M/s Rajeev Builders, Visakhapatnam v. The ITO, Ward-3(1), Visakhapatnam

MA 10/VIZ/2011 | 2004-2005
Pronouncement Date: 15-03-2011 | Result: Partly Allowed

Appeal Details

RSA Number 1025324 RSA 2011
Assessee PAN AAHFR6659K
Bench Visakhapatnam
Appeal Number MA 10/VIZ/2011
Duration Of Justice 16 day(s)
Appellant M/s Rajeev Builders, Visakhapatnam
Respondent The ITO, Ward-3(1), Visakhapatnam
Appeal Type Miscellaneous Application
Pronouncement Date 15-03-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 15-03-2011
Assessment Year 2004-2005
Appeal Filed On 28-02-2011
Judgment Text
MA 10/V/11 RAJEEV BUILDERS VSKP IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV JUDICIAL MEMBER AND SHRI BR BASKARAN ACCOUNTANT MEMBER MA NO. 10 /VIZAG/ 20 11 (ARISING OUT OF ITA NO.425/VIZ/2009) ASSESSMENT YEAR : 2004 - 05 M/S. RAJEEV BUILDERS VISAKHAPATNAM VS. ITO WARD - 3(1) VISAKHAPATNAM (APPELLANT) (RESPONDENT) PAN NO.AAHFR 6659K APPELLANT BY: SHRI I. KAMASASTRY CA RESPONDENT BY: SHRI J. SIRI KUMAR SR. DR ORDER PER SHRI S.K. YADAV JUDICIAL MEMBER:- THIS MISCELLANEOUS APPLICATION IS PREFERRED BY TH E ASSESSEE AGAINST THE ORDER OF THE TRIBUNAL DATED 5.1.2011 STATING THERE IN THAT AN ERROR APPARENT IN THE ORDER OF THE TRIBUNAL HAS CREPT THEREFORE NEC ESSARY RECTIFICATIONS ARE CALLED FOR. 2. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER CON TENDED THAT TRIBUNAL HAS OBSERVED IN ITS PARA-9 THAT THERE WAS NO SPECIF IC FINDING OF THE CIT(A) WITH REGARD TO THE SUFFICIENCY OF REASONS TO FORM A BELIEF THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT IN THE ORD ER OF THE CIT(A) DATED 12.2.2007. WHEREAS THE CIT(A) IN ITS ORDER DATED 12.2.2007 HAS GIVEN A SPECIFIC FINDING WITH REGARD TO THE INSUFFICIENCY O F THE REASONS RECORDED FOR RE- OPENING OF THE ASSESSMENT. IN SUPPORT OF HIS CONTE NTIONS HE HAS INVITED OUR ATTENTION TO THE ORDER OF THE CIT(A) DATED 12.2.200 7. 3. THE LD. COUNSEL FOR THE ASSESSEE FURTHER CONTEND ED THAT REVENUE HAS TAKEN A SPECIFIC GROUND IN THEIR GROUNDS OF APPEAL THAT CIT(A) HAS ERRED IN HOLDING THAT NOTICE U/S 148 WAS ISSUED WITHOUT OBTA INING SANCTION FROM THE ADDITIONAL CIT. THIS GROUND WAS NOT ADJUDICATED BY THE TRIBUNAL. THEREFORE A PROPER ADJUDICATION OF THIS GROUND IS CALLED FOR. MA 10/V/11 RAJEEV BUILDERS VSKP 2 4. THE LD. D.R. ON THE OTHER HAND HAS SUBMITTED THA T BEFORE THE CIT(A) IN FIRST ROUND THE ASSESSEE HAS NOT RAISED A SPECI FIC GROUND WITH REGARD TO THE SUFFICIENCY OF REASONS RECORDED FOR RE-OPENING OF THE ASSESSMENT. HE HAS CHALLENGED THE VALIDITY OF THE NOTICE ISSUED U/S 14 8 OF THE ACT THROUGH GROUND NO.1 RAISED BEFORE THE CIT(A). WHILE