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TMI Blog2023 (9) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances additional grounds are admitted for hearing. Applications are allowed. Reopening of assessment u/s 147 or 153C - Assessments were completed/unabated on the date of receipt of information from the Investigation Wing on 12.03.2013 and documents/material was found and seized during the course of search and seizure operation therefore the only action to be taken by the AO was available u/s. 153C of the Act and he was not entitled to invoke provisions of section 147/148 to initiate reassessment proceedings on the basis of material found and seized during the course of search and seizure operation on the third person. Therefore, there was no justification for the A.O. to have been initiated proceedings w/s. 147 / 148 of the I.T. Act. The correct course of action would have been to proceed against the assessee under section 153C. Approval u/s. 151(2) - AO initiated reassessment proceedings and issued notice u/s. 148 of the Act by mentioning applicable section as 147(b)which was not in existence in the book of statue at the time of recording reasons and the ld. PCIT also granted approval u/s. 151 on the said proposal of AO. Therefore as safely hold that the autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment as email address for communication. 3. Placing reliance on the various judgement of Hon ble Supreme Court in the case of N. Balakrishnan vs. M Krishnamurthy (1998) 70 Hon'ble Supreme Court 123 and order of ITAT Amritsar in ITA No. 57/Asr/2021 dated 01.03.2023 in the case of M. K Hotels Resorts Ltd. vs. ACIT the ld. AR submitted that the coordinate bench of the Tribunal has condone delay of nine years on account of non-receipt of intimation resulted in to no action on the part of assessee. The AR submitted that the delay of 1202 days has been treated as properly explained and may kindly be condoned. 4. Replying to the above, the ld. Senior DR strongly opposed to the condonation of delay and filed written reply and report of the Assessing Officer and submitted that the factual report of Assessing Officer clearly reveals that the orders in all three appeals were sent to the address given in the assessment order and all three received back with the postal remark left without address . He further submitted that the soft copy of the orders was emailed to the assessee on [email protected] on 01.04.2019 therefore this date has to be treated as the date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... physical copy of orders was returned back by the postal authorities and the soft copy was send to the email address which was not provided by the assessee to the Department and the same was also not mentioned as email address for communication in Form No. 35. As per assessee the orders came to his notice on 03.09.2022 and he filed appeals on 14.09.2022. In my considered view it is a settled law that in matters of condonation of delay, a highly pedantic approach should be eschewed and a justice oriented approach should be adopted and a party should not be made to suffer on account of technicalities. Before me, no material has been placed by Revenue to demonstrate that the delay in filing the appeal by the assessee was due to some malafide intention on its part. In view of the aforesaid facts and in view of the well settled principle of natural justice that sufficient opportunity of hearing should be afforded to parties and no party should be condoned unheard, I am of the view that the delay in filing the appeal needs to be condoned. Accordingly, applications seeking condonation of delay are allowed and appeals are admitted for hearing. Application for admission of additional g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On reassessment on the basis of incriminating material found in search of a 3rd party, the provisions of Sec. 153C are applicable which excludes the application of Sec. 147/148 The scope of Sec. 147 / 148 vis-a-vis 153C are different Sec. 147 is applicable where there is any information taken out from the seized material in search of a 3rd party while, Sec. 153C is to be invoked where the reasstt. is proposed on the basis of incriminating material/documents found in search on a 3rd party Hence, on the basis of seized material, the impugned proceedings could had been initiated only u/s. 153C and not u/s. 147 / 148, hence whole proceedings are liable to be quashed CASE LAWS PCIT Vs. Abhisar Buildwell Pvt. Ltd. Civil Appeal No. 6580/2021 (S.C.) Dtd.24.04.23 Pg.53/Para-11 ..However, in case during the search no incriminating material is found, in case of completed/unabated assessment, the only remedy available to the Revenue would be to initiate the reassessment proceedings under sections 147/48 of the Act, subject to fulfillment of the conditions mentioned in sections 147 / 148. Jasneet Kaur Chattwal Vs ITO - ITA No. 215/DEL/2016 Dtd. 23.03.23 (10-19 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue would be to initiate the reassessment proceedings under sections 147/48 of the Act, subject to fulfillment of the conditions mentioned in sections 147 / 148. At the cost of repetition I my point out that their Lordship in the case of PCIT vs. Abhisar Buildwell Pvt. Ltd. (supra) has drawn a clear distinction between two types of cases first where no incriminating material has been found and seized then the only remedy available to the revenue would be to initiate reassessment proceedings u/s. 147/148 of the Act, subject to fulfillment of condition mentioned therein and second where incriminating material and documents have been found and seized. In my humble understating in later situation the only valid action and recourse available to the Assessing Officer is to invoke provision of section 153C of the Act. This view also gets strong support from the orders of various coordinate benches of the Tribunal including order of ITAT Delhi Bench in the case of Saurashtra Color Tones P. Ltd. vs. ITO (supra). 14. In the present case, the assessments were completed/unabated on the date of receipt of information from the Investigation Wing on 12.03.2013 and documents/material wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ec. 147. The Hon' ble Court held approval given on the basis of Sec. 147 is a case of non application of mind and mechanical approval. VRC Township Pvt. Ltd. Vs. ITO ITA. No. 1503/Del./2017 Dtd. 14.10.20 (Issue discussed in Para-6.1, findings in Para-6.4 of decision) In this case the proposal of reopening was us. 147(b) which was approved us. 151 as it is. Following the above mentioned Bom. HC decision, the reopening on the basis of such approval has been held invalid. Maheshwari Roller Flour Mills Pvt. Ltd. ITA No. 4257/D/2019 Dtd. 17.12.20 Following above cases, where approval is as u/s.147(b), held mechanical and without application of mind. 16. The ld. Senior DR strongly opposed to the above submissions and submitted that such kind of typographical mistakes are natural which does not make reassessment order and proceedings bad in law and the assessee is not eligible for any relief on this count. 17. On vigilant perusal of the approval u/s. 151(2) of the Act, available at page 33 to 35 of assessee paper book it is clearly discernable that in column no. 7 of form for recording the reasons for initiation of proceedings u/s. 148 of the Act the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiate reassessment proceedings and notice u/s. 148 of the Act and also granting approval u/s. 151 of the Act, without application of mind and by mentioning in applicable and non-existent provision of the Act. Therefore initiation of reassessment proceedings and all consequent proceedings and orders including impugned reassessment order dated 21.10.2016 u/s. 143(3)/147 of the Act is invalid being bad in law and thus I quash the same. Accordingly, additional ground no. 2 of assessee is also allowed. 19. Since undisputedly facts and circumstances of assessment year 2010-11 and 2011-12 are identical and similar to the facts and circumstance of AY 2009-10 therefore my conclusion drawn for AY 2009-10 would apply mutatis mutandis to other two appeals pertaining to AY 2010-11 and 2011-12. Accordingly, additional ground no. 1 2 in the said two appeals are also allowed and initiation of reassessment proceedings u/s. 147/148 of the Act are quashed being invalid and bad in law. 20. The ld. representatives of both the side have not placed any submissions on the other grounds of assessee on legal as well as on merits therefore I don t deem it fit to adjudicate the same in absence of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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