Ajaykumar J. Patel, , Surat vs Assessee

सुनवाई क तार ख/ Date of Hea ring : 21/11/2014 घोषणा क तार ख /Date of P ronouncement: 16/01/2015

आदेश /O R D E R

PER MUKUL Kr. SHRAWAT, JUDICIAL MEMBER :

This Misc. Application has been filed by the Applicant on 7th of May, 2014 arising from the order of the Tribunal dated 7th March, 2014. Through this Misc. Application, the Applicant is aggrieved on the ground that one of the argument raised during the course of hearing in respect of validity of the notice issued u/s.148 was not duly considered by the Tribunal; therefore, a mistake was committed which is now to be rectified. Relevant portion of the Application is reproduced below:

"(1) At the time of hearing, it was argued on behalf of the appellant that the re-assessment proceedings initiated in the case of appellant u/s 147/148 of the Act are wrong and bad in law ab initio because the reasons u/s 148(2) were recorded by a different assessing officer (AO), whereas the notice u/s 148 was issued by another/ different AQ. Attention of Hon'ble Bench was drawn to Para '3' of the assessment order passed u/s. 147 r.w.s. 143(3) of the Act, in which it has been clearly mentioned that the reasons for re-opening were duly MA No.73/Ahd/2014 in ITA No.2558/Ahd/2013 Shri Ajay Kumar J. Patel Vs. DCIT, Circle-9, Surat.

For A.Y. 2006-07 -2- recorded by the Assessing Officer DCIT, Circle - 9, Surat. Attention of Hon'ble bench was also drawn to the page no. 'I' of the paper book filed by the appellant, which is the copy of notice u/s 148 of the Act issued on 21/12/2010 by the AO Income Tax Officer, Ward - 7(1), Surat. By drawing the attention of Hon'ble Bench to above material, it was argued that as the reasons were recorded by a different AO (DCIT, CIR -9, Surat) and the notice u/s 148 was issued by a different AO (ITO, Ward -7 (1), Surat), the whole of re-assessment proceeding is wrong and invalid ab initio as per the law laid down by Hon'ble Gujarat High Court in the case of HYNOOP FOOD & OIL INDUSTRIES LTD. Vs ACIT (2008) 307 ITR 115 (Guj). Reliance was placed on the above referred case law of Hon'ble Gujarat High Court and it was pleaded that the appeal of the appellant on this issue is covered by this case law of Hon'ble jurisdictional High Court. However, in the appeal order passed by Hon'ble Bench, the above argument of appellant has not been considered and the above mentioned case law relied upon on behalf of the appellant has also not been considered. Thus, the first ground of appeal of the appellant has been dismissed without considering the above argument of the appellant and without considering the above referred case law relied upon by the appellant.

RELIEF PRAYED The assessee (appellant), therefore, prays that

(1) the said order of Hon'ble ITAT dated 07-03-2014 be kindly amended to rectify the above mistake apparent from the records and the first ground [ground no.1(a) & (b)] of the appeal be kindly decided afresh after considering the above argument of the appellant and after considering the above referred case law relied upon by the appellant i.e. HYNOOP FOOD & OIL INDUSTRIES LTD. Vs. ACIT (2008) 307 ITR 115 (Guj)."

2. From the side of the Applicant, learned AR has pleaded that the decision of Hynoop Food and Oil Industry, 307 ITR 115 (Guj.) has not been considered by the Tribunal while passing the order. He has mentioned that the notice u/s.148 was issued by some other Income Tax Officer, however the assessment was finalized by an another officer therefore in view of the Hon'ble Gujarat High Court decision the impugned notice u/s.148 was to be quashed by the Respected Tribunal.

MA No.73/Ahd/2014 in ITA No.2558/Ahd/2013 Shri Ajay Kumar J. Patel Vs. DCIT, Circle-9, Surat.

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3. From the side of the Revenue, learned Sr.D.R., Sri V.K. Singh has placed reliance on paragraphs 5 page 6 of the order of the Tribunal for reference reproduced below:

"5. We have heard the rival contentions and perused the material on record. In this case, processing of the case was made u/s.143(1A) only and no scrutiny assessment was made by the A.O. The case was reopened u/s.148 after recording the reasons within 4 years. The assessee had not disclosed long term capital gain in the computation of income even there was no long term capital gain on sale of land. The A.O. recorded the reasons as per law and issued notice u/s. 148. The Id. A.R. had not controverted the findings given by the Id. CIT(A) on this issue by relying upon various decisions on this issue by the various Courts. There is no material with the assessee to show that he has challenged the proceeding u/s. 148 before the A.O. and asked to give the copy of reasons recorded to the A.O. He had co-operated in the proceeding with the A.O. without any objection. Therefore, at the stage of appellant, he cannot take other route to defend his case. Further, the assessee himself admitted that the show cause notice was issued for making addition u/s.50C by letter dated 02.02.2011 by the A.O., whereas assessment was completed on 25.10.2011 by the AO. Therefore, there is no. justification of challenging the 148 proceeding by the assessee. Accordingly, we dismiss the first ground of assessee's appeal."

