2019 (12) TMI 406 - HC - Income Tax

Appeals Dismissed: Tribunal's Decision Stands, Assessment Cannot Be Reopened u/s 153A of Income Tax Act.

Pr. Commissioner of Income Tax (C) - 1 Versus M/s. Rehab Housing Pvt. Ltd.

The HC dismissed the Revenue's appeals, upholding the ITAT's decision to quash the order under section 153A of the Income Tax Act. The Tribunal ruled in ... Reopening of assessment in exercise of powers u/s 153A - Tribunal quashing the order u/s 153A stating that in absence of any incriminating material on issue which has already been examined and finalized in original assessment cannot be reexamined and reopened - HELD THAT:- This Court in Commissioner of Income Tax II vs. Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015 (5) TMI 656 - BOMBAY HIGH COURT] and noticed that an identical issue had come up for consideration. The Division Bench had rejected the Revenue’s appeals and confirmed the decision of the Special Bench of the Tribunal - It was held in the said case that such assessment cannot be reexamined or reopened in exercise of powers under section 153A of the Act. Appeal dismissed. Issues:Challenge to judgment of Income Tax Appellate Tribunal on quashing order under section 153A.Analysis:The High Court addressed the appeal filed by the Revenue challenging the judgment of the Income Tax Appellate Tribunal. The issue at hand pertained to the justification of quashing the order under section 153A of the Income Tax Act. The respondent, a private limited company, was involved in the appeal concerning the Assessment Year 2005-2006. The Tribunal, in its impugned judgment, ruled in favor of the assessee by deleting the assessment made under section 153A. The basis for this decision was the presence of incriminating material before the Assessing Officer during the original assessment, specifically related to the deduction under section 80-IB (10) of the Act. The Tribunal held that since the issue had already been examined during the original assessment, it could not be reopened under section 153A. The High Court noted the Tribunal's reliance on previous decisions, including the one in the case of Commissioner of Income Tax II vs. Continental Warehousing Corporation (Nhava Sheva) Ltd.Continuing the analysis, the High Court referred to its own judgment in the case of Commissioner of Income Tax II vs. Continental Warehousing Corporation (Nhava Sheva) Ltd., where a similar issue was considered. The Division Bench had previously rejected the Revenue's appeals and upheld the decision of the Special Bench of the Tribunal. Additionally, the High Court cited decisions from the Delhi High Court and another case from its own jurisdiction to support the dismissal of the appeals. Based on the precedents and the facts of the case, the High Court dismissed the appeals filed by the Revenue, thereby upholding the Tribunal's decision to quash the order under section 153A.In conclusion, the High Court's judgment affirmed the Tribunal's decision to delete the assessment made under section 153A, emphasizing that the issue had already been examined during the original assessment and could not be reopened. The dismissal of the appeals by the Revenue was based on established legal principles and precedents, including decisions from other High Courts and previous rulings from the Bombay High Court itself.