M/s Kerala Minerals and Metals Ltd, Kollam v. ACIT, Kollam

ITA 543/COCH/2009 | misc
Pronouncement Date: 15-07-2011

Appeal Details

RSA Number 54321914 RSA 2009
Assessee PAN AAACT8118R
Bench Cochin
Appeal Number ITA 543/COCH/2009
Duration Of Justice 1 year(s) 7 month(s) 28 day(s)
Appellant M/s Kerala Minerals and Metals Ltd, Kollam
Respondent ACIT, Kollam
Appeal Type Income Tax Appeal
Pronouncement Date 15-07-2011
Appeal Filed By Assessee
Bench Allotted DB
Tribunal Order Date 15-07-2011
Date Of Final Hearing 16-06-2011
Next Hearing Date 16-06-2011
Assessment Year misc
Appeal Filed On 17-11-2009
Judgment Text
ITA NO. 543/COCH/2009 (AY 1999- 2000) 1 IN THE INCOME TAX APPELLAT E TRIBUNAL COCHIN BEN CH COCHIN BEFORE S/SHRI N.VIJAYAKUMARAN JM AND SANJAY AR ORA AM I.T.A. NO. 543/COCH/2009 ASSESSMENT YEAR:1999-2000 KERALA MINERALS & METALS LTD. SANKARAMANGALAM CHAVARA KOLLAM. [PAN: AAACT 8118R] VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX CIRCLE-1 KOLLAM. (ASSESSEE -APPELLANT) (REVENUE- RESPONDENT) ASSESSEE BY SHRI R.RAJASEKHARAN CA-AR REVENUE BY SHRI S.R.SENAPATI SR.DR O R D E R PER SANJAY ARORA AM: THIS APPEAL BY THE ASSESSEE A PUBLIC SECTOR UNDER TAKING OF THE STATE GOVERNMENT IS DIRECTED AGAINST THE ORDER BY THE COMMISSIONER O F INCOME-TAX (APPEALS)-I TRIVANDRUM (CIT(A) FOR SHORT) DATED 16.9.2009 AN D THE ASSESSMENT YEAR UNDER REFERENCE IS 1999-2000 2.1 THE ONLY ISSUE ARISING IN APPEAL IT WAS URGED BY THE LD. AR THE ASSESSEES COUNSEL IS WHETHER THE REVISED RETURN FILED BY THE ASSESSEE ON 22.3.2001 IS A VALID RETURN U/S. 139(5) OF THE INCOME-TAX ACT 1961 (`THE ACT HEREINAFTER) OR NOT. RECOUNTING THE FACTS IN BRIEF IT WAS EXPLAINED THAT THE ASSESSEE FILED ITS ORIGINAL RETURN FOR THE RELEVANT YEAR AT AN INCOME OF ` 8626.51 LAKHS. THE SAME WAS PROCESSED U/S. 143(1) AT THE RETURNED INCOME AND INTIMATION U/S. 143(1)(A) OF THE ACT IS SUED (COPY ON RECORD ). THE ASSESSEE HOWEVER FILED A REVISED RETURN ON 22.3.2001 REVISING ITS INCOME TO A LOWER SUM OF ` 8312.49 LAKHS. ON THE SAME BEING NOT PROCESSED AND TAKEN COGNIZANCE OF THE MATTER WAS CARRIED TO THE FIRST APPELLATE AUTHORITY WHICH VIDE ITS ORDER DATED 9.9.2004 (IN I.T.A. NO. 147-Q/01-02) DIRECTED THE ASSESSING AUTHORITY TO VERIFY WHETHER THE REVISED RETURN ITA NO. 543/COCH/2009 (AY 1999- 2000) 2 FILED BY THE ASSESSEE WAS A VALID RETURN UNDER THE ACT. THE ASSESSING OFFICER (AO) IN THE APPEAL-EFFECT GIVING PROCEEDINGS STATED VIDE ORDER DATED 26.5.2005 THAT THE SECOND RETURN FILED BY THE ASSESSEE WAS NOT A VALID REVISION U/S. 139(5) AS IT WAS FILED AFTER THE PROCESSING OF THE ORIGINAL RETURN OF INCOME. THE SA ID ORDER HOWEVER DID NOT BEAR THE DATE OF THE SAID PROCESSING OR THE ISSUE OF THE INTIMATI ON UNDER REFERENCE. IN THE APPELLATE PROCEEDINGS THE ASSESSEE FILED THE COPY OF THE INT IMATION DATED 30.3.2001 WHICH AMPLY CLARIFIED THAT THE ORDER OF THE AO BORE A MISTAKE AS THE PROCESSING U/S. 143(1) WAS ONLY AFTER THE FILING OF THE SECOND RETURN AND THE REVE NUES OBJECTION THUS NOT VALID. THIS PROCESS AS IT APPEARS STOOD REPEATED WITH THE FI RST APPELLATE AUTHORITY PASSING ANOTHER SET ASIDE/REMAND ORDER (NO. 60Q/2005-06 