M/s. Marble Art, New Delhi v. ACIT, New Delhi

ITA 2480/DEL/2013 | 2003-2004
Pronouncement Date: 08-03-2021 | Result: Allowed

Appeal Details

RSA Number 248020114 RSA 2013
Assessee PAN AAFFM2468R
Bench Delhi
Appeal Number ITA 2480/DEL/2013
Duration Of Justice 7 year(s) 10 month(s) 11 day(s)
Appellant M/s. Marble Art, New Delhi
Respondent ACIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 08-03-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 08-03-2021
Date Of Final Hearing 22-05-2017
Next Hearing Date 22-05-2017
Assessment Year 2003-2004
Appeal Filed On 26-04-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES E: DELHI BEFORE SHRI G.S. PANNU HONBLE VICE PRESIDENT AND SHRI AMIT SHUKLA JUDICIAL MEMBER ITA.NO.2478/DEL./2013 ASSESSMENT YEAR 2004-05 MARBLE ART B-358 NEW FRIENDS COLONY NEW DELHI. PAN NO. AAFFM2468R [ VS. ACIT CIRCLE 22(1) NEW DELHI. (APPELLANT) (RESPONDENT) ITA.NO.2479/DEL./2013 ASSESSMENT YEAR 2002-03 MARBLE ART B-358 NEW FRIENDS COLONY NEW DELHI. PAN NO. AAFFM2468R [ VS. ACIT CIRCLE 22(1) NEW DELHI. (APPELLANT) (RESPONDENT) & ITA.NO.2480/DEL./2013 ASSESSMENT YEAR 2003-04 MARBLE ART B-358 NEW FRIENDS COLONY NEW DELHI. PAN NO. AAFFM2468R [ VS. ACIT CIRCLE 22(1) NEW DELHI. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI C.S. AGGARWAL SR. ADV. SHRI R.P. MALL ADVOCATE FOR REVENUE : MS. RAMITA M. BISWAS CIT DR 2 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. DATE OF HEARING : 19.11.2020 DATE OF PRONOUNCEMENT : 08.03.2021 ORDER PER AMIT SHUKLA J.M. 1. THE AFORESAID THREE APPEALS FILED BY THE ASSESSEE A RE AGAINST SEPARATE IMPUGNED ORDERS PASSED BY LD. CIT( A) 23 NEW DELHI FOR THE QUANTUM OF ASSESSMENT PASSED U/S 143(3)/147 FOR THE ASSESSMENT YEARS 2002-03 VIDE OR DER DATED 25.01.2012; AND FOR A.Y. 2003-04 AND A.Y. 200 4-05 VIDE ORDER DATED 28.02.2013. IN ALL THE APPEALS COM MON ISSUES ARE INVOLVED AND THEREFORE WERE HEARD TOGETHER AND ARE THUS BEING DISPOSED OF BY WAY OF THIS CONSOLIDA TED ORDER. 2. IN THE APPEALS THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: A. ITA NO. 2479/DEL/2013 FOR AY 2002-03: 1. THE LEARNED CIT(A) WAS NOT JUSTIFIED NOT TO CON SIDER THAT THE ISSUE OF NOTICE U/S 148 OF I.T. ACT WAS BARRED BY LIMITATION AND AS SUCH THE ASSESSMENT MADE ON THE B ASIS OF IT WAS ILLEGAL AB INITIO VOID AND WITHOUT JURISDIC TION. 2. THE LEARNED CIT(A) WAS NOT JUSTIFIED TO UPHOLD THE ADDITION OF RS. 69 42 652/- (34.7% OF RS. 2 00 07 6 45/-) TO THE INCOME OF THE APPELLANT AND INCOME FROM UNDISCL OSED SOURCES. THE ADDITION OF RS. 69 42 652/- IS UNFOUND ED AND UNCALLED FOR. 3 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 3. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT: (A) E BOOKS OF ACCOUNT. (B) THE APPELLANT WAS NOT CONFRONTED WITH ANY EVIDENCE BY THE LEARNED ASSESSSING OFFICER THAT IT HAD MADE ANY SALE OUTSIDE THE BOOKS OF ACCOUNT. 4. THE VARIOUS REASONS GIVEN BY THE LEARNED CIT(A) TO UPHOLD THE ADDITION OF RS. 69 42 652/- TO THE INCOM E OF THE APPELLANT ARE MISCONCEIVED AND INCORRECT. (C) THE APPELLANT HAS NOT MADE ANY SALE WHICH IS NOT RECORDED IN THE BOOKS OF ACCOUNT. ALL THE SALES AFFECTED BY THE APPELLANT TO M/S MARG RA INDUSTRIES GHAROLI ARE DULY ACCOUNTED FOR IN THE B OOKS OF ACCOUNT. THERE IS NO SALE MADE TO THIS PARTY WHICH HAS NOT BEEN RECORDED IN THE BOOKS OF ACCOUNT. 5. THE APPELLATE ORDER IS CONTRARY TO THE FACTS AND LAW OF THE CASE. 6. THE APPELLANT CRAVES LEAVE TO ADD AMEND OR ALTE R ANY OF THE FOREGOING GROUNDS OF APPEAL AT THE TIME OF H EARING. B. ITA NO. 2480/DEL/2013 FOR AY 2003-04: 1. THE LEARNED CIT(A) WAS NOT JUSTIFIED NOT TO HOL D THAT THE NOTICE ISSUED U/S 148 OF THE I.T. ACT WAS ILLEGAL AB INITIO VOID AND WITHOUT JURISDICTION. 2. THE LEARNED CIT(A) WAS NOT JUSTIFIED TO UPHOLD THE ADDITION OF RS. 53 63 998/- (25.37% OF RS. 2 11 07 645/-) TO 4 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. THE INCOME OF THE APPELLANT AS INCOME FROM UNDISCLO SED SOURCES. THE ADDITION OF RS. 53 63 998/- IS UNFOUND ED AND UNCALLED FOR. 3. THE OBSERVATIONS OF LEARNED CIT(A) ARE INCORRECT THAT: (A) THE APPELLANT HAS FAILED TO FILE ANY EVIDENCE TO CONTRADICT THE FINDINGS OF CUSTOMS & CENTRAL EXCISE AUTHORITIES THAT HE SALES OF RS. 2 11 42 997/- HAD BEEN MADE THROUGH CANCELLED INVOICES. (B) THE APPELLANTS OBJECTION TO THE ADOPTION OF MARKET PRICE IN ESTIMATING THE UNDISCLOSED SALES ALSO IS WITHOUT MERIT AS THE SALE PRICE HAS BEEN TAKEN FROM THE CANCELLED IN VOICES. 4. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT: (A) THE APPELLANT HAS NOT MADE ANY SALES WHICH WAS NOT RECORCED IN THE BOOKS OF ACCOUNT. (B) COMPLETE BOOKS OF ACCOUNT SALE AND PURCHASE VO UCHERS WERE PRODUCED BY THE APPELLANT. 5. THE VARIOUS REASONS GIVEN BY THE LEARNED CIT(A) TO UPHOLD THE ADDITION OF RS. 53 63 998/- TO THE INCOM E OF THE APPELLANT ARE MISCONCEIVED AND INCORRECT. 6. THE APPELLATE ORDER IS CONTRARY TO THE FACTS AND LAW OF THE CASE. 7. THE APPELLANT CRAVES LEAVE TO ADD AMEND OR ALTE R ANY OF THE FOREGOING GROUNDS OF APPEAL AT THE TIME OF H EARING. C. ITA NO. 2478/DEL/2013 FOR AY 2004-05: 5 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 1. THE LEARNED CIT(A) WAS NOT JUSTIFIED NOT TO HOL D THAT THE NOTICE ISSUED U/S 148 OF THE I.T. ACT WAS ILLEGAL AB INITIO VOID AND WITHOUT JURISDICTION. 2. THE LEARNED CIT(A) WAS NOT JUSTIFIED TO UPHOLD THE ADDITION OF RS. 82 00 985/- (33.51% OF RS. 2 44 73 246/-) TO THE INCOME OF THE APPELLANT AS INCOME FROM UNDISCLO SED SOURCES ON THE GROUND THAT UNACCOUNTED SALES OF RS. 2 44 73 246/- HAD BEEN MADE OUTSIDE THE BOOKS OF AC COUNT. 3. THE LEARNED CIT(A) ERRED TO UPHOLD THE ADDITION OF RS. 1 04 39 050/- TO THE INCOME OF THE APPELLANT AS INC OME FROM UNDISCLOSED SOURCES ON ACCOUNT OF EXCESS STOCK FOUN D IN THE SEARCH MADE BY THE CUSTOMS AND EXCISE DEPARTMENT. T HE ADDITION OF RS. 1 04 39 050/- TO THE INCOME OF THE APPELLANT IS UNFOUNDED AND UNCALLED FOR. 4. THE LEARNED CIT(A) WAS NOT JUSTIFIED TO UPHOLD T HE ADDITION OF RS. 11 48 057/- BY APPLYING GP RATE OF 33.51% ON 34 26 014/- TO THE INCOME OF THE APPELLANT AS INCOM E FROM UNDISCLOSED SOURCE ON ACCOUNT OF SHORT STOCK OF MAR BLE PROFILES AND MARBLE MOSAIC FOUND DURING THE SEARCH MADE BY THE CUSTOMS & CENTRAL EXCISE DEPARTMENT. THE ADDITI ON OF RS. 11 48 057/- IS ARBITRARY AND UNCALLED FOR. 5. WITHOUT PREJUDICE TO THE CONTENTION OF THE APPE LLANT THAT NO SALE OUTSIDE THE BOOKS OF ACCOUNT WAS MADE BY TH E APPELLANT THE LEARNED CIT(A) WAS NOT JUSTIFIED TO ALLOW DEDUCTION U/S 10B OF THE I.T. ACT ON SUCH SALES. 