ADJUDICATING THE GROUND THE CIT(A) HAS DWELT UPON THE ISSUE WHETHER NOTICE U/S 148 CAN BE ISSUED WHERE THE TIME FOR ISSUING THE NOTICE U/S 143(2) WAS AVAILABLE WIT H THE ASSESSING OFFICER. WHILE ADJUDICATING THAT GROUND HE MADE A PASSING RE FERENCE WITH REGARD TO THE REASONS RECORDED BY THE A.O. THE MAIN FINDING OF THE CIT(A) IS BASED ON AN ISSUE WHETHER NOTICE U/S 148 CAN BE ISSUED WHERE TIME IS AVAILABLE FOR ISSUING A NOTICE U/S 143(2) OF THE ACT. THEREFORE THESE FINDINGS OF THE CIT(A) CANNOT BE CALLED TO BE A CONCLUSIVE FINDING ON THE ISSUE OF SUFFICIENCY OF REASONS RECORDED BY THE A.O. 5. THE LD. D.R. FURTHER CONTENDED THAT WHILE REOPEN ING THE ASSESSMENT AT SECOND TIME THE ASSESSING OFFICER HAS GIVEN THE RE ASONS AS TO HOW THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT AND WHILE RECORDING THE REASONS FOR RE-OPENING THE ASSESSMENT THE ASSESSIN G OFFICER HAS MENTIONED THEREIN THAT THE EARLIER REOPENING WAS KNOCKED DOWN BY THE CIT(A) ON THE GROUND THAT NOTICE U/S 148 COULD NOT BE ISSUED ON T ECHNICAL GROUNDS. THEREFORE THE TRIBUNAL HAS GIVEN A CORRECT FINDING THAT THE ISSUE OF SUFFICIENCY OF REASONS WAS NOT PROPERLY ADJUDICATED BY THE CIT(A) IN FIRST ROUND. THUS NO ERROR APPARENT IN THE ORDER OF THE TRIBUNAL HAS CREPT FOR WHICH A RECTIFICATION IS CALLED FOR. 6. WITH REGARD TO THE NON-ADJUDICATION OF GROUND NO .2 LD. D.R. CONTENDED THAT THIS GROUND ESCAPED THE ATTENTION OF THE TRIBUNAL THEREFORE IT WAS NOT PROPERLY ADJUDICATED. 7. HAVING HEARD THE RIVAL SUBMISSIONS AND FROM A CA REFUL PERUSAL OF THE ORDER OF THE AUTHORITIES BELOW VIS--VIS THE MISCE LLANEOUS APPLICATION AND THE ORDER OF CIT(A) DATED 12.2.2007 WE FIND THAT IN FI RST ROUND OF APPEAL THE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE NOTICE U/S 148 BESIDES RAISING MA 10/V/11 RAJEEV BUILDERS VSKP 3 OTHER GROUNDS OF MERIT. THE CIT(A) WHILE ADJUDICAT ING THE ISSUE OF VALIDITY OF NOTICE U/S 148 MAINLY DWELT UPON THE LEGAL ISSUE WH ETHER NOTICE U/S 148 CAN BE ISSUED WHERE TIME LIMIT FOR ISSUING NOTICE U/S 1 43(2) IS AVAILABLE WITH THE ASSESSING OFFICER. WHILE DEALING WITH THE ISSUE TH E CIT(A) HAS CATEGORICALLY HELD THAT WHATEVER INVESTIGATION ASSESSING OFFICER WANTS TO MAKE BY REOPENING OF THE ASSESSMENT IT CAN BE DONE BY ISSU ING A NOTICE U/S 143(2) SEEKING INFORMATION OR CLARIFICATION OF A PARTICULA R ISSUE THEN TO FRAME A REGULAR ASSESSMENT. KEEPING IN VIEW OF THIS PROPOS ITION OF LAW THE CIT(A) HAS HELD THAT NOTICE U/S 148 CANNOT BE ISSUED WHERE TIME LIMIT FOR ISSUING NOTICE U/S 143(2) IS AVAILABLE WITH THE ASSESSING O FFICER. IN HIS ORDER THOUGH HE HAS MADE THE PASSING REFERENCE WITH