DATED 16.01.200 7) TO NO EFFECT; THE AO CONFIRMING HIS EARLIER STAND VIDE ORDER DATED 28/5/ 2007. THE LD. CIT(A) FINALLY DISALLOWED THE ASSESSEES CLAIM DOUBTING THE AUTHE NTICITY OF `ITS INTIMATION AS THAT ON THE RECORD OF THE DEPARTMENT DID NOT BEAR EITHER TH E DATE OF ITS PASSING OR THE D&C (DEMAND AND COLLECTION) NUMBER WHILE THAT FURNISHE D BY THE ASSESSEE CONTAINED BOTH. 2.2 THE ASSESSEE IT WAS FURTHER URGED BY HIM HAS NO CONTROL OVER THE RECORDS MAINTAINED BY THE DEPARTMENT AND THUS COULD IN NO MANNER BE PENALIZED FOR THE SAME. IN ANY CASE IF IN DOUBT THE LD. CIT(A) OUGHT TO H AVE VERIFIED THE FACTS WITH REFERENCE TO THE D&C NO. RATHER THAN PROCEEDING TO HOLD THAT TH E ASSESSEE HAD FAILED TO ESTABLISH THE GENUINENESS OF THE INTIMATION FURNISHED BY IT AND CONSEQUENTLY ITS CLAIM. FURTHER ON IRRESPECTIVE OF THE DATE OF INTIMATION I.E. WHETH ER BEFORE OR AFTER 22.3.2001 AN INTIMATION U/S. 143(1)(A) DOES NOT CONSTITUTE AN `A SSESSMENT AND AS SUCH THE RETURN FILED ON THAT DATE (22.3.2001) IS A VALID RETURN U/S. 139 (5) AND THUS IS TO BE TAKEN ON RECORD AND TAKEN COGNIZANCE OF BY THE DEPARTMENT. TOWARD T HE SAME HE CITED THE DECISION IN THE CASE OF CIT (ASST.) VS. RAJESH JHAVERI STOCK BROKERS PVT. L TD. (2007) 291 ITR 500 (SC) AND S.R. KOSHTI VS. CIT 276 ITR 165 (GUJ). 2.3 THE LD. DR ON THE OTHER HAND STRONGLY REFUTED THE ASSESSEES CLAIM. IT IS ONLY THE DOCUMENT ON RECORD WHICH COULD BE TAKEN COGNIZANCE OF BY THE LD. CIT(A) AND NOT WITH THE ASSESSEE WHICH IS NOT BINDING ON THE REVENUE. AS SUCH NO INFIRMITY ATTENDS THE ITA NO. 543/COCH/2009 (AY 1999- 2000) 3 INFERENCE BY THE LD. CIT(A) THAT THE ASSESSEE HAS B EEN UNABLE TO PROVE ITS CLAIM OF THE REVISION OF ITS RETURN AS HAVING BEEN MADE PRIOR TO THE PROCESSING OF ITS (ORIGINAL) RETURN U/S. 143(1)(A) AND THUS BEING VALID IN LAW. AS RE GARDS THE ASSESSEES ARGUMENT THAT THE INTIMATION U/S. 143(1) OF THE ACT DOES NOT CONSTITU TE AN ASSESSMENT INASMUCH AS THE SAME IS NOT AN ASSESSMENT U/S. 143(3) OR U/S. 144 THE P ROVISION OF S. 139(5) EMPLOYS THE TERM `ASSESSMENT AND NOT `REGULAR ASSESSMENT WHICH (L ATTER) ONLY IS DEFINED U/S. 2(40) TO MEAN AN ASSESSMENT MADE U/S. 143(3) OR U/S. 144. SE C. 143(1) IS ONLY A FORM OF ASSESSMENT AS THE HEADING OF THE SECTION WOULD CLA RIFY; THE SECTION ITSELF FALLING UNDER CHAPTER XIV TITLED PROCEDURE FOR ASSESSMENT. 3. WE HAVE HEARD THE PARTIES AND PERUSED THE MATER IAL ON RECORD. 3.1 WE FIND THE REVENUES CASE AS NOT MAINTAINA BLE. AS CLARIFIED BY THE APEX COURT IN THE CASE OF CIT (ASST.) VS. RAJESH JHAVERI STOCK BROKERS PVT. L TD. (SUPRA) THERE HAVE BEEN SUBSTANTIAL AND MATERIAL CHANGES IN SEC. 143(1) W.E .F. APRIL 1 1989. THE EXTANT LAW ONLY ALLOWED THE ASSESSING OFFICER TO MAKE CERTAIN PRIMA FACIE ADJUSTMENTS THERE-UNDER TO THE RETURNED INCOME. FURTHER THE SAME IS WITHOUT PREJU DICE TO THE PROVISION OF S. 143(2) SO THAT THE PROCESSING OF THE RETURN U/S. 143(1) WOULD NOT PRECLUDE THE ASSESSING OFFICER FROM INITIATING ACTION THERE-UNDER AND FRAMING AN A SSESSMENT U/S. 143(3). IT WAS EXPLAINED THAT THEREFORE THERE IS A CONCEPTUAL DI FFERENCE BETWEEN THE TWO PROVISIONS I.E. SS. 143(1) AND 