble High Court’s order is not supported by any provisions of law or by any legal precedent. His next argument that assessee having given purshish that he will not object to the jurisdiction of I.T.O. Wardha he is estoppel from taking plea of limitation is also not tenable. Ld A.R. pointed out that the purshish has to be understood in the context of things. What is meant by the purshish is that the assessee will not challenge the territorial jurisdiction of I.T.O. Wardha to make assessment and it goes without saying that the assessment has to be made according to law and within the frame work of law. Purshish does not give licence to I.T.O. Wardha to act dehors the law and further there

11 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA is no estoppel against law. For this proposition he relied on various case law :- (i) AIR 1991 (Bom.) P.35 Ajab Enterprises Vs. Jayant Vegviles and Chemicals (P) Ltd. (ii) (1970) 75 ITR P.625 (All) Smt. Parbatidevi Vs. C.I.T. (iii) (2003) 262 ITR P.633 (Cal.) Mayank Poddar HUF Vs. W.T.O. (iv) (2004) 269 ITR P.1 (Bom.)

He further pointed out that the case relied on by Dept. in his written submission viz. Ramchandra and Co. Vs. C.I.T. 168 I.T.R. P.375 was a case where the assessee having agreed and accepted certain facts and assessment having been made accepting those facts, then the assessee cannot be said to be aggrieved and hence he cannot file appeal challenging the said fact. This does not in any way go against the proposition that there cannot be estoppel against law. 11. On next issue viz. I.T.O. Wardha cannot pass and repeat the same order u/s.153-A which was annulled by the High Court, the A.R. referred to his written submission para 25 on page 19 to 22 and reiterated the same. 12. On next issue relating to issue of notice u/s.143(2) he referred to his written submission para 27 on page 22 and relied on the case law of

12 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA ACIT Vs. Hotel Blue Moon reported in (2010) 321 ITR P.362 (S.C.) and others. 13. With regard to the next issue that there is no proper approval of Jt. Commissioner and no application of mind he pointed out that looking to the facts on record and quick succession of events and the fact that the proceedings were going on till 29.12.2010 the A.O. could not have passed 7 orders in assessee’s case and 7 orders in case of his six relatives i.e. total 49 orders in just one day. Further all the orders passed by I.T.O. Wardha are verbatim repetition of orders dt.23.12.2009 passed by Dy.C.I.T. CC-2(3), Nagpur and which were annulled by the High Court. Looking to the totality of facts it was even impossible to even to read all those orders, if they were really passed on 30.12.2010 and much less to apply mind to the various aspects of the order and give his approval after satisfying himself. Thus the so called approval was merely mechanical and without application of mind and hence violative of sec.153-D. He also relied on the decision of Hon’ble Supreme Court in the case of Chhugmal Rajpal Vs. S. P. Chaliha & others reported in (1971) 79 ITR P.603 (S.C.). 14. On merits the ld A.R. referred to the detailed written submission from page 26 to 46 and reiterated the same.

13 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA 15. On the other hand the ld D.R. relied on the orders passed by ld. C.I.T.(A) and the Assessing Officer, the written submission dt.09.07.2021 filed by him with case law and submitted that the appeals of the assessee are liable to be dismissed. 16. We have perused the assessment orders passed by I.T.O. Wardha, order of learned C.I.T.(A)-2, Nagpur, perused the detailed written submissions filed by the parties and various case laws relied on by them. We discuss the issues arising in this appeal as under :- Basic facts are already stated earlier and they are not repeated. Reasoning adopted by ld C.I.T.(A) as stated in para 8 of his order are that search took place on 07.09.2007 and hence the time limit for completion of assessment u/s.153-A would be 21 months from the end of the relevant financial year i.e. 21 months from 01.04.2008 that is till 31.12.2009. Dy.CIT CC-2(3), Nagpur had passed order u/s.153-A on 23.12.2009 and hence the same was a valid order and in time when it was passed. However assessee filed writ petition on 05.04.2010 challenging the said order and jurisdiction of A.O. Nagpur and hence the matter became sub-judice and hence I.T.O. Wardha, pending decision of High Court could not have taken any action for want of jurisdiction until the decision of High Court on 09.09.2010 (C.I.T.(A) has referred to date

