TMI Blog2008 (7) TMI 843X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,646 and cricketing income of Rs. 2,87,500. In the assessment originally completed under section 143(3), the said claim of the assessee for exemption was accepted by the Assessing Officer. Subsequently, the assessment in the case of the assessee for the assessment year 1998-99 was completed under section 143(3) on March 30, 2001. In the said assessment the claim of the assessee for exemption in respect of cricketing income and award money was held to be not admissible on the ground that the assessee being a professional cricketer was not eligible for the benefit of Circular No. 447 and Instruction No. 1432 issued by the Central Board of Direct Taxes. The order of the Assessing Officer disallowing the said exemptions to the assessee was further confirmed by the learned Commissioner of Income-tax (Appeals) vide an appellate order dated January 25, 2001. On the basis of this outcome of the assessment in the assessee's own case for the assessment year 1998-99, the assessment for the assessment year 1996-97 was reopened by the Assessing Officer by issuing notice under section 148 on November 8, 2002 after recording the reasons and after obtaining the requisite approval from the concern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es on account of cricket income. 4. Whether the learned Assessing Officer was justified in disallowing the exemption of Rs. 1,26,826 otherwise available to the assessee in accordance with Circular No. 447. 5. The assessee may please be allowed to add, delete, alter, modify any of the grounds of appeal." After taking into consideration the submissions made on behalf of the assessee before him as well as the material available on record, the learned Commissioner of Income-tax (Appeals) found that a similar issue as raised by the assessee in his appeal for the assessment year 1996-97 challenging the validity of assessment completed under section 147/143(3) was also involved in the assessee's own case for the assessment year 1995-96. He also found that the appeal of the assessee for the assessment year 1995-96 on this issue was allowed by his predecessor vide an appellate order dated October 10, 2003 and the assessment order for that year was quashed by him for the following reasons : "The Assessing Officer has mentioned in the assessment order that in the original return filed by the appellant, he had claimed exemption as per instruction No. 1432 of the Central Board of Direct T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the reopened proceedings are not valid and the assessment order under section 147 is accordingly cancelled. In view of this order, the other grounds need not be discussed." As the issue involved in the appeal before him for the assessment year 1996-97 as well as all the facts relevant thereto were similar to that of the assessment year 1995-96, the learned Commissioner of Income-tax (Appeals) followed the order of his predecessor for the assessment year 1995-96 and cancelled the assessment order passed by the Assessing Officer under section 147/143(3) for the assessment year 1996-97 holding that the same was based on a mere change of opinion. In view of his decision on this preliminary issue cancelling the assessment made by the Assessing Officer under section 147/143(3), the learned Commissioner of Income-tax (Appeals) did not consider it necessary to adjudicate upon the other grounds raised by the assessee in his appeal. Aggrieved by the order of the learned Commissioner of Income-tax (Appeals), the Revenue has preferred this appeal before the Tribunal challenging the action of the learned Commissioner of Income-tax (Appeals) in cancelling the assessment made by the Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed since the end of the assessment year 1997-98, therefore, as per section 151(2), the approval of Joint Commissioner of Income-tax/Additional Commissioner of Income-tax is needed for reopening as the assessment was not completed under section 143(3)/147. (Sd.) Pankaj Jindal. ACIT-C-C-9, New Delhi. Date : 28-10-2002." A perusal of the reasons recorded by the Assessing Officer for reopening the assessment for the assessment year 1996-97 as given above shows that there was no allegation made by the Assessing Officer about escapement of income as a result of failure on the part of the assessee to disclose fully and truly all material facts necessary for the assessment. As per the first proviso to section 147, an assessment completed under section 143(3) cannot be reopened after the expiry of four years from the end of the relevant assessment year unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for that year. In the case of ITO v. Lakhmani Mewal Das [1976] 103 ITR 437, the hon'ble Supreme Court has held that both the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f assessment beyond the period of four years was held to be unsustainable. To similar effect are the decisions of the hon'ble Punjab and Haryana High Court in the cases of Duli Chand Singhania v. Asst. CIT [2004] 269 ITR 192 and Winsome Textiles Industries Ltd. v. UOI [2005] 278 ITR 470 wherein the reasons recorded did not contain even a whisper or an allegation that escapement of income had occurred by reason of failure on the part of the assessee to disclose fully and truly all the material facts necessary for his assessment and in the absence of any such finding which was a sine qua non for assuming jurisdiction under section 147 in a case falling under the proviso thereto, the reopening of assessment by the Assessing Officer was held to be without jurisdiction. As already observed, a perusal of the reasons recorded by the Assessing Officer in the present case for reopening the assessment for the assessment year 1996-97 clearly shows that there was nothing contained therein to ascribe the escapement of income to the failure on the part of the assessee to disclose fully and truly all material facts necessary for reassessment. There was not even a whisper that the alleged escape ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer to the total income of the assessee and when the said assessment was challenged by the assessee in law as well as on the merits in an appeal filed before the learned Commissioner of Income-tax (Appeals), the latter followed the appellate order of his predecessor passed in the assessee's own case for the assessment year 1995-96 to hold that the said assessment was liable to be cancelled, being invalid in the eyes of law as the same was based on a mere change of opinion. In view of his decision on this preliminary issue cancelling the assessment made by the Assessing Officer under section 147/143(3), the learned Commissioner of Income-tax (Appeals) did not consider it necessary to adjudicate upon the other grounds raised by the assessee in his appeal. Aggrieved by the order of the learned Commissioner of Income-tax (Appeals), the Revenue has preferred this appeal before the Tribunal challenging the action of the learned Commissioner of Income-tax (Appeals) in cancelling the assessment made by the Assessing Officer under section 147/143(3) whereas the assessee has also filed his cross-objection. We have heard the arguments of both sides and also perused the relevant ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of Income-tax (Appeals) keeping in view his decision on the preliminary issue cancelling the assessment made by the Assessing Officer under section 147/143(3). As we have already set aside the impugned order of the learned Commissioner of Income-tax (Appeals) on the said preliminary issue and the learned Commissioner of Income-tax (Appeals) has not adjudicated upon the other issues raised by the assessee in an appeal before him, we deem it just and proper to remand the matter to the learned Commissioner of Income-tax (Appeals) with a direction to decide the said issues on the merits. During the course of appellate proceedings before us, the assessee has moved an application for admission of an additional ground wherein the validity of reassessment made by the Assessing Officer is sought to be challenged on the ground that no notice under section 143(2) was issued by the Assessing Officer. As we are remanding the matter to the learned Commissioner of Income-tax (Appeals) for deciding the other issues, the assessee is free to raise this issue before the learned Commissioner of Income-tax (Appeals) who shall consider and decide the same in accordance with law after examining the rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cketer not entitled to the benefit of Circular No. 447 dated January 22, 1986. In our opinion, the ratio of both these decisions of the Tribunal is clearly applicable to the issue in the present case and respectfully following the same, we hold that the assessee was entitled to exemption in respect of award money as per Circular No. 447 dated January 22, 1986. As regards the claim of the assessee for exemption in respect of cricketing income, learned counsel for the assessee has not disputed the position that the relevant Instruction No. 1432 of Central Board of Direct Taxes relied upon by the assessee has been subsequently withdrawn. He, however, has submitted that the cricketing income of Rs. 3,81,558 has already been declared by the assessee in the return of undisclosed income filed for the block period. A perusal of the details of undisclosed income declared by the assessee in the block return, however, shows that there is a slight difference in the amount claimed to be declared as cricketing income. Moreover, as rightly contended by the learned Departmental representative before us, this claim of the assessee raised before the Tribunal apparently for the first time requires ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld by the learned Commissioner of Income-tax (Appeals) for the same reasons as given by the Assessing Officer. Before us, learned counsel for the assessee has reiterated the submissions made on behalf of the assessee before the authorities below. He, however, has not been able to lay hands on any evidence to support and substantiate the stand of the assessee that the amount in question was paid by M/s. Jadeja Consultants Pvt. Ltd. as security deposit for the camera. Moreover, by the assessee's own submissions made before the authorities below, he had received the rent for his camera from the said company even in the earlier years. It means that the camera was given on rent by the assessee to the said company even in the earlier years and if it is so, it is not understandable as to why the security deposit amount was given in the year under consideration. Furthermore, as noted by the authorities below in their orders, the amount received from the said company was shown by the assessee in his balance-sheet as loan and there was no indication given in the balance-sheet that the said amount was received as security deposit against camera. As such, considering all the facts of the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... firmed by the learned Commissioner of Income-tax (Appeals). We have heard the arguments of both sides and also perused the relevant material on record. It is observed that substantial amount of professional charges was recovered by the assessee from M/s. Jadeja Consultants Pvt. Ltd. and his claim was that the said amount was inclusive of the camera hire charges. The Assessing Officer and the learned Commissioner of Income-tax (Appeals), however, did not accept the said claim merely because the assessee could not produce the agreement between him and M/s. Jadeja Consultants Pvt. Ltd. which, in our opinion, was not justified in the facts and circumstances of the case. Admittedly, the camera was not only owned by the assessee but the same was given on rent in the immediately preceding year and even the rental income from that camera was shown by the assessee separately in that year at Rs. 1,50,000. In these circumstances, there was no reason for the authorities below not to accept the explanation of the assessee merely for non-production of the relevant agreement especially when the substantial amount of the professional receipts from M/s. Jadeja Consultants Pvt. Ltd. was shown by t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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