6 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 6. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT: (A) NO COPIES OF DOCUMENTS/DETAILS RELATING TO SUPP RESSION OF SALES OR REMOVAL OF GOODS WITHOUT PAYMENT OF DUT Y CANCELLED INVOICES WERE SUPPLIED TO THE APPELLANT F IRM. (B) NO DOCUMENTS/DETAILS IN RESPECT OF EXCESS STOCK OF RS. 1 04 39 050/- STOCK SHORT OF RS. 34 26 014/- AND UNACCOUNTED SALE OF RS. 2 44 73 246/- WERE SUPPLIED TO THE APPELLANT FIRM. INFACT THERE WAS NO DIFFERENCE IN THE STOCKS. (C) COMPLETE BOOKS OF ACCOUNT SALE & PURCHASE VOUCHERS BANK STATEMENTS VOUCHER OF EXPENSES ETC WERE PRODU CED BY THE APPELLANT. (D) THE APPELLANT HAS NOT MADE ANY SALE WHICH WAS NOT RECORDED IN THE BOOKS OF ACCOUNT. 7. THE VARIOUS REASONS GIVEN BY THE LEARNED CIT(A) TO UPHOLD THE AFORESAID ADDITIONS TO THE INCOME OF THE APPELLANT ARE MISCONCEIVED AND INCORRECT. 7. THE APPELLATE ORDER IS CONTRARY TO THE FACTS AND LAW OF THE CASE. 8. THE APPELLANT CRAVES LEAVE TO ADD AMEND OR ALTE R ANY OF THE FOREGOING GROUNDS OF APPEAL AT THE TIME OF H EARING. 3. ALL THESE THREE APPEALS ARE OUTCOME OF THE REASSESSMENT PROCEEDINGS INITIATED UNDER SECTION 14 7 OF THE ACT ON THE BASIS OF NOTICES ISSUED U/S 148. IN THES E APPEALS FILED THE ASSESSEE HAS CHALLENGED THE VALIDITY AND LEGALITY OF THE INITIATION OF THE REASSESSMENT PROCEEDINGS AS W ELL AS IT 7 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. HAS CHALLENGED THE ADDITIONS MADE AND SUSTAINED BY THE CIT (A). IN RESPECT OF INITIATION OF THE REASSESSME NT PROCEEDINGS U/S 147 OF THE ACT THE SUBMISSION OF T HE ASSESSEE WAS THAT INITIATION OF THE REASSESSMENT PR OCEEDINGS PER SE WAS BAD IN LAW AND ON FACTS SINCE THERE WAS NO ESCAPEMENT OF INCOME AND FURTHER THE PROCEEDINGS IN ITIATED WERE WITHOUT JURISDICTION. ONE OF THE CONTENTIONS R AISED BY THE ASSESSEE WAS THAT THERE WAS COMPLETE LACK OF TA NGIBLE MATERIAL ENABLING THE AO TO INITIATE THE PROCEEDING S U/S 147 OF THE ACT AS SUCH NOTICE ISSUED U/S 148 IS MISCON CEIVED BOTH ON FACTS AND IN LAW. 4. THUS IN ORDER TO EXAMINE THE CONTENTION OF THE ASSESSEE ON 04.12.2018 THE BENCH HAD INITIALLY DI RECTED THE REVENUE TO PLACE ON RECORD SUCH MATERIAL AS THE AO HAD BEFORE INITIATING THE REASSESSMENT PROCEEDINGS U/S 147 OF THE ACT. ON 04.12.2018 THE BENCH HAD PASSED THE FO LLOWING ORDER: BEFORE US LEARNED SENIOR COUNSEL SHRI. C.S. AGGA RWAL CHALLENGING THE VALIDITY OF REOPENING U/S 147/148 A ND THE REASONS RECORDED BY THE ASSESSING OFFICER THE COPY OF WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGE 35 SUBMITTED THAT HE SAME HAS BEEN REOPENED ON THE BAS IS OF CERTAIN INFORMATION RECEIVED FROM ADIT (INVESTIGATI ON) GHAZIABAD ALLEGING THAT ASSESSEE REMOVED GOODS WITH OUT PAYMENT OF DUTY; AND CERTAIN INVOICES WERE THOUGH R AISED BUT LATER ON SHOWN TO HAVE BEEN CANCELLED WHICH CON TAINS 8 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. THE DETAILS OF THE REMOVAL OF THE GOODS. HE SUBMITT ED THAT NO SUCH INFORMATION OR INVOICES WERE MADE AVAILABLE TO THE ASSESSEE DURING THE COURSE OF ENTIRE RE-ASSESSM ENT PROCEEDINGS AS WELL AS BEFORE THE APPELLATE PROCEED INGS. EVEN THE REASONS ARE VAGUE AND THERE WAS NO TANGENT MATERIAL AVAILABLE WITH THE ASSESSING OFFICER WHILE RECORDING THE REASONS. WHILE DRAWING AN ADVERSE INFERENCE AGAINST THE ASSESSEE ON MERITS ALSO THER E IS NO REFERENCE TO THE SAID INVOICE EXCEPT FOR PRESUMPTIO N THAT BASED ON THIS INFORMATION ASSESSEE MUST HAVE MADE S ALES OUTSIDE THE BOOKS OF ACCOUNT. 2. SINCE THE INFORMATION AND MATERIAL IN THE FORM O F REPORT SUBMITTED BY ADIT (INVESTIGATION) GHAZIABAD IS VER Y CRUCIAL AND GOES TO THE VERY ROUTE OF THE ISSUE INV OLVED NOT FOR DECIDING THE ISSUE ON MERITS BUT ALSO ON THE VA LIDITY OF REASONS RECORDED THEREFORE IT WAS FELT NECESSARY T HAT DEPARTMENT SHOULD PRODUCE NOT ONLY THE SAID REPORT FROM THE INVESTIGATION WING BUT ALSO THE ALLEGED INVOICE S REFERRED IN THE REASONS AS WELL AS ASSESSMENT ORDER UPON WHICH PRESUMPTION HAS BEEN DRAWN THAT SUCH CANCELLE D INVOICES HAS LED TO UNDISCLOSED SALE ON WHICH GP AD DITION HAS BEEN MADE. 3. LD. CIT-DR MR. S.S. RANA REQUESTED THAT SINCE I T IS VERY CRUCIAL DOCUMENT HAVING A BEARING ON THE CASE THER EFORE SOME TIME SHOULD BE GIVEN TO PRODUCE THE RECORDS. 4. ACCORDINGLY WE DIRECT THE ASSESSING OFFICER THR OUGH LD. CIT-DR THAT ALL THE RELEVANT RECORDS MENTIONED IN T HE 9 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. REASONS RECORDED AS WELL AS THE ENTIRE ASSESSMENT R ECORD SHOULD BE PRODUCED BEFORE THE BENCH WITH A COPY TO THE ASSESSEE ON OR BEFORE 30 TH JANUARY 2019. THE DEPARTMENT SHOULD ENSURE THAT THESE DOCUMENTS SHOULD BE PRODUC ED OTHERWISE THE BENCH WILL PROCEED TO HERE THE MATTER AVAILABLE ON RECORD BEFORE US. ADJ. TO 30.01.2019. PARTIES INFORMED IN THE OPEN COURT 5. SINCE THE AFORESAID DIRECTION OF THE TRIBUNAL WAS N OT COMPLIED AS SUCH AGAIN ON 25.04.2019 FOLLOWING O RDER WAS MADE: ORDER DATED 04.12.2018 HAS NOT BEEN COMPLIED BY TH E LD. CIT DR. SHE STATED THAT ASSESSMENT RECORD IS WITH H ER. HOWEVER SHE WILL COMPLY THE ORDER DATED 04.12.201 8 OF THE BENCH. HENCE REQUESTED TWO WEEKS TIME TO DO THE SAME. ON HER REQUEST THE CASE IS ADJOURNED FOR 21.05.2019 TO COMPLY THE EARLIER ORDER DATED 04.12. 2018 FOR FINAL ARGUMENT. 6. THEREAFTER ON 15.05.2019 IN COMPLIANCE TO THE AFORESAID DIRECTIONS OF THE TRIBUNAL THE REVENUE H AS FILED FOLLOWING FOUR DOCUMENTS: I) A COPY OF LETTER ISSUED BY ADDL. DIRECTOR OF INCOME TAX (INV.) MEERUT DATED 24.03.2009 TO ADDL. CIT RAN GE 22 NEW DELHI. II) A COPY OF LETTER ISSUED BY ADDL. DIRECTOR OF INCOME TAX (INV.) NOIDA DATED 17.03.2009 TO ADDL. DIT (INV. ) MEERUT. 10 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. III) A COPY OF ORDER PASSED BY SH. S. K. GOEL COMMISSIONER CENTRAL EXCISE NOIDA. IV) A COPY OF LETTER DATED 18.02.2019 ADDRESSED BY SENIOR INVESTIGATING OFFICER OF CUSTOMS CENTRAL EX CISE & SERVICE TAX SETTLEMENT COMMISSION PRINCIPAL BENCH NEW DELHI TO PERSONS STATED THEREIN . 