TMI Blog2013 (5) TMI 278X X X X Extracts X X X X X X X X Extracts X X X X ..... amount was undisclosed. Even the AO order indicates that it is received through banking channel. That itself may not affirm the genuineness of the credit but confirmation filed by assessee prima facie indicate that the amount can not be treated as unexplained cash credit.Reopening order is to be quashed - In favour of assessee. - ITA No. 2009/Mum/2012 - - - Dated:- 8-5-2013 - Shri B. Ramakotaiah And DR. S. T. M. Pavalan,JJ. For the Appellant : Shri Vijay Mehta For the Respondent : Shri Mohit Jain ORDER Per Dr. S. T. M. Pavalan, JM:- This appeal filed by the assessee is direct against the order of the Ld. CIT(A) - 33, Mumbai dated 31.01.2012 for the A.Y. 2008-09. 2. Grounds no. 1 2 relate to the addition of Rs.15,34,000/- made by the AO to the total income on account of unexplained cash credit/ceased liability u/s 28(iv) of the Income Tax Act and the direction given by the Ld. CIT(A) to re-open the A.Y. 2002-03 as the addition was not sustainable in the relevant year under consideration. 3. Briefly stated, the assessee, an individual engaged in the business of builder and developer in the balance sheet had shown an unsecured loan of Rs.15,34,000/- from on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to bring it to tax. As the amount is appearing as opening balance in instant A.Y. 2008-09 same cannot be added here and accordingly ground no. 4 is treated allowed for statistical purpose." Aggrieved by the impugned order, the assessee is in appeal before us. 5. Before us the Ld. AR has stated that it is an admitted fact that the impugned receipt/loan pertains to A.Y. 2002-03 and the same cannot be taxed during the year under consideration. The Ld. AR has also submitted before us a written submission to support the analogy that the Ld.CIT(A) is not correct in directing the AO to reopen the assessment for the A.Y. 2002-03 when the same is not related to the grounds in issue before him. The relevant portion of the written submission is reproduced hereunder:- I. "The CIT(A) Could not have issued 'direction' to the Assessing Officer to issue notice u/s.148 of the Act as reopening of the assessment has to be based on own belief of the Assessing Officer and it cannot be pursuant to the direction of higher authority. Bireswar Sarkar V. Gift-tax Officer [223 ITR 404) (Cal)] Sheo Narain Jaiswal v ITO [176 ITR 352) (Pat)] CIT v. T.R. Rajakumari [96 ITR 78) (Mad)] In view of thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of A, a finding in respect of B may be called for. For instance, where the facts show that the income can belong either to A or B and to no one else, a finding that it belongs to B or does not belong to B would be determinative of the issue whether it can be taxed as A's income. A finding respecting B is intimately involved as a step in the process of reaching the ultimate finding respecting A. If, however, the finding as to A's liability can be directly arrived at without necessitating a finding in respect of B, then a finding made in respect of B is an incidental finding only. It is not a finding necessary for the disposal of the case pertaining to A. The same principles seem to apply when the question is whether the income under enquiry is taxable in the assessment year under consideration or any other assessment year. As regards the expression 'direction' in s. 153(3) (ii) of the Act, it is now well settled that it must be an express direction necessary for the disposal of the case before the authority or court is empowered to give while deciding the case before it..." (Emphasis supplied). III. Without prejudice, the learned CIT(A) ought not to have directed the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r direction contained in an order passed by any authority in any proceeding under this Act by way of appeal, reference or revision or by a Court in any proceeding under any other law. Section 150 does not enable or require an appellate authority to give any directions for reopening of assessment, but it deals with a situation in which a reassessment is to be initiated to give effect to findings or directions of the appellate authority or the court. That is a cal to be taken by the Assessing Officer and not by me. Having said that, let me also add that in terms of Hon'ble Supreme Court's judgment in the case of Rajinder Nath v. CIT (120 ITR 12), an appellate authority's powers to give findings or directions are not unfettered so as to give any such findings or directions as appellate authority deems desirable on the facts of the case, but, in Their Lordships' considered opinion, an appellate authority can give only such findings or directions as are necessary for disposal of an appeal. As I understand, scheme of the Income Tax Act, as visualized by Hon'ble Supreme Court in Rajender Nath's case (supra), does not permit considerations of safeguarding the interests of revenue to have a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the proceeding. He is aware of the credit in that year. Since the law prohibits the reopening u/s 147 beyond six years, the direction of Ld.CIT(A) to reopen A.Y.2002- 03 in financial year 2012 in the order is against the provisions of law and principles on the issue. There is no finding that the amount was undisclosed. Even the AO order indicates that it is received through banking channel. That itself may not affirm the genuineness of the credit but confirmation filed by assessee prima facie indicate that the amount can not be treated as unexplained cash credit. Further, The various decisions relied on by the Ld. AR clearly suggests that the direction given by the Ld.CIT(A) to reopen the assessment for the A.Y. 2002-03 is not a finding necessary for the disposal of an appeal in respect of the year of assessment in question which in our view is the result of ultra vires exercise of jurisdiction by the Ld.CIT(A). While we agree with the findings of the Ld.CIT(A) that the impugned addition cannot be made in the relevant year under consideration, we are of the view that the direction of the Ld.CIT(A) to reopen the A.Y. 2002-03 is not justified and accordingly we decide the grounds i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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