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2019 (6) TMI 609

order - HELD THAT:- In the present set of facts where the Commissioner himself has given a finding that the re-assessment proceedings have not been correctly carried out against the assessee and the AO has failed to fulfill his obligation, then under such circumstances where, he has also held that “since, the copy of reasons recorded for re-opening of the assessment were not furnished to assessee till date of completion of assessment, the order of the AO is void”, then revisionary jurisdiction cannot be exercised against such order. When the said order is void and did not stand in law, it cannot be held to be erroneous and prejudicial to the interest of revenue by the Commissioner. Consequently, the exercise of jurisdiction under section 263 of the Act in the present case, is not justified and is bad in law. We cancel the same. - Appeal of the assessee is allowed. - ITA No.479/PUN/2017 - 10-6-2019 - Ms. Sushma Chowla, JM And Shri Anil Chaturvedi, AM For the Assessee : Shri Ketan Ved For the Revenue : Shri S.B. Prasad ORDER PER SUSHMA CHOWLA, JM : The appeal filed by the assessee is against the order of Principal Commissioner of Income Tax - 1, Aurangabad dated 22.12.201 .....

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n a total income of ₹ 9.03 crore. 4. The Commissioner, on verification of the case record notes that vide letter dated 07-04-2014, the assessee had insisted for supply of reasons for reopening the assessment in response to the notice issued under section 148 dated 07-03-2014. The Commissioner noted that, in reply, the assessee had submitted since the system is not allowing us to file the revised e-return, we request you to treat the return of income already filed for the above assessment year as filed in response to the above notice . The Commissioner observed that the Assessing Officer did not furnish the reasons and issued notice under section 142(1) dated 17-12-2014 calling for return by 07-01-2015 and communicated the reasons on which addition was proposed. However, the assessee did not attend in response and the Assessing Officer issued notice under section 143(2) on 19-02-2015. Thereafter, the Assessing Officer issued letter dated 03-03-2015 communicating the reasons on which addition was proposed. In the case, hearing was fixed on 09-03-2015. The assessee filed return of income on 19-03-2015 along with written submissions wherein it raised objection for issuance of not .....

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that as per the reasoning of the Commissioner, the order passed by the Assessing Officer was void, so in otherwords, the order does not exist. If that be so, then how can the Commissioner exercise the jurisdiction under section 263 of the Act. He placed reliance on the judgment of Hon ble Calcutta High Court in the case of Keshab Narayan Banerjee Vs. CIT, judgment dated 28-08-1998 and the decision of Pune Bench of the Tribunal in the case of Manisha Construction Co. Vs. CIT in ITA Nos. 1522 to 1526/PUN/2017, order dated 30-07-2018 for the assessment years 2004-05 to 2008-09. 8. The learned Authorized Representative for the assessee pointed out that the order passed by the Assessing Officer was void since the objections of the assessee on the reasons recorded for reopening the assessment were not separately decided. Hence, the exercise of jurisdiction by the Commissioner under section 263 of the Act was not correct. 9. The learned Departmental Representative for the Revenue placed reliance on order of Commissioner. 10. We have heard the rival contentions and perused the record. The issue which arises in the present appeal is that where the assessment order passed by the Assessing O .....

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cts has not followed the said procedure but has disposed of the objections raised by the assessee against the reasons recorded for reopening the assessment, in the assessment order itself. Such inaction of the Assessing Officer makes the assessment order void and not sustainable in law. When the assessment order is void and did not exist in law, the question which arises is whether the Commissioner can exercise his revisionary jurisdiction under section 263 of the Act against the same. The answer to the same is No. The Commissioner can exercise the jurisdiction under section 263 of the Act where the assessment order is live. Incase the order is void, then the same cannot be held to be erroneous and prejudicial to the interest of revenue. We find no merit in the exercise of jurisdiction by the Commissioner in this regard, where he himself admits that the assessment order was void. 12. The Hon ble Calcutta High Court in Keshab Narayan Banerjee Vs. CIT (supra) in similar situation of exercise of power by the Commissioner under section 263 of the Act against the order passed under section 147 of the Act, wherein the condition precedent of service of notice was not fulfilled, held that .....

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