3.1 Learned Sr.D.R. has therefore contested that no mistake was committed by the Tribunal because the issue raised about the validity of the notice u/s.148 was duly considered by the Tribunal and thereafter rejected that ground. He has further pleaded that the Tribunal has no power to review its own order.

4. We have heard both the sides and carefully perused the orders referred before us.

4.1 The first contention that the decision of Hynoop Food and Oil Industry, 307 ITR 115 (Guj.) was cited at the time of hearing appears to be incorrect because the undersigned (Judicial Member) was one of the signatory of the order of the Tribunal dated 7.3.2014 (ITA MA No.73/Ahd/2014 in ITA No.2558/Ahd/2013 Shri Ajay Kumar J. Patel Vs. DCIT, Circle-9, Surat.

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No.2558/Ahd/2013, A.Y.2006-07). Due to this reason, the log book of the date of hearing of the Appeal i.e. 24th February, 2014 was consulted and found that no such case law was referred at the time of hearing. Photocopies of the pages of the log book are now placed in this MA file for any future reference. It is, therefore, incorrect to allege that this case law of Hon'ble Gujarat High Court was ever referred when the hearing of this Appeal took place before ITAT 'D' Bench Ahmedabad.

4.2 Be that as it was, even now we have thought it proper to deal with this objection of the Applicant therefore we have perused the case records and the compilation filed. In this Misc. Application, the Applicant has mentioned that in paragraph 3 of the assessment order it was mentioned that reasons for reopening were recorded by "Assessing Officer" DCIT, Circle-9, Surat. However, we have also noted that the assessment order has also been finalized by DCIT, Circle-9, Surat. We are of the view that the reasons were recorded by DCIT, Circle-9, Surat and the assessment was completed by the same DCIT, Circle-9, Surat. We, therefore, hold that it was a wrong objection. There is one more reason to reject this contention because on page 2 of the paper book, part of the Appeal record, the assessee had written a letter dated 03.02.2011 addressed to DCIT, Circle-9, Surat. This letter itself proves that DCIT, Circle-9, Surat had issued notice to the assessee and in reply the assessee had informed that the return was filed for A.Y. 2006-07 within time and required to be considered. However, on the other hand, learned AR pleaded that notice u/s.148 dated 21.12.2010 was issued by Income Tax Officer, Ward-7(1) Surat. There is no denial of this fact but after 21.12.2010 the subsequent "recording of reason" and the issuance of MA No.73/Ahd/2014 in ITA No.2558/Ahd/2013 Shri Ajay Kumar J. Patel Vs. DCIT, Circle-9, Surat.

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requisite notices should have been issued by DCIT, Circle-9, Surat because the assessee had made compliance to DCIT, Circle-9, Surat instead of ITO Ward-7(1) Surat.

4.3 In the light of these facts, we have examined the order of the Hon'ble Court pronounced in the case of Hynoop Food and Oil Industry (supra) and found the reason of the said pronouncement was basically that the assessee should get a reasonable opportunity to contest his case. The Hon'ble Court has noted that they were called upon to decide as to whether the reasons recorded by the AO empower them to assume the jurisdiction for issuance of the notices to frame the assessment order u/s.143(3) r.w.s. 147 of the Act. On perusal of record, it was found that the notice issued u/s.148 by some officer and the reasons were recorded by an another officer. As against those facts, the facts in the present Appeal are that the reasons were recorded by DCIT Circle-9 and thereafter the notice were issued which were duly complied with by the assessee before that very officer. We, therefore, hold that the fact being not identical; hence the case law as cited by the learned AR is misplaced under the facts and circumstances as discussed above.

4.4 Lastly, it is also worth to note that a reasoned order was passed by the Respected Co-ordinate Bench and thereupon it was concluded to restore the issue back to the file of the AO to verify the veracity of the valuation report. The merits of the case have also been properly discussed and dealt with; hence in a situation when the merits have been restored back for reconsideration then the assessee should not have any grievance. The issue of challenging the validity of Section 148 has also MA No.73/Ahd/2014 in ITA No.2558/Ahd/2013 Shri Ajay Kumar J. Patel Vs. DCIT, Circle-9, Surat.

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been dealt with by the Tribunal; therefore, that decision cannot be rectified u/s.254(2) of IT Act. We, therefore, dismiss the Misc. Application of the Assessee.

5. In the result, the present Misc. Application is dismissed.

Sd/- Sd/- (ANIL CHATURVEDI) (MUKUL Kr. SHRAWAT) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 16/01/2015 Prabhat Kr. Kesarwani, Sr. P.S. आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आयु त / Concerned CIT 4. आयकर आयु त(अपील) / The CIT(A)-III, Ahmedabad

5. वभागीय त न ध, आयकर अपील य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad

6. गाड फाईल / Guard file.

आदेशानुस ार / BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, अहमदाबाद / ITAT, Ahmedabad