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TMI Blog2015 (6) TMI 641X X X X Extracts X X X X X X X X Extracts X X X X ..... e has raised the following grounds of appeal:- 1 . On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeals) erred in confirming addition of ₹ 4757658/- on account of alleged non genuine purchases from MIS Sonotron Trading Co. P Ltd. 2. On the facts and in the circumstances of the case and in law the learned Commissioner of Income Tax (Appeals) erred in relying upon the statement of partners of the appellant firm inspite of the fact that the said statements have been retracted by the deponent as the same is not correctly recorded. 3. The order made under section 143(3) rws 147 of the Act is bad in law in as much as reason recorded by the Assessing Officer before issuing notice under section 148 of the Act has not been provided to the appellant before making said order under section 143(3) rws 147 of the Act. 4. The order made under section 250 of the Act by Commissioner of Income Tax (Appeals) confirming order made under section 143 (3) rws 147 of the Act is illegal, bad-in-law, ultra virus and without allowing reasonable opportunity of the hearing, and without appreciating the facts, submission and ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mated by the A.O. to the assessee that the request for providing reasons for reopening the assessment will be entertained and the reasons will be communicated only after the filing of the return of income for the aforesaid year. The ld. D.R. submitted that the assessee has not made any request for furnishing of the reasons recorded for reopening of the assessment after filing the return of income which is a mandatory condition and therefore the assessee cannot take a plea for quashing of the assessment for non-furnishing the reasons recorded for reopening of the assessment. 6. We have considered the rival submissions as well as material placed on record. At the outset, we note that an identical issue has been considered and decided by the co-ordinate Bench of this Tribunal in assessee s own case for A.Y. 2008-09 vide order dated 25-3-2013 in para 7 to 17 are as under:- 8. There is no dispute to the fact that assessee filed its return of income u/s.139 of the Act on 29.9.2008 declaring total income of ₹ 7,67,171. The said return was processed u/s.143(1) of the Act accepting the income returned. It is observed that there was a survey action u/s.133A of the Act on the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court (Panaji Bench) in the case of Fomento Resorts and Hotels Ltd (supra) vide its order dated 27.11.2006 has held that giving reasons in support of an order is part of complying with the principles of natural justice. Since the reasons were not given before making the assessment order, the Hon ble High Court confirmed the order of ITAT and dismissed the appeal filed by the department. We observe that similar issue came before the ITAT in the case of Videsh Sanchar Nigam Ltd (supra) and the Tribunal considered the following issue before it: Whether the supply of the reasons to the assessee by the Assessing Officer after the completion of the assessment makes the assessment bad in law, as the reassessment is to be held as invalid. 12.1 The Tribunal after considering the decision of Hon ble apex Court in the case of GKN Driveshafts (India) Ltd (supra) and various other decisions of Hon ble High Courts and ITAT has held vide paras 16 17 as under: 16. Thus in view of the above discussion and in view of the binding precedents, respectfully applying these propositions to the facts of the case and as the Assessing Officer has not furnished the reasons to the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entative was that the judgment of the Supreme Court in the case of G.K.Driveshafts (India) Ltd. vs. ITO (2003) 259 ITR 19 (SC) only lays down a procedure or a course of action to be adopted by the Assessing Officer and if the reasons for reopening the assessment are not supplied to the assessee despite the assessee s request, the assessment itself cannot be quashed or held ab initio void. He invited my attention to the following orders / judgments where this point arose but despite the same the reassessments orders were merely set aside for being redone after supplying the reasons to the assessee: (1) Datamatics Ltd. vs. ACIT (2008) 110 ITD 24 (Mum) (2) Smt Kamlesh Sharma vs. ITO (2006) 287 ITR 337 (Del) (3) Areva T D India Ltd. vs. ACIT (2007) 294 ITR 233 (Mad) (4) CIT vs. Jai Prakash Singh (1996) 219 ITR 737 (SC) (5) ITO vs. Smt Gurinder Kaur (2006) 102 ITD 189 (Del) (6) S Narayanappa Ors vs. CIT (1967) 63 ITR 219 (SC) 3. The learned counsel for the assessee strongly relied on the judgment of the Hon ble Bombay High Court in CIT vs. Fomento Resorts and Hotels Ltd. in Tax Appeal No.71 of 2006 dated 27.11.2006 (copy filed), in which it was held that giving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 11 of the Expenditure Tax Act provides for chargeable expenditure escaping assessment. It does not expressly provide for recording of reasons before issuing the notice of reassessment. Section 148(2) of the Income Tax Act expressly states that before issuing a notice of reassessment the Assessing Officer shall record his reasons for doing so. I do not think that there is any material difference between the two provisions because it has been held by the Panaji Bench of the Hon ble Bombay High Court in the judgment cited supra that giving of reasons in support of an order is part of complying with the rules of natural justice and, therefore, no fault can be found with the order of the Tribunal holding that the notice issued under section 11 of the Expenditure Tax Act without recording reasons is invalid. Section 148(2) of the Income Tax Act only makes it explicit what was already implicit in the section. The judgment of the Hon ble Bombay High Court has become final, the Supreme Court having dismissed the Special Leave Petition filed by the Department against the same. In addition to the above, a Division Bench of the Tribunal in Mumbai has held in its order dated 30.10.2009 in I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses cited by the learned Senior DR are cases recorded for reopening the assessment were never supplied to the assessee. The facts being different, the cited judgments are not. applicable. 6. In the light of the binding judgment of the Panaji Bench of the Hon ble Bombay High Court (supra) and the order of the Tribunal in the case of Videsh Sanchar Nigam Ltd. (supra) and respectfully following the same, I hold that since the Assessing Officer did not furnish the reasons recorded for reopening the assessment to the assessee despite specific request, the reassessment order is liable to be quashed as null and void. The point of difference No: ii) is answered accordingly. 16. We observe that the Tribunal by its order dated 29.6.2010 gave effect to the order of Third Member and in accordance with the majority view, held that assessment order passed by the AO is illegal and void ab nitio. Therefore, the assessment was quashed. 17. In the case before us, as mentioned hereinabove, we observe that assessee vide its letter dated 28.4.2010 made a specific request to the AO to furnish reasons recorded for reopening of assessment. We observe that AO vide his letter dated 29.4.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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