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TMI Blog2015 (12) TMI 1854X X X X Extracts X X X X X X X X Extracts X X X X ..... hich is incomplete, do not help us to reach to the conclusion as to whether any reasons were ever recorded by the AO prior to the issue of notice u/s.148 on 6-3-2009. Under such circumstances, we have no option other than relying on the finding recorded by CIT(A) to the effect that no reasons were recorded for reopening before the date of issue of notice u/s.148 on 6-3-2009. - Decided in favour of assessee. - ITA No. 1719/Mum/2012 And Cross Objection No. 70/Mum/2013 - - - Dated:- 9-12-2015 - Shri R.C. Sharma, AM And Shri Sandeep Gosain, JM For the Revenue : Manjunatha R Swamy. For the Assessee : Shri Dinesh Vyas. ORDER Per R.C. Sharma (A.M): This is an appeal filed by the revenue and cross objection filed by the assessee against the order of CIT(A), Mumbai, for the assessment year 2004-05, in the matter of order passed u/s.143(3) r.w.s.148 of the IT Act. 2. Rival contentions have been heard and record perused. In this case, the assessment was reopened by issue of notice u/s.148 on 6-3-2009. After reopening the AO reduced the deduction claimed u/s.10A and 80HH. The contention of assessee was that reason for reopening was recorded much after issue o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not claimed any expenditure of ₹ 293.4 lakhs and the reasons recorded by the AO on 19.03.2009 do not pertain to the appellant company and the reasons are incorrect and erroneous, (vi) The AO vide notice u/s.142 dt.12.10.2009 stated that the reasons dated 19.03.2009 recorded by my predecessor did not pertain to your company. On perusal of the records, it is seen that your contention is correct. The AO states that it is further seen from the records that there was a clerical error in filing the papers. It is seen from the assessment record that the AO has recorded the correct reasons in your case on 19.03.2009, a copy of which is enclosed. Copy of reason recorded signed by Shri Bharat B. Garg, ACIT-2(3), Mumbai dated 19.03.2009 and also dated by pen by Shri Bharat B. Garg, ACIT 2(3), Mumbai as 19.03.2004 . 5. This office sent a letter dated 26.09.2011 stating as under: 1. The appellant has challenged the validity of reopening proceedings submitting that: (i) Notice u/s.14B was issued on 06.03.2009 and served on 09.03.2009 and the reasons for reopening was recorded on 19.03.2009. (ii) The copy of reasons provided to the appellant vide your office letter dated 25 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11-12 dated 4th Oct.2011 along with letter Ref. DCIT 2(3)/Remand Reportl2011-12 dated 3()th Sept.2011 signed by the present A.O. (Mr. Anil Gupta) enclosing a hand written statement of the reasons for re-opening under Sec. 148 for A. Y. 2004-05, signed by the then A. 0. (Mr. Bharat Garg) with date 5th March 2009. We strongly oppose the substitution of the reasons, which were; furnished to us on two occasions and on both occasions the reasons were dated 19 March 2009; and countered by us as per the provisions of section 148(2) as having been recorded after the issue of the Notice under section 148(1). We wish to take you through the sequence of events which had taken place during the re-opening proceedings: Notice issued under Sec. 148 dated 6th March 2009. Vide letter dated 25th Aug.2009, attested true copy of the reasons recorded for re-opening were enclosed. The statement recording the reasons, was dated 19103109 and the same was duly signed by the then A. O. (Mr. Bharat Garg). These reasons, specifically for reopening the assessment of Tata Sons Ltd, pertained to error in claim and allowance of Store Launch Expenses. Vide our letter dated October ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uance of such a Notice, being void ab initio and non est. Appellant's Contention. Even after pointing out that the invalid Notice, on account of reasons recorded after the date of the Notice as per section 148(2) , could not be cured by the provisions of section 292B (as meekly relied upon by the AO. to counter our objections in his Rebuttal Order dated 10 November 2009), the A 0. could not produce the reasons purported to have been recorded on 5 March 2009. Order under 143(3) r.w.s.148 dated 30.12.09, was passed. In the said Order, on the issue of the reasons for reopening being recorded