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TMI Blog2021 (2) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... in the premises of M D Industries by the DDIT (Inv)- ll, Surat on 11/03/2005. During the survey Shri Pankaj Danaala, CA, was found to have created large number of bogus capital build up cases in the name of different person by adopting various modus operandi like showing more opening capita! then the closing capital of earlier year, gifts, interest income, etc. Further such funds were transferred to the various assessee of MD Group. Shri Pankaj Danawala in his statement recorded during the survery accepted this fact and Shri Kirit Patel, the then director of M D Industries Pvt Ltd vide his statement recorded on 20/05/2005 had further confirmed this finding of the department and owned up the bank accounts and benamidars. This fact has also been accepted by the assessee in the submission filed before the settlement commission. 2. On the basis of findings during the Survey, notice u/s 148 of the IT Act was issued to the assessee for AYs 1999-2000 to 2005-06. The details are as under: A.Y. Date of Notice Section 1999-2000 01/12/2005 148 2000-01 01/12/2005 148 2001-02 01/12/2005 148 2002-03 01/12/2005 148 2003-04 01/12/2005 148 2004-05 24/10/2005 143 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forwarded to the Pr. CIT(l), Surat for his comments. Hon'ble Pr. CIT(l) Surat vide letter dated 18.10.2018 has submitted comments on the submission of the assessee thereafter several hearing took place in the case during the proceedings u/s 245D[4) of the IT Act. 5. Therefore, from the proceeding before the Settlement Commission it is apparent that all the reports called for in the case have been submitted by the Department and the case is pending before the Settlement Commission at the stage of disposal. 6. Thereafter, the assessee has filed an appeal before the Hon'ble ITAT, Surat. The Hon'ble ITAT, Surat vide order No. 497 to 503 & 527/SRT/2019 dated 06.12.2019 has set aside the order of the Ld.CIT(A) to the Ld CIT(A) with a direction to decide the case on merit and allowed the appeal of the assessee for the statistics purpose. 7. Since, in this case, for the assessment years 1999-2000 to 2005-06 the case have been admitted by Hon'ble Settlement Commission and proceeding u/s 245D(4) is pending before the Settlement Commissionfor passing order u/s 245D(4) of the IT Act therefore as per provision of Section 245F (2) the Settlement Commission is having exclusive jur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;ble ITA, it is found that the facts are different in as much as in the ITA NO. 1635 to 1638 & 1655/Ahd/2016, the cases were not admitted by the Income-tax Settlement Commission whereas in the case of the assessee M/s MD Industries Pvt LTd, its Settlement application have been admitted by the ITSC, Mumbai for A.Y. 1999-2000 to 2005-06 and same is pending for passing order u/s/245(D)(4) of the income-tax act. 10. Therefore, in view of the above facts, it is apparent that for the A.Y. 1999- 2000 to 2005-06, Hon'ble Settlement Commission Mumbai has exclusive jurisdiction over the assessee by virtue of provision of section 245F(2) of the income-tax act. Ld. CIT(A) being an income-tax authority had no jurisdiction over the assessee for the A.Y. 2005-06. Therefore Ld. CIT(A) had rightly dismissed the appeal of the assessee. Since in this case the assessee had no valid order to be contested before Hon'ble ITAT, therefore the appeal filed by the assessee for A.Y. 1999-2000 to 2005-06 was not maintainable. Therefore it is humbly requested that in the present case Misc. Application may kindly be considered and the appeal filed by the assessee may kindly be dismissed because the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion for any appealable order placed before the Tribunal, nor any direction when no such abatement order has been passed by Settlement Commission. In support of her submissions ld. DR for the revenue relied on the decision of Tribunal in JC Augustine (2010) 122 ITD 9 (Cochin), wherein it was held that if the matter is abated before ITSC, the erstwhile jurisdiction of the CIT(A) gets revived, thus, the assessee has to move a restoration petition before ld. CIT(A). The Ld. DR for the revenue prayed that order dated 06.12.2019 may be recalled as the appeal filed by the assessee was not maintainable and the same may be dismissed. 5. On the other hand, the Ld.Authorised Representative (AR) for the assessee submits that the Tribunal while deciding the appeal of assessee for A.Y. 1999-2000 to 2005-06 in ITA(s) No. 497 to 503/Srt/2019 vide its combined order dated 06.12.2019, set-aside the matter to the file of the Ld.CIT(A). The Revenue in its application has basically raised three grievances/objections i.e. (i) that the jurisdiction over the matter of assessee lies with ITSC by virtue of section 245F(2) of the Act and the Tribunal has no jurisdiction to adjudicate the appeal, (ii) the Ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing submission, during the hearing of appeals. The ld.AR for assessee read out the following relevant portion of the said order: "The Ld. AR also pointed out that Hon'ble Settlement Commission passed order vide order vide its common order passed u/s. 245HA of the Act admitted some assessment years while abated some years. Al the admitted petitions/years of the Group were abated on 31-03-2008 due to amendment brought in by Finance Act 2007 in section 245D(4) of the Act, wherein if any settlement proceedings were not concluded by 31-03-2008 such proceedings would be abated. All the Group member of