Sushila Khandelwal, v. Asstt. Commissioner Of Income Tax, Bareilly

ITA 363/LKW/2013 | misc
Pronouncement Date: 10-11-2014 | Result: Allowed

Appeal Details

RSA Number 36323714 RSA 2013
Assessee PAN ALEPK6710E
Bench Lucknow
Appeal Number ITA 363/LKW/2013
Duration Of Justice 1 year(s) 5 month(s) 20 day(s)
Appellant Sushila Khandelwal,
Respondent Asstt. Commissioner Of Income Tax, Bareilly
Appeal Type Income Tax Appeal
Pronouncement Date 10-11-2014
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 10-11-2014
Date Of Final Hearing 17-09-2014
Next Hearing Date 17-09-2014
Assessment Year misc
Appeal Filed On 20-05-2013
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SHRI A.K. GARODIA ACCOUNTANT MEMBER ITA NO.363/LKW/2013 BLOCK PERIOD:01/04/90 TO 10/10/2000 A.C.I.T. CIRCLE - BAREILLY. VS. SMT. SUSHILA KHANDELWAL 71 HIRA NAGAR HALWANI DISTT. NAINITAL. PAN:ALEPK6710E (RESPONDENT) (APPELLANT) SHRI YOGESH AGARWAL ADVOCATE APPELLANT BY SHRI RAJIV JAIN CIT D.R. RESPONDENT BY 17/09/2014 DATE OF HEARING 10 /11/2014 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) BAREILLY CAMP AT MORADABAD DATED 22/03/2013 FOR THE BLOCK PERIOD 01/04/1990 TO 10/10/2000. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: I. THE LEARNED COMMISSIONER OF INCOME TAX - (APPEALS) - II DEHRADUN HAVING CONCURRENT JURISDICTION OF CIT - (APPEALS) BAREILLY [HEREINAFTER REFERRED TO AS THE LEARNED CIT (A)'S GROSSLY ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT THE ORIGINAL ASSESSMENT SO FRAMED U/S 158BD IS BAD - IN - LAW AS THE NOTICE IS ILLEGAL AS THE NOTICE U/S 158BD CAN ONLY BE ISSUED SUBSEQUENT OF RECORDING THE SATISFACTION THAT TOO PRIOR TO PASSING OF THE ORDER OF ASSESSMENT IN WHOSE CASE SATISFACTION IS B EING RECORDED AND HANDING OVER THE BOOKS OF ACCOUNTS AND ASSETS SEIZED AND AS NO SUCH SATISFACTION HAS EVER BEEN RECORDED PRIOR TO THE 2 PASSING OF THE ASSESSMENT ORDERS THE ORIGINAL ORDER SO PASSED SUFFERS FROM INCURABLE DEFECTS AND THUS ALL SUBSEQUENT PROC EEDINGS HAVE BECOME ILLEGAL AND THUS NEED TO BE QUASHED. II. THE LD. CIT (A)'S GROSSLY ERRED ON FACTS AND IN LAW IN NOT DECIDING THE ISSUE REGARDING THE ISSUANCE OF NOTICE U/S 158BD BY THE ASSESSING OFFICER AFTER A CONSIDERABLE LAPSE OF TIME AND COMPLETING THE ASSESSMENT. WHILE ISSUING THE NOTICE U/S 158 BC/BD THE LD. AO HAD CHOSEN TO IGNORE OR RATHER COMPLETELY FAILED TO APPRECIATE THE FACT THAT SUCH A NOTICE CANNOT BE ISSUED AFTER A LAPSE OF ALMOST 35 MONTHS AND THUS THE NOTICE BEING ISSUED BEYO ND THE LIMITATION PERIOD IS A NULLITY ILLEGAL AND BAD - IN - LAW AND THUS ALL SUBSEQUENT PROCEEDINGS ARE VOID - AB - INITIO. III. NOTICE U/S 143(2) DT. 12 - 12 - 2005 IS BARRED BY LIMITATION AS THE