2011 (4) TMI 1419 - AT - Income Tax

Tribunal directs reevaluation by CIT(A) on jurisdictional issue under section 147

The Tribunal set aside the issue to the Ld. CIT(A) to examine whether the assumption of jurisdiction u/s 147 was justified, given that no addition was ... Assumption of jurisdiction under section 147 of the Income-tax Act - reopening of assessment without identification of escaped income as basis - requirement of a speaking order when reopening assessmentAssumption of jurisdiction under section 147 of the Income-tax Act - reopening of assessment without identification of escaped income as basis - requirement of a speaking order when reopening assessment - Assessee's challenge to the validity of reopening the assessment under section 147 where no addition was made as basis for reopening was remitted to the file of the Commissioner (Appeals) for fresh examination and a speaking order. - HELD THAT: - The Tribunal admitted the amended ground contending that the assessment purportedly reopened under section 148/147 was not predicated upon any specific addition or identified escaped income and that the assessee had not been supplied with reasons for reopening. Because this legal ground had not been raised before the CIT(A) earlier but was admitted by the Tribunal, the matter of whether the Assessing Officer properly assumed jurisdiction under section 147 in the absence of an addition forming the basis of the notice was not finally determined by the Tribunal. The Tribunal directed that the CIT(A) should examine the assessee's contention on the legality of the assumption of jurisdiction under section 147 and pass a reasoned (speaking) order on that question. [Paras 4]Remitted to the file of the CIT(A) for examination and a speaking order on the legality of reopening under section 147 where no addition forming the basis of the notice was made.Addition on merits set aside for fresh adjudication - consequential remand following jurisdictional remittance - Addition made by the Assessing Officer was set aside and remitted to the CIT(A) for fresh adjudication. - HELD THAT: - Having set aside the issue relating to the assumption of jurisdiction under section 147 and remitted it to the CIT(A), the Tribunal also set aside the addition made on merits and directed that the addition be decided afresh by the CIT(A). The remand contemplates reconsideration in the light of the CIT(A)'s examination and speaking order on jurisdiction, and thereafter determination of the merits as appropriate. [Paras 4]Addition set aside and remitted to the CIT(A) to be decided afresh.Final Conclusion: The appeal is allowed for statistical purposes; the questions concerning the validity of reopening under section 147 and the merits of the addition are remitted to the CIT(A) for fresh consideration and a speaking order. Order pronounced on 07th April 2011. Issues involved: Jurisdiction u/s 147 of the Income Tax Act for Assessment Year 2004-05.Summary:The appeal by the assessee challenged the assessment made in response to a notice u/s 148 read with Section 147, contending that no addition was made based on which the assessment was reopened. The assessee filed amended grounds of appeal, arguing that the Assessing Officer assessed income not subject to the notice. The AR for the assessee requested admission of this ground before the Ld. CIT(A), which was conceded. After hearing both parties, the amended grounds were admitted. The Tribunal set aside the issue to the Ld. CIT(A) to examine whether the assumption of jurisdiction u/s 147 was justified, given that no addition was made for the income escaping assessment for which the assessment was reopened. The Ld. CIT(A) was directed to pass a speaking order on this issue. Consequently, the addition made on merit was also set aside for fresh consideration by the CIT(A). The appeal by the assessee was allowed for statistical purposes.The order was pronounced in the open court on 07th April 2011.