143(3) OF THE ACT. NO DOUBT AS AR GUED BY THE LD. DR THE SAID DECISION WAS IN A DIFFERENT CONTEXT I.E. THE MAINTAINABILI TY OF THE ACTION U/S. 147 IN VIEW OF ABSENCE OF ANY REGULAR ASSESSMENT; THE SAME IS HOW EVER RELEVANT IN-AS-MUCH AS IT CLARIFIES THAT AN INTIMATION U/S. 143(1)(A) WHICH IS WITHOUT PREJUDICE TO S. 143(2) CANNOT BE EQUATED WITH AN ASSESSMENT. IN FACT PER SUB-SE CTION (1B) TO SECTION 143 THE LAW ITSELF PROVIDES FOR FURNISHING A REVISED RETURN SUBSEQUENT TO THE ISSUE OF AN INTIMATION U/S. 143(1). THAT IS THE SAID PROVISION INSERTED BY FI NANCE ACT 1996 W.R.E.F. 1.4.1989 ABUNDANTLY CLARIFIES THAT THE ISSUE OF AN INTIMATIO N U/S. 143(1) WOULD NOT OPERATE TO BAR THE REVISION OF A RETURN PROCESSED WHERE IT IS OTH ERWISE IN TERMS OF THE RELEVANT SECTION I.E. S. 139(5) SETTLING ANY CONTROVERSY THAT MAY HAVE EXISTED IN THE MATTER. THE DECISION IN THE CASE OF S.R. KOSHTI VS. CIT (SUPRA) IS ALSO SQUARELY ON THE POINT. ITA NO. 543/COCH/2009 (AY 1999- 2000) 4 3.2 IN VIEW OF THE FOREGOING WE FIND NO MERIT IN T HE REVENUES CASE IN DECLINING TO TAKE THE ASSESSEES REVISED RETURN FILED ON 22.3.20 01 ON RECORD AND ACCORD DUE COGNIZANCE THERETO. WITH REGARD TO THE SECOND CONTE NTION WHICH WE MAY NOT DWELL THERE- UPON FOR THE REASON OF HAVING ADJUDICATED THE MATTE R ON THE BASIS OF THE VALIDITY OF THE RETURN FOLLOWING THE CLEAR LAW IN THE MATTER SO T HAT THE SAME BECOMES SUPERFLUOUS. HOWEVER WE MAY ADD THAT IT IS INDEED UNFORTUNATE T HAT THE DEPARTMENT HAS FIRSTLY ISSUED AN UNDATED AND INCOMPLETE INTIMATION AND SECONDLY DECLINES TO VERIFY THE AUTHENTICITY OF THE ASSESSEES CLAIM MADE WITH REFERENCE A DOCUMEN T ISSUED BY IT EVEN AS THE VERY EXISTENCE OF TWO DIFFERENT `INTIMATIONS QUA A PARTICULAR PROCESSING SHOULD ITSELF BE A CAUSE OF CONCERN AND CONSTERNATION. THE MISSING ING REDIENTS ARE ESSENTIAL FOR THE VALIDITY AND INTEGRITY OF THE SAID DOCUMENT. WE COULD UNDERS TAND A CONTROVERSY; THE ONUS TO RESOLVE WHICH AGAIN WOULD AGAIN LIE ON THE REVENUE WHERE THE INTIMATION ON RECORD WITH THE DEPARTMENT SHOWED DIFFERENT PARTICULARS I.E. A DIFFERENT DATE AND D&C NO. COULD AN ORDER BE UNDATED ? FURTHER COULD IT YET BE CONSIDERED AS FINAL ? THE D&C NO. SHOULD IN FACT PROVIDE AN INSTANT ANSWER OR AT LEAST A LEAD I N THE MATTER. IT IS FOR WANT OF PROPER CARE AND REGARD TO THE BASIC PRINCIPLES OF NATURAL JUSTI CE THAT THE ASSESSEE HAS BEEN PUT THROUGH CONSIDERABLE EXERCISE NECESSITATING AN APPEAL BEFO RE THE TRIBUNAL AS WELL AS THRICE BEFORE THE FIRST APPELLATE AUTHORITY CONSUMING A TIME PER IOD OF OVER A DECADE. WE CLOSE THE MATTER WITH THESE COMMENTS. 4. IN THE RESULT THE ASSESSEES APPEAL IS ALLOWED. SD/- SD/- (N.VIJAYAKUMARAN) (SANJAY ARORA) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: ERNAKULAM DATED: 15TH JULY 2011 GJ COPY TO: 1. M/S. KERALA MINERALS & METALS LTD. SANKARAMANGA LAM CHAVARA KOLLAM. ITA NO. 543/COCH/2009 (AY 1999- 2000) 5 2. THE ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE -1 KOLLAM. 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-I TRIV ANDRUM. 4. THE COMMISSIONER OF INCOME-TAX TRIVANDRUM. 5. D.R. I.T.A.T. COCHIN BENCH COCHIN. 6. GUARD FILE .