7. AFTER THE RECEIPT OF THE AFORESAID DOCUMENTS SUPPLI ED BY THE REVENUE THE ASSESSEE FILED ITS SUBMISSION O N 14.08.2019 AND CONTENDED THAT ONLY PARTIAL COMPLIA NCE HAS BEEN MADE AND NEITHER ALL THE RELEVANT RECORDS MEN TIONED IN THE REASONS RECORDED HAS BEEN PROVIDED NOR HAS FURNISHED THE COPIES OF THE ALLEGED INVOICES REFERR ED IN THE REASONS RECORDED FOR INITIATING THE PROCEEDINGS AS WELL AS ASSESSMENT ORDER UPON WHICH PRESUMPTION HAD BEEN DR AWN THAT SUCH CANCELLED INVOICES HAS LED TO UNDISCLOSED SALE ON WHICH GP ADDITION HAS BEEN MADE. THE ASSESSEE SUBMI TTED THAT IN SO FAR AS THE LETTER DATED 17.03.2009 OF AD DL. DIRECTOR OF INCOME TAX (INV.) NOIDA IS CONCERNED SAME WAS SUPPLIED TO THE ASSESSEE DURING THE COURSE OF THE ASSESSMENT ON 10.12.2009 AND IN RESPONSE THERETO THE ASSESSEE FILED A LETTER ON 14.12.2009 AND SUBMITT ED THAT ALL THE SALES MADE TO M/S MARGRA INDUSTRIES LTD. DU RING THE ASSESSMENT YEAR 2002-03 ARE DULY ENTERED IN THE BOO KS OF ACCOUNT OF THE ASSESSEE FIRM AND THE ASSESSEE HAS N OT REMOVED ANY GOODS WITHOUT PAYMENT OF DUTY AND THERE FORE REQUESTED TO PROVIDE THE COPIES OF CANCELLED INVOIC ES. 11 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. HOWEVER DESPITE THE REQUEST OF THE ASSESSEE CANCE LLED INVOICES WERE NOT SUPPLIED TO THE ASSESSEE. IN RESP ECT OF THE COMMUNICATION DATED 24.03.2009 ADDRESSED BY THE AD DL. DIT( INV.) MEERUT TO ADDL. CIT RANGE 22 NEW DE LHI THE ASSESSEE SUBMITTED THAT THE ADDL. DIT (INV.) MEERUT HAD RECOMMENDED THE CASES OF THE ASSESSEE TO BE REOPENE D AND THE RECOMMENDATION HAD BEEN MADE WITHOUT PROVIDING TO THE ASSESSING OFFICER ANY SUPPORTING MATERIAL. IT W AS SUBMITTED THAT SINCE IN THE REASONS RECORDED THE AO HAD NOT REFERRED TO EITHER ANY COMMUNICATION DATED 24.0 3.2009 BY THE ADDL.DIT (INVESTIGATION) MEERUT TO ADDL.CIT RANGE 22 NEW DELHI AND TO THE ORDER OF COMMISSIONER OF C USTOM AND EXCISE NOIDA UNDATED THE SAME CANNOT BE CONSI DERED TO BE ANY TANGIBLE MATERIAL AVAILABLE AT THE TIME O F REOPENING OF THE ASSESSMENT. IT WAS SUBMITTED THAT ADDL. DIT (INV.) MEERUT WHO RECOMMENDED THE CASES TO BE REOPENED HA D NO TANGIBLE MATERIAL WITH HIM OTHER THAN THE INTIMATIO N RECEIVED THAT THE CUSTOMS & CENTRAL EXCISE AUTHORIT IES HAD CONDUCTED A SEARCH ON ASSESSEES BUSINESS PREMISES ON 19.08.2003 DURING THE COURSE OF WHICH CERTAIN DISCRIMINATORY DOCUMENTS (SIC) WERE FOUND HOWEVE R LD. COUNSEL POINTED OUT THAT NONE OF THE DOCUMENTS WHIC H IS STATED TO BE DISCRIMINATORY WERE AVAILABLE WITH THE AO AT THE TIME OF INITIATION OF PROCEEDINGS SO AS TO BE SATIS FIED THAT ASSESSEES INCOME HAD ESCAPED ASSESSMENT. 12 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 8. IN VIEW OF THE AFORESAID SUBMISSIONS OF THE ASSESSE E THE TRIBUNAL AGAIN ON 30.09.2019 REQUIRED THE REVEN UE TO PRODUCE ANY RECORD WHICH WAS AVAILABLE WITH THE AO AT THE TIME OF ISSUANCE OF NOTICE BY WAY OF FOLLOWING ORDE R SHEET ENTRY: THE ASSESSEE HAS CHALLENGED THE VALIDITY OF REOPEN ING U/S. 148 IN THE FOLLOWING SEVEN COUNTS. I THAT REASONS RECORDED ARE NOT BASED ON ANY TANGIBLE AND RELEVANT MATERIAL II THAT REASONS RECORDED ARE NOT BASED ON ANY APPLICATION OF MIND MUCH LESS INDEPENDENT APPLICATION OF MIND III THAT REASONS HAVE BEEN RECORDED TO CONDUCT INVESTIGATION AND EXAMINATION I.E. TO MAKE FISHING AND ROVING ENQUIRIES WHICH IS NOT PERMISSIBLE IV THAT IN THE ABSENCE OF ANY SUM OF INCOME HAVING BEEN SPECIFIED WHICH HAS ALLEGEDLY ESCAPED THE PRECONDITION AS ENVISAGED U/S 149(1)(B) SINCE REMAINED UNSATISFIED THERE WAS A LACK OF FOUNDATION FOR INITIATE THE PROCEEDINGS V NON FURNISHING OF FOUNDATIONAL MATERIAL VITIATES THE PROCEEDING FOR INVOKING SECTION 147 OF THE ACT HAS NOT BEEN SATISFIED VI THAT APPROVAL GRANTED IS A MECHANICAL APPROVAL AND HENCE INITIATION OF PROCEEDINGS U/S 147 OF THE ACT 13 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. VII THAT ONCE THE BASIS OR EDIFICE ON WHICH PROCEED INGS HAVE BEEN INITIATED CEASES TO EXIST THE ACTION IS WITHOUT JURISDICTION LD SENIOR COUNSEL SHRI C.S AGARWAL HAD POINTED THA T ON EARLIER OCCASIONS THIS BENCH HAD DIRECTED THE LD. CIT-DR TO PRODUCE THE RELEVANT RECORDS AS MENTIONED IN THE REASON RECORDED AS WELL AS THE MATERIAL WHICH HAS BEEN RELIED UPON ALONG WITH THE ASSESSMENT RECORDS. THEREAFTER IN COMPLIANCE THEREOF THE REVENUE HAD FILED LETTER DATED 15.05.2019 WHICH WERE ALSO SUPPLIED T O THE LD. COUNSEL. HOWEVER ASSESSEE HAS FILED THESE MA TERIAL ON DETAIL OBJECTION VIDE LETTER DATED 21.05.2019 ST ATING THAT FIRSTLY THESE DOCUMENTS ARE NOT EVEN COMPLETE AND SECONDLY NOWHERE SUCH DOCUMENTS AS STATED IN THE REASON HAVE BEEN PROVIDED SPECIFICALLY THE ALLEGAT ION OF REMOVAL OF GOODS WITHOUT PAYMENT OF DUTY AND INVO ICES ISSUED WELL LATER ON CANCELLED BY THE ASSESSEE. LD. CIT-DR TODAY AT THE TIME OF HEARING REQUESTED T HAT THAT FURTHER OPPORTUNITY SHOULD BE GIVEN IN ORDE R TO ASCERTAIN WHETHER ANY SUCH MATERIAL OR INFORMATION WAS THERE IN SOME SEPARATE FOLDER AVAILABLE WITH THE AS SESSING OFFICER. LD. SENIOR COUNSEL FURTHER POINTED OUT THA T FROM THE PERUSAL OF THE REASON RECORDED IT CAN BE SEEN THAT THE ASSESSING OFFICER IN VIEW OF THE ALLEGATION GIVEN I N THE INFORMATION FROM THE ADDITIONAL DIRECTOR OF INCOME TAX 14 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. (INVESTIGATION) IS TRYING TO EXAMINE THE CLAIM OF E XEMPTION U/S.10B WHICH IS IMPERMISSIBLE IN LAW. LD. CIT-DR IS DIRECTED TO PRODUCE ANY RECORD WHICH IS AVAILABLE WITH THE ASSESSING OFFICER AT THE TIME OF ISSUANCE OF NOTICE AND ALSO GIVEN HER STATEMENT ON THE OBJEC TION RAISED BY THE LD. SENIOR COUNSEL. IT IS MADE CLEAR THAT NO FURTHER ADJOURNMENT SHALL BE GIVEN AS ALREADY SEVER AL ROUND OF HEARING HAS TAKEN PLACE. DASTI BE GIVEN TO THE PARTIES. 