Chhattisgarh State Minor Forest Produce (Trading And Development) Co-Operative Federation Limited, Raipur, District Raipur (C.g v. Pr. Commissioner Of Income Tax-1, Raipur (C.g

(Tax Case No.182/2024) Digitally signedby SISTASISTASOMAYAJULUSOMAYAJULUDate: 2024.09.25 2024:CGHC:37552-DB NAFR 15:43:18 +0530 HIGH COURT OF CHHATTISGARH AT BILASPUR TAXC No. 182 of 2024 Chhattisgarh State Minor Forest Produce (Trading and Development) Co-operative Federation Limited, Raipur, District Raipur (C.G.) ... Appellant versus Pr. Commissioner of Income Tax-1, Raipur (C.G.) ... Respondent For Appellant:Dr. Rakesh Gupta and Mr. Mohit Kumar, Advocates.For Respondent:Mr. Amit Chaudhari and Ms. Ankita Gouraha, Advocates. -Division Bench: Hon'ble Shri Sanjay K. Agrawal and Hon'ble Shri Amitendra Kishore Prasad, JJ. Order on Board(24/09/2024) Sanjay K. Agrawal, J. 1. This tax appeal has been admitted for hearing by formulating the following substantial question of law: - “Whether the ITAT is justified in confirming the orderof learned Principal Commissioner of Income Taxpassed under Section 263 of the Act, 1961, whereby theassessment order was set aside without looking into thedefence raised and application of mind?” (Tax Case No.182/2024) 2. The appellant herein / assessee submitted return of income for theassessment year 2018-19 on 31-10-2018 declaring total income asNIL after claiming deduction under Section 80P(2)(d) of theIncome Tax Act, 1961 (for short, ‘the IT Act’). Thereafter, on 22-9-2019, notice under Section 143(2) of the IT Act was issued by theIncome Tax Officer, Ward 3(1), Raipur and notice under Section142(1) was issued on 26-4-2020 and ultimately, assessment orderwas passed on 27-2-2021 accepting return of income and thereafter,on 1-2-2023, the Principal Commissioner of Income Tax-1, Raipur(PCIT) issued show cause notice under Section 263 of Actreproducing the proposals / reasons by the Assistant Commissionerof Income Tax-1(1), Raipur including all inaccuracies and incorrectfacts and figures calling upon the appellant herein / assessee tosubmit reply which the appellant filed on 15-2-2023 and ultimately,on 29-3-2023, order was passed by the PCIT under Section 263remanding the matter to the Assessing Officer for freshconsideration on two grounds against which the appellant herein on2-5-2023, preferred appeal under Section 253 of the Act before theITAT and by the impugned order dated 9-5-2024, the ITAT affirmedthe order of the PCIT dated 29-3-2023. 3. Dr. Rakesh Gupta, learned counsel appearing for the appellant /assessee, would submit that the ITAT is absolutely unjustified inaffirming the order of the PCIT ignoring the facts and grounds andassessee, would submit that the ITAT is absolutely unjustified inaffirming the order of the PCIT ignoring the facts and grounds and Page 3 of 4 (Tax Case No.182/2024) the documents filed by the appellant were not considered and inslip-shot manner, the order impugned affirming the order of thePCIT has been passed, particularly, for three assessment years2015-16, 2016-17 & 2017-18, this Court in Tax Case Nos.163/2024,164/2024 & 165/2024, had already remanded the matters to thePCIT setting aside the order of the PCIT and the ITAT. Therefore,the impugned order also deserves to be set aside. 4. Mr. Amit Chaudhari, learned counsel for the respondent / Revenue,would submit that the above three tax cases had been remanded tothe PCIT. would submit that the above three tax cases had been remanded tothe PCIT. 5. We have heard learned counsel for the parties and considered theirrival submissions made herein-above and also went through therecord with utmost circumspection. rival submissions made herein-above and also went through therecord with utmost circumspection. 4. Mr. Amit Chaudhari, learned counsel for the respondent / Revenue,would submit that the above three tax cases had been remanded tothe PCIT. would submit that the above three tax cases had been remanded tothe PCIT. 5. We have heard learned counsel for the parties and considered theirrival submissions made herein-above and also went through therecord with utmost circumspection. rival submissions made herein-above and also went through therecord with utmost circumspection. 6. True it is that common order was passed by the ITAT on 9-5-2024affirming the order of the PCIT and three tax cases namely TaxCase Nos.163/2024, 164/2024 & 165/2024 had already beenallowed by a coordinate Bench of this Court and the matters havebeen remanded to the PCIT. In Tax Case No.164/2024, followingfinding has been recorded by this Court in paragraph 7: -affirming the order of the PCIT and three tax cases namely TaxCase Nos.163/2024, 164/2024 & 165/2024 had already beenallowed by a coordinate Bench of this Court and the matters havebeen remanded to the PCIT. In Tax Case No.164/2024, followingfinding has been recorded by this Court in paragraph 7: - “7.The order of the Pr. CIT, therefore, necessarily wouldrequire to explain i.e. record reasons to exercise the powerunder Section 263 of the Act, 1961 to say that the order wasprejudicial to the interest of Revenue. However, in case inhand after that proceedings were initiated, the enquiry wasrequire to explain i.e. record reasons to exercise the powerunder Section 263 of the Act, 1961 to say that the order wasprejudicial to the interest of Revenue. However, in case inhand after that proceedings were initiated, the enquiry was Soma (Tax Case No.182/2024) conducted and during such enquiry the reply and thedocuments were placed by assessee. Section 263 makes itincumbent to the Pr. CIT to conduct enquiry. The enquirymeans not to shelve the reply and the documents but todeliberate upon it and the same cannot be set aside on theground that the Officer is not satisfied with reply. Thereasons for satisfaction or non-satisfaction are required tobe recorded. In the instant case, after going through para 5of the order, which is the substratum of the entire issue, it ismanifest that the said procedure has not been followed.” 7. Since three tax appeals of assessment years 2015-16, 2016-17 &2017-18 have already been allowed and the matters have beenremanded to the PCIT for reconsidering the reply and documents ofthe assessee by following the correct procedure, this tax appeal isalso allowed and the orders of the PCIT and the ITAT, both, arehereby set aside. Accordingly, the substantial question of law isanswered in favour of the assessee and against the Revenue. It isdirected that the PCIT shall reconsider the reply and documents ofthe assessee and pass order afresh after giving opportunity ofhearing to both the parties. It is made clear that this Court has notexpressed any opinion on the merits of the matter and the learned PCIT shall pass order in accordance with law, on its own merits. Sd/- Sd/-(Sanjay K. Agrawal) (Amitendra Kishore Prasad) JUDGE JUDGE