REGARD TO TH E REASONS RECORDED BY THE ASSESSING OFFICER FOR ISSUING A NOTICE U/S 148 OF THE ACT BUT NO SPECIFIC FINDING WAS GIVEN TO THE NATURE OF REASONS RECORDED BY THE AO BECAUSE HE WAS OF THE VIEW THAT NOTICE U/S 148 CANNOT BE ISSUE D WHERE TIME LIMIT FOR ISSUING NOTICE U/S 143(2) WAS AVAILABLE WITH THE AS SESSING OFFICER AND FOR THESE REASONS THE CIT(A) HAS KNOCKED DOWN THE NOTI CE ISSUED U/S 148 OF THE ACT. NOW IN A SECOND ROUND THE ASSESSING OFFICER HAS REOPENED THE ASSESSMENT AFTER RECORDING THE FRESH REASONS FOR RE OPENING OF THE ASSESSMENT AND ISSUED NOTICE U/S 148 OF THE ACT. IN THESE REA SONS HE HAS ALSO MENTIONED THE FACTS RELATING TO THE EARLIER PROCEED INGS UNDERTAKEN IN FIRST ROUND OF APPEAL. THOUGH THE CIT(A) HAS MADE THE OB SERVATION WITH REGARD TO THE NATURE OF REASONS BUT THESE OBSERVATIONS CAN NOT BE CALLED TO BE THE FINDING OF THE CIT(A) WITH REGARD TO THE SUFFICIENC Y OF REASONS RECORDED FOR REOPENING OF THE ASSESSMENT BECAUSE THE VALIDITY O F THE NOTICE WAS CHALLENGED ON DIFFERENT GROUNDS. THAT IS WHY THE TRIBUNAL HAS RECORDED IN HIS ORDER THAT CIT(A) HAS NOT GIVEN ANY FINDING WIT H REGARD TO THE SUFFICIENCY OF REASONS RECORDED FOR REOPENING OF THE ASSESSMENT . THEREFORE WE FIND NO ERROR IN THE ORDER OF THE TRIBUNAL IN THIS REGARD. 8. SO FAR AS NON-ADJUDICATION OF GROUND NO.2 RAISED IN THE APPEAL WITH REGARD TO THE ISSUANCE OF NOTICE U/S 148 OF THE ACT WITHOUT OBTAINING SANCTION FROM THE ADDITIONAL CIT IS CONCERNED WE ARE OF THE VIEW THAT THOUGH THE GROUND WAS RAISED IN THE APPEAL BUT NO ARGUMENT WAS ADVANCED DURING THE COURSE OF HEARING OF THE APPEAL AND THAT IS WHY IT ESCAPED THE ATTENTION OF MA 10/V/11 RAJEEV BUILDERS VSKP 4 THE TRIBUNAL WHILE DISPOSING THE APPEAL. SINCE NO SPECIFIC FINDING IS GIVEN ON THIS ISSUE WE RELEASE THE FILE AND FIX IT FOR HEAR ING ON LIMITED ISSUE OF GROUND NO.2 THAT THE LD. CIT(A) ERRED IN HOLDING THAT THE SECOND NOTICE U/S 148 WAS ISSUED WITHOUT OBTAINING SANCTION FROM THE ADDITION AL CIT. THE REGISTRY IS DIRECTED TO FIX THIS APPEAL FOR HEARING ON THE AFOR ESAID LIMITED ISSUE ON 12.4.2011. PARTIES BE INFORMED ACCORDINGLY. 9. IN THE RESULT THE MISCELLANEOUS APPLICATION OF THE ASSESSEE IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 15.3.2011 SD/- SD/- (BR BASKARAN) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL M EMBER VG/SPS VISAKHAPATNAM DATED 15 TH MARCH 2011 COPY TO 1 M/S. RAJEEV BUILDERS D.NO.6 - 22 - 6 EAST POINT COLONY VISAKHAPATNAM 2 ITO WARD - 3(1) RANGE - 3 VISAKHAPATNAM 3 THE CIT VISAKHAPATNAM 4 T HE CIT(A) VISAKHAPATNAM 5 THE DR ITAT VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM