2023 (1) TMI 471 - AT - Income Tax

Revision u/s 263 - assessee s claim by way of provisions was disallowed and added to the assessee s returned income - HELD THAT - It is not in dispute that the aforesaid revisionary order of the learned PCIT has been quashed by Coordinate Bench in the case of DLF Garden City Indore Pvt. Ltd 2022 (9) TMI 1081 - ITAT DELHI . It follows that the aforesaid assessment order passed in pursuance of the aforesaid revisionary order has no legs to stand; and that in effect the original assessment order stands restored and further that the impugned appellate order dated 04/02/2020 of the learned CIT(A) is of no relevance at present. In view of the foregoing the first two grounds of appeal in the present appeal before us have become merely academic and need not be adjudicated. Further respectfully following the aforesaid order dated 07/09/2022 in the case of DLF Garden City Indore Pvt. Ltd. (supra) of Co-ordinate Bench of ITAT Delhi we hold in respect of the third ground of appeal that the original assessment orders the effective assessment order as on date; and we direct the Assessing Officer to treat the original assessment order as restored at present. Accordingly third ground of appeal in the present appeal before us is treated as allowed.

Summary

Issues:
1. Appeal against order of Learned Commissioner of Income Tax (Appeals) for Assessment Year 2014-15.
2. Disallowance of claim amounting to Rs.6,35,58,558/- on account of Anticipated Loss.
3. Appeal maintainability regarding the order dated 19/06/2019 passed by the Assessing Officer u/s 143(3) r.w.s.263 of the Act.
4. Impact of the revisionary order dated 14/03/2019 and subsequent restoration of the original assessment order dated 27/12/2016.

Issue 1:
The appeal was filed against the order of the Learned Commissioner of Income Tax (Appeals) for Assessment Year 2014-15. The appellant contended that the dismissal of the appeal by the CIT(A) was on untenable grounds. However, following subsequent developments, the original assessment order dated 27/12/2016 was restored as the effective assessment order. Consequently, the impugned appellate order dated 04/02/2020 of the CIT(A) became irrelevant. The first two grounds of appeal were deemed academic and not adjudicated. The third ground of appeal regarding the addition of Rs.6,35,58,558/- on account of Anticipated Loss was allowed, directing the Assessing Officer to treat the original assessment order as restored.

Issue 2:
The disallowance of the claim amounting to Rs.6,35,58,558/- on account of Anticipated Loss was a key contention in the appeal. The CIT(A) had confirmed this addition in the assessment order dated 19/06/2019. However, following the restoration of the original assessment order dated 27/12/2016, this disallowance was set aside, and the Assessing Officer was directed to consider the original assessment order as effective.

Issue 3:
The question of appeal maintainability regarding the order dated 19/06/2019 passed by the Assessing Officer under section 143(3) r.w.s.263 of the Act was raised. However, with the quashing of the revisionary order dated 14/03/2019 by the Co-ordinate Bench of ITAT, Delhi, the subsequent assessment order dated 19/06/2019 was deemed to have no legal standing. Consequently, the appeal against this order became irrelevant, and the original assessment order was reinstated.

Issue 4:
The impact of the revisionary order dated 14/03/2019 and the subsequent restoration of the original assessment order dated 27/12/2016 was a crucial aspect of the case. The Co-ordinate Bench of ITAT, Delhi quashed the revisionary order dated 14/03/2019, thereby reinstating the original assessment order. This decision rendered the subsequent assessment order dated 19/06/2019 ineffective, leading to the restoration of the original assessment order as the valid assessment for the relevant period.

In conclusion, the appeal was partly allowed, with the original assessment order dated 27/12/2016 being treated as the effective assessment order following the quashing of the revisionary order and subsequent developments in the case.