9. EVEN AFTER THE AFORESAID DIRECTION THE LD. CIT DR ON 20.10.2020 MERELY FURNISHED THE COPY OF LETTER ISSU ED BY ADDL. DIRECTOR OF INCOME TAX (INV.) MEERUT DATED 24.03.2009 TO ADDL. CIT RANGE 22 NEW DELHI AND COPY OF LETTER ISSUED BY ADDL. DIRECTOR OF INCOME TAX (INV. ) NOIDA DATED 17.03.2009 TO ADDL. DIT (INV.) MEERUT WHICH HAD ALREADY BEEN FILED ON EARLIER OCCASION AND NOTED HE REINABOVE AND NO OTHER DOCUMENT WAS FILED. IN VIEW OF THE AFO RESAID FACTS SINCE REVENUE COULD NOT PRODUCE ANY OTHER DO CUMENT NOR THEY COULD PRODUCE THE CANCELLED INVOICES WHICH MADE THE BASIS TO ASSUME UNDISCLOSED SALE ON WHICH GP AD DITION HAS BEEN MADE AS SUCH THESE APPEALS WERE FINALLY HEARD ON THE BASIS OF MATERIAL/DOCUMENTS FURNISHED BY THE ASSESSEE AND PRODUCED BY THE REVENUE BEFORE US. 15 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED TH E RELEVANT FINDING GIVEN IN THE IMPUGNED ORDERS AND M ATERIAL PLACED ON RECORDS WHICH WERE REFERRED TO BEFORE US AT THE TIME OF HEARING. IT IS SEEN THAT ASSESSEE IS ENGAGE D IN THE BUSINESS OF MANUFACTURE AND EXPORT OF NATURAL STONE PRODUCTS. ALL THE THREE PRESENT APPEALS EMANATE FRO M THE PROCEEDINGS INITIATED U/S 147 OF THE ACT. THE RELEV ANT FACTUAL DETAILS IN RESPECT OF PRESENT APPEALS QUA T HE STATUS OF EARLIER RETURN OF INCOME AND ASSESSMENTS ARE AS UNDER: ASSESS- -MENT YEAR RETURN OF INCOME FILED ON ASSESSMENT MADE ORIGINALLY U/S 143(3) NOTICE ISSUED U/S 148 ON ASSESSMENT MADE U/S 147/143(3) 2002-03 31.10.2002 AT NIL NO ASSESSMENT U/S 143(3). 17.03.2009 29.12.2009 AT AN INCOME OF RS. 1 44 85 734/- BY ACIT CIRCLE 22(1) NEW DELHI 2003-04 02.12.2003 AT RS. 22 74 705/ - 20.03.2006 31.03.2010 12.12.2011 AT AN INCOME OF RS. 1 05 84 430/- BY ACIT CIRCLE 22(1) NEW DELHI 2004-05 01.11.2004 AT RS. 5 39 261/- 22.12.2006 30.03.2011 12.12.2011 AT AN INCOME OF RS. 2 46 07 267/- BY ACIT CIRCLE 22(1) NEW DELHI 16 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 11. AFORESAID DETAILS SHOWS THAT EXCEPT FOR THE AY 200 2- 03 ASSESSMENT U/S 143(3) OF THE ACT WAS FRAMED IN THE CASE OF THE ASSESSEE FOR THE AY 2003-04 AND 2004-05 AND IN ALL THE THREE ASSESSMENT YEARS THE REASSESSMENT PROCEE DINGS WERE INITIATED BEYOND THE FOUR YEARS. THE ASSESSEE APART FROM DISPUTING THE MERITS OF THE ADDITIONS MADE IN THE ORDER OF ASSESSMENT HAS CHALLENGED THE ASSUMPTION OF JURISDICTION U/S 147 OF THE ACT BY THE AO ON VARIOU S GROUNDS WHICH CAN BE SUMMARISED AS UNDER: A. THAT REASONS RECORDED ARE NOT BASED ON ANY TANGIBLE AND RELEVANT MATERIAL; B. THAT REASONS RECORDED ARE NOT BASED ON ANY APPLICATION OF MIND MUCH LESS INDEPENDENT APPLICATI ON OF MIND; C. THAT REASONS HAVE BEEN RECORDED TO CONDUCT INVESTIGATION AND EXAMINATION I.E. TO MAKE FISHING AND ROVING ENQUIRIES WHICH IS NOT PERMISSIBLE; D. THAT IN THE ABSENCE OF ANY SUM OF INCOME HAVING BEE N SPECIFIED WHICH HAS ALLEGEDLY ESCAPED THE PRECONDIT ION AS ENVISAGED U/S 149(1)(B) SINCE REMAINED UNSATISFI ED THERE WAS A LACK OF FOUNDATION FOR INITIATE THE PROCEEDINGS; E. NON FURNISHING OF FOUNDATIONAL MATERIAL VITIATES TH E PROCEEDING FOR INVOKING SECTION 147 OF THE ACT HAS NOT BEEN SATISFIED; 17 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. F. THAT APPROVAL GRANTED IS A MECHANICAL APPROVAL AND HENCE INITIATION OF PROCEEDINGS U/S 147 OF THE ACT; G. THAT ONCE THE BASIS OR EDIFICE ON WHICH PROCEEDINGS HAVE BEEN INITIATED CEASES TO EXIST THE ACTION IS WITHOUT JURISDICTION. 12. FOR THE AYS 2003-04 AND 2004-05 SINCE THE ASSESSMENT WAS ORIGINALLY MADE U/S 143(3) OF THE AC T AND ASSESSMENT WAS REOPENED BEYOND FOUR YEARS IT WAS A LSO CONTENDED BY THE ASSESSEE THAT THERE WAS NO FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY AL L MATERIAL FACTS AS SUCH ACTION U/S 147 OF THE ACT WAS IN EXC ESS OF JURISDICTION. 13. DURING THE COURSE OF THE HEARING LEARNED SENIOR COUNSEL SHRI. C.S. AGGARWAL ARGUED AT LENGTH IN RE SPECT OF THE AFORESAID CONTENTIONS. HE SUBMITTED THAT PROCEE DINGS U/S 147 OF THE ACT HAD BEEN INITIATED IN THE CASE O F THE ASSESSEE WITHOUT ANY TANGIBLE MATERIAL AS IN THE RE ASONS TO BELIEVE THE LEARNED AO ON THE BASIS OF LETTER OF A DDL. DIT (INV) GHAZIABAD AND REPORT OF ADIT (INV) NOIDA HA S ALLEGED THAT ASSESSEE IS NOT KEEPING PROPER RECORDS OF RAW MATERIAL AND FINISHED GOODS PRODUCED THEREFROM IN COLLUSION WITH MARGRA INDUSTRIES. IT WAS SUBMITTED THAT AFORESAID ALLEGATION WAS BASED ON THE ALLEGED FACT THAT ASSES SEE HAS REMOVED GOODS WITHOUT PAYMENT OF DUTY AND CERTAIN INVOICES WERE THOUGH RAISED BUT THESE INVOICES WERE LATER 18 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. SHOWN CANCELLED THOUGH THEY CONTAINED DETAILS LIKE THE DATE AND TIME OF REMOVAL TRANSPORT VEHICLE NO ETC HOWEV ER NO SUCH INFORMATION OR THE CANCELLED INVOICES WERE MAD E AVAILABLE TO THE ASSESSEE EITHER DURING THE ASSESSM ENT OR IN THE APPELLATE PROCEEDINGS. IT WAS SUBMITTED THAT AS SESSEE HAS NOT REMOVED ANY GOODS WITHOUT PAYMENT OF DUTY A ND IN FACT DURING THE ASSESSMENT PROCEEDINGS THE ASSESS EE HAS FURNISHED THE COPIES OF THE INVOICES AS WELL AS THE QUANTITATIVE DETAILS OF THE ALL THE SALES AND PURCH ASES MADE. IT WAS SUBMITTED THAT ASSESSEE DURING THE ASSESSMEN T PROCEEDINGS VIDE LETTER DATED 14.12.2009 HAD SPECIF ICALLY REQUESTED TO PROVIDE THE COPY OF THE CANCELLED INVO ICES AND EVEN AFTER THE DIRECTIONS OF THE TRIBUNAL ON VARIOU S DATES THE REVENUE COULD NOT FURNISH THE ALLEGED CANCELLED INVOICES WHICH SHOWS THAT THERE WAS NO SUCH MATERIAL WITH TH E LEARNED AO AT THE TIME OF FORMING HIS REASONS TO BE LIEVE AND HENCE ASSUMPTION OF JURISDICTION BY THE LEARNED AO WITHOUT HAVING THE MATERIAL BEFORE HIM IS BAD IN LAW. 13.1 IT WAS FURTHER CONTENDED THAT REASSESSMENT PROCEEDINGS HAS BEEN INITIATED IN THE CASE OF THE A SSESSEE MECHANICALLY MERELY ON THE BASIS OF REPORT OF INVES TIGATION WING AND NOT ON INDEPENDENT APPLICATION OF MIND AS REPORT OF THE INVESTIGATION WING REFER THE CANCELLED INVOI CES WHICH WAS NOT EVEN THERE BEFORE THE LEARNED AO AND THEREF ORE THE PROCEEDINGS INITIATED ARE WITHOUT JURISDICTION. IT WAS ALSO CONTENDED THAT THE IN THE REASONS TO BELIEVE FOR THE AY 19 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 2003-03 IT HAS BEEN RECORDED BY THE LEARNED AO THA T IN VIEW OF THE ALLEGATION MADE IN THE INFORMATION RECE IVED FROM ADDL. DIT (INV) GHAZIABAD THE CLAIM OF EXEMPTION U/S 10B NEEDS TO BE EXAMINED AND THIS FACT SHOWS THAT THER E WAS NO MATERIAL BEFORE THE LEARNED AO AND PROCEEDINGS HAVE BEEN INITIATED MERELY TO EXAMINE THE EXEMPTION CLAIMED U /S 10B OF THE ACT. IT WAS SUBMITTED THAT INITIATION OF THE PROCEEDINGS TO EXAMINE THE CLAIM OF EXEMPTION U/S 1 0B OF THE ACT IS OUTSIDE THE SCOPE OF SECTION 147 OF THE ACT AS REASSESSMENT PROCEEDINGS CAN BE INITIATED ONLY IN T HE CASE OF TANGIBLE MATERIAL THAT THE INCOME OF THE ASSESSE E HAS ESCAPED ASSESSMENT AND RECOURSE OF SECTION 147 OF THE ACT CANNOT BE TAKE TO MAKE ROVING AND FISHING ENQUIRY. IT WAS SUBMITTED THAT IN THE REASONS TO BELIEVE FOR THE AY 2002- 03 IT HAS NOT EVEN BEEN MENTIONED WHAT IS THE AMOU NT OF INCOME WHICH HAS BEEN ESCAPED ASSESSMENT AS SUCH I N VIEW OF SECTION 149(1) OF THE ACT INITIATION OF TH E REASSESSMENT PROCEEDINGS IS ILLEGAL. 