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TMI Blog2022 (5) TMI 1170X X X X Extracts X X X X X X X X Extracts X X X X ..... percentages referred in the assesseement order and the shares are determinate and known, which is not disputed by the revenue. Further they have offered the share of income of joint lessees in their hands/assessments with the jurisdictional income authorities. Reopening is on the wrong assumption of facts and the information received from another assessing officer would not by itself be the basis to have a belief that the income has escaped assesseement . Accordingly, we find the reassessment is bad in law and quash the assessment order passed u/s 143(3) r.w.s 147 of the Act. Since the legal issue is decided in favour of the assessee and again adjudicating on merits becomes academic and are left open and we allow the grounds of appeal in favour of the assessee. - ITA No. 2797/Mum/2016 And ITA No. 3203/Mum/2016 - - - Dated:- 9-5-2022 - Shri Pramod Kumar, Vice President And Shri Pavan Kumar Gadale, Judicial Member For the Appellant /Respondent : Shri G.P Mehta.AR For the Respondent/Appellant : Shri T. Shankar.DR ORDER PER PAVAN KUMAR GADALE JM: The cross appeal is filed by the assessee and revenue against the order of the CIT(A)-32, Mumbai passed u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a beneficial owner of the leasehold property. Thus any income accruing or arising in relation to said properties could not have been taxed in the hands of the appellant. 2. The brief facts of the case are that, the assessee is assessed as AOP. The Assessing officer(A.O) has received the information from ITO-6(1)(4), Mumbai, that the Hon ble ITAT in the case of M/s Industrial Estate Pvt Ltd has passed the order for A.Y 2005-06, 2006-07 2007-08 and upheld the CIT(A) decision and dismissed the revenue appeal. The A.O. is of the opinion that, as per the observations of the ITAT, the addition in the hands of M/s Industrial Estate Pvt Ltd is deleted and is taxable in the hands of joint lessees of Industrial Estates(assessee). Whereas, in the assessment of Industrial Estate Pvt Ltd for the A.Y 2007-08, the A.O. has held the following incomes belong to the assessee and not to the joint lessees as under: 1. Income from house property as reduced by the amount of Rs. 36,733/- shown by one entity Rs. 2,82,966/- After allowing only deduction u/s 24(1)(a) as details of Municipal Taxes paid were not furnished ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 29.12.2014, furnished the following details which is reproduced as under; (a) The assessee joint Lessees of Industrial Estates, have Rent Income as the main source of income. Apart from this they have income from Capital Gains as well as Income from Other Sources. The assessee's are lease holders of a property at Lalbaug, Mumbai. The brief facts of the case are that the trustees of the N.M. Petit Charity Fund under a Head-Lease agreement dated 14.04.1950, leased out a piece of land admeasuring about 1.02,242 Sq.yards situated at Lalbaug, Parel, Mumbai, along with various establishments thereon; (1) The National Electrical Industries Limited (2) New India Mosaic Marble Co., Pvt. Ltd., (3) The Bombay Silk Mills Ltd. (4) Shri Chandulal Kothari Manilal Parekh representing Calico Dyeing Printing Works. (5) Shri M.J. Vaidya Others representing M/s. Anandji Naranji Co. (6) Dr. L.C. jariwala (7) Shri Akalchand G. Shah Others representing M/s. Sakalchand G. Shah Company. All collectively called The Joint Lessees . The lease was for a period of 99 years w.e.f .03.01.1948 to 02.01.2047 on the basis of Lease rent @ 11,666.67 per m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment proceedings, the assessee has claimed loss from house property and declared income from transfer of tenancy right long term capital gains on sale of property and their distribution among the members of the AOP, vide chart reproduced below: Income from house property as per computation filed on 05.03.2015- Loss Rs. 5,88,542/-, This loss distributed as under: Sno Name of the Member Share Income/loss Income declared by the members 1 Voltas Ltd 25% 147135.50 - 2 New India Mosaic Marble Co. P Ltd 25% 147135.50 75,935.00 3 Bombay Silk Mills Ltd. 16.665% 98,090.34 47,170.00 4 Ashok K. Kothari 12.5% 73,567.75 - 5 Manoj C. Chokshi 12.5% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 Ashok K. Kothari 12.5% 14,53,472.25 50,36,200.0 5 Manoj C. Chokshi 12.5% 14,53,472.25 - 6 Anandji Naranji Co 8.335 968,981.50 33,70.638.0 Income-Loss 100% 1,16,27,778 2,08,67,606 In order to quantify the exact share of income of each joint lessees for income tax purpose, the return of joint lesses was filed for the first time for A.Y 2008-09 NIL income of AOP since the income is distributed among joint lessees accordingly to their respective shares. 