14 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA of H.C.’s order as 18.01.2010. This is not correct. The date 18.01.2010 is the date of HC’s order in the cases filed by assessee’s relatives. The date of H.C.’s order in the case of assessee is 09.09.2010 copy of which is placed on record on page 50 to 52 of assessee’s paper book). Dy. CIT CC-2(3) transferred seized material to I.T.O. Wardha on 01.12.2010. Thus according to ld. C.I.T.(A) the jurisdiction for issue of notice for passing search assessment by I.T.O. Wardha commenced only after the date of pronouncement of decision by H.C. i.e. 09.09.2010 (not 18.01.2010). Therefore the period during which the original order passed u/s.153-A dated 23.12.2009 was sub-judice before Hon’ble High Court is required to be excluded for calculating period of 21 months for completing search assessment. However in next breath he says that according to him, the limitation of 21 months will commence afresh from the date of pronouncement of Hon’ble High Court’s order dt.09.09.2010 by virtue of which jurisdiction was held good with I.T.O. Wardha by virtue cancellation of transfer order dt.07.03.2008 u/s.127(2) (wrongly mention as 17.09.2009 – This date relates to other relatives). Ld C.I.T.(A) further states that thus according to this logic as envisaged in the Income Tax Act, 1961 the search assessment passed by I.T.O. Wardha on 30.12.2010 is within time. Above referred reasoning of ld

15 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA C.I.T.(A) to hold the impugned assessment dt.30.12.2010 in time are full of fallacies. Firstly the Hon. High Court having held in absolute terms that the transfer order 07.03.2008 and consequent assessment order u/s.153-A dt.23.12.2009 were without jurisdiction means that the said orders were invalid and non-est from it’s inception. An order which is declared as invalid or without jurisdiction is invalid right from it’s inception and not from the date on which it is declared so. Further the order of the Hon’ble High Court cancelling the transfer order dt.07.03.2008 and 153-A assessment order dt.23.12.2009 were in absolute terms based on the decision of Hon’ble Supreme Court referred to therein. Second reasoning of ld C.I.T.(A) that the matter became sub-judice when the assessee filed Writ Petition on 05.04.2010 and hence the I.T.O. Wardha pending decision of H.C. could not take any action is also untenable and irrelevant. As soon as Dy. C.I.T. CC-2(3), Nagpur passed the 153-A order on 23.12.2009 the matter of assessment came to an end. Assessment thereafter cannot be said to sub-judice. Thus when a concluded assessment is challenged in H.C. it cannot be said that the assessment proceedings which had already concluded became sub-judice. Further when the assessment order passed by Dy.C.I.T. CC-2(3), Nagpur were challenged before the High Court, I.T.O.

16 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA Wardha had no role at all. He was not even a party to the Writ Petition. Thus to say that during the pendency of Writ Petition the I.T.O. Wardha could not take any action etc. is wholly irrelevant. His assumption that the entire matter of assessment was sub-judice till the H.C. passed order on 09.09.2010 and the limitation of 21 months will commence from the date of H.C.’s order and this logic said to be envisaged in the Income Tax Act, 1961 etc. is untenable and unsupported by any provision of Income Tax Act or any other law or any other precedent. On the other hand Income Tax Act,1961 itself provides for all contingencies about limitation. It provides for limitation for making assessment u/s.153-A or u/s.153-C. It provides while counting the limitation period for making assessment which time is excluded and when. It provides for as to what will happen on annulment of 153-A order and what happens when annulment order is set aside. Thus there is no scope for making any assumptions. With regard to one of the submission of ld. C.I.T.(A) that the time taken in Hon’ble High Court proceeding is required to be excluded, the ld A.R. has rightly pointed out that even if it is assumed that the time taken in Hon’ble High Court proceeding from 05.04.2010 to 09.09.2010 is required to be excluded in counting period of limitation