13.2 LASTLY IT WAS SUBMITTED THAT APPROVAL GRANTED U/S 151 OF THE ACT WAS NOT IN ACCORDANCE WITH LAW AND W AS WITHOUT APPLICATION OF MIND AND HENCE REASSESSMENT PROCEEDINGS INITIATED IS VITIATED IN LAW. IT WAS SU BMITTED THAT IN ALL THE THREE ASSESSMENT YEARS I.E. AY 2002-03 2003-04 AND 2004-05 APPROVAL HAS BEEN TAKEN FROM ADDL. CIT RANGE 22 NEW DELHI WHO HAS MERELY STATED APPROVED . IT WAS SUBMITTED THAT FIRSTLY APPROVAL GRANTED IS NOT A SANCTION 20 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. AS MANDATED U/S 151OF THE ACT AND SECONDLY IN THE C ASE WHICH FALLS UNDER PROVISO TO SECTION 151(1) OF THE ACT APPROVAL HAS TO BE GRANTED BY THE CHIEF COMMISSIONE R OR COMMISSIONER AND SINCE FOR THE AY 2003-04 AND 2004- 05 APPROVAL HAS BEEN GRANTED BY THE ADDL. CIT HENCE IN ITIATION OF PROCEEDINGS UNDER SECTION 147 OF THE ACT IS INVA LID. IN RESPECT OF EACH OF THE CONTENTION THE APPELLANT HA S CITED NUMBER OF JUDICIAL PRECEDENTS WHICH SHALL BE DEALT WITH WHILE ADJUDICATING THE ISSUE. 14. THE LEARNED CIT- DR DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND SUPPORTED THE ORDER OF THE AO AND CIT (A). IT WAS SUBMITTED BY HER THAT PROCEEDINGS HAVE BEEN INITIATED ON THE BASIS OF MATERIAL I.E. INFORMATION RECEIVED FROM THE ADDL. DIT (INV) GHAZIABAD AND REPORT OF A DIT (INV) NOIDA WHICH CONSTITUTES THE MATERIAL FOR THE ASSUMP TION OF JURISDICTION. IT WAS FURTHER SUBMITTED THAT WHILE G RANTING THE APPROVAL IF ADDL. CIT RANGE 22 NEW DELHI HAS GRANTED APPROVAL BY WRITING APPROVED IT DOES NOT SHOW TH AT HE HAS GRANTED MECHANICALLY. IT WAS SUBMITTED THAT APPROVA L GRANTED IS IN ACCORDANCE WITH LAW AND SAME CANNOT B E FAULTED WITH. 15. WE HAVE HEARD THE RIVAL CONTENTIONS PERUSED THE RELEVANT FINDINGS OF THE AUTHORITIES BELOW AND THE MATERIAL AVAILABLE ON RECORD ON THE ISSUE OF VALIDITY OF RE OPENING UNDER SECTION 147. IN THESE APPEALS THOUGH THE ASS ESSEE 21 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. HAS CHALLENGED THE REASSESSMENT PROCEEDINGS ON VARI OUS PROPOSITIONS HOWEVER FIRSTLY WE PROPOSE TO DEAL W ITH THE ASPECT OF APPROVAL GRANTED UNDER SECTION 151 OF THE ACT. 15.1 IT IS SEEN THAT IN THE CASE OF THE ASSESSEE PROCEEDINGS HAD BEEN INITIATED FOR THE THREE ASSESS MENT YEARS I.E. AY 2002-03 2003-04 AND 2004-05 AND EXCE PT FOR THE AY 2002-03 IN REMAINING TWO YEARS ASSESSMENT WAS ALSO ORIGINALLY FRAMED U/S 143(3) OF THE ACT. IN AL L THE THREE ASSESSMENT YEARS NOTICE HAD BEEN ISSUED BEYOND A P ERIOD OF FOUR YEARS FROM THE RELEVANT ASSESSMENT YEARS. A T THIS STAGE IT IS RELEVANT TO REFER THE PROVISIONS OF SE CTION 151 OF THE ACT WHICH READS AS UNDER: SANCTION FOR ISSUE OF NOTICE. 151. (1) IN A CASE WHERE AN ASSESSMENT UNDER SUB- SECTION (3) OF SECTION 143 OR SECTION 147 HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR NO NOTICE SHALL B E ISSUED UNDER SECTION 148 BY AN ASSESSING OFFICER WHO IS B ELOW THE RANK OF ASSISTANT COMMISSIONER OR DEPUTY COMMISSIONER UNLESS THE JOINT COMMISSIONER IS SATI SFIED ON THE REASONS RECORDED BY SUCH ASSESSING OFFICER T HAT IT IS A FIT CASE FOR THE ISSUE OF SUCH NOTICE: PROVIDED THAT AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR NO SUCH NOTICE SHA LL BE ISSUED UNLESS THE CHIEF COMMISSIONER OR COMMISSIONE R IS SATISFIED ON THE REASONS RECORDED BY THE ASSESSING 22 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. OFFICER AFORESAID THAT IT IS A FIT CASE FOR THE IS SUE OF SUCH NOTICE. (2) IN A CASE OTHER THAN A CASE FALLING UNDER SUB-S ECTION (1) NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSESSING OFFICER WHO IS BELOW THE RANK OF JOINT COMMISSIONER AFTER THE EXPIRY OF FOUR YEARS FROM T HE END OF THE RELEVANT ASSESSMENT YEAR UNLESS THE JOINT COMMISSIONER IS SATISFIED ON THE REASONS RECORDED BY SUCH ASSESSING OFFICER THAT IT IS A FIT CASE FOR T HE ISSUE OF SUCH NOTICE. 15.2 ERGO PROVISIONS OF SUB SECTION (1) OF SECTION 151 OF THE ACT DEALS WITH THE CASES WHEREIN ASSESSMENT WAS EARLIER FRAMED U/S 143(3) OR SECTION 147 OF THE ACT WHEREA S SUBSECTION (2) PROVIDES FOR THE CASES WHEREIN NO ASSESSMENT WAS FRAMED EARLIER. UNDER SUB SECTION (1 ) OF SECTION 151 IF THE PROCEEDINGS ARE INITIATED WITHI N FOUR YEARS NO NOTICE SHALL BE ISSUED UNDER SECTION 148 UNLESS THE JOINT COMMISSIONER IS SATISFIED ON THE REASONS RECORDED BY SUCH ASSESSING OFFICER THAT IT IS A FIT CASE FOR THE ISSUE OF SUCH NOTICE. HOWEVER THE PROVISO TO THE SUB-SECTIO N (1) PROVIDES FOR THE APPROVAL IN THE CASES WHERE NOTICE IS ISSUED AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR. THE PROVISO PROVIDES THAT IF THE N OTICE IS ISSUED BEYOND FOUR YEARS SUCH NOTICE SHALL BE ISSU ED AFTER TAKING APPROVAL FROM THE CHIEF COMMISSIONER OR COMMISSIONER ON THE REASONS RECORDED BY THE ASSESSI NG 23 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. OFFICER. FURTHER UNDER SUB-SECTION (2) IT WAS PROV IDED THAT IF NO ASSESSMENT WAS FRAMED EARLIER U/S 143(3)(147 NO NOTICE SHALL BE ISSUED UNDER SECTION 148 BY AN ASSE SSING OFFICER WHO IS BELOW THE RANK OF JOINT COMMISSIONE R AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVA NT ASSESSMENT YEAR UNLESS THE JOINT COMMISSIONER IS SATISFIED ON THE REASONS RECORDED BY SUCH ASSESSIN G OFFICER THAT IT IS A FIT CASE FOR THE ISSUE OF SUCH NOTICE. 