2018 (8) TMI 2034 - AT - Income Tax

Condonation of delay - delay of 225 days - HELD THAT - The vested right cannot be disturbed so lightly. Such a concept of vested right is not available to the Revenue in the income-tax proceeding. Constitution of India in categorical term declares that the Revenue cannot collect any tax unless it is authorized by law. Therefore the Revenue cannot retain a single pie of the assessee unless it is authorized by law. The concept of vested right or vested interest is alien to the income-tax proceeding. Therefore this Tribunal do not find any merit in the objection of the Revenue. Accordingly the delay of 225 days in filing the appeal by the assessee before this Tribunal is condoned and the appeal of the assessee is admitted. Reopening of assessment u/s 147 - share transactions which were not disclosed by the assessee - HELD THAT - For the assessment year 2008-09 the assessee admittedly filed return of income on 05.02.2009 however the share transactions were admittedly not disclosed by the assessee. Since the figures with regard to share transactions are claimed to be wrongly mentioned by the CIT(Appeals) this Tribunal is of the considered opinion that the matter needs to be reexamined. Accordingly the orders of both the authorities below are set aside and the entire issue is remitted back to the file of the Assessing Officer. The Assessing Officer shall re-examine the matter afresh and bring on record all the transactions correctly thereafter decide the issue afresh in accordance with law after giving a reasonable opportunity to the assessee. In the result the appeal of the assessee is allowed for statistical purposes.

Summary

Issues:
1. Condonation of delay in filing appeal before ITAT
2. Merits of the appeal regarding undisclosed share transactions

Condonation of Delay:
The appellant filed an appeal against the order of the Commissioner of Income Tax (Appeals) for the assessment year 2008-09, with a delay of 225 days. The appellant claimed that the delay was due to residing outside the country, misplacement of the order copy by the power of attorney holder, and subsequent death of the holder. The appellant, being a non-resident, argued that he was unable to file returns within the prescribed time limit. The Departmental Representative opposed the condonation, relying on a judgment of the Madras High Court. The ITAT observed that no counter affidavit was filed by the Revenue and deemed the cross-objection filed by the Revenue as not maintainable. Considering the circumstances, the ITAT condoned the delay, emphasizing that the concept of vested right is not applicable in income-tax proceedings, and admitted the appeal.

Merits of the Appeal:
Regarding the undisclosed share transactions leading to the reopening of assessment under Section 147 of the Income-tax Act, the appellant contended that the figures mentioned by the CIT(Appeals) were incorrect, and the Assessing Officer did not compute the capital gain accurately. The Departmental Representative argued that the capital gain from the share transactions was not disclosed, justifying the reassessment. The ITAT found that the share transactions were not disclosed by the appellant, and as discrepancies existed in the figures, the matter needed reexamination. Consequently, the ITAT set aside the orders of the lower authorities and remitted the issue back to the Assessing Officer for fresh examination and decision in accordance with the law. The appeal of the appellant was allowed for statistical purposes, while the cross-objection of the Revenue was dismissed.

This judgment by the ITAT Chennai dealt with the condonation of delay in filing an appeal before the tribunal and the merits of the appeal related to undisclosed share transactions for the assessment year 2008-09. The ITAT, after considering the submissions from both sides, condoned the delay of 225 days, emphasizing the non-applicability of the concept of vested right in income-tax proceedings. On the merits of the appeal, the ITAT found discrepancies in the figures related to share transactions and remitted the issue back to the Assessing Officer for a fresh examination. The appeal of the appellant was allowed for statistical purposes, while the cross-objection of the Revenue was dismissed.