2015 (11) TMI 1803 - AT - Income Tax

Revision u/s 263 - HELD THAT - As decided in Subhlakshmi Vanijya Pvt. Ltd., vs. CIT 2015 (8) TMI 174 - ITAT KOLKATA Failure of the AO to give a logical conclusion to the enquiry conducted by him gives power to the CIT to revise such assessment order - notices u/s 263 were properly served through affixture or otherwise. Further the law does not require the service of notice u/s 263 strictly as per the terms of section 282 of the Act. The only requirement enshrined in the provision is to give an opportunity of hearing to the assessee, which has been complied with in all such cases. Limitation period for passing order is to be counted from the date of passing the order u/s 147 read with sec. 143(3) and not the date of Intimation issued u/s 143(1) of the Act, which is not an order for the purposes of section 263. In all the cases, the orders have been passed within the time limit. CIT having jurisdiction over the AO who passed order u/s 147 read with section 143(3), has the territorial jurisdiction to pass the order u/s 263 and not other CIT. Addition in the hands of a company can be made u/s 68 in its first year of incorporation. After amalgamation, no order can be passed u/s 263 in the name of the amalgamating company. But, where the intention of the assessee is to defraud the Revenue by either filing returns, after amalgamation, in the old name or otherwise, then the order passed in the old name is valid. Order passed u/s 263 on a non-working day does not become invalid, when the proceedings involving the participation of the assessee were completed on an earlier working day. Order u/s 263 cannot be declared as a nullity for the notice having not been signed by the CIT, when opportunity of hearing was otherwise given by the CIT. Refusal by the Revenue to accept the written submissions of the assessee sent after the conclusion of hearing cannot render the order void ab initio. At any rate, it is an irregularity. Search proceedings do not debar the CIT from revising order u/s passed u/s 147 of the Act. - Decided against assessee.

Summary

Issues involved:
Appeals challenging orders passed by Commissioners of Income-tax u/s 263 of the Income-tax Act, 1961; Similarity in facts and grounds of appeal; Ex parte disposal of appeals due to non-appearance of assesses; Assessment orders passed u/s 143(3) with nominal additions; Jurisdictional CITs passing orders u/s 263; Applicability of previous tribunal orders; Proper service of notices u/s 263; Limitation period for passing orders; Territorial jurisdiction of CIT; Additions u/s 68 in the first year of incorporation; Validity of orders post-amalgamation; Validity of orders passed on non-working days; Validity of orders without signed notice by CIT; Acceptance of written submissions post-hearing; Revision of orders post-search proceedings.

Analysis:
The Appellate Tribunal ITAT Kolkata addressed multiple appeals challenging orders passed by Commissioners of Income-tax u/s 263 of the Income-tax Act, 1961, concerning various assessment years. Despite repeated adjournments sought by assesses, the tribunal proceeded to dispose of the appeals in a consolidated manner due to the similarity in facts and grounds of appeal. The assesses did not appear for the hearing, leading to ex parte disposal of the appeals. The tribunal noted that the issues raised were previously decided against the assesses in similar cases, including the necessity for thorough enquiries by Assessing Officers (AO) and the power of CIT to revise assessment orders.

The tribunal observed that the facts of the cases under consideration were similar to previous cases where over 500 similar issues were disposed of through various orders. The tribunal upheld the conclusions drawn in a specific case, emphasizing that the AO's failure to conclude inquiries logically empowered the CIT to revise assessment orders. Additionally, the tribunal affirmed the proper service of notices u/s 263 and clarified the limitation period for passing orders. It was emphasized that the territorial jurisdiction of the CIT is crucial for passing orders u/s 263.

Furthermore, the tribunal addressed various legal aspects, including the validity of orders post-amalgamation, orders passed on non-working days, and the acceptance of written submissions after hearings. The tribunal highlighted that search proceedings do not prohibit the CIT from revising orders passed u/s 147 of the Act. Ultimately, following the precedent set in previous cases, the tribunal upheld all impugned orders, resulting in the dismissal of all appeals.

In conclusion, the tribunal's detailed analysis covered a wide range of legal issues, ensuring a comprehensive understanding of the judgment's implications and the application of relevant legal principles in the context of the Income-tax Act, 1961.