TMI Blog2022 (12) TMI 1122X X X X Extracts X X X X X X X X Extracts X X X X ..... the ground taken by the assessee for all three assessment years is rejected. Approval of competent authority as required u/s.151(2) of the Act, before issue of re-assessment notice u/s.148 - HELD THAT:- In this case, for the AY 2003-04, DR fairly agreed that instead of JCIT, the CIT-III, Chennai, has approved issue of notice u/s.148 - for the AY 2003-04, the CITIII has granted approval instead of the Addl. CIT/JCIT as prescribed under the law and thus, notice issued u/s.148 of the Act, on 30.03.2010 for the AY 2003-04, is bad in law and consequent assessment proceedings is null and void. As regards AYs 2004-05 2005-06, DR placed evidences to prove that the Addl.CIT, Range-V, Chennai, has granted approval for issue of notice and in our considered view said approval is in accordance with law as prescribed u/s.151(2) of the Act and thus, re-assessment notice issued u/s.148 of the Act, and consequent assessment proceedings are valid and thus, we reject the ground taken by the assessee for the AYs 2004-05 2005-06. To sum up, notice u/s.148 of the Act, and consequent re-assessment proceedings for the AY 2003-04 is quashed and notice issued u/s.148 of the Act, and consequent re- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment years. Therefore, for the sake of brevity, grounds of appeal filed for the AY 2003-04, are re-produced as under: 1. The order of the CIT(A) is erroneous, opposed to law and facts and liable to be set aside insofar as the same is passed in a casual and summary manner. 2.1 The CIT(A) erred in upholding the jurisdiction of the AO to reopen the assessment u/s 147 of the Act. 2.2 The CIT(A) having noticed that the law laid down by the Hon'ble Supreme Court having not been followed the order of reassessment ought to have been quashed. 3.1 The CIT(A) erred in upholding a sum of Rs. 17,99,3467- as unexplained investment u/s.69 of the Act. 3.2 The CIT(A) failed to consider that on the one hand, the AO placed reliance on the sworn statement of Mr.Chelladurai, who acted as a Middle man, without even providing an opportunity of cross examination by the Assessee. On the other hand, the AO completely ignored the statement of the same Chelladurai that he received Rs.3.30 cr from Wescare group in his answer to Q.No.12 in his Sworn statement deposed. This statement proves beyond doubt the source and cost of purchase. Wescare books also corroborates to this fact. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 51 (2) of the Income Tax Act in as much as he didn't get the approval from the competent authority, the Joint Commissioner of Income-Tax, the reassessment proceedings is void ab-initio. 2.2 The CIT(A) failed to consider the fact that the AO sought approval for issuance of notice u/s.148 from CIT-3 who is not the designated authority to sanction the proceedings as contemplated u/s.151(2). 4. The Ld.Counsel for the assessee at the time of hearing referring to petition filed by the assessee submitted that the assessee had taken two additional grounds challenging validity of notice issued u/s.148 of the Act, by the AO and consequent approval granted u/s.151(2) of the Act, and both grounds are purely legal issues which goes to question the root of the matter and thus, same may be admitted for adjudication. 5. The Ld.DR, on the other hand, opposing the petition filed by the assessee for admission of additional grounds submitted that the assessee could not explain the reasons for not rising these grounds before the lower authorities. Therefore, the same should not be admitted. 6. We have heard both the parties, perused the materials available on record and conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on non-existing company is invalid and consequent assessment proceedings is null and void. The Hon ble Supreme Court has taken a contrary view in the case of M/s.Gopal Shri Scrips Pvt. Ltd. (supra) and dealt the issue in light of provisions of Sec.560(5) proviso (a) of the Companies Act, 1956, and Chapter-XV of the Income Tax Act, 1961 and held that appeal proceedings can continue even in a case of company whose name has been struck off from RoC u/s.560(5) of the Companies Act, 1956. In the case of Maruthi Suzuki India Ltd., (supra), the Hon ble Supreme Court has taken note of the fact that the assessee has informed the AO about striking off name of the company from RoC u/s.560 of the Act, and even after intimation to the AO, the AO continued to issue notice for assessment proceedings. Therefore, under those facts, the Hon ble Supreme Court came to conclusion that notice issued to a non-existing company and consequent assessment proceedings are null and void. In so far as the decision of the Hon ble Supreme Court in the case of M/s.Gopal Shri Scrips Pvt. Ltd., it is in the context of continuing the appeal proceedings when the name of the company has been struck off from RoC and not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice, but the CITIII, Chennai, has approved and issued notice u/s.148 of the Act. However, for other two assessment years, the ACIT, Range-V, Chennai, has approved issuance of notice, which is in accordance with law. 8.2 We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. The provisions of Sec.151 of the Act, Income Tax Act, 1961, prescribes authority for approval of re-assessment notice on different situations and as per provisions of Sec.151(2) of the Act, in case there is no regular assessment was completed for any assessment year, then the JCIT concerned range is competent authority to accord approval for issue of re-assessment notice. In this case, for the AY 2003-04, the Ld.DR fairly agreed that instead of JCIT, the CIT-III, Chennai, has approved issue of notice u/s.148 of the Act. Therefore, we are of the considered view that for the AY 2003-04, the CITIII has granted approval instead of the Addl. CIT/JCIT as prescribed under the law and thus, notice issued u/s.148 of the Act, on 30.03.2010 for the AY 2003-04, is bad in law and consequent assessment proceedings is null and void. As regards AYs 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d further, M/s.Wescare (India) Ltd., has offered income arises out of land transactions. In this regard, he has filed financial statements of M/s.Wescare (India) Ltd., along with agreement between the parties and argued that M/s.Wescare (India) Ltd., has offered income under the head other income towards compensation for sale of land. Therefore, further addition in the hands of the assessee on very same transaction amounts to double addition. We find that the AO has treated difference between consideration paid for purchase of land as per books of accounts of the assessee and as per statement of Mr.Chelladurai as unexplained investment in the hands of the assessee. The assessee claimed that entire land transaction has been owned up and also income arises out of land transaction has been offered by M/s.Wescare (India) Ltd. We find that if at all the claim of the assessee is correct, then, the question of making further additions in the hands of the assessee towards very same land and consequent compensation / gain does not arise. But, facts remain that whether M/s.Wescare (India) Ltd., has considered the transaction in their books of accounts and also offered to tax compensation / ..... X X X X Extracts X X X X X X X X Extracts X X X X
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