RETURN WAS FILED ON 19 - 03 - 2004 AND NOTICE U/S 143(2) COULD HAVE BEEN ISSUED AND SERVED BEFORE 31 - 03 - 2005 THUS THE ORDER SO FRAMED IS BAD IN LAW AND NEEDS TO BE QUASHED. IV. THE REASONS SO RECORDED FOR ISSUING THE NOTICE U/S 158BD OF THE ACT ARE NOT RELEVANT OR GERMANE ENOUGH TO VALIDLY INITIATE THE PROCEEDINGS AND THUS A S THE REOPENING IS BASED ON SUCH REASONS THE ORDER SO PASSED MAY KINDLY BE ORDERED TO BE QUASHED. NOTWITHSTANDING AND WITHOUT PREJUDICE TO ALL THE ABOVE GROUNDS : - V. WHILE CONFIRMING THE ADDITION OF RS.2 10 670/ - AS ALLEGED UNDISCLOSED INVESTMENT MADE I N GOLD COINS WEIGHING 472.200 GMS THE LD. CIT (A)'S WAS NOT AT ALL JUSTIFIED AS IT WAS DULY EXPLAINED DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN THE CASE OF SRI. PRADEEP KHANDELWAL THAT THIS IS ANCESTRAL JEWELLERY AND AFTER CONSIDERING THE SUBMISSION N O ADDITION AT ALL WAS MADE IN HIS CASE OR ANY SATISFACTION RECORDED TO THE CONTRARY THAT IT REPRESENTS UNDISCLOSED INVESTMENT OF THE APPELLANT AND THUS THE ADDITION BASED ON WHIMS AND FANCIES MAY KINDLY BE ORDERED TO BE DELETED. 3 VI. THE LD. CIT (A)'S GROS SLY ERRED ON FACTS AND IN LAW NOT AFFORDING ANY OPPORTUNITY TO THE APPELLANT TO HAVE HER SAY OR MAKE NECESSARY COMPLIANCE OF THE REASONS RELIED UPON BY HIM IN CONFIRMING THE ADDITIONS AND THUS THE ORDER SO PASSED WITHOUT AFFORDING ADEQUATE OPPORTUNITY MAY KINDLY BE ORDERED TO BE QUASHED. VII. THE ADDITIONS MADE IS HIGHLY EXCESSIVE CONTRARY TO FACTS LAWS AND PRINCIPLES OF NATURAL JUSTICE AND FAIR - PLAY AND THUS MAY KINDLY BE ORDERED TO BE QUASHED/ANNULLED. VIII. THE LD. CIT (A)' S ERRED ON FACTS AND IN LA W IN NOT DECIDING THE ISSUE REGARDING THE LEVY OF SURCHARGE AS THE SAME IS NOT APPLICABLE ON THE FACTS AND IN THE PECULIAR CIRCUMSTANCE OF THE PRESENT CASE MORE SO ON ACCOUNT OF THE FACT THAT THE SAME WAS DELETED BY THE LD. CIT (A)'S IN THE FIRST ROUND AND THE DEPARTMENT HAD NOT PREFERRED ANY GROUND ON THE SAME IN THE SECOND APPEAL FILED BEFORE THE HON'BLE ITAT AND THUS THE SAME MAY KINDLY BE ORDERED TO BE DELETED. 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT IN THE PRESENT CASE THE BLOCK AS SESSMENT IN THE CASE OF THE SEARCHED PERSON SHRI PRADEEP KUMAR KHANDELWAL WAS COMPLETED ON 31/10/2002 AS PER THE BLOCK ASSESSMENT ORDER AVAILABLE ON PAGES 22 TO 25 OF THE PAPER BOOK. HE ALSO SUBMITTED THAT THE SATISFACTION NOTE RECORDED BY THE ASSESSING O FFICER IS AVAILABLE ON PAGE 1 OF THE PAPER BOOK WHICH IS DATED 17/02/2004. HE ALSO DRAWN OUR ATTENTION TO PAGE NO. 5 OF THE PAPER BOOK AND POINTED OUT THAT AS PER THE BLOCK ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER THE RETURN OF INCOME WAS FILED B Y THE ASSESSEE ON 19/03/2004 BUT NOTICE U/S 143(2) WAS ISSUED BY THE ASSESSING OFFICER ON 12/12/2005 WHICH IS AFTER 19 MONTHS FROM THE DATE OF RETURN OF INCOME AND THEREFORE NOT VALID. HE PLACED RELIANCE ON THE JUDGMENT OF HON'BLE ALLAHABAD HIGH COURT R ENDERED IN THE CASE OF SMT. PRABHA RANI AGRAWAL VS INCOME - TAX OFFICER [2013] 351 ITR 275 (ALL). 