6. On the disputed issue (i) with respect to income from house property, the assessee has disclosed the loss from house property of Rs. 5,88,542/- in respect of payment of land revenue tax, property tax and bad debts. Whereas, the assessee has submitted the details of land revenue tax and therefore the A.O has considered the deduction of land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of reassessment proceedings. The Ld.AR has restricted his arguments to the extent of validity of reassessment proceedings and emphasized that the A.O. based on the observations of the Hon ble ITAT in other assessee case and without conducting the independent enquiry of facts / opinion has issued notice and passed the assesseement order. The Ld. AR has substantiated the arguments/ submissions with the paper book and judicial decisions and prayed for allowing the appeal. Contra, the Ld. DR supported the order of the CIT(A) on the validity of re-assessment. 10. We heard the rival submissions and perused the material on record and judicial decisions. The assessee has filed the grounds of appeal on legal issue of validity of assesseement u/s 147 of the Act and on the merits of the case. The Ld. AR emphasized that the A.O has issued the notice based on the observations of the Hon ble ITAT in the case of M/s industrial estates Pvt Ltd and no independent enquiry was conducted for recording the reasons and purely relied on the findings of the other assessing officer. The Ld. AR has demonstrated the reasons recorded for the reopening of assessment at page 9 of the paper book. The Ld. AR s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the liability of filing the return clearly laid upon the Joint Lessees. We also find that the Joint Lessees have filed the return as Joint Lessees of Industrial Estates in the status of AOP for Assessment Year 2008-09 and 2009-2010. If the Joint Lessees did not file return for Assessment Year 2005-06, 2006-07 2007-08, it was for the Revenue Authorities to explore other possible ways as per the provisions of law to assess the income in the hands of the Joint Lessees. Be that as it may, these incomes cannot be taxed in the hands of the assessee by any stretch of imagination. The CIT(A) has rightly deleted the addition from the hands of the assessee and we do not find any reason to interfere with the finding of the CIT(A). The Order of the CIT(A) for all these three Assessment Years i.e. 2005-06, 2006-07 2007-08 are confirmed. 11. The Ld. AR contentions are that the A.O. has issued notice based on the findings of the Hon ble Tribunal in particular at Para 15 of the order. Further the time limit for issuing notice u/s 148 of the Act has to be considered before any decision is taken by the A.O. The Ld. AR demonstrated the notice issued u/s 148 of the Act dated 27.03.2014 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the above paragraphs on the facts with respect to issue of notice u/s 148 of the Act and the provisions of Sec. 153(1) and 153(3) of the Act. The Ld.AR has empathetically dealt on each aspect of provisions of Act relating to reassessment and duly supported with the judicial decisions and is appreciated. 15. Whereas in the present case, the A.O. has issued the notice in the year 2014 and the Ld.AR has raised one of the objections that no satisfaction of the Jt.CIT was obtained u/sec151 of the Act before the issue of impugned notice and the prior sanction of appropriate authority. Since the issue pertains to A.Y 2007-08, the revenue has expressed the difficulty in providing the records/material to verify the factual aspects on sanctioning authority. We find that the assessee has filed the return of income for the A.Y.2007-08 in the status of A.O.P. with taxable income of Rs.Nil in compliance to notice u/sec148 of the Act. The Ld.AR demonstrated that the income is distributed among the six Joint Lessees with the percentages referred in the assesseement order and the shares are determinate and known, which is not disputed by the revenue. Further they have offered the share of in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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