17 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA then also the impugned assessment made on 30.12.2010 are much beyond 21 months and barred by time. 17. Next argument of ld C.I.T.(A) is his order and on which reliance is placed by ld D.R. is that since the assessee had given purshish before H.C. that he will not object to the jurisdiction of I.T.O. Wardha to make assessment he is estopped from challenging the impugned order of I.T.O. Wardha dt.30.10.2010. In this regard it appears that the department immediately after the High Court’s order dt.08.09.2010 sought the view of the Departmental Counsel whether it was necessary to get certain clarification from the High Court to which he gave his opinion by his letter dt.13.10.2010 :- “ I quite see that the judgment of the Hon’ble High Court does not say anything as regards the authority of the Assessing officer at Wardha to proceed under section 153-A of the Act. However, the assessee himself having passed pursis giving his no objection for the ITO, Wardha to proceed against him consequent to notice dated 30.05.2008 under section 153-A of the Act (the pursis being the part of the record of the High Court in writ petition No.2743/10), the Assessing Officer can proceed against the assessee without any further difficulty. In the event of any objection being taken by the assessee on the ground of limitation, it may be rejected on the ground of estopples, particularly when the assessee himself has given no objection for such course of action to be adopted by the assessing officer.

18 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA Further, the assessee also cannot raise any objection on the ground of limitation since in our considered opinion the limitation would begin from the date of order of the Hon’ble High Court and therefore, even on that count the assessing officer need not stop the proceedings and on the other hand proceed to complete the assessment in accordance with law. In view of the above position, we are of the considered view that we need not make any application seeking further clarification from the Hon’ble High Court, particularly when the assessee himself has agreed to follow the above referred course of action. Hence, this opinion.” On this basis he held that the assessment made by I.T.O. Wardha on 30.10.2010 was in time and assessee was estoppel from raising any plea against the said order. 18. Now referring to the Purshish he states :- “ I quite see that the judgement of the Hon’ble High Court does not say anything as regards the authority of Assessing Officer Wardha to proceed under section 153-A of the Act.” 19.However further relying on the purshish given by assessee he says :- “ However the assessee himself having passed purshish giving his no objection for the I.T.O. Wardha to proceed against him consequent to notice dt.30.05.2008 under sec. 153-A of the Act the assessing officer can proceed against the assessee without any further difficulty.” Said opinion further says that the objection, if any, can be rejected on the ground of estoppel.

19 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA 20. It further says that in his opinion limitation will begin from the date of H.C.’s order. 21. He further says that in view of this, there is no need to make any application seeking further clarification from Hon’ble High Court. 22. Said purshish referred to earlier is placed on page 58 of assessee’s paperbook. However the same is quoted below :- “The Petitioner has no objection for continuation of proceedings by Income Tax Officer Wardha, initiated under sec.153-A dt.30.05.2008 of Income Tax Act.” 23. Now reading the judgment of the Hon’ble High Court (P.51 &52 of paperbook) makes it absolutely clear that the transfer order u/s.127(2) and the 153-A orders dt.23.12.2009 have been cancelled in absolute terms based on Supreme Court judgment and not based on any concession stated in purshish. Further as pointed out by Dept’s counsel, in his opinion that Hon’ble High Court does not say anything regards the authority of I.T.O. Wardha. There is no direction of any nature by the H.C. to the Deptt. or to the assessee. The orders are simply and absolutely quashed. Now referring to the Purshish it was submitted by ld A.R. that the purshish has to be read in the context. What was under challenge was the transfer of territorial jurisdiction of assessee from I.T.O. Wardha to Assessing Officer at Nagpur. Since the Hon’ble High

20 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA Court as per prayer of assessee quashed the territorial jurisdiction of Assessing Officer at Nagpur, the assessee stated that he will not now object to the jurisdiction of I.T.O. Wardha. That meant that the assessee will not object to the territorial jurisdiction of I.T.O. Wardha to make assessment in pursuance of notice u/s.153-A dt.30.05.2008. This obviously means that the assessment has to be made according to law. Thus in the context it only mean that the assessee will not object to the territorial jurisdiction of I.T.O. Wardha to make assessment, obviously according to law. It was submitted that even the court cannot give direction to the authority under the Act to ignore the period of limitation prescribed under the Act. Reliance is placed by ld.AR on the decision of Hon’ble Supreme Court in the case of Hope Textile Ltd. and another Vs. Union of India and others reported in (1994) 205 I.T.R. P.508. In the said case for A.Y.1971-72 assessee’s return declaring loss was accepted by order dt.27.03.1974. On 21.02.1976 reassessment notice was issued u/s.148. In pursuance thereof assessee filed return disclosing further loss. No assessment was made till Sept.1981. Appellant therefore filed a Writ of Mandamus in High Court for directing the Income Tax Officer to pass an order in pursuance of notice. High Court dismissed the petition holding that mandamus cannot be issued compelling I.T.O. to make

