Reassessment does not nullify original assessment orders. Assessees can appeal both separately. The Appellate Tribunal ITAT Bangalore held that reassessment proceedings do not render original assessment orders infructuous. Assessees can appeal ...
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Reassessment does not nullify original assessment orders. Assessees can appeal both separately.
The Appellate Tribunal ITAT Bangalore held that reassessment proceedings do not render original assessment orders infructuous. Assessees can appeal against both original assessment and reassessment separately, addressing additions made in each. The Tribunal dismissed the Department's argument that reassessment supersedes original assessment, citing the case law of V. Jaganmohan Rao. The appeals were directed to be fixed for hearing due to the stay of demand granted in all appeals.
Issues: - Maintainability of appeals filed by assessees against CIT(A) orders due to reassessment proceedings.
The judgment by the Appellate Tribunal ITAT Bangalore involved a preliminary hearing to determine the maintainability of appeals filed by assessees against CIT(A) orders. The assessees had filed their returns showing agricultural income, which was partly disbelieved in the assessment orders leading to additions from other sources. The assessees approached the Settlement Commission for earlier periods, and revised estimates were accepted. Subsequently, assessments were reopened based on seized materials, leading to reassessments with proper evidence. The Department argued that once reassessment orders were passed, original assessment orders became infructuous, citing the Kerala High Court case of CIT v. K. Kesava Reddiar. The Department also referred to the Supreme Court case of CIT v. Sun Engg. Works (P.) Ltd., emphasizing that reassessment supersedes original assessment. However, the Tribunal analyzed the Supreme Court's interpretation of reassessment proceedings in the case of V. Jaganmohan Rao, concluding that reassessment only sets aside the previous underassessment, not the entire assessment. The Tribunal held that the original assessment and reassessment are separate, and an assessee can appeal against both, addressing additions made in each separately. The Tribunal dismissed the Department's contention, directing the appeals to be fixed for hearing due to the stay of demand granted in all appeals.
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