TMI Blog2012 (2) TMI 596X X X X Extracts X X X X X X X X Extracts X X X X ..... rongly pleaded when the notice itself is illegal and without jurisdiction, therefore, invoking the revisional jurisdiction automatically fails. The learned counsel for the assessee also relied upon the following decisions: - Jheendu Ram vs. CIT (2010) 130 TTJ (Luck) 82; CIT vs. Sohana Woolen Mills (2008) 296 ITR 238 (P H); Nandprakash Co. vs. ITO (1991) 19 ITC - 313 (Chd); Satish Kumar Kesari vs. ITO (2007) 106 TTJ (Pat) 980; CIT vs. S. Sidhartha Ltd. (ITA No.836 of 2011) (Del); CIT vs. Sattandas Mohandas Siddhi (230 ITR 591) (MP) It was submitted that before the Assessing Officer, the necessary details were furnished, which were examined by him and the claim of the assessee was accepted, therefore, the order is neither erroneous nor prejudicial to the interest of the Revenue because one of the possible view was taken by him. Our attention was also invited to computation of income, filed by the assessee, during assessment proceedings. 2.1 On the other hand, the CIT/DR Shri Keshave Saxena strongly defended the impugned order by submitting that ITO (Tech.) is working under CIT (Admn.), therefore, there is no illegality in issuing the show-cause notice. It was al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ks of account and other details which were test-checked by the Assessing Officer. However, we find that the ld. Assessing Officer framed the assessment without making a detailed discussion accepting the returned income. The assessment was framed in a sleep shot manner/hurried manner and without mentioning the justification for accepting the returned income even without discussing the issue of LTCG/STCG/business income, therefore, in view of the decisions in the cases of Thalibai F. Jain vs. ITO (101 ITR 1) (Kar), CIT vs. Pushpa Devi (164 ITR 639) (Pat), Gee Vee Enterprises vs. Addl. CIT (99 ITR 375) (Del), Indian Textiles vs. CIT (157 ITR 112) (Mad), the Revenue is having a strong case in its favour for invoking revisional jurisdiction u/s 263 of the Act and moreso, the Assessing Officer was directed by ld. CIT to examine and investigate the case de novo. However, before going into merit of the case, since the assessee has challenged the legality of assumption of jurisdiction u/s 263 of the Act, we are supposed to first adjudicate the same. 3.2 In view of above discussion, we are reproducing hereunder the relevant provisions of the Act i.e. Section 263: Revision of orders p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contained in an order of the Appellate Tribunal, 88 [National Tax Tribunal,] the High Court or the Supreme Court. Explanation.--In computing the period of limitation for the purposes of sub-section (2), the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 129 and any period during which any proceeding under this section is stayed by an order or injunction of any court shall be excluded. If the language used in the aforesaid Section, the Parliament in its wisdom, has authorised the ld. Commissioner to call for and examine the report of any proceedings under the Act and if he finds the order to be erroneous and prejudicial to the interest of the Revenue then the ld. Commissioner after giving an assessee an opportunity of being heard, after making such inquiry, as the ld. Commissioner being necessary, may pass such order as per circumstances, meaning thereby, the satisfaction of the Commissioner is necessary and not of any subordinate officer. In the case of the present assessee, the show-cause notice was issued by the ITO (Tech.) and the ld. CIT, himself, neither called for/examined the record of any proceedings nor made any inq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Estate (75 Taxman 503) (AP); H.H. Maharaja R.P. Dewas vs. CIT (138 ITR 518 (MP); During hearing, the ld. CIT/DR relied upon a decision from Hon'ble Apex Court in the case of Malabar Industrial Co. Ltd. vs. CIT (supra). We have gone through the order and usefully reproducing hereunder the relevant portion of the order: ..................... The Commissioner has to be satisfied of twin conditions, namely, (i) the order of the Assessing Officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the Revenue. If one of them is absent - the order of the ITO is erroneous but is not prejudicial to the Revenue or if it is not erroneous but is prejudicial to the Revenue - recourse cannot be had to Section 263(1) of the Act.............. If the aforesaid decision from Hon'ble Apex Court is kept in juxtaposition with the facts of the present appeal, it is clear that the ld. Commissioner has to be satisfied about the twin conditions before invoking the revisional jurisdiction u/s 263 of the Act and not the ITO (Tech.). Even otherwise, here before us, the first issue is legality of assumption of jurisdiction and not the merit of the case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Identical view was taken by Hon'ble Calcutta High Court in the case of B.K. Gooyee vs. CIT (1966) 62 ITR 109 that irregularity of serving a notice u/s 34 of the Indian Income Tax Act, 1922, cannot be waived by the assessee or his counsel as the irregularity is not one of a merely procedural nature and service of a valid notice is necessary. The ratio laid down in CIT vs. General Trade Agencies (1973) TLR 1383, wherein show-cuase notice issued by the Commissioner did not fairly indicate the grounds used by him for ordering cancellation of the firm's registration and for cancellation of assessment, made by the ITO. It was held that the assessee was deprived of fair opportunity to show-cause against proposed action. The Tribunal was held to be justified in reversing the order of the Commissioner. There lordships while coming to a conclusion made reference to the decision of the Hon'ble Apex Court in the case of Rampyari Devi Saraogi vs. CIT (1968) 67 ITR 84. A similar view was taken by Hon'ble Orissa High Court in the matter of sales-tax in the case of Rawani Dal Flour Mills vs. CST (1992) 86 STC 409. In that case, under the Orissa Sales-Tax, the ld. Commissioner is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice dated 12.3.2010, signed by the ITO (Tech.). The relevant portion challenging the jurisdiction (letter dated 18.3.2010 of the assessee) is reproduced hereunder: ........With reference to above-referred Show Cause Notice in respect of the proposal under section 263 dated 12.3.2010 is received by the assessee to attend the office on 18.3.2010. In this connection we have to submit that the notice is illegal, bad in law, and without jurisdiction looking to the facts and circumstances of the case. .................... Even by the proviso added to Section 292BB of the Act, nothing contain in the Section shall apply where the assessee has raised such objections before the completion of such assessment or reassessment. In view of above, it can be said that Section 292BB of the Act does not come to the rescue of the Revenue. 6. So far as merit of the case is concerned, since we have found the assumption of jurisdiction itself void-ab-initio, therefore, we are refraining ourselves to deal with the issue on merit, consequently, on assumption of jurisdiction, we allow the appeal of the assessee. Finally, the appeal of the assessee is allowed in terms indicated hereinabove. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