21 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA order of assessment beyond time prescribed u/s.153(2). Appellant preferred appeal to Hon’ble Supreme Court. Hon’ble Supreme Court dismissed the petition holding that sub-sec.(ii) of section 153(3) could not be understood as empowering High Court to give direction to the authority under the Act to ignore the period of limitation prescribed under the Act. Hon’ble Supreme Court emphatically said that it cannot issue mandamus to compel an authority to pass an order in violation of statutory provision. Thus it cannot be said that in view of purshish filed by assessee the I.T.O. Wardha can pass order contrary to law or beyond limitation. There are number of decision which clearly says that there is no estoppel against law nor can there be any waiver on the ground of limitation. Hon’ble Bombay High Court in the case of Ajab Enterprises Vs. Jayant Vegoites and Chemical (P) Ltd. reported in AIR 1991 Bom. P.53 says :- “Apart from this there is catena of decisions on the basis of which it could be said that there can be no waiver of grounds of limitation even if it is assumed that in fact the said consent terms could be considered as a waiver. Under section 3 of Limitation Act it is the duty of the court to also consider as to whether the suit is barred by limitation or not even if no such defence is taken by the defendant in a suit. Therefore there cannot be such waiver against provisions of limitation. Reliance could be placed on the ruling reported in AIR 1920 P.C. 139 which has been followed in (1968) ILR

22 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA 47 Pat. 263. In view of this there also cannot any estopped which could be pleaded by plaintiff successfully. The defendant cannot be said to be estopped from pleading that the suit is barred by limitation when in fact the claim by plaintiffs appears to be barred by limitation taking into consideration Article 15 of the Limitation Act.” See Allahbad H.C. in the case of Smt. Pratibhaben Vs. C.I.T. (1970) 75 ITR P.625 head notes :- “Return – voluntary return under section 139(4) – validity – voluntary return was filed beyond the period of limitation mentioned in sub-sec(4) of sec.139 and was therefore invalid – If the return was itself invalid, the return could not support assessment under sec.153(1)(c) – Assessment itself would be beyond limitation – Petitioner is right in his contention that the assessment order dt.1st April, 1966 was beyond limitation – Inspite of the compromise with the department it is open to the Assessee to take up the position that the return filed by her in 1966 was barred by time.” Relevant portion from the decision of Calcutta H.C. in the case of Mayank Poddar (HUF) Vs. Wealth Tax Officer reported in (2003) 262 ITR P.633 says :- “There cannot be any estoppels against statute. A property which is not otherwise taxable, cannot become taxable because of misunderstanding or wrong understanding of law by the Assessee or because of his admission or on his misapprehension. If in law an item is not taxable, no amount of admission or misapprehension can make it taxable. The taxability or the authority to impose tax is independent of admission. Neither there can be

23 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA any waiver of right by the Assessee. The Department cannot rely upon any such admission or misapprehension if it is not otherwise taxable.” Bombay H.C. in the case of Nirmala L. Mehta Vs. A. Balsubramaniam Comm. of I.T. (2004) 269 ITR P.1 says :- “Acquiescence cannot take away from a party the relief that he is entitled to where tax is levied or collected without authority of law – Therefore merely because the Petitioner offered the prize money to tax under the I.T. Act, 1961 that cannot take away her right in contending that the said prize money was not taxable.” Thus in our view the assessee is not estoppel from raising the issue of limitation. Similarly there is no basis for Departmental Counsel’s view that fresh limitation will begin from the date of order of Hon’ble High Court. He has not pointed out any provision from the Income Tax Act or law of limitation nor any case law or a precedent to support his view. In our considered opinion impugned orders u/s.153-A dt.30.12.2010 are barred by limitation. Thus issue No.1 is answered accordingly. 24. With regard to issue No.2, arising from additional ground the assessee has given his submission in para 25 pages 19 to 22 of his written submission. Briefly stated, section 153-A(2) provides that if assessment under section 153-A(1) are annulled then the assessments which were pending on the date of search and which abated due to

