2014 (4) TMI 624 - AT - Income Tax

Validity of passing of effect order Petition pending u/s 154 of the Act not decided Held that - The proceedings under section 154 of the Act have nothing to do with the action of the AO in giving effect to the order of the Tribunal - the appeal of the assessee was decided on merits by the Tribunal vide order dated 10.03.06 - The AO was duty bound to give effect to the order of the Tribunal - Even though an application under section 154 moved by the assessee was pending before the AO, still it cannot be said that the AO was not justified in giving effect to the order of the Tribunal - The assessee has got a separate remedy against the decision or non-decision on its application moved u/s 154 of the Act - There is nothing provided in the section 154 of the Act that pending such application moved under this section, the AO is prevented from giving effect to the order of the appellate authority. Bar of limitation Held that - The application moved or pending before the AO on the similar grounds which have already been adjudicated by the Tribunal, becomes infructuous and nullity and the AO becomes functus- officio to decide the said application on merits - the AO cannot sit in appeal relating to the matter which has already been adjudicated by the Tribunal - Once the assessee moved the application u/s 254 of the Act before the Tribunal and the same has been considered and decided by the Tribunal, the order of the Tribunal would be binding upon the AO and the AO has no jurisdiction to decide the application moved u/s 154 on the matter which has already been decided by the Tribunal - the assessee has independent remedy to move to the higher authorities raising the issue relating to adjudication or non-adjudication of its application, but on that ground it cannot be said that the order giving effect to the order of the Tribunal was bad in law Decided against Assessee. Validity of reopening of case Held that - The AO while giving effect to the order of the Tribunal was not supposed to give any finding on the merits of the case but only course before him was to give effect to the order of the Tribunal as such Decided against Assessee. Validity of reopening of assessment Held that - The issue has already been raised by the assessee in his rectification applications as observed above before the Tribunal and the rectification applications have already been dismissed by the Tribunal - the matter has already been adjudicated by the Tribunal and the assessee has not filed any appeal before the Hon ble High Court, the findings of the Tribunal have become final and there was no jurisdiction either to the AO or to the CIT(A) to re-adjudicate these issues on merits either on any application moved under section 154 or otherwise Decided against Assessee.

Issues Involved:
1. Validity of the reopening of assessment.
2. Issuance of notice under section 143(2) within the limitation period.
3. Validity of the order giving effect to the Tribunal's order without deciding the pending petition under section 154.
4. Jurisdiction of the effect order vis-`a-vis the assessment order.
5. Dismissal of additional grounds relating to the validity of reopening of assessment.

Detailed Analysis:

1. Validity of the reopening of assessment:
The assessee contended that the reopening of the assessment was bad in law and that the notice under section 143(2) was not issued within the limitation period. The Tribunal had previously dismissed these contentions in its order dated 10.03.06. The Tribunal reiterated that the issues raised by the assessee had already been considered and decided against the assessee. The Tribunal emphasized that the AO had obtained the necessary approvals for reopening the assessment and that the assessee had participated in the proceedings without raising objections at the relevant time.

2. Issuance of notice under section 143(2) within the limitation period:
The Tribunal found that the notice under section 143(2) was issued beyond the prescribed period. However, the Tribunal noted that this issue had already been addressed in previous miscellaneous applications, which were dismissed. The Tribunal held that the AO's issuance of the notice was valid and that the assessee's participation in the proceedings without objection precluded them from raising this issue later.

3. Validity of the order giving effect to the Tribunal's order without deciding the pending petition under section 154:
The Tribunal held that the AO was justified in giving effect to the Tribunal's order dated 10.03.06, even though the assessee's petition under section 154 was pending. The Tribunal emphasized that the AO was duty-bound to give effect to the Tribunal's order and that the pending petition under section 154 did not prevent the AO from doing so. The Tribunal also noted that the application under section 154 was filed beyond the limitation period of four years and that the AO had no jurisdiction to decide the application on matters already adjudicated by the Tribunal.

4. Jurisdiction of the effect order vis-`a-vis the assessment order:
The Tribunal dismissed the assessee's contention that the effect order dated 20.03.07 was invalid due to the pending petition under section 154. The Tribunal reiterated that the AO was required to give effect to the Tribunal's order and that the pending petition under section 154 did not affect the validity of the effect order.

5. Dismissal of additional grounds relating to the validity of reopening of assessment:
The Tribunal dismissed the additional grounds raised by the assessee regarding the validity of the reopening of the assessment. The Tribunal noted that these issues had already been adjudicated in the rectification applications, which were dismissed by the Tribunal. The Tribunal held that the findings had become final and that neither the AO nor the CIT(A) had jurisdiction to re-adjudicate these issues.

Conclusion:
The Tribunal dismissed both appeals filed by the assessee, affirming that the issues raised had already been adjudicated and that the AO was justified in giving effect to the Tribunal's order. The Tribunal emphasized the finality of its previous decisions and the lack of jurisdiction for re-adjudication by the AO or CIT(A). The Tribunal's order was pronounced in the open court on 28th February 2014.

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