2012 (12) TMI 377 - HC - Income Tax

Undisclosed Additions - cash purchases made from Jindal Electro Casting Pvt. Ltd. Hissar to the extent of Rs. 86, 87, 000/- for assessment year 2000-01 and Rs. 2, 42, 71, 186/- for assessment year 2001-02 in dispute - additions to the extent of Rs. 62, 37, 000/- and Rs. 2, 22, 19, 840/- were deleted by CIT (A) in appeals filed against the original assessments and his order was accepted by the Revenue which did not file any appeal before the Tribunal - assessee filed appeals before the Tribunal against the additions sustained by CIT (A) - held that - since Revenue accepted order of CIT (A) in the first round of proceedings deleting substantially the additions made by AO. It did not prefer any appeals to the Tribunal against the relief of Rs. 62, 37, 000/- and Rs. 2, 22, 19, 840/- granted by the CIT (A) respectively for assessment years 2000-01 and 2001-02. Matters which have attained finality cannot be re-agitated - Revenue failed to file appeals before the Tribunal challenging the relief granted by the CIT (A) in the first round of proceedings. That part of the assessment orders therefore got merged with the order of CIT (A) which became final. It was therefore not open to the Assessing Officer to tamper with their finality so far as the relief granted by the CIT (A) is concerned. Tribunal has rightly held that the Revenue cannot question the relief granted by the CIT (Appeals) on the principle of finality of orders. In our opinion therefore no question of law arises for our consideration. The appeals of the revenue are accordingly dismissed with no order as to costs.

Issues:
1. Validity of reopening of assessment
2. Cross-examination of witness
3. Repeated additions in fresh assessments
4. Jurisdiction of Assessing Officer
5. Finality of relief granted by CIT (Appeals)

Validity of Reopening of Assessment:
The case involved appeals by the Revenue arising from an order passed by the Income Tax Appellate Tribunal (Tribunal) regarding the assessment years 2000-01 and 2001-02. Initially, the assessee and the Revenue agreed before the Tribunal that the assessment would be sent back to the Assessing Officer for fresh disposal. The Assessing Officer subsequently repeated additions in the fresh assessments under Section 69C of the Income Tax Act, 1961. The assessee contended that the additions were wrongly repeated, arguing that certain additions had been deleted by the CIT (Appeals) in the first round of appeals, and the Revenue did not challenge those deletions before the Tribunal. The CIT (Appeals) accepted this contention, holding that the Assessing Officer had no power to bring back the deleted amounts to tax in the fresh assessments.

Cross-Examination of Witness:
During the fresh assessment proceedings, the assessee requested the cross-examination of a witness, Pradeep Jindal, who did not appear due to indisposition. The Assessing Officer repeated the additions based on the original assessment proceedings, stating that no fresh evidence supported the assessee's contention regarding cash purchases. The CIT (Appeals) found that no new facts were presented during the fresh assessment proceedings, and confirmed certain additions based on the previous assessment.

Repeated Additions in Fresh Assessments:
The Assessing Officer repeated additions in the fresh assessments, leading to appeals by both the assessee and the Revenue before the Tribunal. The Tribunal dismissed the Revenue's appeals, stating that the Assessing Officer should not have gone beyond the directions of the Tribunal and restricted the reframing of the issue to the extent of the assessee's appeal only. The Tribunal upheld the CIT (Appeals) orders and dismissed the Revenue's appeals.

Jurisdiction of Assessing Officer:
The CIT (Appeals) held that the Assessing Officer had no power to repeat the additions that were deleted in the first round of appeals and not challenged by the Revenue. The Tribunal agreed with the assessee and deleted certain additions for the assessment years 2000-01 and 2001-02. The High Court found no substantial question of law arising for consideration, as the Revenue did not challenge the relief granted by the CIT (Appeals) in the first round of proceedings, and matters that had attained finality could not be re-agitated.

Finality of Relief Granted by CIT (Appeals):
The High Court concluded that the Revenue could not question the relief granted by the CIT (Appeals) in the first round of proceedings, as it had not filed appeals before the Tribunal challenging the deletions made by the CIT (Appeals). The finality of orders was emphasized, and the High Court dismissed the Revenue's appeals, stating that no question of law arose for consideration.

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