24 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA search alone shall revive. Thus only those assessments which were pending on the date of search shall revive and they can be completed within one year as provided in sec.153(4) from the date of revival in normal course. The assessments which were already completed on the date of search and had become final will remain final. Thus the position ante the date of search will come into operation and the pending assessment which had abated because of search will revive and can only be completed u/s.143(3). The assessments u/s.153-A which are annulled are annulled forever, unless the annulment is cancelled by some Higher Court. Thus no assessment can be made once again u/s.153-A which were annulled. In the case of the assessee as on the date of search dt.07.09.2007 assessment upto A.Y.2006-07 were final, only the assessment for A.Y.2007-08 and A.Y.2008-09 were pending and which had abated got revived on annulment of 153-A orders dt.23.12.2009 by Hon’ble High Court. Thus the I.T.O. Wardha could make regular assessment u/s.143(3) for those two years only and that too after following the procedure laid down in sec.143. On annulment of orders u/s.153-A Revenue cannot over again make assessment u/s.153- A for those very years. I.T.O. Wardha instead of making regular assessment u/s.143(3) only for A.Y.2007-08 and 2008-09 made

25 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA assessment orders over again for all those very years from A.Y.2002-03 to A.Y.2008-09 under section 153-A and verbatim repeating the same orders word by word which had been annulled by Hon’ble High Court. This is wholly illegal and contrary to the specific provisions of section 153A(2). We find substance in the argument. This is the meaning on plan reading of section 153A(2). Further it will be mockery of law if the I.T.O. is allowed to pass the very same order under very same section which were cancelled by the Hon’ble High Court in absolute terms. In absence of any direction from High Court or in absence of any other enabling provisions of law how can I.T.O. disregard the order of High Court and make the very same order over again? When the orders u/s.153-A are annulled for whatever reasons they are annulled forever and the same cannot be redone by the I.T.O. over again. In our view there is substance in the said argument and accordingly we hold that the impugned assessments u/s.153-A dt.30.12.2021 are contrary to law. 25. Regarding third issue whether in absence of notice u/s.143(2) after filing of return the assessments made on 30.12.2010 are illegal. This issue is covered against the assessee by Delhi H.C., Punjab & Haryana H.C. and Mumbai Tribunal wherein it has been held that in search assessment notice u/s.143(2) is not mandatory as held in

26 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA following cases viz. Ashok Chhadha & Co. Vs. C.I.T. 168 ITR P.375, Tarsem Singh Vs. DCIT CC-III Ludhiana 385 ITR P.138 and Sumantlal Bansal Vs. ACIT CC-8, Mumbai dt.20.05.2015 ITA No.525 to 530/M/2008. Accordingly this issue is decided against the assessee. However this has no impact on our decision of earlier two issues. 26. Next issue raised by the AR is that the impugned orders u/s.153-A dt.30.12.2010 passed by A.O. are without proper approval of Addl. Commissioner of I.T. and without application of mind as is required u/s.153-D. Thus the so called approval of Addl. C.I.T. vide his letter dt.30.12.2010 is merely mechanical and without satisfaction. For this submission the reasoning advanced are that the hearing of assessment continued till 29.10.2010 which required consideration of voluminous material on record. The A.O. could not have considered the material spreading over seven years in assessee’s case and seven years each in case of each of his six relatives and pass 49 orders just in a day on 30.10.2010, and then forward the same to Addl. C.I.T. and then Addl. C.I.T. reading all those orders, apply his mind and give his approval after due satisfaction on the same day. Thus the so called approval dt.30.10.2010 by Addl. C.I.T. was just mechanical and without application of mind. Further referring to the impugned orders u/s.153-A

