TaxTMI 
TaxTMI 
2024 (11) TMI 627
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....he same may kindly be quashed. 1.2. The ld. AO has grossly erred in law as well as on the facts of the case order in passing the Ex-party order u/s 144 rws147 without providing the adequate and reasonable opportunity of being heard to the assessee in gross breach of law and are bad in law, invalid, illegal and on facts of the case, and hence the same may kindly be quashed and the resultant addition may kindly be deleted in full. 2.1 The ld. CIT(A) has grossly erred in law as well as on the facts of the case in dismissing the appeal of the assessee on the wrong allegation that the assessee has gone in "Vivad Se Vishwas Sceme /act 2020", while assessee has not adopted or gone in "Vivad Se Vishwas Sceme /Act 2020" against this quantum Appeal. Further the date of hearing was given on 20.07.2023 and the ld. CIT(A) has passed the order on dt. 17.07.2023 before the due date of hearing, thus the order in passing the Ex-party order without providing the adequate and reasonable opportunity of being heard to the assessee and on wrong stands are in gross breach of law and are bad in law, invalid, illegal and on facts of the case, and hence the same may kindly be quashed and t....
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....our honor for A.Y.2011-12 by the delay about 10 Months and 23 days. Although actually there is no delay if following facts are being considered. 3.That as per date of order the appeal was to be filed on or before 15.09.2024 but the same is being filed by delay of 10 Months 23 days. Although actually there is no delay if following facts are being considered. 4.That I would like to submit that actually there is no delay in the appeal filling, Still if your honor is of the view that the appeal is being filled with the delay. Then the reason of late filing was that as the ld. CIT(A) has send the hearing notice on dt.13.07.2023 in which the date of hearing was given on dt.20.07.2023. However the ld. CIT(A) has passed the order on dt. 17.07.2023, on wrong allegation that the assessee has gone in "Vivad Se Vishwas Sceme /act 2020", while I have not adopted or gone in "Vivad Se Vishwas Sceme /Act 2020" against this quantum Appeal and the ld. CIT(A) has passed the order on dt. 17.07.2023 before the due date of hearing i.e 20.07.2023, thus the order in passing the Ex-party order without providing the adequate and reasonable opportunity of being heard to me and on wrong stan....
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....ason the appeal could not be filed within time. 12.That I am not much literate person and living in rural area. 13.That the contents or averment of application for condonation of delay are true and correct and may be treated as part of this affidavit. Place: Jaipur Date: .08.2024 Deponent " Considering the reasons mentioned in the said application accompanied by an Affidavit of the assessee, I feel that the reasons mentioned in the application constitute sufficient cause for not filing the appeal within the time before the Tribunal. Moreover, no counter affidavit has been filed by the revenue. Therefore, taking a lenient view and considering the principles laid down in the case of Collector, Land Acquisition vs. Mst. Katiji, 1987 AIR 1353 (SC), I condone the delay in filing the appeal before me and decide the appeal herein below. 3. Ground nos. 1 and 2 of the appeal raised by the assessee relates to challenging the invalid action under section 147 read with section 148 and invalid and illegal assessment and illegal order by the ld. CIT (A). 4. The brief facts of the case are that the assessee is an Ind....
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....ty issued order on 04.03.2022 in Form-5 vide acknowledgement no. 286790001040322, u/s 5(2) of the Act, for the full and final settlement of tax-arrears. As per provisions of section 4(2) of the Act, any appeal, filed before Commissioner (Appeals), shall be deemed to have been withdrawn from the date on which certificate under section 5(1) of the Act, was issued by the designated authority." In view of aforesaid facts of the case, this appeal is dismissed." Against the said order of the ld. CIT (A), the assessee has preferred the present appeal before the Tribunal on the grounds mentioned above. 5. Before me, the ld. Counsel of the assessee reiterated his submissions as made before the first appellate authority and submitted his written submissions which are being reproduced hereunder : "1. Notice u/s 148 not served upon the assessee: At the very outset it is submitted that the Ld. AO has erred in framing there assessment order without serving notice u/s 148 properly to the appellant and therefore assessment is made without jurisdiction and deserve to be quashed. In instant case the notice u/s 148 of the IT act was not served upon the assess....
