Siva Prasad Vedula v. The Income Tax Officer Ward- 1(1), Bhilai (C.g

DigitallySAIFANsigned byKHANSAIFANKHAN Page No.1 of 5 2025:CGHC:37453-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR TAXC No. 55 of 2025 Siva Prasad Vedula S/o Late Surya Narayan Vedula Aged About 64 Years R/o House No. 376/6, Street No. 7, Pragati Nagar, Risali, Bhilai-490 006 (C.G.) Pan - Adgpv7445m ... Appellant versus The Income Tax Officer Ward- 1(1), Bhilai (C.G.) ... Respondent [Cause-title taken from Case Information System (CIS)] --------------------------------------------------------------------------------------------For Appellant: Mr. S. Rajeswara Rao, AdvocateFor Respondent :Mr. Ajay Kumrani, Advocate on behalf of Mr. Mr. S. Rajeswara Rao, AdvocateMr. Ajay Kumrani, Advocate on behalf of Mr.Mr. Amit Choudhari, Advocate ------------------------------------------------------------------------------------------- Division BenchHon'ble Shri Justice Sanjay K. Agrawal andHon'ble Shri Justice Sachin Singh Rajput Order on Board(31.07.2025) Sanjay K. Agrawal, J 1. This tax appeal, preferred under Section 260-A of the Income Tax Act, 1961 (for short the “Act of 1961”) was admitted for hearing on the following substantial question of law formulated by order of this Court dated 16.04.2025:- “Whether the concerned Authorities have concurrently justified in initiating reassessment proceedings under Section 147 of the Income Tax Act, 1961 without fulfilling the necessary conditions stipulated under the said provision by recording a finding which is perverse to the record ?” 2.The aforesaid substantial question of law arises for determination on the following factual backdrop: 2.1The appellant is a retired bank employee and filed his return of income on 20.02.2018 for the assessment year 2017-18 declaring total income of Rs.8,31,410/- on the basis of Form-16 issued by his employer. His employer has treated appellant’s Leave Fare Concession (for short the “LFC”) of Rs.2,44,374/- for foregin travel as exempted under Section 10(5) of the Income Tax Act, 1961 (for short the “Act of 1961”) and also has excluded the same from taxable income of the appellant. As such, the appellant has adopted his income on the basis of said Form-16. The return was processed under Section 143(1) of the Act of 1961 and same was duly accepted. On 16.03.2020, the Assessing Officer submitted Form for recording reasons to the Joint Commissioner of Income Tax, seeking his approval for issuing notice under Section 148 of the Act of 1961 on the ground that the appellant/assess wrongly claimed exemption of LFC of Rs.2,44,374/- under Section 10(5) of the Act of 1961. Accordingly, on 17.03.2020, approval was granted by the Joint Commissioner of Income Tax, Range-2, Bhilai and, thereafter, on Page No.3 of 5 23.03.2020 notice under Section 148 of the Act of 1961 was issued to the appellant and the same was also uploaded on the ITBA Portal, to which, the appellant filed his response on 24.09.2021. However, on the same day (i.e. on 24.09.2021) the assessing officer passed ex-parte order of assessment under Section 144/144B/147 of the Act of 1961 assessing the total income of the appellant at Rs.10,74,784/-. It is case of the appellant that the impugned order of assessment has been passed without considering the return filed by the appellant in response to notice issued under Section 148 of the Act of 1961 and also without issuing statutory notice under Section 143(2) of the Act of 1961 for completing assessment. Page No.3 of 5 23.03.2020 notice under Section 148 of the Act of 1961 was issued to the appellant and the same was also uploaded on the ITBA Portal, to which, the appellant filed his response on 24.09.2021. However, on the same day (i.e. on 24.09.2021) the assessing officer passed ex-parte order of assessment under Section 144/144B/147 of the Act of 1961 assessing the total income of the appellant at Rs.10,74,784/-. It is case of the appellant that the impugned order of assessment has been passed without considering the return filed by the appellant in response to notice issued under Section 148 of the Act of 1961 and also without issuing statutory notice under Section 143(2) of the Act of 1961 for completing assessment. 2.2Aggrieved by the said assessment order dated 24.09.2021, the appellant herein preferred an appeal before the Commissioner of Income Tax (Appeals) (for short the “CIT(A)”), which also stood dismissed ex-parte vide order dated 20.12.2023. Against which, the appellant/assessee preferred appeal before the Income Tax Appellate Tribunal (for short the “ITAT”), Raipur raising specific legal ground challenging the validity of initiation of re-assessment proceedings, which was also dismissed by order dated 24.05.2024. Questioning the legality, validity and correctness of the said impugned orders, the present appeal has been preferred by the appellant/assess before this Court, which have already been admitted for hearing on the substantial question of law, summarized in Para-01 of this order. 3.Mr. S. Rajeswara Rao, learned counsel appearing for the appellant submits that the learned ITAT is absolutely unjustified in dismissing the appeal of the appellant by limiting its findings to the issue of jurisdiction and failed to adjudicate the legal ground challenging initiation of re-assessment proceedings, leading to failure of justice and, therefore, the matter be remitted to the ITAT for fresh adjudication of the matter in accordance with law. Hence, the present appeal be allowed. 4.Per-contra, Mr. Ajay Kumari, learned counsel appearing for the respondent-revenue supported the impugned orders and prays for dismissal of the appeal. 5.We have heard learned counsel for the parties, considered their rival submissions made hereinabove and went through the record with utmost circumspection. 6.In case at hand, a careful perusal of the record would show that the appellant had raised five grounds before the learned ITAI and, out of which, the first ground relates to initiation of re-assessment proceedings under Section 147 of the Act of 1961 without fulfilling all necessary conditions stipulated under the Act of 1961, being illegal and without jurisdiction. However, the learned ITAI in Para-10 of the impugned order has duly recorded that no submission has been made on behalf of the appellant with regard to the merits of the case. But, in the considered opinion of this Court once grounds s@if have been raised in the memo of appeal on behalf of the assessee, all the grounds ought to have been considered by the learned ITAT, which the learned ITAT has failed to do in the present case. As such, the impugned order dated 24.05.2024, passed by the learned ITAT is hereby set aside. The matter is remitted to the learned ITAT, Raipur for fresh consideration of the matter/all the grounds raised by the appellant on merits after providing due opportunity of hearing to the appellant/assessee in accordance with law expeditiously. The parties are directed to appear before the learned ITAT, Raipur on 28.08.2025 for the said purpose. Hence, the substantial question of law is answered in favour of the appellant/assessee. 7.Consequently, this appeal is allowed to the extent indicated herein above. No cost. Sd/- Sd/-(Sanjay K. Agrawal) Judge Judge (Sachin Singh Rajput) Judge