27 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA dt.30.10.2010 it was submitted that they are the verbatim repetition of the earlier orders dt.23.12.2009 passed by Dy.C.I.T. CC-2(3), Nagpur which had been annulled by the High Court. Ld A.R. relied on the decision of Hon’ble Supreme Court in the case of Chhugmal Rajpal Vs. S.P. Chaliha and others reported in (1971) 79 ITR P.603 (S.C.). That was a case under section 151(2) of I.T.Act,1961. In that case the I.T.O. sought permission of Commissioner of I.T. to issue notice u/s.148 to the assessee as he believed certain loans taken by assessee as not genuine but in his report he did not mention the material before him on the basis of which he had reason to believe that some income escaped assessment. On this report the Commissioner against the question “whether the Commissioner is satisfied that it is a fit case for issue of notice under section 148” merely noted “yes” and affixed his signature thereunder. Hon’ble Supreme Court held that the Commissioner had mechanically accorded permission. The important safeguard provided under section 147 and 151 were lightly treated by the officer and the Commissioner and hence the Hon’ble Supreme Court held the notice under section 147 as invalid. In the present case the A.O. in the assessment order itself refers to the fact that he sought approval of Addl. C.I.T. W.R. Wardha before passing the order and Addl. C.I.T. by

28 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA his letter dt.30.12.2010 has granted approval and it is after obtaining approval the A.O. has passed the order. Approval is specifically communicated by a letter granting approval. It is not a case of mechanically saying “yes” without application of mind. Though everything happened in a day which may raise doubt about the application of mind by Addl. C.I.T. before granting approval but that by itself cannot lead to the conclusion that Addl. C.I.T. granted approval mechanically or without application of mind. There is no material with us to disbelieve what is recorded by A.O. in assessment order and hence we do not accept the contention of ld A.R. that the order is passed without proper approval. However as we have already said earlier this will have no impact on our finding that the orders are passed beyond the period of limitation and contrary to the provisions of law. 27. Next issue is regarding merits of the additions. Ld A.R. has relied on the written submissions made by him in paras 29,30 and 31 and their sub-paras on page 26 to 46 wherein he has challenged the various findings by A.O. as (a) in flagrant disregard of principles of natural justice and making the assessment in post haste, (b) without independently applying his mind to the facts of the case and material on record and merely repeating verbatim the earlier assessments made by

29 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA Dy.C.I.T. CC-2(3), Nagpur dt.23.12.2009 which has been annulled by Hon’ble High Court. (c) without any admissible material or evidence making allegation that certain individual and company’s were his benamidars wherein he deposited his moneys in the year 2001-02 and through maze of transaction laundered his unaccounted money. But the A.O. failed to see that in the year 2001-02 and 2002-03 he was an employee of Vijaychand Jain connected with Raisoni group drawing salary of Rs.6,000/- p.m. which he had also returned in his income returns for those years and that neither he nor any of his family members were directors in the companies alleged to be paper company. He also failed to see as per his own finding in assessment order that the said moneys got ultimately parked in Vibrant Infotech Ltd. and Shradhha Industries belonging to Raisoni group. (d) and failing to see that for proving benami nature of transaction the burden lay on the department which the Revenue failed to discharge and (e) various other submission. However we do not go into those factual grounds and also it is not necessary to do so since we have held the impugned assessment u/s.153-A dt.30.12.2010 are barred by time and contrary to law and are liable to be set aside on those grounds. In the result, the impugned

30 ITA568/NAG/2016 TO ITA 574/NAG/2016 Shri Chaitanya Kochar, Nagpur vs ITO, WARDHA assessments u/s.153-A dt.30.12.2010 are cancelled and thus the appeals of the are Allowed. In the result, the above mentioned appeals of the assessee are 28. allowed. Order pronounced in the open Court on 28 /04/2022.

Sd Sd/- (ARUN KHODPIA) (SANDEEP GOSAIN) Accountant Member Judicial Member Nagpur Dated:- 28/04/2022 *Mishra Copy of the order forwarded to: The Appellant- Shri Chaitanya Kochar, Distt. Wardha. 1. The Respondent- The ITO, Wardha 2. CIT 3. The CIT(A) 4. DR, ITAT, Nagpur 5. Guard File (ITA No. 568 /Nag/2016) 6. By order, Asst. Registrar