Pr. Commissioner Of Income Tax-10 … v. Haxaware Technologies Ltd. …

Urmila Ingale IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 1126 OF 2017 Pr. Commissioner of Income Tax-10… AppellantVs. Haxaware Technologies Ltd.… Respondent Mr.Suresh Kumar, for the Appellant. Mr.Nishant Thakkar a/w Mr.Hiten Chande i/b PDS Legal for theRespondent. CORAM : NITIN JAMDAR & M. S. KARNIK, JJ. DATE : 19 DECEMBER, 2019. P. C. :.By this Appeal, the appellant has challenged the orderpassed by Income Tax Appellate Tribunal in I.T.A No. 725 of 2015.The present Appeal pertains to the Assessment Year 2007-08. TheAppellant – Revenue has formulated the following substantial questionof law for consideration in this Appeal. “Whether on the facts and in the circumstances of the case andin Law, the Hon’ble ITAT erred in holding that thereassessment is invalid without appreciating that the reasonswere communicated to the assessee vide letter dated02/07/2012 and the issue raised therein were the reasons for re-opening ?” 1/4 2.The Respondent – Assessee filed return of Income Tax forthe year 2007-08 on 31 October 2007 declaring total income ofRs.7,52,80,804/-. The assessment was completed under section 143(3)of the Income Tax Act, 1961 on 30 November 2010. Thereafter itwas sought to be reopened under section 147 of the Act. Notice undersection 148 was issued on 1 March 2012 and served on the Assessee.The Assessee filed his reply on 05 March 2012 stating that return filedon 31 October 2007 be treated as its return in response to the notice.The Assessing Officer proceeded to pass the order. The Respondent –Assessee filed an appeal to the Commissioner of Income Tax (Appeals),main ground being that the Assessing Officer did not supply reasons insupport of the reopening notice. The Commissioner (Appeals) allowedthe appeal on the ground of jurisdiction of the Assessing Officer and onmerits. The appeal filed by the Appellant – Revenue to the Income TaxAppellate Tribunal was dismissed by the impugned order. Hence, thisappeal by the Revenue. 3.We have heard Mr.Suresh Kumar, learned Counsel for theAppellant and Mr.Nishant Thakkar, learned Counsel for theRespondent. 4.The Tribunal and the Commissioner have recorded afinding that no reasons in support of notice for reopening weresupplied to the Respondent - Assessee inspite of they being asked bythe Respondent - Assessee. After considering the material placed 2/4 before it the Tribunal, observed as under : “We have considered the rival contentions of the Id AR for theparties and perused the material placed on record. The notice u/s148 dated 01.03.2012 was duly served upon the assessee. In reply tothe notice u/s 148 the assessee submitted that return already filed on31.10.2007 may be treated as return filed in response to the notice u/s 148 of the Act. The assessee requested reasons recorded forreopening. The AO did not passed any order about the reasonsdemanded by assessee. We have further perused the order ofreassessment u/s 143(3) r.w.s. 147 dated 18.03.2013, the AO has notrecorded that the reasons of reopening was supplied. Though parano.3 of the assessment order contained the reference of reply ofassessee dated 05.03.2012. The Ld. CIT (A) while considering thisground of appeal on the allegation of assessee that assessee was notsupplied reasons of reopening despite requesting time and again,forwarded the objections raised by assessee to the AO and directedto submit his report. The AO filed his report dated 22.09.2014,wherein it was contended that the AR of the assessee was providedcopy of reasons recorded during the hearing dated 12.09.2014(during remand proceedings). The Ld. CIT (A) observed thatreasons recorded were never communicated to the assessee duringthe course of assessment proceeding despite being repeatedly askedby assessee. No separate order for disposing the objection raised byassessee was passed by AO.” Thus the Tribunal has confirmed the factual finding recorded by theCommissioner that copy of the reasons were not supplied to theRespondent - Assessee inspite of being asked by the Respondent -Assessee. Nothing is pointed out how this position is incorrect. Evenon merits, the Tribunal found that the reasons were incorrect as theywere not pertaining to the year under consideration. 5.Once it is established from the record and concurrentlyheld by both Commissioner and the Tribunal that copy of the reasons 3/4 DigitallyUrmilasigned byUrmila P. IngleP.Date:2019.12.21Ingle13:15:45+0530 was given to the Respondent – Assessee in support of the notice forreopening, the view taken that the reopening of assessment was withoutjurisdiction, cannot be faulted with. Learned Counsel for theRespondent - Assessee has placed on record decision of the DivisionBench of this Court in case of Commissioner of Income-Tax Vs. Videsh .Sanchar Nigam Ltd. reported in (2012) 21 taxmann.com.53(Bombay)It is held by Division Bench that if the reasons for reopening of theassessment, though repeatedly asked, are not supplied and suppliedonly after completion of assessment, the order of reassessment cannotbe upheld. This dicta directly applies to the present case. 6.In these circumstances, question as framed does not giverise to any substantial question of law. Appeal is dismissed. [M. S. KARNIK, J.] [NITIN JAMDAR, J.] 4/4