2017 (11) TMI 1023

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....eassessment was rightly made. 2. Whether under the facts and circumstances of the case the Hon'ble Income Tax Appellate Tribunal was justified in confirming the reassessment under Section 143(3) /148, when no mandatory notice u/s 143(2) for making such assessment was issued & served. 3. Whether the Hon'ble Income Tax Appellate Tribunal was justified in holding that the ratio of the decision of the ITAT Delhi Bench in the case of Anil Gupta 96 TTJ 798 is not applicable to the facts of the case & as such proceedings for reassessment u/s 147 were rightly initiated as well as the reassessment order u/s 143(3)/148 dated 27.2.03 was rightly passed. 4. Whether the Hon'ble Income Tax Appellate Tribunal was justified in confirming the reassessment u/s 143(3)/148 when it itself has quashed the consequential reassessment orders for the preceding & succeeding assessment years by the same common order. 5. Whether the Hon'ble Income Tax Appellate Tribunal was justified in not considering that the re-assessment proceedings were initiated merely on change of opinion vide reasons dated 29.5.01, because as per notice u/s 154/254 dated 21.5.01 for 2....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....the income of the assessee has been assessed at Rs. 4,96,600/-. Aggrieved by the said order an appeal has been preferred by the assessee before the Commissioner of Income Tax (Appeals). During the appellate proceedings the Commissioner of Income Tax (Appeals) has noticed that the proceedings for the preceding year namely assessment year 1992-93 are similar and considering the material has observed that all the grounds raised by the assessee before the CIT (Appeals) are well discussed in his order for the assessment year 1992-93 including the additional ground taken by the assessee namely, that the assessing officer was not justified in issuing the notice under Section 147. The relevant extract of the order of CIT (Appeals) is quoted hereinbelow : "It will be necessary to trace the proceedings related to A.Y. 1992-93. For that year the assessee company filed the Return of income on 01.02.1993. The order u/s. 143(3) was passed by the AO on 08.11.1993. In the said return, the appellant had claimed unabsorbed losses of earlier years amounting to Rs. 16,18,650/-. This was allowed as per claim of the appellant. The claim of the appellant was based on his claim of loss in e....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....y the Tribunal (cited supra). We also observe that the reasons stated by the A.O. in the notice issued u/s. 154/254 of the Act dated 21.5.2001 and the reasons stated in the notice issued u/s. 148 of the Act (mentioned hereinabove) are not same. During the course of hearing, the ld. Authorized representative of the assessee was given two opportunities to explain as to how it could be said that proceedings u/s. 154 of the Act were pending when the A.O. had initiated action u/s. 148 of the Act. The ld. Authorized representative of the assessee conceded that the facts stated in the reasons recorded u/s. 148(2) of the Act are not same as stated by the A.O. in notice issued u/s. 154/254 of the Act dated 21.5.2001. Therefore, we are of the considered view that reliance placed by the ld. Authorized representative of the assessee on the I.T.A.T.'s decision in the case of Anil Gupta vs. A.O. (supra), is not applicable to the facts of the case before us, as initiation of proceedings by the A.O. U/s. 148 of the Act is not for taxing the same income in respect of which the A.O. had initiated proceeding u/s. 154 of the Act, as mentioned hereinabove. The ld. Authorised representative of the a....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....r the department has submitted that both the proceedings initiated under Section 154 and under Section 147/148 are different and are based on different material. He has submitted that Section 154 provides for the rectification of mistake. He has submitted that the provisions of Section 154 provides to rectify any mistake apparent from the face of the record, which is only confined to amend any order passed by the assessing authority/ income tax authority and to amend any intimation or deemed intimation under Section (1) of Section 143 and further to amend any intimation under Sub Section 1 of Section 200-A. He has submitted that the order under Section 154 can be amended by the authority of its own motion and the same can be rectified if the said mistake is brought to the notice of the authority concerned by the assessee. Sub section 3 of Section 154 provides that in case if an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee or the deductor, an opportunity has to be given of his intention so to do and has further allowed a reasonable opportunity of being heard to the person concerned. Section....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ot relevant, provided there is omission or failure on the part of assessee. The latter confers jurisdiction to reopen assessment. Therefore whether or not there was a failure or omission to disclose fully and truly material facts, is essentially a question of fact. Learned counsel for the appellant had submitted that reopening proceedings cannot be sustained as after the original assessment proceedings were concluded, notice for rectification of mistake was issued under Section 154 and a reply was filed by the assessee, thereafter, nothing was heard from the Assessing Officer and presumably no order under Section 154 of the Act was passed. It was submitted that as a legal proposition; that once a notice under Section 154 of the Act is issued, proceedings under Section 147 of the Act on the same ground or reasons cannot be taken. It is not possible to accept the said proposition in broad terms as propounded or as one having universal application. Scope and ambit of Section 154 and 147/148 of the Act are different. Under Section 154 of the Act, the Assessing Officer can only rectify mistakes and errors. Section 154 is not a substitute for Section 147/148. In a given case, resor....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

...., therefore, the aforesaid decisions suggest that recourse to Section 154 may be justified rather than recourse to the provisions of Section 147/148 of the Act for reopening of assessments. But this is different from stating that if notice under Section 154 is issued, then notice under Section 147/148 is barred or prohibited. Per se and ex facie the language of Section 147 shows that the pre-requisites of the said provision are not controlled, curbed and regulated with the requirement of mistake which is apparent from the record. In the instant case, the return of the assess claiming unabsorbed losses of earlier years was allowed by the assessing officer, however subsequently the assessing authority has initiated the re-assessment proceedings under Section 147 as no order has been passed by the assessing authority to rectify return proceedings under Section 143(1)/154 of the Act while accepting the claim of the assessee by brought forward losses of earlier years. The ITAT has noticed that the reasons stated by the assessing officer in the notice issued under Section 154/254 and in the notice issued under Section 148 of the Act are not same. After detailed discussion the Tribunal....