TMI Blog2020 (2) TMI 1142X X X X Extracts X X X X X X X X Extracts X X X X ..... n. None of the authorities realized that there is no assessment framed u/s 143(3) of the Act on the date of the assumption of jurisdiction. The erstwhile assessment has been declared as null and void as mentioned as well. In our considered opinion assumption of jurisdiction without any application of mind is bad in law. Same reasons have been given for reopening the assessment which were used for framing the assessment u/s 143(3) r.w.s 153C of the Act. The Hon ble High Court of Punjab and Haryana in the case of Smt. Anchi Devi [ 2008 (3) TMI 39 - HIGH COURT PUNJAB AND HARYANA] has held that AO cannot be allowed to initiate fresh reassessment proceedings on identical facts where the first reassessment proceedings were quashed being barred by limitation. We are of the considered view that the AO has wrongly assumed jurisdiction in framing the assessment order dated 02.03.2015 u/s 143(3) r.w.s 147 of the Act and such order deserves to be set aside. - Decided in favour of assessee. - ITA No. 6218/DEL/2015, CO No. 403/DEL/2015 (Arising out of ITA No. 6218/DEL/2015) - - - Dated:- 20-2-2020 - Sh. N. K. Billaiya, Accountant Member And Ms Suchitra Kamble, Judicial Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T reads as under: The above order of the CIT(A)-XXXII was accepted by the Department and no appeal was filed. Jurisdiction u/s 153C for assessing 6 years preceding the year in which search was initiated can be invoked only when impugned documents are seized u/s 132 or requisitioned u/s 132A. It cannot be invoked in the case of impounding of documents u/s 133A. The very foundation for instituting the proceedings u/s 153C is missing. It has been held by ITAT, Chennai in the case of ACIT vs M.N. Rajaraman (2010) 5 ITR (TRIB) 261 Chennai and High Court of Gujarat in the case of CIT vs Meghmani Organics Ltd. (2014) 221 Taxmann 25 (Guj.) that where the very foundation for instituting the proceedings by A.O. was missing, the consequential action and orders must fail and that assessment made pursuant to such proceedings would have to be annulled. Since in the present cases there is no proper assumption of jurisdiction, the assessments made pursuant to such proceedings are annulled herewith. No submissions have been filed on other grounds. However, since the assessment is being treated as null and void, I do not find it necessary to examine other issues raised by the assessee a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hence, sum to the tune of ₹ 11,000/- is required to be treated as unexplained cash deposit, which has escaped assessment. C) The assessee company had received ₹ 42,00,000/- as share application during the assessment year. The assessee hasn t filed any documentary evidence to establish the identity and capacity of the persons who have allegedly given share application money or to establish the genuineness of these transactions. Hence, sum to the tune of ₹ 42,00,000/- is required to be added to the income as it has escaped assessment, on protective basis in interest of revenue. D) From perusal of the bank statements and other documents is its seen that there are unexplained deposits other than cash to the tune of ₹ 8,17,10,951/-. These deposits are unexplained even after considering the unexplained other liabilities, share capital share premium. Hence, sum to the tune of ₹ 8,17,10,951/- is required to be treated as unexplained other deposits, which has escaped assessment on protective basis in interest of revenue. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny application of mind by the sanctioning authority. The approval accorded to initiate proceedings is as under: 11. Whether the Additional Commissioner of income Tax, Central range-4, New Delhi is satisfied on the reasons recorded by the ACIT, Central Circle-09, New Delhi that it is a fit case for the issue of a notice under section 148 Based on reasons recorded above, I am satisfied that it is a fit case for issue of notice u/s 148. (Salil Mishra) Addl. CIT, Central Range-4, Delhi) 12. Whether the Commissioner of Income tax, Central-II, New Delhi, is satisfied on the reasons recorded by the ACIT, Central Circle 09, New Delhi that it is a fit case for the issue of a notice under section 148 On examination of the case, and the reasons recorded by the AO, I am satisfied that this is a fit case of issue of notice u/s 148 (A. D. Mehrotra) CIT(Central)-II, New Delhi 12. Neither the Addl. Commissioner n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (3)? 15. Hon ble High Court held as under : 11. Against this order, the assessee preferred appeal before ld. CIT(A). The proceedings initiated u/s 148 were also challenged. The ld. CIT(A) uphold the reopening of the assessment. However, appeal of the assessee on merit was allowed in part as certain additions were sustained i.e. trading addition by applying n.p. rate at 10.5% confirming the addition of ₹ 3,25,000/- in the name of Sh. S.K. Upadhyay and not treating the interest on fixed deposit income as business income. The remaining additions were deleted by ld. CIT(A). 12. The department is in appeal against deleting the additions by ld. CIT(A) and assessee is challenging confirming the reopening the assessment and addition on account of applying n.p. rate of 10.5% and addition made in the name of Sh. S.K. Upadhyay at ₹ 3,25,000/-. 14.1 Once an assessment has been completed and the same was subject matter of appeal, therefore, in our considered view on the same issue reassessment cannot be framed after issuing notice u/s 148. Notice u/s 143(2) was not issued in time, therefore, the assessment was annulled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there must be some material before AO to hold that any part of income has escaped assessment. 15. In the present case there was no fresh material at all. The material which was available before the AO was only original assessment order which was annulled. Once an assessment has been annulled then department cannot adopt a recourse to corret their mistake committed originally not issuing notice u/s 143(2) in time. 23. Again such facts are not in the case in hand as the reason were recorded on the basis of annulled assessment only. Therefore, the ratio of this decision is also not applicable on the facts of the present case. 24. Few more cases on which reliance has been placed by ld. D/R i.e. in case of Raymond Woollen Mills Ltd. Vs. ITO 236 ITR 34 (SC), Claggat Brachi Co. Ltd. Vs. CIT 177 ITR 409 (SC) and Kalyan Mavji and Co. Vs. CIT 102 ITR 287 (SC). In all these cases certain information was received during the assessment proceedings and, therefore, notice u/s 148 was issued and held as valid. However, in the present case no such facts are involved as no information was received during the assessment proceedings. We have al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... empowered to. It is trite law that limitation period under Section 143 cannot be extended by an IT authority and it is also quite recognised principle of law that an act, which cannot be done by an authority directly, cannot be done indirectly by him. Fact that the return was pending for disposal cannot constitute a valid reason for reopening the assessment, even under the amended s. 147. Though s. 147, after the amendment, has widened the powers of the AO to reopen the assessment, still there is intrinsic evidence in the section itself to show that cases where returns validly filed have not been disposed of, have not been brought under the net of the section. This is dear from Expln. 2(b) which says that for the purpose of the section, a case where a return of income has been furnished by the assessee, but no assessment has been made, is to be deemed as a case where income chargeable to tax has escaped assessment, but only if it is noticed by the AO that the assessee has understated the income or claimed excessive loss, deduction, etc. in the return. Thus, though under the new s. 147, the AO can issue a notice of reassessment, even where a valid return filed by the assessee has n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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