our Group, thereafter filed writ petitions in the Hon'ble Bombay High Court challenging the constitutional validity of certain sections of the Act as amended/inserted by Finance Act, 2007. After admitting the writ petitions of the Group members, interim order was passed by Hon'ble Bombay High Court in case of Shri Rajendra Lakhotia vide order dated 13-10-2008 (Combined order for 18 petitioners). He also drew our attention towards interim order para 2 of Hon'ble High Court dated 06-03-2009, wherein their lordship issued directions to the Respondent No.1, 3 & 4 which reads as follows : "A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly direct the authorities below that the order of Hon'ble High Court has to be followed respectfully as directed by us in para 9 of this order, and they will not proceed to pass appeal effect order in pursuant to this order tiff final decision/order is passed by Hon'ble High Court We also direct the authorities below that white giving effect to this order and to ensure the respectful and proper compliance of forthcoming order of Hon'ble High Court, we also find it appropriate and necessary to issue following directions to the authorities below: i) In case the Hon'ble Bombay High Court set aside the petitions to the Settlement Commission setting aside the abatement order then, the settlement commission will get exclusive jurisdiction to decide the cases and the AG will not be required to act further in any manner. ii) In case the Hon'ble Bombay High Court uphold the abatement order of the settlement commission then, the AO will get the jurisdiction to decide and re frame assessment afresh after allowing due opportunity of hearing to the assessee." 10. The ld.AR for the assessee by referring the aforesaid observations of the Tribunal submits that it can be se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atable. Thus, the section 254(2) of the Act cannot be resorted for debatable issue. To support his submission, the Ld.AR for the assessee relied upon the decision of this Tribunal in Gufic Pvt Ltd. (MA No.37/SRT/52018). On the basis of aforesaid submissions, the Ld.AR for the assessee submitted that the contention of the Ld.DR for the revenue that no appeal lies against the order of Ld.CIT(A) is unsustainable or at least is debatable. 14. On third objection about the exclusive jurisdiction of the cases with ITSC, the Ld.AR for the assessee submits that no such argument was made by the Department during the course of hearing of appeal and on this ground the mistake pointed out by the Revenue deserves to be rejected. In without prejudice submission, the ld.AR for the assessee submits that a plain reading of section 254F(2) of the Act, it is clear that exclusive jurisdiction to exercise the power and performance the function of Income Tax Authority under the Act, in relation to 'case' as defined in section 245(A)(b) of the Act lies with ITSC on admission of application till order is passed under section 245D(4) of the Act. From the reading of section 116 of the Act, it is clear that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merit, but merely set-aside the matter to Ld.CIT(A) with certain directions. The directions of Tribunal are not contrary to the provision of section 254H(2) of the Act. It was pointed out by the ld.AR for the assessee that the ld.DR has also placed her submission based on the above section and agreed that proceedings are required to be revived in the event of abatement of petitions by ITSC. The Ld.AR for the assessee prayed that there is no mistake in the order passed by the Tribunal and would submit that applications filed by the Revenue may be rejected. 16. After conclusion of hearing both the parties were directed to file their respective submissions. In compliance of our directions, both the parties also filed their submissions in writing, repeating the same submissions, which we have narrated above. The submission of both the parties were taken on record. 17. We have considered the submission of both the parties and have gone through the order of the Tribunal dated 06.12.2019. Our predecessor while deciding the appeal of assessee for A.Y. 1999-2000 to 2005-06 in ITA No.497 to 503 and 527/SRT/2019, condoned the delay of 4378 days. While condoning the delay, our predecessor r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee vehemently submitted that while adjudication the appeal of the assessee, the Tribunal relied on the decision in ITA No.1635 to 1638 & 1655/AHD/2016, for limited purpose for condoning the delay. We find merit in the submissions of ld.AR for the assessee that reliance on the order ITA No.1635 to 1638 & 1655/AHD/2016 was only for condoning the delay. We noted that the revenue has not raised grievances about the condonation of delay in admitting the appeal. We have further seen that the cases of assessee are similar on facts as in case of Kirit M. Patel bearing no.1639, 1821 and 1822/AHD/2016 and 678/AHD/2015 and other group cases which were also restored by the Tribunal to the file of LD. CIT(A), hence, the Tribunal in the present case has made no mistake, much less apparent mistake while following the order of the Tribunal in group cases. The revenue has not filed application to recall the order in Kirit M. Patel bearing no.1639, 1821 and 1822/AHD/2016 and 678/AHD/2015 dated 29.05.2018. Thus, the grievance of the revenue as raised in objection no. (iii) is also misplaced. 21. At the time of making submission the ld. DR for the revenue made reliance on the decision of Cochin Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X
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