15.3 THEREFORE UNDER THE STATUTORY PROVISION THE A CT PROVIDE FOR THE SAFEGUARDS FOR ISSUING NOTICE U/S 1 48 OF THE ACT. IT IS THE INTENT OF THE LEGISLATURE THAT SUPER IOR AUTHORITY SHOULD APPLY HIS MIND AND GIVE HIS SATISFACTION BEF ORE ISSUANCE OF NOTICE. IN SUCH CIRCUMSTANCES THE APPR OVAL SHOULD NOT BE MECHANICAL BUT SHOULD BE OBJECTIVE SATISFACTION AND SATISFACTION RECORDED SHOULD REFLE CT THAT THERE IS APPLICATION OF MIND. IN FACT THE ISSUE IS NO MORE RES INTEGRA. THE APEX COURT IN THE CASE OF CHHUGAMAL RAJPAL VS. S.P. CHALIHA & ORS REPORTED IN 79 ITR 603 (SC) HAS HELD THAT IMPORTANT SAFEGUARDS ARE PROVIDED IN SECT IONS 147 AND 151 OF THE ACT AND SAME CANNOT BE LIGHTLY T REATED BY THE COMMISSIONER. IT WAS HELD THAT WHILE GRANTIN G THE APPROVAL THE COMMISSIONER SHOULD GIVE REASON FOR C OMING TO THE CONCLUSION THAT IT IS A FIT CASE FOR THE ISS UE OF A NOTICE UNDER SECTION 148 OF THE ACT. THE JURISDICTIONAL HI GH COURT IN THE CASE OF UNITED ELECTRICAL COMPANY PVT. LTD. VS. CIT REPORTED IN[2002] 258 ITR 317 (DELHI) HAS HELD THAT THE 24 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. LEGISLATURE HAS PROVIDED CERTAIN SAFEGUARDS TO PREV ENT ARBITRARY EXERCISE OF POWERS BY AN ASSESSING OFFICE R PARTICULARLY AFTER A LAPSE OF SUBSTANTIAL TIME FROM COMPLETION OF ASSESSMENT. THE POWER VESTED IN THE COMMISSIONER TO GRANT OR NOT TO GRANT APPROVAL IS C OUPLED WITH A DUTY. THE COMMISSIONER IS REQUIRED TO APPLY HIS MIND TO THE PROPOSAL PUT UP TO HIM FOR APPROVAL IN THE LIGHT OF THE MATERIAL RELIED UPON BY THE ASSESSING OFFICE R. THE SAID POWER CANNOT BE EXERCISED CASUALLY AND IN A RO UTINE MANNER. IN FACT IN THE CASE OF CIT V. S. GOYANKA LIME & CHEMICAL LTD. REPORTED IN 231 TAXMAN 73 (MP) IT WAS HELD THAT SANCTION GRANTED BY MERELY RECORDING 'YES I AM SATISFIED' IS MECHANICAL AND SAME IS UNSUSTAINA BLE. IN FACT SLP FILED AGAINST THE AFORESAID JUDGMENT OF M ADHYA PRADESH HIGH COURT IS ALSO DISMISSED AND SAME IS RE PORTED IN 237 TAXMAN 378 (SC). IN FACT IN THE CASE OF PR. CI T VS M/S N.C. CABLES LTD. REPORTED IN [2017] 391 ITR 11 (DELHI) JURISDICTIONAL HIGH COURT HAS HELD AS UNDER: 11. SECTION 151 OF THE ACT CLEARLY STIPULATES THAT THE CIT (A) WHO IS THE COMPETENT AUTHORITY TO AUTHORIZE TH E REASSESSMENT NOTICE HAS TO APPLY HIS MIND AND FORM AN OPINION. THE MERE APPENDING OF THE EXPRESSION 'APPR OVED' SAYS NOTHING. IT IS NOT AS IF THE CIT (A) HAS TO RE CORD ELABORATE REASONS FOR AGREEING WITH THE NOTING PUT UP. AT THE SAME TIME SATISFACTION HAS TO BE RECORDED OF T HE GIVEN CASE WHICH CAN BE REFLECTED IN THE BRIEFEST POSSIBL E MANNER. IN THE PRESENT CASE THE EXERCISE APPEARS T O HAVE 25 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. BEEN RITUALISTIC AND FORMAL RATHER THAN MEANINGFUL WHICH IS THE RATIONALE FOR THE SAFEGUARD OF AN APPROVAL B Y A HIGHER RANKING OFFICER. FOR THESE REASONS THE COUR T IS SATISFIED THAT THE FINDINGS BY THE ITAT CANNOT BE DISTURBED. 15.4 WHEN THE FACTS OF THIS CASE ARE SEEN IN THE LIGH T OF THE AFORESAID BINDING PRECEDENTS IT IS FOUND THAT IN THIS CASE ALSO WHILE ACCORDING APPROVAL THE LD. ADDL. C IT WHILE GRANTING APPROVAL HAS MERELY RECORDED APPROVED AN D HAS NOT GIVEN ANY REASON AT ALL THE REASON FOR GRANTING APPROVAL. IN FACT THIS SHOWS THAT WHILE GRANTING APPROVAL H E HAS NOT EVEN EXAMINED WHETHER THE MATERIAL REFERRED IN THE REASONS TO BELIEVE IS AVAILABLE WITH THE AO AND HAD HE APPL IED HIS MIND HE WOULD HAVE FOUND THAT EVEN THE MATERIAL RE FERRED IN THE REASONS TO BELIEVE IS NOT AVAILABLE WITH THE AO. NOW BE THAT AS MAY BE IN THE A.Y. 2002-03 EVEN THE REA SONS RECORDED DO NOT CLOTHE THE AO WITH THE JURISDICTION TO REOPEN THE ASSESSMENT AS HE DID NOT HAD THE RELEVA NT MATERIAL. 15.5 FROM A BARE PERUSAL OF THE REASONS RECORDED FOR THE AY 2002-03 IT IS SEEN THAT SAME IS BASED ON CERTAI N INFORMATION RECEIVED FROM ADDL. DIT (INV.)-GHAZIABA D. THE RELEVANT PORTION OF THE REASONS RECORDED IS REPRO DUCED HEREUNDER: 26 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. INFORMATION HAS BEEN RECEIVED FROM THE ADDL. DIT(INV.) GHAZIABAD ALONGWITH A REPORT OF THE ADDL. DIT(INV.) NOIDA ALLEGING THAT THE ASSESSEE M/S MARBLE ART IS NOT KEEPING PROPER RECORDS OF RAW MATERIAL AND FINISHED GOODS PRODUCED THERE FROM AND IN COLLUSION WITH M/S MARGRA INDUSTRIES LTD. IS EVADING TAXES. FOR THE AY 2002-03 THE ASSESSEE HAS REMOVED GOODS WITHOUT PAYMENT OF DUTY AND THESE INVOICES WERE LATER SHOWN CANCELLED THOUGH THEY CONTAINED DETAILS LIKE THE DATE AND TIME OF REMOVAL TRANSPORT VEHICLE NO. ETC. THE RECORDS OF THE ASSESSEE FIRM WERE EXAMINED. THE ASSESSEE HAS BUSINESS TRANSACTIONS WITH M/S MARGA INDUSTRIES. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF EXPORT OF NATURAL STONE PRODUCTS AND CLAIMS EXEMPTION U/S 10B. IN VIEW OF THE ABOVE ALLEGATIONS THE BUSINESS ACTIVITY OF THE ASSESSEE ALONG WITH ITS CLAIM OF EXEMPTION U/S 10B NEEDS TO BE EXAMINED. THEREFORE THERE IS A REASON TO BELIEVE THAT THERE IS INCOME WHICH HAS ESCAPED ASSESSMENT IN THE CASE OF THE ASSESSEE FOR THE SAID ASSESSMENT YEAR. 15.6 AS DISCUSSED ABOVE THE BENCH HAD DIRECTED THE REVENUE TO PRODUCE THE MATERIAL WHICH THE AO HAD AT THE TIME OF INITIATION OF PROCEEDINGS U/S 148 APART FRO M THE 27 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. AFOREMENTIONED LETTER. HOWEVER THE REVENUE HAD FI LED ONLY FOUR DOCUMENTS WHICH ARE AS UNDER: I. A COPY OF LETTER ISSUED BY ADDL. DIRECTOR OF INCOME TAX (INV.) MEERUT DATED 24.03.2009 TO ADDL. CIT RANGE-22 NEW DELHI. II. A COPY OF LETTER ISSUED BY ADDL. DIRECTOR OF INCOME TAX (INV.) NOIDA DATED 17.03.2009 TO ADDL. DIT(INV.) MEERUT. III. A COPY OF AN UNDATED ORDER PASSED BY SH. S.K. GOEL COMMISSIONER CENTRAL EXCISE NOIDA. IV. A COPY OF LETTER DATED 18.02.2019 ADDRESSED BY SENIOR INVESTIGATING OFFICER OF CUSTOMS CENTRAL EXCISE & SERVICE TAX SETTLEMENT COMMISSION PRINCIPAL BENCH NEW DELHI TO PERSONS STATED THEREIN. 15.7 FIRST OF ALL IN THE REASONS THERE IS NO WHISPER REGARDING DOCUMENTS AT SL. NO . (III.) & ( IV .) NOW FILED BY THE DEPARTMENT. NOWHERE IT HAS BEEN BROUGHT ON RECORD W HAT WAS THE AMOUNT AND GOODS WHICH HAS BEEN ALLEGED TO BE REMOVED WITHOUT PAYMENT OF DUTY AND WHAT ARE THESE CANCELLED INVOICES. THE REVENUE COULD NOT EVEN PROD UCE THE COPIES OF ALLEGED INVOICES REFERRED IN THE REASONS RECORDED UPON WHICH PRESUMPTION HAD BEEN DRAWN THAT SUCH CANCELLED INVOICES HAS LED TO UNDISCLOSED SALE OF W HICH GP 28 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. ADDITION HAS BEEN MADE. FROM THE COMMUNICATION DAT ED 24.03.2009 ADDRESSED BY ADDL. DIT (INV.) MEERUT TO ADDL. CIT RANGE-22 WHICH READS AS UNDER: - IN THIS CASE CUSTOM & CENTRAL EXCISE AUTHORITIES CONDUCTED A SEARCH ON THE BUSINESS PREMISES OF M/S MARBLE ART ON 19.08.2003. DURING THE COURSE OF SEARCH CERTAIN DISCRIMINATORY DOCUMENTS WERE FOUND AND SEIZED BY CUSTOM AUTHORITIES. A SHOW CAUSE NOTICE DATED 16.08.2004 WAS ISSUED BY THE COMMISSIONER OF CUSTOM & CENTRAL EXCISE NOIDA. LATER ON AN ORDER DATED 21.11.2005 WAS PASSED BY THE COMMISSIONER OF CUSTOM & CENTRAL EXCISE NOIDA BY CONFIRMING ALMOST ALL THE ALLEGATION IN THE SHOW CAUSE NOTICE. AGAINST THE ORDER OF THE CUSTOM & CENTRAL EXCISE COMMISSIONER THE FIRM M/S MARBLE ART HAS GONE IN CUSTOM & CENTRAL EXCISE SETTLEMENT COMMISSIONER. THE DECISION OF HONBLE SETTLEMENT COMMISSION IS STILL PENDING. ON THE BASIS OF SHOW CAUSE NOTICE ORDER OF COMMISSIONER OF CUSTOM & CENTRAL AND MATERIAL IMPOUNDED BY THE ADIT(INV.) NOIDA. ADIT (INV.) HAS SUBMITTED HIS REPORT TO THE UNDERSIGNED WITHIN THE PREVIEW OF INCOME TAX ACT. IN THIS REPORT THE ADIT (INV.) HAS RECOMMENDED THAT THE CASE M/S MARBLE ART LTD. MAY KINDLY BE REOPENED FOR AY 2002-03 2003-04 AND 2004-05. 