TaxTMI 
TaxTMI 
2021 (9) TMI 1343
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....pect of reopening of assessment k) The appellant denies himself to be assessed to tax as the mandatory conditions for assumption of jurisdiction under section 148 of the Act did not exist or have not been complied and consequently the order of assessment is bad in law and liable to be cancelled on the facts and circumstance of the case. l) The assessment is also bad in law as no notice under 148 has been served on the appellant and consequently the order of assessment is bad in law. m) The assessment is also bad in law as no proper sanction under section 151 of the Act as contemplated in law has been obtained and consequently the order of assessment is bad in law and liable to be cancelled on the facts and circumstance of the case. n) The assessment order is further bad in law as the objections to the reasons under section 148 have not been disposed of by a speaking order and hence contrary to law and on this count also the assessment is liable to be cancelled on the facts and circumstance of the case. 4. Grounds on asset being agricultural land and not capital asset a) The assessing officer and the CIT (A) are not justified in ....
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....were not justified in considering the guideline value on the date of registration of the property as full value of consideration on the facts and circumstance of the case. b) The authorities below were not justified in not adopting the appellants share of the amount shown in the sale deed at Rs. 10,50,000/- as the full value of consideration for the purpose of computing capital gains on the facts and circumstance of the case. c) The authorities below failed to appreciate that the section 50C is not applicable to the facts of the case as the land sold is not a capital asset but agricultural land on the facts of the case. d) Without prejudice the authorities below ought to have referred to the valuation officer to determine the full value of consideration as per Section 50 of the Act on the facts and circumstance of the case. e) The authorities below failed to appreciate that the proviso to section 50 C has been held to be clarificatory and hence the value on the date of the agreement alone should have been considered as full value of consideration for the purpose of computing capital gains on the facts and circumstance of the case. f) Wit....
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....eri Municipality vide Sale Deed dated 28.12.2005 and registered on 24.9.2008. The guidance value of the said property was Rs. 1.6 crores as against the consideration shown in the sale agreement at Rs. 10.5 lakhs. On these reasons, the assessment was reopened by recording the reasons and issued notice u/s. 148 on 29.3.2016. The assessee filed objections for reopening of the assessment vide his submissions dated 24.10.2016. 3. Now the contention of the ld. AR is that the assessee duly filed objections for reopening the assessment on 24.10.2016. These objections were not disposed by passing a speaking order. According to the ld. AR, the AO is bound to dispose of the objections filed by the assessee prior to proceeding with the assessment. When the AO failed to pass such order, the assessment order is liable to be quashed. He relied on the following judgments:- 4. The ld. DR supported the findings of the CIT(Appeals) and further relied on the judgment of the Hon'ble Supreme Court in the case of Home Finders Housing Ltd. v. ITO, 94 taxmann.com 84 / 256 Taxman 59 (SC) and submitted that the assessment order cannot be quashed. 5. We have heard both the parties and perused the mat....
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....wherein the Hon'ble Karnataka High Court took the view that if the AO does not dispose off the objections regarding the validity of proceedings under section 147 of the Act as laid down by the Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. (supra), then the order of assessment passed cannot be sustained. The Hon'ble Court held that if the assessee desires to seek the reasons for issuing the notice, the Assessing Officer is bound to furnish the reasons and upon the receipt of such reasons, the assessee is entitled to file the objections to the issuing of the notice and the Assessing Officer thereafter is bound to dispose of the same by passing a speaking order. If the AO does not dispose off the objections prior to proceedings with the assessment and passes an order of assessment, such order of assessment cannot be sustained and is liable to be quashed. Learned DR however placed reliance on the order of the CIT(A) from the decision referred to in the order of CIT(A). Learned Counsel for the assessee however brought to our notice that Hon'ble Madras High Court has taken a contrary view to the view taken in the case referred to by the CIT(A) in the impugned order an....
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....usions Pvt. Ltd., 80 taxmann.com 77 (Kar) wherein it was held that if the AO does not dispose of the objection regarding validity of the proceedings u/.s 147 of the Act as laid down by the Supreme Court in GKN Driveshafts (India) Ltd. 251 ITR 19 (SC), then the order of assessment passed cannot be sustained. It was held that if the assessee decides to seek reasons for issuing notice, the AO is bound to furnish the reasons and upon receipt of such reasons, the assessee is entitled to file objections to the issuing of notice and the AO thereafter is bound to dispose of the same by passing a speaking order. If the AO does not dispose of the objections prior to proceedings of assessment and passes an order of assessment, such order of assessment cannot be sustained and liable to be quashed. 9. The main contention of the ld. AR is that the AO has to dispose of the objections raised by the assessee for reopening the assessment by a separate speaking order and thereafter he has to frame the assessment order. For this purpose, he relied on the judgment of Supreme Court in GKN Driveshafts (India) Ltd. (supra). There are divergent views of different High Courts on this issue as to whether ....
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....icer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the Assessing Officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the abovesaid five assessment years." 6.1 In a subsequent decision in the case of Garden Finance Ltd. v. CIT (Asst.) [2004] 268 ITR 48 (Guj), the effect of the Supreme Court decision in the case of GKN Driveshafts [2003] 259 ITR 19 came up for consideration and by a majority opinion it was laid down by the Hon'ble Court: "What the Supreme Court has now done in the GKN Driveshafts (India) Ltd.'s case [2003] 259 ITR 19 is not to whittle down the principle laid down by the Constitution Bench of the apex court in Calcutta Discount Co. Ltd. case [1961] 41 ITR 191 but to require the assessee first to lodge preliminary objection before the Assessing Officer who is bound to decide the preliminary objections to issuance of the reassessment notice by passing a speaking order and, therefore, if such order on the preliminary objections is still against the assessee, the assessee will ge....
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....ngly, the reassessment order dated December 16, 2008 is hereby quashed and set aside and the respondent authority shall dispose of the preliminary objections by passing a speaking order and only thereafter proceed with the reassessment proceedings in accordance with law. Considering the fact that the normal period of limitation, for framing reassessment pursuant to notice dated March 3, 2008, issued under section 148 of the Act, has already expired on December 31, 2008, in the peculiar facts and circumstances of the case it would serve the ends of justice if the respondent authority is directed to abide by the following schedule : (i) The respondent authority shall dispose of the preliminary objections raised by the petitioner within a period of 4 (four) weeks from by passing a speaking order in accordance with law; (ii) Thereafter, the respondent authority shall undertake reassessment proceedings, if necessary, and shall complete the same within a period of 4 (four) weeks thereafter, i.e., the date of disposal of the preliminary objections; (iii) No extension of time shall be sought for by either side in the fact situation of the present case; (....
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.... "11. We have considered the rival submissions of both the parties and have carefully gone through the material available on record. In the present case, it appears that when the AO issued notice u/s. 148 of the Act for reopening the assessment, the assessee filed objections and those objections were not disposed of by the AO. This fact has also been admitted by the ld. CIT(A), who observed that he was not inclined to agree with the assessee that merely because the AO had not considered his objection to the notice u/s. 148, the entire assessment becomes bad in law. On a similar issue, Their Lordships of the Hon'ble Supreme Court in the case of GKN Driveshafts India Ltd. v. ITO & Ors. (2003) (supra) at page 20 held as under: ".... The Assessing Officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the Assessing Officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the Assessing Officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding wit....