2019 (8) TMI 619 - HC - Income Tax

Reopening of assessment u/s 147 - ITAT upheld the reopening but deleted addition on merit - revenue not filed appeal against deletion of addition on merit - HELD THAT - Substantial question of law framed for consideration is not required to be answered in the light of the fact that the Tribunal granted relief to the assessee on the merits of the case. However, with regard to the reopening of assessment under Section 147 of the Act, the Tribunal held against the assessee, as against which, the above appeals have been preferred. It is further submitted that the Revenue has not preferred any independent appeal questioning the order of the Tribunal, which was decided on merits in favour of the assessee. Issue raised in these appeals has become academic and it is not required to be answered, as the assessee succeeded before the Tribunal and it has become final. Further, the Revenue has not preferred any appeal on the finding rendered in that regard on merits.

Summary

Issues:
1. Jurisdiction of the Assessing Officer under Section 147 for reopening assessment.
2. Tribunal's decision on the reopening of assessment.
3. Appellant's success before the Tribunal and Revenue's lack of appeal.

Jurisdiction of the Assessing Officer under Section 147:
The High Court heard appeals under Section 260A of the Income Tax Act, 1961 challenging the common order of the Income Tax Appellate Tribunal regarding the reopening of assessments for the years 2002-03 to 2004-05. The substantial question of law revolved around whether the Tribunal was correct in upholding the Assessing Officer's jurisdiction under Section 147 to reopen the assessments without a change of opinion. However, both parties agreed that the Tribunal had already ruled in favor of the assessee on the merits of the case, rendering the question of law unnecessary to answer.

Tribunal's Decision on Reopening of Assessment:
The Tribunal had granted relief to the assessee on the merits of the case. Although it ruled against the assessee regarding the reopening of assessments under Section 147, no independent appeal was filed by the Revenue challenging the Tribunal's decision. Consequently, the appeals before the High Court were filed by the assessee, as the Revenue did not contest the Tribunal's decision on the merits, thereby making the issue of reopening assessments academic.

Appellant's Success Before the Tribunal and Revenue's Lack of Appeal:
Given the assessee's success before the Tribunal and the absence of any appeal by the Revenue disputing the Tribunal's decision in favor of the assessee, the High Court disposed of the tax case appeals. It was concluded that there was no need to address the substantial question of law framed initially, as the assessee had prevailed before the Tribunal, and the Revenue had not challenged the Tribunal's ruling on the merits. Consequently, the appeals were disposed of without any costs, leaving the substantial question of law unanswered.