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....nal requirement that must be mandatorily complied with and in the absence of the same, the proceedings should not be initiated on the assessee. The same contention is favored by many land mark judgments which are as follows : Honourable ITAT, Agra Bench in M/s K.P. Cold Storage Vs ITO ITA No. 145/Agra/2018 had held that; In the present case AO on basis of information received from the ADIT(Inv.) that there were huge cash deposits in the bank accounts maintained by assessee during the period F.Y 2008-09, had issued notice under section 148 which culminated into assessment framed determining total income at Rs. 2,21,60,400/- as against Rs. 12,45,390/- originally returned by assessee. Assessee contended that no notice under section 148 was served upon assessee and ex-parte assessment was completed without serving any notice under section 148 till the completion of assessment which rendered the assessment order to be held void-ab-initio. It was held a valid service of a valid notice under section 148, is not a mere procedural requirement, but is a condition precedent to the validity of any assessment, reassessment or re-computation to be made under section 147 and it ....
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....ponsible person working for the group entities of assessee family and this amounts to a proper service on assessee. These facts are admitted by the department which are evidenced by the remand report and field correspondence mentioned above. Assessee's contention that said Ved Prakash was neither his employee nor his authorized agent, remains uncontroverted. Merely because he appeared in some other group entities will not detract the fact that notice was not served on assessee. During the course of reassessment AO was intimated about non service of notices u/s 148 and 143(2) but AO failed to take cognizance of assessee's intimation and objections. From the assessment record, remand reports, field correspondence and oral contentions, department could not demonstrate before us that notice u/s 148 was served on the assessee for A.Y. 2001-02. In the absence of a valid service of notice u/s 148 on the assessee the reassessment proceedings for AY2001-02 are bad in law, consequently they are quashed. CIT vs. Hotline International Pvt. Ltd 296 ITR 333 (Del); Hotel Blue Moon 321 ITR 362 (SC), followed. The above decision has been affirmed by the Hon'ble High Court Delhi refer CIT v....
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....igned by ITO (T&J), who is not a competent authority to give and signed the approval letter, which shows how the PR. CIT has acted in very formal way. When we examined of the assessment record, it is gathered that the approval was in photocopy and not in original or there was no original letter or documents of approval. Further the name of the assessee was at Sr. 46 out of 56 assessee's and even there was no tick on the name of the assessee in the approval list, which creates a doubt that the approval has been received before the issue of notice u/s 148 of the Act as the approval letter lying on the file after issuance of the notice u/s 148 or not before or attached with the notice u/s 148 and may reach in the office of the AO after 31.03.2016. Thus, in our view, approval u/s 151 cannot be given of all the 56 assessee's in a single documents, as all assessee's are the independent and separate also the reason recorded are different in each case and it is not possible that there shall be same reasons. Looking to these facts and record it is also held that the procedures and way of approval and satisfaction is not proper. Here AO initiated proceedings u/s. 147 r.w.s. 148 o....
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....asthan Syntex Ltd. (2009)313 ITR 231 (Raj.) SLP dismissed (2009) 313 ITR (St.) 27 (SC); Sun. Pharmaceutical Industries Ltd. Vs. DY. CIT (2016)287 CTR(Del.)621; The Impugned initiation of assessment proceedings had started by the AO on borrowed satisfaction but not their own which is mandatory condition of the law as provided for re -opening of any assessment. Section 147 of Act clearly specify. In impugned case the Ld. AO had claimed that a certain transaction of bogus LTCG on the basis of statements as recorded of third party and Ld. AO could not have been made any enquiry regarding both the facts and without conducting any enquiry/investigation re-opened the case and issued the notices which is completely based on perverse findings and deserve to be declared as null and void ab initio. Here in impugned case AO's self-satisfaction regarding escapement of income is not bringing on record which is mandatory condition of law under section 147 of Income Tax Act, 1961, it could have been come only after conducting enquiry and investigation but Ld. AO did not make such therefore complete reassessment proceedings come under suspicious circle, various honorable ....
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....ch the AO sought to assume jurisdiction under section 147 of the Act, was the information received from an external source viz., from the DGIT and not the material on record as reflected in the reasons recorded. Since the belief of the AO was not based upon the material on record, but on some other material from an external source which did not find reference in the reasons recorded by him, it was held that the basic requirement of section 147 was not satisfied. Hence, the HC quashed and set aside the impugned notices under section 148 of the Act. (AY. 2009-10 to 2011-12)" In an identical matter of "Hitesh Ashok Vaswani Vs DCIT (ITAT Ahmedabad) dated 12/11/2020" Hon'ble ITAT Ahemdabad held that "the information received from investigation wing, emanating from the search records would not per se empower the Assessing Officer to exercise the power of reassessment. Such information with regard to escapement of income which comes into possession of an Assessing Officer has to be processed and, on the basis, thereof an opinion has to be formed objectively before issuing notice under Section 148 of the Act to an assessee":- "87. Coming to the second question of....
