Ita/530/2016 Of M/S Padmini Products(P) Ltd v. The Deputy Commissioner Of Income Tax

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 22 DAY OF OCTOBER 2020 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND| THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASAD ILT.A. NO.530 OF 2016 BETWEEN: M/S. PADMINI PRODUCTS (P) LTD.,.NO.157, K. KAMARAJ ROAD,|BENGALURU - 560 0427(REPRESENTED BY ITS DIRECTOR,SRI. PRABHU KIRAN,|AGED ABOUT 62 YEARS,|S/O LATE NAGARAJ N.VEMULKAR) APPELLANT (BY SRI CHYTHANYA K.K, ADV.) AND: THE DEPUTY COMMISSIONER OF ©INCOME TAXCIRCLE - 12(2),BMTC BUILDING, 5 BLOCK,KORAMANGALA, —BANGALORE - 560095.(BY SRI K.V.ARAVIND, ADV.) RESPONDENT| THIS I.T.A. IS FILED UNDER SECTION 260-A OF|I.T.ACT, 1961, ARISING OUT OF ORDER DATED:05/08/2016 PASSED IN ITA NO.1444/BANG/2015, ITANO.1445/BANG/2015 & ITA NO.1446/BANG/2015 FORTHE ASSESSMENT YEAR 2004-05, 2010-11 & 2011-12PRAYING TO A) FORMULATE THE SUBSTANTIAL QUESTION OF LAWSTATED ABOVE.» B) ALLOW THE APPEAL AND SET ASIDE THE IMPUGNEDORDER OF THE ITAT, BENGALURU ‘A’ BENCH BEARINGIN ITA NO.1444/BANG/2015, ITA NO.1445/BANG/2015& ITA NO.1446/BANG/2015 DATED:05/08/2016 FORTHE AYS 2004-05, 2010-11 & 2011-12. | THIS I.T.A. COMING ON FOR FINAL HEARING,|THIS|DAY,ALOKARADHE|J.,DELIVEREDTHEFOLLOWING: JUDGMENT Mr.Chythanya_K.K,learned.counsel|for.theaSSeSSAE., Mr.K.V.Aravind, learned counsel for the revenue. 2 |This appeal under Section 260-A of theIncome Tax Act, 1961 (hereinafter referred to as ‘theAct’, for short) has been preferred by the assessee. The subject matter of the appeal pertains to the Assessment.Years 2004-05, 2010-11 and 2011-12. The appeal was admitted by a Bench of this Court vide order dated01.02.2017 on the following substantial questions oflaw: [.Whether,In|thefactsand|In|thecircumstances of the case, the ITAT is not.justifiedupholdingtheactionoftheRespondent in issuing notice under section148 without prior approval of the LearnedJoint Commissioner of [Income Tax @senvisaged under section 151(2) of IT Act forthe AY 2004-05?circumstances of the case, the ITAT is not.justifiedupholdingtheactionoftheRespondent in issuing notice under section148 without prior approval of the LearnedJoint Commissioner of [Income Tax @senvisaged under section 151(2) of IT Act forthe AY 2004-05? Ll.Whetner,In|thefactsand|In|thecircumstances of the case, the ITAT was.right in law tn upholding the action ofLearned Respondent in re-opening theassessment for the assessment year 2004-O5 under Section 14/7 of the IT Act In theabsence of any tangible material but merelyOf)thebasisofadditionsMadeIn.subsequent assessment year 2007-2008?circumstances of the case, the ITAT was.right in law tn upholding the action ofLearned Respondent in re-opening theassessment for the assessment year 2004-O5 under Section 14/7 of the IT Act In theabsence of any tangible material but merelyOf)thebasisofadditionsMadeIn.subsequent assessment year 2007-2008? [ll.Whetner,In|thefactsand|In|thecircumstances of the case, the ITAT was.rignt in law in nolding that the Appellant iseligible to claim depreciation only withreference to the written down value oftransferred|assetsIn|thehands.Of|preaecessor firm and not witn reference toactual cost incurred by it?circumstances of the case, the ITAT was.rignt in law in nolding that the Appellant iseligible to claim depreciation only withreference to the written down value oftransferred|assetsIn|thehands.Of|preaecessor firm and not witn reference toactual cost incurred by it? TV.Whether,In|thefactsand|In|thecircumstances of the case, the ITAT was.rignt in law in upholding tne action of thecircumstances of the case, the ITAT was.rignt in law in upholding tne action of the Learned Respondent in invoking 5th provisoto Section 32(1) of the IT Act in theassessmen.Yearssubsequent|to.theassessment year in wnicn tne successiontook place i.e. for the AYs 2010-11 ana2OQO11-17 TV.Whether,In|thefactsand|In|thecircumstances of the case, the ITAT was.rignt in law in upholding tne action of thecircumstances of the case, the ITAT was.rignt in law in upholding tne action of the Learned Respondent in invoking 5th provisoto Section 32(1) of the IT Act in theassessmen.Yearssubsequent|to.theassessment year in wnicn tne successiontook place i.e. for the AYs 2010-11 ana2OQO11-17 VJWhether,In|thefactsand|In|thecircumstances of the case, the ITAT was.rignt in law in upholding tne action of theLearned Commissioner Appeals in invokingExplanation 3 to section 43(1)?circumstances of the case, the ITAT was.rignt in law in upholding tne action of theLearned Commissioner Appeals in invokingExplanation 3 to section 43(1)? 3.)When the matter was taken up today, learnedcounsel for the assessee submitted that the assessee|does not want to press the substantial questions of lawNo. I and II framed in this appeal. However, ali thecontentions with regard to the aforesaid substantialquestions of law may be kept open. It is furthersubmitted that the substantial questions of law No. III,IV and V nave already been answered Dy a Bench of thisCourt vide order dated 05.10.2020 in ITA No.154/2014. 4Tne aforesaid.SUDMISSION|could not pe!disputed by learned counsel for the revenue. 5.|In view of aforesaid submissions and for thereasons assigned by us in the order dated 05.10.2020passed in ITA No.154/2014, the substantial questions oflaw No. III, IV and V are answered in favour of theassessee and against the revenue. — In the result, the order passed by the Income Tax|Appellate Tribunal dated 05.08.2016 is hereby quashed. Accordingly, the appeal is allowed. an/-CT-HR| Sd/-| JUDGEJUDGE| Sd/-.