29 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. YOU ARE THEREFORE REQUESTED TO TAKE NECESSARY ACTION BRINGING INCOME OF M/S MARBLE ART FOR RELEVANT ASSESSMENT YEAR BY REOPENING THIS CASE. 15.8 FROM THE CONTENTS OF AFORESAID COMMUNICATION IT IS SEEN THAT ADIT (INV.) MEERUT HAD RECOMMENDED THE C ASE OF THE ASSESSEE TO BE REOPENED WITHOUT PROVIDING THE A O ANY SUPPORTING MATERIAL. IT CAN THUS BE SAFELY CONCLUDE D AND INFERRED THAT REOPENING PROCEEDINGS HAD BEEN INITIA TED NOT ON THE BASIS OF SATISFACTION OF THE AO ALBEIT ON T HE BASIS OF MERE RECOMMENDATION OF ADIT (INV.) MEERUT. THE R EASON TO BELIEVE HAS TO BE THAT OF THE AO WHO IS INITIATING THE PROCEEDINGS AND IN ABSENCE OF ANY INDEPENDENT APPLI CATION OF MIND AND SATISFACTION OF THE AO THE REASON TO BE LIEVE FALLS IN THE REALM OF CONJECTURES. THE AO HAS TO HAVE TA NGIBLE MATERIAL WITH HIM AND EVEN IF THE INFORMATION HAS C OME FROM INVESTIGATION WING THE AO MUST PERUSED THE MA TERIAL WHICH HAS BEEN REFERRED IN THE SAID INFORMATION AND EXAMINE WHAT IS THE INCOME WHICH HAS ESCAPED ASSESS MENT. RECOMMENDATION MAY COME FROM ANY PERSON OR AUTHORIT Y BUT IT IS THE AO WHO HAS TO ENTERTAIN REASON TO BEL IEVE BASED ON MATERIAL BEFORE HIM THAT INCOME CHARGEABLE TO TA X HAS ESCAPED ASSESSMENT. THE MOST CRUCIAL MATERIAL HERE IN THIS CASE IS THAT ASSESSEE HAS REMOVED GOODS WITHOUT PAY MENT OF DUTY AND THERE WERE INVOICES WHICH WERE LATER SHOWN TO BE CANCELLED BUT NOWHERE THERE IS ANY WHISPER ABOUT TH E 30 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. INVOICES NOR THEY HAVE BEEN PRODUCED. AO SIMPLY AP PEARS TO HAVE REOPENED TO EXAMINE THE CLAIM OF SECTION 10 B AND WHAT WAS THE BASIS AND PREMISE BEFORE HIM AS TO HOW THE CLAIM ON EXAMINE U/S 10B HAS INCORRECT IS NOT COMIN G FORE. MERE INTIMATION RECEIVED FROM ANY AUTHORITY CANNOT LEAD TO IMMEDIATE PRESUMPTION BUT IT NEEDS TO BE VERIFIED B Y THE AO AND TO APPLY HIS MIND. HERE IN THIS CASE EVEN THE DOCUMENTS PERTAINING TO CUSTOM & CENTRAL EXCISE AUTHORITIES WAS NOT AVAILABLE WITH THE AO AT THE TI ME OF INITIATION OF PROCEEDINGS WHICH FACT HAS BEEN SURFA CED BEFORE US. THUS WE HOLD THAT THE REASONS RECORDED BY THE AO DO NOT GIVE JURISDICTION TO REOPEN THE ASSESSMENT U/S 147 READ WITH SECTION 148. 16. NOW IN SO FAR AS OTHER TWO YEARS THAT IS AYS 20 03-4 & 2004-05 IT IS ALSO SEEN THAT IN THE CASE OF THE ASSESSEE NOT ONLY APPROVAL WAS MECHANICAL BUT APPROVAL WAS A LSO NOT TAKEN FROM COMPETENT AUTHORITY. THE RELEVANT DETAIL S IN RESPECT OF THE APPROVAL FOR THESE YEARS ARE AS UNDE R: ASSESSMENT YEAR ASSESSED UNDER SECTION NOTICE ISSUED U/S 148 OF THE ACT ON SANCTION U/S 151 WAS TAKEN FROM COMPETENT AUTHORITY TO GRANT SANCTION U/S 151 2002-03 143(1) 17.03.2009 ADDL. CIT ADDL. CIT/JCIT 31 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 2003-04 143(3) 31.03.2010 ADDL. CIT CHIEF CIT/CIT 2004-05 143(3) 30.03.2011 ADDL. CIT CHIEF CIT/CIT 16.1 FROM THE ABOVE TABLE IT IS APPARENT THAT THE LE ARNED ASSESSING OFFICER HAS OBTAINED THE SANCTION FROM TH E LEARNED ADDL. CIT FOR ALL THE THREE ASSESSMENT YEARS WHICH IS NOT IN ACCORDANCE WITH LAW AS FOR THE AY 2003-04 AND 2004 -05 ASSESSMENT WAS ORIGINALLY FRAMED U/S 143(3) OF THE ACT AND NOTICE U/S 148 OF THE ACT WAS ISSUED BEYOND THE FOU R YEARS AS SUCH THE SANCTION FOR THE AY 2003-04 AND 2004-0 5 SHOULD HAVE BEEN OBTAINED OF CHIEF CIT/CIT. THIS IS SUE HAS ALSO BEEN CONSIDERED IN PLETHORA OF JUDGMENTS WHER EIN IT HAS BEEN HELD THAT IF THE SANCTION HAS NOT BEEN TAK EN FROM THE APPROPRIATE AUTHORITY AS PROVIDED U/S 151 OF TH E ACT INITIATION OF THE REASSESSMENT PROCEEDINGS IS NOT I N ACCORDANCE WITH LAW. THE ASSESSEE HAS FURNISHED A SUMMARY OF VARIOUS JUDGMENTS ON THIS ISSUE IN TABUL AR FORM WHICH ARE AS UNDER: S.NO. NAME OF THE CASE NOTICE ISSUED BY APPROV AL TAKEN FROM AS PER THE HONBLE COURT APPROVAL SHOULD HAVE BEEN TAKEN FROM . 1 CIT VS. SPLS SIDDHARTHA LTD [2012] 345 ITR 223 (DELHI) ACIT CIT JCIT/ADDL CIT . 2 YUM! RESTAURANTS ASIA PTE. LTD VS. DDIT [2017] 397 ITR 639 DCIT DIT ADDL. DIT 32 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. (DELHI ) . 3 CIT V. SOYUZ INDUSTRIAL RESOURCES LTD. [2015] 232 TAXMAN 414 (DELHI) AO CIT JCIT . 4 CIT V. AQUATIC REMEDIES (P.) LTD [2018] 406 ITR 545 (BOMBAY) DCIT CIT ADDL CIT . 5 GHANSHYAM K. KHABRANI V. ACIT [2012] 346 ITR 443 (BOM) DCIT CIT ADDL CIT . 6 DSJ COMMUNICATION LTD. V. DCIT [2014] 41 TAXMANN.COM 151 (BOMBAY) DCIT CIT ADDL. CIT . 7 CIT VS. GEE KAY FINANCE & LEASING CO. LTD ITA 935/2009 DATED 08.02.2018 DCIT NO APPROV AL CIT . 8 DHADDA EXPORTS V. ITO [2015] 377 ITR 347 (RAJASTHAN) ITO JCIT CIT . 9 RELIABLE FINHOLD LTD. V. UNION OF INDIA [2014] 369 ITR 419 (ALLAHABAD) ITO - CIT 10 ITO V. BHAVESH KUMAR [2011] 140 TTJ 257 (AGRA) ACIT JCIT CCIT / CIT 16.2 IT IS SEEN THAT IN THE CASE OF CIT VS. SPLS SIDDHARTHA LTD [2012] 345 ITR 223 (DELHI) WHEREIN APPROVAL WAS TAKEN BY THE AO FROM SUPERIOR AUTHORIT Y I.E. 33 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. CIT WHEREAS THE UNDER THE STATUTORY PROVISION APP ROVAL WAS TO BE TAKEN FROM JCIT/ADDL CIT IT WAS HELD THAT NOTICE ISSUED U/S 148 OF THE ACT IS INVALID. THE RELEVANT FINDING OF THE HONBLE HIGH COURT IS AS UNDER: 7. SECTION 116 OF THE ACT ALSO DEFINES THE INCOME TAX AUTHORITIES AS DIFFERENT AND DISTINCT AUTHORITIES. SUCH DIFFERENT AND DISTINCT AUTHORITIES HAVE TO EXERCISE THEIR POWERS IN ACCORDANCE WITH LAW AS PER THE POWERS GIV EN TO THEM IN SPECIFIED CIRCUMSTANCES. IF POWERS CONFERRE D ON A PARTICULAR AUTHORITY ARE ARROGATED BY OTHER AUTHORI TY WITHOUT MANDATE OF LAW IT WILL CREATE CHAOS IN THE ADMINISTRATION OF LAW AND HIERARCHY OF ADMINISTRATI ON WILL MEAN NOTHING. SATISFACTION OF ONE AUTHORITY CANNOT BE SUBSTITUTED BY THE SATISFACTION OF THE OTHER AUTHOR ITY. IT IS TRITE THAT WHEN A STATUTE REQUIRES A THING TO BE D ONE IN A CERTAIN MANNER IT SHALL BE DONE IN THAT MANNER ALO NE AND THE COURT WOULD NOT EXPECT ITS BEING DONE IN SOME O THER MANNER. IT WAS SO HELD IN THE FOLLOWING DECISIONS: (I) CIT V. NAVEEN KHANNA (DATED 18.11.2009 IN IT APPEAL NO. 21 OF 2009 (DHC). (II) STATE OF BIHAR V. J.A.C. SALDANNA AIR 1980 SC 326. (III) STATE OF GUJARAT V. SHANTILALMANGALDAS AIR 19 69 SCN 634. 