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.... to the Assessing Officer and the formation of belief was absent. The "reasons to believe" recorded were not reasons but only conclusions and a reproduction of the information received from the Director (Investigation). Hence it is nothing but a "Borrowed satisfaction". 90. The AO, in the reasons recorded, discussed in details the materials found by the search team and thereafter initiated the proceedings by observing as detailed under: On the basis of analysis base on above seized documents it has been found that these transaction are done in cash by ASV (Ashok Sunderdas Vaswani) for the relevant assessment year 2008-09. 91. Thus what is inferred from the satisfaction recorded by the AO is that there was no application of the mind of the AO which was pre-requisite for acquiring the jurisdiction under Section 147/148 of the Act. As such the AO in the reason recorded nowhere mentioned how he reached to believe that the information received from the investigation wing represent income of the assessee and such income has escaped assessment. There is no mention in reasons recorded with respect to the fact that whether the assessee has filed original return or....
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....r appeal filling fees for appeal before this Hon'ble Tribunal and fees of counsel or advocates and other expenses are also being paid, when there was no default of the assessee. She has suffered as mentally harassment, hence all the cost which are being incurred by the assessee should be imposed on the ld. CIT(A) or revenue with compensation for harassment. As the assessee and revenue both are equal parties before the Hon'ble Court/Tribunal, so the above cost should also be imposed on the revenue and the order of the ld. CIT(A) may kindly be quashed and the resultant addition may kindly be deleted in full." 6. On the other hand, the ld. D/R has vehemently supported the orders of the Revenue authorities. 7. I have considered the rival contentions of both the parties and perused the material available on record. From perusal of the record, I observe that the AO has reopened the case of the assessee for escaping the income of Rs. 28,02,415/- on account of alleged unexplained investment in purchase of property and assessee has also not filed her return of income and accordingly issued notice under section 148 of the IT Act on 27.03.2018 after recording reasons that income of the ....
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....Se Vishwas Act, 2020, CIT (A)'s order under section 271(1)(b) and 271F. On perusal of record, I further find that vide notice under section 250 dated 13.07.2023 issued by the appellate authority the assessee was required to furnish his written submission on or before 20.07.2023 whereas the ld. CIT (A) has passed the order ex parte on 17.07.2023 before assessee could submit his written submission on 20.07.2023. From the above facts, it is clear that the ld. CIT (A) has passed a wrong order in quantum appeal, that too without giving adequate opportunity of being heard, allowing the assessee to file the reply on wrong stands taken by the appellate authority which is against the principles of natural justice. 7.1 Before me, the ld. A/R of the assessee submitted that the assessee was not served with the notice under section 148 of the Act. In this regard, he also submitted that the assessment order was silent in respect of service of notice on the assessee, the assessment order only mentioned that the notice under section 148 was issued. The AO has not placed any evidence that the notice under section 148 was served on the assessee. In this regard, the ld. A/R placed reliance on vari....
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....al manner has been adopted by all the authorities. On this preposition and issue, reference is made to decision of Coordinate Bench of the Tribunal in the case of Shri Satya Narayan Bairwa vs. ITO in ITA No. 867 & 869/JP/2018 dated 15.09.2021 wherein it has been held as under :- "20. The ld. A/R has also drawn our attention on the approval of the Pr. CIT placed at page Nos. 7-8 of the paper book and also from the assessment record placed before us, we found that he has given one consolidated approval of 56 different assessee's in one shot through one letter dated 29.03.2016 which is even not signed by him but signed by ITO (T&J), who is not a competent authority to give and signed the approval letter, which shows how the PR. CIT has acted in very formal way. When we examined of the assessment record, it is gathered that the approval was in photocopy and not in original or there was no original letter or documents of approval. Further the name of the assessee was at Sr. 46 out of 56 assessee's and even there was no tick on the name of the assessee in the approval list, which creates a doubt that the approval has been received before the issue of notice u/s 148 of the Ac....
