9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (10) TMI 1188 - AT - Income TaxAssessment u/s 144C(13) in pursuant to the directions of DRP - payment made for immovable property - Addition u/s 69 - payment made for immovable property unexplained - HELD THAT - The provisions of sections 144C provides the entire mechanism for making a reference to the DRP; powers of the DRP and also the procedures which have to be followed to issue directions to the Assessing Officer. Sub Section (5) when Read with Sub Section (7) and (8) makes it very clear that DRP could not have issued direction for verification in the manner it has done in the present case. Ld. DRP is supposed to examine the material before it and directions issued by way of guidance to Ld. AO under sub section (5) should be categorical, specific and comprehensive. In the case in hand, the direction for verification as issued were colourable and the Latin maxim Quando aliquid prohibetur ex directo, prohibetur et per obliquum , which means you cannot do indirectly what you cannot do directly when applied to aforesaid provisions applicable to DRP prohibits such directions of verification of the whole of the case of an assessee without any element of guidance for the Ld. AO. There was no liberty for further enquiry the Ld. AO has merely reasserted his opinion without any verification of the material and submissions which Ld. DRP had considered were relevant to settle the query raised in assessment. The verification is process of examination of truth by proof and a general direction to verify without liberty of further enquiry on the issue is of no help to Ld. AO. Thus the Bench is inclined to allow ground in favor of the assessee and allow the appeal for statistical purposes.
Issues Involved:
1. Non-provision of reasons for reopening under Sections 147/148 and requisite approval under Section 151. 2. Non-compliance with procedures for reassessment under Sections 147/148. 3. Validity of the Dispute Resolution Panel (DRP) order. 4. Consideration of documents and submissions by the Assessing Officer (AO) and DRP. 5. Justification for additions made to the returned income. 6. Submission of details regarding property purchase and mutual fund investments. 7. Treatment of evidence filed by the assessee. 8. Explanation for investment in immovable property. 9. Explanation for investment in mutual funds. 10. Double addition of certain amounts. 11. Basis of assessment. 12. Consideration of replies and submissions by the AO and DRP. 13. Opportunity of hearing by the DRP. 14. Levy of interest under Sections 234A and 234B. 15. Alleged harassment of the appellant. Summary: Issue 1: Non-provision of reasons for reopening under Sections 147/148 and requisite approval under Section 151 The assessee contended that the AO erred in law by not providing reasons for reopening under Sections 147/148 and the requisite approval under Section 151, even though the return of income was filed in response to the notice issued under Section 148. Issue 2: Non-compliance with procedures for reassessment under Sections 147/148 The assessee argued that the AO did not follow the established procedures for reassessment under Sections 147/148, as per the Supreme Court's decision in GKN Driveshaft, which could vitiate the entire reassessment proceedings. Issue 3: Validity of the Dispute Resolution Panel (DRP) order The assessee claimed that the DRP's order was unsustainable in law as it was a non-speaking order passed mechanically, making the subsequent assessment order also bad in law. Issue 4: Consideration of documents and submissions by the AO and DRP The assessee argued that the assessment order was passed without considering the documents on record and submissions made on three occasions, rendering it perverse. Issue 5: Justification for additions made to the returned income The AO added Rs. 6,15,23,087 to the returned income, including investments in immovable property and mutual funds, and payments to non-residents. The assessee contended that these additions were unjustified as the details were submitted on the Income Tax Department's e-portal. Issue 6: Submission of details regarding property purchase and mutual fund investments The AO held that the assessee did not submit details of the property purchased, home loan, or mutual fund investments, despite these being provided on the e-portal. Issue 7: Treatment of evidence filed by the assessee The assessee argued that the DRP and AO erroneously treated the evidence filed as additional evidence, even though these documents were duly filed/uploaded. Issue 8: Explanation for investment in immovable property The assessee submitted that the investment in the immovable property was explained with an e-sanction letter, property details, and bank disbursement records, which were not considered. Issue 9: Explanation for investment in mutual funds The AO wrongly noted that the assessee did not file details regarding mutual fund investments. The assessee clarified that the investments were made from the bank account, with the major source being the redemption of mutual funds and capital gains. Issue 10: Double addition of certain amounts The AO added Rs. 15,283 and Rs. 463 without appreciating that these amounts were already offered for tax under income from other sources and capital gains, resulting in double addition. Issue 11: Basis of assessment The assessee argued that the assessment was made on surmises and conjectures without any basis. Issue 12: Consideration of replies and submissions by the AO and DRP Both the DRP and AO failed to consider the replies and submissions made by the assessee. Issue 13: Opportunity of hearing by the DRP The DRP failed to give a reasonable opportunity of hearing to the assessee. Issue 14: Levy of interest under Sections 234A and 234B The levy of interest under Sections 234A and 234B was deemed erroneous, excessive, and without authority of law. Issue 15: Alleged harassment of the appellant The assessee claimed that the reassessment proceedings amounted to sheer harassment, entitling them to receive costs from the department. Conclusion: The Tribunal found that the AO did not properly examine and appreciate the material before him. The DRP erroneously directed the AO to verify without conducting any fresh inquiry. The Tribunal allowed grounds 3 and 7 in favor of the assessee, set aside the impugned assessment order and DRP order, and restored the issue to the DRP for a fresh order in light of the Tribunal's observations. The appeal was allowed for statistical purposes.
|