after the date of the Notice u/s. 148, the A O. repeated verbatim his earlier stand. Appellant s contention : Even after the submissions made by the Appellant vide letter dated 23 November 2009 and before passing of the Order under section 143(3) r.w.s.147, the AO could not produce any reasons recorded prior to 19 March 2009. The Appellant is therefore left with no alternative but to conclude that the reasons dated 19 March 2009, which were furnished to the Appellant during the re-assessment proceedings, were the only reasons which were available with the A O. Subsequen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asons in your case on 19-03-2009, a copy of which is enclosed . (Emphasis supplied). Appellant also contends that once the order under Sec. 143(3) r.w.s. 147 is passed on 30.12.09, no new evidence can be considered or taken on record. This is more so when the Appellant during the reassessment proceedings had raised the specific issue of the reasons having been recorded after the date of the Notice under Sec. 148 and the then A O. (Mr. Iyengar) had dealt with it by merely relying on provisions of Sec. 292B. Now, after a gap of more than the and a half years when the subject matter is remanded to the A O during Appellate proceedings, suddenly, a hand written statement stating the reasons for re-opening dated 05/03/09 is produced. The Appellant therefore respectfully submits that the reasons dated 19 March 2009, furnished to the Appellant, as per the procedure laid down by the Supreme Court in the case of GKN Driveshafts (India) Ltd v Income-tax Officer Others (259 ITR 19), are the only reasons which should be considered for the re-assessment proceedings. The Appellant further submits that, in accordance with the procedure as laid down by the Supreme Court, the Appellant is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blunders as analyzed under:- (a) The reasons for reopening u/s.148 which was forwarded by Shri K. R. Iyengar, DCIT-2(3), Mumbai to the appellant vide his letter dated 25.08.2009. (i) In this reason for reopening, the facts mentioned regarding escapement of income did not pertain to the appellant company and this fact was accepted by Shri K. R. Iyengar, DCIT-2(3), Mumbai in his letter dated 12.10.2009 written to the appellant. (ii) The notice u/s.148 is dated 06.03.2009 signed by Shri Bharat B. Garg, ACIT-2(3), Mumbai. (iii) The reason recorded is dated 19.03.2009. Thus, the reason recorded on 19.03.2009 is subsequent to the notice u/s.148 issued on 06.03.2009 and the reason recorded contends facts which do not pertain to the appellant company. (b) The reasons for reopening of assessment forwarded by Shri K. R. Iyengar, DCIT-2(3), Mumbai to the appellant vide his letter dated 12.10.2009- (i) This reason recorded for reopening is dated 19.03.2009 (typed on Page 2 of the reasons) and is also dated 19.03.09 as put by pen below his signature by Shri Bharat B. Garg, ACIT-2(3), Mumbai. (ii) The notice u/s.148 is dated 06.03.2009, signed by Shri Bharat B. Garg, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lea that the reopening initiated by issue of notice u/s.148 dated 6-3-2009 is not valid. Against the above order of CIT(A), the revenue is in appeal before us and contended that the CIT(A) was not correct in questioning the reopening of assessment, whereas the assessee has filed cross objection supporting the CIT(A) s conclusion to the effect that CIT(A) was justified in quashing the reopening. The assessee in ground No.3 of cross objection, has requested the Tribunal to direct the CIT(A) to adjudicate the other grounds of the appeal which he declined to do in para 9 of his appellate order. 5. It was contended by ld. CIT DR that reasons were recorded much prior to the date of issue of notice u/s.148 dated 6.3.2009, however, while supplying the reasons to assessee, inadvertently wrong date was put on the reasons. 5. We have considered rival contentions, carefully gone through the orders of the authorities below and found from the record that a clear finding has been recorded by the CIT(A) to the effect that reasons for reopening was recorded much after issue of notice u/s.148. The Bench specifically asked the department to produce the assessment records so as to substantiate t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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