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....sequent proceedings and assessment order passed was not in accordance with law. The case laws relied upon by the ld. D/R are not tenable in the facts and circumstances of the present case, therefore, considering the totality of facts and circumstances of the case as well as the judicial pronouncements qua the issue under consideration, I find merit in the contention of the ld. A/R, therefore, I quash the proceedings under section 147 of the Act. 7.3 The order of the ld. CIT (A) is also dismissed as he has passed a wrong order in quantum appeal because the assessee has not applied for any immunity under "Vivad Se Vishwas Scheme/Act, 2020" in quantum appeal. From the order of the ld. CIT (A), it is clear that the order relates to penalty under section 271(1)(b) and 271F. Therefore, the order passed by ld. CIT (A) is quashed. Ground No. 3 : Addition of Rs. 28,02,415/- on account of alleged unexplained investment in purchase of property. FACTS : Kindly refer facts mentioned in GOA 1. SUBMISSION: "1. No provisions has been applied by the ld. AO: At the very outset it is submitted that the ld. AO made the addition of Rs. 28,02,415/- but he has not i....
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....ing And Rolling Mills ... vs Income-Tax Department Through Its ... on 25 January, 2024 in W.P. (T) No. 1850/2022 dt. 25.01.2024 where it has been held that " Furthermore, the recorded reason is also silent under which provision of the Act the additions are sought to be made i.e. whether Section 68, Section 69A, Section 69B, Section 69C or any other provisions of the Act. It is not the case of the Revenue that the Petitioner has paid any cash to the so-called accommodation entry provider to obtain the accommodation entry to plough back own funds, hence, there is no ground/material to form reasonable belief of any accommodation entry. (Refer PCIT Vs. Meenakshi Overseas P. Ltd. reported in [2017] 395 ITR 677 (Del). In the case of Oryx Fisheries Pvt. Ltd. Vs. UOI reported in (2010) 13 SCC 427, it is held by the Hon'ble Supreme Court that the show cause notice should give the noticee a reasonable opportunity of making objections against proposed charges indicated in the notice and the person proceeded against must be told the charges against him so that he can make his defense and prove his innocence. In the entire course of the proceeding, at no stage the Petitioner is mad....
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....lawas Tehsil Lalsot along with Vimla Devi w/o Shri Deen Dayal on dated 29.10.2010 for Rs 49,00, 000/-. The registry cost was 7,04,830/-. Total Cost Rs 56,04,830/-. But the above land was purchased and taken possession by her husband Sh. Ram Sahay S/o Sukdev R/o Daglov Tehsil Dausa along with Smt Rukmani W/o Shri Ramphool on dated 25.05.1999 at a sales consideration of Rs 4,00,000/- and made payment of sales consideration in cash also vide sales agreement dated 25.09.1999 duly notarized and possession has been taken by the purchaser on that date i.e 25.05.1999. At the time of this agreement and it had been decided by both the parties that registry can be done any time when the purchaser required the same. And he can do agricultural work, construction etc on that agricultural land. On the basis of agreement dated 25.05.199 during the year 2010-11, Ram Sahay S/o Sukh Dev has decided to do registry of its share in above agricultural land in the favour of his Wife Smt. Prabhati Devi and Smt Rukhmani Devi W/o Shri Ram Phool has decided to do registry of her share in above agricultural land in favour of her daughter in law Smt. Vimla Devi W/o Deen Dayal. Thus during the year 2010....
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....37;़ी प्राप्त कर उक्त विक्रय की गयी भूमि पर कब्जा वास्तविक रूप से कब्जा हमारे समान करा दिया |) Thus when the payment had given in cash then how the ld. CIT(A) can say that no mode of payment is given. How the ld. CIT(A) can say there is no evidence of payment when in the agreement itself it is mentioned, if he was having any doubt he could have asked to the ld. AO to make the inquiry from the seller and purchaser, and when the payment was made by the family member in the year 1999, then how the ld. CIT(A) can ask for the source in this year and when the payment has been made by the family members. Further the other allegation of the ld. CIT(A) that "It may be pointed out that all the transaction of immovable property are necessarily required to be registe....
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....ec 2(47) of the IT Act. Hence all the above details may kindly be considered and taken on records. Prayer: Hence in view of the above facts, circumstances and legal position entire addition may kindly be deleted in full." 8. On the other hand, the ld. D/R has vehemently supported the orders of the Revenue authorities. 9. At the very outset, on perusal of the assessment order, it is noticed that the AO while making the addition has not invoked or applied any provisions of law. The AO has not stated under what provision of law he has made the addition and under what head whether, under business or trading income, agriculture income, capital gain or under section 48, 56 or under section 68 or 69. Thus the addition so made without any provision of Act is also against the law and liable to be deleted on this ground alone. Without invoking the provision of Act/law, the AO cannot make the addition. For each and every offence, specific provisions are given in the law/Act to hold any person as victim defaulter, therefore, without applying any provision for that a person cannot be taxed and penalized. As the AO himself has not stated under what provision the assessee ....