2018 (2) TMI 1651 - HC - Income Tax

High Court upholds Tribunal decision on Revenue's appeal over Assessing Officer's order cancellation.

The High Court affirmed the Tribunal's decision to dismiss the Revenue's appeal challenging the cancellation of the Assessing Officer's order under ... Cancelling the order passed by the A.O. under Section 143(3) r.w.s. 263 by ITAT - Held that:- In the above facts, the Tribunal dismissed the appeal of the Revenue as the substratum of the order dated 9th December 2011 under Section 143(3) read with Section 263 of the Act passed by the Assessing Officer viz. the order dated 30th March 2009 of the Commissioner of Income Tax stood quashed. This case is covered by the legal maxim 'Sublato Fundamento Cadit Opus' i.e. when foundation is removed the superstructure falls. No substantial question of law. Issues:Challenge to order of Income Tax Appellate Tribunal under Section 260A of the Income Tax Act for assessment year 2006-2007. Substantial question of law regarding cancellation of order passed by Assessing Officer under Section 143(3) read with Section 263 of the Act.Analysis:The appellant challenged the order of the Income Tax Appellate Tribunal dated 20th January 2015, which dismissed the Revenue's appeal arising from an assessment order passed under Section 263 of the Act for the assessment year 2006-2007. The Tribunal upheld the order of the Commissioner of Income Tax (Appeals) setting aside the Assessing Officer's order passed under Section 143(3) read with Section 263 of the Act. The Tribunal's decision was based on the previous order dated 30th March 2009 of the Commissioner of Income Tax, which was set aside by the Tribunal in an appeal by the respondent assessee. The Revenue's subsequent appeal to the High Court was dismissed on 15th January 2013.The Tribunal dismissed the Revenue's appeal as the foundation of the Assessing Officer's order dated 9th December 2011 under Section 143(3) read with Section 263 of the Act, i.e., the order dated 30th March 2009 of the Commissioner of Income Tax, was quashed. The principle 'Sublato Fundamento Cadit Opus' was applied, meaning when the foundation is removed, the superstructure falls. Consequently, the substantial question of law proposed by the appellant was deemed not to arise and was not entertained.Therefore, the High Court dismissed the appeal, affirming the Tribunal's decision and holding that the cancellation of the Assessing Officer's order was justified based on the quashing of the Commissioner of Income Tax's order. The legal maxim 'Sublato Fundamento Cadit Opus' was crucial in determining the outcome of the case, emphasizing the importance of a valid foundation for any subsequent actions in legal proceedings.