8. THUS IF AUTHORITY IS GIVEN EXPRESSLY BY AFFIRMATI VE WORDS UPON A DEFINED CONDITION THE EXPRESSION OF T HAT 34 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. CONDITION EXCLUDES THE DOING OF THE ACT AUTHORISED UNDER OTHER CIRCUMSTANCES THAN THOSE AS DEFINED. IT IS AL SO ESTABLISHED PRINCIPLE OF LAW THAT IF A PARTICULAR A UTHORITY HAS BEEN DESIGNATED TO RECORD HIS/HER SATISFACTION ON ANY PARTICULAR ISSUE THEN IT IS THAT AUTHORITY ALONE W HO SHOULD APPLY HIS/HER INDEPENDENT MIND TO RECORD HIS/HER SATISFACTION AND FURTHER MANDATORY CONDITION IS THA T THE SATISFACTION RECORDED SHOULD BE 'INDEPENDENT' AND N OT 'BORROWED' OR 'DICTATED' SATISFACTION. LAW IN THIS REGARD IS NOW SELL-SETTLED. IN SHEONARAIN JAISWAL V. ITO [1989] 176 ITR 352 / 45 TAXMAN 213 (PAT.) IT WAS HELD: 'WHERE THE ASSESSING OFFICER DOES NOT HIMSELF EXERC ISE HIS JURISDICTION UNDER SECTION 147 BUT MERELY ACTS AT T HE BEHEST OF ANY SUPERIOR AUTHORITY IT MUST BE HELD T HAT ASSUMPTION OF JURISDICTION WAS BAD FOR NON-SATISFAC TION OF THE CONDITION PRECEDENT.' 9. THE APEX COURT IN THE CASE OF ANIRUDH SINHJI KARAN SINHJI JADEJA V. STATE OF GUJARAT [1995] 5 SCC 302 HAS HELD THAT IF A STATUTORY AUTHORITY HAS BEEN VESTED WITH JURISDICTION HE HAS TO EXERCISE IT ACCORDING TO IT S OWN DISCRETION. IF DISCRETION IS EXERCISED UNDER THE DI RECTION OR IN COMPLIANCE WITH SOME HIGHER AUTHORITIES INSTRUCT ION THEN IT WILL BE A CASE OF FAILURE TO EXERCISE DISCR ETION ALTOGETHER. 35 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 10. WE ARE THEREFORE OF THE OPINION THAT THE TRIBUNAL HAS RIGHTLY DECIDED THE LEGAL ASPECT KEEPING IN VIEW W ELL- ESTABLISHED PRINCIPLES OF LAW LAID DOWN IN CATENA O F JUDGMENTS INCLUDING THAT OF THE SUPREME COURT. 16.3 IN THE CASE OF CIT VS. SOYUZ INDUSTRIAL RESOURCES LTD. REPORTED IN [2015] 232 TAXMAN 414 (DELHI) THE JURISDICTIONAL HIGH COURT HAS HELD AS UNDER: 8. THE REVENUE'S ARGUMENT SEEMS PLAUSIBLE AND EVEN LOGICAL BECAUSE THE COMMISSIONER OR A CHIEF COMMISSIONER IS UNARGUABLY RANKED HIGHER IN AUTHORI TY THAN A JOINT COMMISSIONER. YET AT THE SAME TIME TH IS COURT HAS TO GIVE EFFECT TO PLAIN WORDS OF THE STAT UTE WHICH UNAMBIGUOUSLY STATES THAT THE COMPETENT AUTHORITY I N SUCH CASES IS THE JOINT COMMISSIONER (AND NOT THE C HIEF COMMISSIONER OR THE PRINCIPAL COMMISSIONER). THE REVENUE'S SUBMISSIONS THAT ALL SUCH CASES ARE COVE RED UNDER PROVISO TO SECTION 147(1) THE COMPETENT AUTH ORITY FOR PRIOR APPROVAL WOULD BE FOUR SUPERIOR OFFICERS RENDERS SECTION 151(2) SUPERFLUOUS. IF ANYTHING THE COURT I S CLEAR THAT IT IS NOT ITS JOB TO RENDER IN THE PROCESS OF INTERPRETATION AN ENTIRE PROVISION ACADEMIC OR INO PERATIVE. THIS COURT IS OF THE OPINION THAT ACCEPTING THE REV ENUE'S POSITION WOULD RESULT IN THAT CONSEQUENCE. THE COUR T ALSO INVOKES THE PRINCIPLE ENUNCIATED BY THE PRIVY COUNC IL IN NAZIR AHMAD V. EMPEROR AIR 1936 PC 253 : THAT IF 36 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. THE STATUTE MANDATES THAT SOMETHING BE DONE IN A PARTICULAR MANNER SHOULD BE IN THAT MANNER OR NOT AT ALL. IN THIS CASE SINCE THE ORIGINAL ASSESSMENT WAS COM PLETED 'OTHER THAN' THE EVENTUALITIES CONTEMPLATED IN SECT ION 151(1) I.E. IT WAS PROCESSED UNDER SECTION 143(1). THUS CLEARLY SECTION 151(2) APPLIED. 16.4 AFORESAID TWO JUDGMENTS WERE SUBSEQUENTLY FOLLOWED IN THE CASE OF YUM RESTAURANTS ASIA PTE LTD VS. DDIT REPORTED IN [2017] 397 ITR 639 (DELHI) WHEREIN IT WAS HELD AS UNDER: 8. THE ABOVE SUBMISSION CANNOT BE ACCEPTED. WHERE THE ORIGINAL ASSESSMENT IS PROCESSED UNDER SECTION 143( 1) OF THE ACT AND THE REOPENING IS SOUGHT TO BE DONE AFT ER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR THE MANDATORY REQUIREMENT UNDER SECTION 151(2) OF THE ACT IS THAT THE APPROVAL FOR THE REOPENING OF THE ASSESSMENT SHOULD BE BY AN OFFICER OF THE RANK OF THE JOINT COMMISSIONER (IN THIS CASE THE A DDL. DIT) AND NOT OTHER OFFICER INCLUDING A SUPERIOR OFF ICER. - ---- 11. IN VIEW OF THE CLEAR POSITION IN LAW THE COURT HA S NO HESITATION IN CONCLUDING THAT IN THE PRESENT CASE THE MANDATORY REQUIREMENT UNDER SECTION 151(2) OF THE A CT AS IT STOOD AT THE RELEVANT TIME HAS NOT BEEN FULFILL ED AND THEREFORE THE REOPENING OF THE ASSESSMENT FOR THE 37 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. ASSESSMENT YEAR 2005-06 BY THE IMPUGNED NOTICE IS B AD IN LAW. 16.5 THEREFORE NOW THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AS FOR REOPENING OF THE ASSE SSMENT FOR THE AY 2003-04 AND 2004-05 THE SANCTION HAS BEEN TA KEN FROM THE LEARNED ADDL. CIT INSTEAD OF CIT AS SUCH SANCTION GRANTED FOR ASSUMPTION OF JURISDICTION IS NOT IN AC CORDANCE WITH THE PROVISIONS OF SECTION 151 OF THE ACT. HENC E RESPECTFULLY FOLLOWING THE DECISION OF THE HONOURAB LE DELHI HIGH COURT WE HOLD THAT THE NOTICE ISSUED BY THE A O U/S 148 OF THE ACT FOR THE AY 2003-04 AND 2004-05 IS BA D IN LAW ON THIS GROUND ALSO. 17. SINCE WE HAVE ALREADY QUASHED THE ASSESSMENT BEING WITHOUT JURISDICTION UNDER SECTION 147 ON THE GROUN D THAT APPROVAL GRANTED IS MECHANICAL AND ALSO FOR THE AY 2003-04 AND 2004-05 EVEN THE SO CALLED APPROVAL IS NOT FRO M THE COMPETENT AUTHORITY THEREFORE OTHER GROUNDS RAISE D BY THE ASSESSEE CHALLENGING THE ASSUMPTION OF JURISDICTION AS WELL AS THE MERITS OF ADDITIONS HAVE BECOME PURELY ACADE MIC. 38 ITA.NOS.2478 TO 2480/DEL./2013 M/S MARBLE ART NEW DELHI. 18. ACCORDINGLY APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 08/03/2021 SD/- SD/- (G.S. PANNU) (AMIT SHUKLA) VICE PRESIDENT JUDICIAL MEMBER DATED: 08/03/2021 *KAVITA ARORA COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC-2 BENCH DELHI 6. GUARD FILE. // BY ORDER // ASSISTANT REGISTRAR ITAT DELHI BENCH ES : DELHI.