4 4. ON THE OTHER HAND LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDER OF LEARNED CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT IN THE BLOCK ASSESSMENT ORDER FRAMED BY THE ASSESSING OFFICER HE HAS HIMSELF NOTED IN THE ASSESSMENT ORDER IN THE FIRST ROUND DATED 20/02/2006 ON PAGE NO. 2 OF THE ASSESSMENT ORDER ON PAGE NO. 5 OF T HE PAPER BOOK THAT THE BLOCK RETURN WAS FILED BY THE ASSESSEE ON 19/03/2004. ON THE SAME PAGE THE ASSESSING OFFICER HAS ALSO NOTED THAT THE NOTICE U/S 143(2) WAS ISSUED ON 12/12/2005 ASKING COMPLIANCE ON 19/12/2005. ADMITTEDLY AS PER THE PROVISO TO SUB SECTION (2) OF SECTION 143 OF THE ACT DURING THE RELEVANT PERIOD NOTICE U/S 143(2) WAS REQUIRED TO BE SERVED ON THE ASSESSEE WITHIN A PERIOD OF 12 MONTHS FROM THE END OF THE MONTH IN WHICH RETURN IS FURNISHED. THE BLOCK RETURN IN THIS CASE WAS FILED B Y THE ASSESSEE ON 19/03/2004 AND THEREFORE THE TIME LIMIT FOR ISSUE AND SERVICE OF NOTICE U/S 143(2) EXPIRES ON 31/03/2005 BUT IN THE PRESENT CASE THE NOTICE U/S 143(2) WAS ISSUED BY THE ASSESSING OFFICER ON 12/12/2005 WHICH IS MUCH AFTER THE EXPIRY OF D UE DATE. THEREFORE IT HAS TO BE ACCEPTED THAT NO VALID NOTICE U/S 143(2) WAS ISSUED AND SERVED ON THE ASSESSEE. AS PER THE JUDGMENT OF HON'BLE APEX COURT RENDERED IN THE CASE OF ASSISTANT COMMISSIONER OF INCOME - TAX VS HOTEL BLUE MOON [2012] 321 ITR 362 (SC) IF NO VALID NOTICE U/S 143(2) WAS ISSUED AND SERVED ON THE ASSESSEE THEN THE BLOCK ASSESSMENT ORDER IS NOT VALID. SIMILARLY IN THE CASE OF VIRENDRA DEV DIXIT VS. ACIT [2010] 233 CTR 177 (ALL) ALSO IT WAS HELD THAT SERVICE OF NOTICE ON THE ASSESSEE U/S 143(2) WITHIN THE PRESCRIBED PERIOD IS PREREQUISITE FOR FRAMING BLOCK ASSESSMENT. HENCE BY RESPECTFULLY FOLLOWING THESE TWO JUDGMENTS OF HON'BLE APEX COURT AND HON'BLE ALLAHABAD HIGH COURT WE HOLD THAT IN THE PRESENT CASE THE BLOCK ASSESSMENT FRAME D BY THE ASSESSING OFFICER IS NOT VALID AND HENCE THE 5 SAME IS QUASHED. SINCE WE HAVE HELD THAT THE BLOCK ASSESSMENT ORDER ITSELF IS NOT VALID THE OTHER GROUNDS RAISED BY THE ASSESSEE DO NOT CALL FOR ANY ADJUDICATION. 6. IN THE RESULT THE APPEAL OF THE ASSESSEE STANDS ALLOWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 10 /11/2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1 . THE APPELLANT 2 . THE RESPONDENT. 3 . CONCERNED CIT 4 . THE CIT(A) 5. D.R. I.T.A.T. LUCKNOW ASSTT. REGISTRAR